Merchants: How to win with Amazon this holiday
Know exactly how much you’re making before you go big
“Before you scale your business, understand how to calculate your margins after accounting for all Amazon fees (commission, FBA fees, return fees, monthly storage, and others). Remember, the goal is not revenue – it’s gross margin,” said Alasdair McLean-Foreman, CEO and founder of Teikametrics.
Use Fulfillment By Amazon (FBA) to target Amazon Prime Customers
“Don’t try and compete with the world’s best fulfillment infrastructure – use it to target 60 million Prime subscribers who are the stickiest and most profitable consumers in retail,” said McLean-Foreman.
Establish a system and process for restocking
“Make sure you’re able to precisely restock the right items to capture the market opportunities throughout peak season. This requires a robust and consistent process to reorder based on fluctuating demand,” said McLean-Foreman.
Plan your pricing strategy
“Selling on Amazon is like trading the stock market. During the holiday season planning, knowing when to exit your trades is the key to maximizing profit. For example, you may want to hold your prices higher as competitors sell through their inventories, giving you the opportunity to win the Buy Box at a higher price. Plan ahead by understanding your inventory position relative to the market,” said McLean-Foreman.
