1. Methods for planning Amazon inventory
In recent years, Amazon has been constantly adjusting its inventory policy, which shows the importance of managing inventory. Amazon’s implementation of this policy may bring certain benefits to the platform and sellers, such as higher warehouse space utilization, more available storage space, and improved delivery efficiency for sellers.
But in fact, there are still many small and medium-sized sellers who are helpless in the face of problems such as chaotic inventory management, difficulty in querying, and inaccurate measurement and forecasting. Sellers’ failure to ship orders in a timely manner has a great impact on buyers’ shopping experience, and may even lead to the closure of the store due to excessively high order defect rate (ODR). There are different methods for inventory management in different operation stages.
(1) New product testing period
During this period, sellers are not yet fully confident about their products, so they can only prepare a small amount of inventory.
(2) New product promotion period
During this period, the product has passed the testing period and is basically fine. If sellers want to sell well in the market, they need to boost sales, so the product inventory plan promotion quantity is the bottom line.
(3) Sales growth stage
At this stage, the product has already gained a certain market share. Therefore, the inventory at this stage should focus on stocking up to ensure that the number of products in stock is sufficient to avoid out-of-stock.
(4) Product decline stage
When a product reaches its peak sales period, it is also a period when competitors intervene strongly. At this time, customer consumption psychology also changes to a certain extent. During this period, sellers should keep an eye on product rankings and sales trends to predict the stocking quantity.
(5) Traffic mutation period
Platform activities, holiday marketing, promotions, etc. suddenly bring about a sudden increase in product traffic. Sellers should plan ahead during this period and add inventory in advance based on the current performance of the product.
2. Principles of Amazon inventory management
(1) Understanding the inventory cycle
The inventory cycle is the time required for a unit of inventory to be sold. It is a basic indicator to measure whether the product sales are healthy. Sellers need to have a clear understanding of the inventory cycle of all products in order to accurately determine whether the product is hot and at which time it is better to sell, so as to make an accurate inventory procurement budget.
(2) Understand industry benchmarks
Sellers compare their inventory status with similar indicators, understand their inventory status in real time, and think about how to keep their inventory performance up to date with the industry.
(3) Understand inventory data
Update and understand your inventory data in real time, accurately obtain your inventory status, and make better decisions.