The need to mitigate the risks associated with Amazon Vendor Central and adopt a unique strategy between Vendor Central and Seller Central/FBA or move from Vendor Central to Seller Central/FBA is among the most frequently asked questions among business owners using the platforms.
Typical inquiries from companies using Vendor Central:
- How may costs be raised on Amazon Vendor Central?
- How can we get Amazon to honor the quoted minimum price?
- How can we get Amazon to order every product on Vendor Central rather than just the best-selling ones?
- How can Vendor Central Chargebacks and Shortage Claims be stopped?
Regrettably, most of the answers to the questions above, except question number four, are “NO, as it is not feasible on Vendor Central.” For three, yes, Born to Run is available on Vendor Central, but Amazon has recently authorized even those requests.
Thanks to Seller Central, these issues can be resolved. As a seller, you have complete control over retail prices on Seller Central, as long as the price you are running on Amazon is competitive with other online merchants. This can also include your website, and if the change is not more than ten percent of the average retail price for the last 100 orders, you are free to make changes whenever you choose.
Switching from Vendor Central to Seller Central:
- Verify the profitability of Vendor Central and Seller Central/FBA; deduct the CoOp charge, then utilize that amount as the Net fee.
- Determine the amount of inventory Amazon has at their FC.
- Calculate the weeks’ worth of Vendor Central inventory Amazon has based on the weekly sell-through rate.
- As a rule of thumb, track what you send to Amazon FCs using Seller Central/FBA.
- Stop accepting purchase orders for those products and prepare to ship them via the Seller Central / FBA procedure based on the values you determine for your SKUs from Step 3; this will cause the Vendor Central inventory to run out eventually, and Vendor Central offers to drop, and the Seller Central / FBA offer to go live.
Disadvantages of Seller Central:
- To expand the space provided, you must be creative about shipping only the products that initially move quickly. You can then progressively add other inventory for the other items to the Amazon FCs.
- You will experience difficulties sending additional products to the Amazon FCs if your IPI score falls below a certain threshold, so achieving the ideal balance is vital.
- Seller Central/FBA operates on a consignment basis, where you receive payment every 15 days for the products sold, as opposed to Vendor Central, where you pay for items that have been delivered to the Amazon FCs. Products that have already been transported must be treated as an extension of your warehouse by your accounting department, and sales of the items must only be recorded when they are sold.
Since the pandemic, e-commerce has been booming and is at an all-time high. As a business owner, it can be stressful trying to figure out which platform is better and how to navigate the backend of Amazon; but at the end of the day, your main focus is ensuring that your business thrives on a platform. So adapting to a platform like Seller Central/FBA will be a bit of a learning curve, but in time your business will surely reap the benefits that Seller Central offers.
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