Amid Covid-19 Uneasiness, Amazon Sellers Are Weighing Their Options
It has been a little over a month since Amazon suddenly stopped accepting replenishment inventory from the majority of FBA sellers. If you weren’t selling a vital product, such as hand sanitizer, food, diapers, rubber gloves, etc., you had to wait several weeks to replenish your inventory. And even now they are still prioritizing which sellers get their goods into inventory and which ones wait.
Even if you do have plenty of inventory at Amazon, the shipping times have gone from 2-day Prime to three to four weeks and even longer for non-essential items. Shopping cart abandonment has been rampant, sending hundreds of thousands of your potential customers to Wal-Mart, eBay, Google Shopping, and physical locations such as Home Depot and Target.
Amazon sellers are looking at their options in the current climate and realizing that this isn’t just a short term problem. Amazon has had unprecedented expansion but more sellers are finding that exclusively selling on Amazon is risky as Amazon controls everything.
Start by Switching to FBM
When we realized that our clients could not get their customer orders shipped in a timely manner, we immediately pivoted and began setting up a fulfillment department which is now fully operational. We recently published a blog outlining the benefits of adding an FBM listing to your current ASINs and you can review the process HERE. If you are using other sales channels such as Walmart, we can fulfill those customer orders as well.
Getting set up for FBM can be a bit confusing so if you need a free consultation on how to do this or other aspects of setting up other fulfillment channels contact me at: email@example.com. I’ll be happy to help you achieve independence on your sales channels as I have.
Stability Comes from Your Own eCommerce Website
I definitely believe it is time to move to a multi-channel selling model. Setting up a seller account on Walmart or Etsy or eBay is relatively easy. Having these sales channels operational will take some of the risks out of online selling through Amazon. The next step is to get your own eCommerce site online so all of these sales channels can integrate into your website. This will provide stability and protect the asset you’ve worked so hard to create.
Getting an eCommerce website set up, such as Shopify, is not too difficult if you have some background in this area. Free training is offered by Shopify to get you started and you can also hire a developer to get set up. More extensive and targetted training is currently being offered by Amazing.com, the most comprehensive online training platform online. You can look at their offer HERE.
You can start the process by using a fulfillment center such as Zebrapals to handle your FBM customer orders. You can then establish any other fulfillment channels that are right for your brand as you get your site up and running. Anything you do to diversify your sales channels will give you a huge advantage as we move into the major selling season of the year.
Amazon’s Growing Pains Could Hurt Your Business
It is unlikely that things will completely go back to pre COVID-19 days as far as selling on Amazon is concerned. Amazon will do what is necessary to protect its bottom line and sellers will need to do the same. As evidence of this, recall that Amazon gave no notice that it was suspending inventory replenishment in March – announcements were made on the same day they cut off seller shipments.
Still Not Convinced?
Amazon announced a massive cut to its affiliate program last week. Check out the whole story HERE.
How does Amazon’s affiliate program affect individual sellers? These affiliates are vital to many brands because they send a significant amount of outside traffic to seller listings which helps them rank and convert.
This cut is severe. For example, Amazon is cutting the commission in Home Improvement, Pets, Lawn & Garden, and Pantry from 8% to 3%. Several categories, such as Amazon Fresh are going down to 1%.
Their affiliate program has suddenly become far less attractive and will severely cut this important source of traffic and send it elsewhere – maybe to Wal-Mart or Google Shopping. If that traffic is going to Walmart or Google, doesn’t it make sense to be visible there?
Zebrapals Customer Fulfillment
Zebrapals can help you with fulfillment, no matter what channel you sell on. As one of the original 3PL companies, we have seen how Amazon has evolved over the past 5 years and can provide you with stable warehouse and distribution services for managing your supply chain. We have evolved as the e-commerce world has evolved.
Providing our customers with comprehensive services has been a journey ever since we accepted the first shipment from my New Zealand colleagues who were just getting started at Amazon.com. We are seeing the vital need for diversifying selling channels and for establishing an independent, viable e-commerce website as time goes on, especially now that we have seen that Amazon is struggling to keep up with demand.
Stamps.com has very comprehensive software that you can use to import your e-Commerce orders from multiple ECommerce platforms, including Amazon. You can get an overview of how this works HERE.
We can fulfill all of your customer orders which will allow you to dramatically improve delivery time to your customers. If you’re ready to get started, you can SEND IN A WORK ORDER.
Make Your Business Future Proof
Businesses that move in the direction of selling from their own website as well as using other channels to sell their products (including Amazon) will have security by reducing the risk of depending on one sales channel.
During the past month, an analysis of three different selling strategies done by Zentail, a commerce operation management system, concluded “The “winning” strategy is a multichannel plan (including a webstore)! To be more specific, a thoughtful multichannel strategy is prevailing.”
You can read their very thoughtful and informative study on their BLOG.
Planning for That Future Sale
For many sellers, building and then selling their business and brand(s) is the ultimate goal. Having your own assets in the form of your eCommerce site, a customer mailing list that you can use at your discretion and multiple fulfillment channels will make your business very attractive to prospective buyers. At that point, you will have removed much of the risk involved with selling online which will spark a big payout when you’re ready.
You deserve to be in control of your own business. You have worked very hard to build it. Starting out on Amazon is still a good opportunity as long as it is only part of the overall business plan which includes your own eCommerce site front and center with multiple selling channels feeding into it.
Using a fulfillment service puts you in control of your customer relationship. We are pleased to be able to offer this as a new service along with our standard warehousing and logistics services. Do you need help transitioning over from a one channel seller? Start with the first step of fulfilling your customer orders yourself using our services, or if possible, doing it yourself.
If you have any questions, contact me (firstname.lastname@example.org) and I’ll be happy to help!
Founder & eCommerce Seller