1. Register now for our upcoming webinar, “Where does Amazon sit as part of your e-commerce strategy?”
E-commerce is a hugely competitive world – to stay ahead of the rest, you need to understand precisely where major players like Amazon fit within your channel strategy.
So, at 10:30 am on 23 February 2023, we’re here with the knowledge you need in our upcoming webinar.
Join our CEO, Amazon specialist Andy Banks, and our handpicked panel of e-commerce experts as we demystify and delve into marketplace.
We’ll be sharing the inside scoop on the current state of the market, the position of Amazon within it and the role it can play alongside your other digital sales channels.
After, you’ll know exactly how to slot Amazon perfectly into your wider planning, maximising its potential and driving your growth.
Who’s on our expert panel?
– ANDREW BANKS –
In a long and varied e-commerce career, Andy has worked both for big brands – heading up e-comm for the likes of Matalan and Victoria Plumb – and agencies, as owner and consultant, before co-founding Venture Forge in 2018.
As CEO of Venture Forge, Andy heads our team of marketplace specialists (each with their own first-hand experience of Amazon), driving rapid and sustainable growth for our partner brands globally.
– JAMES EWENS –
James is Head of E-commerce at Furniturebox, one of the fastest-growing companies in the South West.
Furniturebox is an online-only furniture seller, selling through its own website and marketplaces.
James has been in the e-comm world from the start, working in various tech roles initially. Now, he is dedicated to growing revenues for Furniturebox by leading the marketplace and e-commerce teams.
– NIC JONES –
Nic has over 20 years of experience in digital marketing and e-commerce in both agency and in-house roles.
He works with a wide range of clients’ e-commerce platforms, including Virgin Holidays, Aldi, Allied Carpets, Homebase and Next, alongside start-ups and smaller businesses.
More recently Nic has worked in-house, developing digital marketing and e-commerce solutions for companies spanning household goods, outdoor furniture, sports supplements and home decor.
Guaranteed to be packed with value, this is a don’t-miss event – and it’s free! But spaces are limited, so register now to secure your seat!
2. Using the newest Automate Pricing feature to beat the prices of your off-Amazon competitors? Here are two things to watch for…
Amazon’s newest update to the Automate Pricing tool means the tool can now be configured to put your prices up as well as down when matching to your competitors outside of the Amazon store. A good thing? Well, sometimes…
Here’s how Amazon explains it:
When you configure price rules to compare against prices from retailers outside the Amazon store, we can increase your price when the external price increases. This applies when there are no other offers for the same item in Amazon’s store that meet your rule criteria.
Amazon
Sounds good, right?
Working well for you, this new tool will help protect your margins and make more money at higher prices.
Amazon also point out that, by adjusting your prices quickly and automatically, you stand a better chance of beating the competition on Amazon to become the Featured Offer.
So what’s the flipside?
We see two key things you need to watch out for:
- 1. It’s possible that your competitors could lower their prices on purpose, creating something of a loss leader situation to attract more customers – and a race to the bottom for your prices.
- 2. Do you include delivery in your price? If your off-Amazon competitor doesn’t, then your price will naturally be higher than theirs – and you risk having to match their offer and include postage to boot.
What’s the solution?
Firstly, never set and forget.
It might seem tempting to reduce your workload by leaving Automate Pricing to do its thing, but it’s never a good idea to rely solely on an algorithm.
Make sure to check in regularly, so you can pinpoint and pull any pricing that’s going awry.
Secondly, be moderate when you set your rules in the first place.
It might seem like you’re being less competitive, but it’s also less of a gamble on your margins over the long-term.
Our marketplace experts will help you work out the best pricing strategy for your products – get in touch today.
3. The Amazon Account Health Service is live!
One easy-to-understand metric that shows you whether your account is at risk or not? Yes please…
As covered in “Hot off the Press 3” (1 Dec 2022), Amazon’s new Account Health Assurance service has been designed based on Seller feedback to help avoid account suspensions – and the frustrating bot-based reinstatement process that has to be followed to get back up and running.
Launched in the US and Canada, the service has now been rolled out here in the UK, as well as the EU and Turkey.
Today, we are excited to announce that, starting in February, we are expanding the program to our selling partners in our France, Germany, Italy, Spain, Netherlands, Poland, Sweden, Belgium, UK, and Türkiye stores.
Account Health Rating is an easy-to-understand metric will give sellers an overall state of their account health, including if this numerical value makes their account “Healthy,” “At-Risk,” or “Unhealthy.
Dharmesh Mehta, Vice President of Worldwide Selling Partner Services, Amazon
What were the main Seller issues, and how does the new Health Assurance service – and its Health Rating metric – address them?
Amazon have listed Sellers’ three key concerns as:
- Sellers wanted to easily understand where their account stood, instead of just receiving a list of policy violations – the Health Rating provides an at-a-glance metric for Sellers.
- Sellers wanted to easily see which of any policy violations on their account were the most serious, so they can prioritise sorting them out to protect their account. The Health Rating will offer a level of severity for each violation.
- Sellers asked for more help from Amazon to adhere to Amazon’s policies. The new service provides an easy route for Sellers to contact them for support, with a dedicated team of Account Health Specialists on hand to help them get their account back on track. The team are contactable by phone or email.
How do I find my Account Health Rating?
- Go to your Seller Central homepage.
- Under Performance, click Account health.
Want to ensure your Seller strategy always keeps your Account healthy? Speak to our team of experts today.
4. Oh yes they have… Amazon FBA Fee Hikes to impact the UK and EU from March
In Hot off the Press 4 (14 Dec 2022), we covered the FBA price rises set to impact the US in January and said it was time to get ready in case the hikes hit our shores – well, they’re coming!
From 1st March 2023, Amazon have announced significant changes to the cost of their fulfilment, storage and return & disposal services.
To try and balance the effect (and stop Sellers from leaving FBA), Amazon have also announced new fee promotions and reductions, plus better benefits for products in the FBA New Selection programme.
Here’s a breakdown of the changes:
Changes to FBA Fulfilment Fees
DIM weight pricing will now apply to all standard and oversize units, not just oversize units, based on the greater of the unit weight and dimensional weight to calculate the billable weight for standard and oversize parcels – a change which has the potential to increase your per unit shipping costs.
And a sneaky inclusion?
DIM will also be applied to customer returns processing fees.
Top tip: Keep your packaging and parcels as compact as possible – large but lightweight products will see big price rises under this new pricing structure.
Fuel & Inflation surcharge
Has been permanently added to regular FBA Fees.
New weight tiers for Special Oversize items
From March 1st, Amazon will add 30 kg and 50 kg weight tiers to its Special Oversize category.
They say this amendment is to “better align fees” with current fulfilment costs.
Monthly Storage Fees…
To rise for all Standard size units.
Up to a 10p increase for storage of standard-sized goods, with off-peak storage (Jan-Sept) at the lower end. Fees to store dangerous and oversized goods will stay the same.
A new Storage Utilisation surcharge from 1 May 2023
Added on top of your monthly storage fee, this surcharge will be calculated based on the ratio of your average daily inventory volume (in cubic ft) and average daily shipped volume (cubic ft) over the trailing 13 weeks, with varying rates depending on your utilisation ratio, season, and product size tier level.
An extra hit for EU FBA Sellers – Amazon will charge separate fees for inventory you keep in fulfilment centres in Spain, France, Italy, and Germany as well as your surcharge fees for your UK stock.
So if you have inventory held in the UK, France and Italy, say, you’ll be charged three separate surcharges. Top tip – and this is one with a dual benefit…
Top tip: Reduce your utilisation ratio by deleting any unused shipping plans and sorting your excess, stranded and reserved inventory levels… and you might just also boost your FBA capacity limits by improving your IPI score.
Higher Aged Inventory Fees
Replacing long-term storage fees, this new surcharge kicks in quicker and costs more – for example, inventory aged between 331 and 365 days goes up from £0.90 to £1.11/cubic foot per month.
Amazon are also adding new surcharge tiers for products remaining unsold between 271 and 300 days (excluding Clothing, Shoes, Bags, Luggage, Jewellery and Watches).
Removal and Disposal Fees
Sizeable increases here, although not the doubling imposed on the US and Canada – a rise that Amazon is blaming on the increased cost of disposing of waste.
FBA Small and Light
Some good news here for UK and EU Sellers, as the price eligibility threshold of SnL items goes up from 1 March:
- UK (from £9 to £10)
- France (from €11 to €12)
- Germany (from €10 to €11)
Plus, to make SnL more affordable than standard FBA fulfilment, Amazon will also introduce new size and weight tiers (460g in standard enveloped and 960g max weight limit for L and XL envelopes) – so this could be a good option for your qualifying products.
Just remember that SnL items will also be eligible for DIM weight pricing from 1 March.
Top tip – think this might work for you? Make sure you’re enrolled in the SnL programme to get the discounted rates.
Phew! Err… You mentioned some offsets?
Yes! Thankfully Amazon is offering some promos to help offset these price increases, including:
- A 17.5% discount on EU fulfilment network fees (from EU to the UK and vice versa) from April 1, 2023.
- Halving the referral fee (from 15.3% to 7.14%) for eligible Clothing and Accessories products.
- Extending the referral fee promo in Amazon Poland from March 31, 2023 to March 1, 2024.
Plus some changes to the FBA New Selection Programme:
For standard-size products eligible for FBA New Selection, you’ll get:
- Increased free storage, removal, and rebate benefits on up to 100 units per parent ASIN (clothing and shoes not included).
- An extended free storage and rebate offer, from 90 days to up to 120 days per parent ASIN (clothing and shoes not included).
- Increasing rebates from 5% to up to 10%.
How can we prepare?
As we said in December, the key to adjusting to all these fee changes is excellent inventory management – because they almost all penalise Sellers for overusing precious warehouse space, from too-large packaging to too-long storage times.
It could even be that FBA is no longer the best option for you, in which case it’s time to find the best alternative and start moving your stock.
If you need expert guidance to implement better inventory practices, or our specialist advice on finding a contingency plan fast, get in touch today.
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