1. What is warehousing?
Most people who work on Amazon encounter the problem of warehousing. The so-called warehouse distribution means that when we ship the goods, Amazon distributes the same batch of goods we send to different warehouses. Because the greater the weight of logistics delivery, the lower the unit price, so once it is divided into warehouses, it means that our goods cannot be shipped together, which requires higher logistics costs. For us, it is definitely disadvantageous because it will increase our costs virtually.
First of all, we need to understand one thing. Amazon divides warehouses by default. Because there are fees for closing warehouses, Amazon defaults to assigning you a warehouse location for each shipment based on the actual situation of the warehouse before you agree to set up warehouse closing. Although there are certain benefits to warehousing, it also comes with high costs for sellers.
Amazon divides our products into standard sizes and extra large sizes according to size. You can clearly see Amazon’s classification of these sizes before putting them in stock. And Amazon has different charging standards for different sizes and weights.
In general, the standard size is 1 pound for the first weight, the first weight is $0.3, and the additional weight is 1 pound, and the fee is $0.1 per pound. Any portion less than one pound will be charged as a pound. If it is an oversized product, the first weight is 5 pounds, and the remainder will be charged at 5 pounds. The first weight will be charged at $13, and the excess weight will be charged at $0.20 per pound.
If a standard size product weighs 3 pounds. Then the warehousing fee charged for each product is 0.3+(3-1) x0.1=0.5 US dollars.
If the product is an extra large 10 lbs. The fee is 1.3+(10-5)x0.2=2.3 US dollars.
It can be seen from this that a product will be charged at least a few yuan just for placing it. Therefore, the cost is very high.
2. The most economical and effective method and cost of warehousing
To solve the problem of warehousing, the most official way is to use FBA’s warehouse closing service. The opening position of this service is at “Settings” in the upper right corner of the backend homepage – “Amazon Logistics” – “Human Library Settings” – “Inventory Method Options” – “Inventory Placement Service”. When this service is turned on, we can use Amazon’s official method to group our products into a warehouse, thereby effectively increasing the starting weight of the first leg and reducing shipping costs.
However, you must carefully calculate the costs listed in Figure 7-2 to see whether using this service can really help you save money. After all, we have already borne a considerable first-leg fee. If we add the cost of closing the warehouse, sometimes it is better to open it separately.
Since the official method of closing positions is so expensive, everyone must want to achieve the purpose of closing positions through some unofficial methods. Next, we will introduce how to reasonably avoid splitting positions.
We all know that when opening a warehouse, you need to fill in the quantity of the warehouse. This quantity is determined by how much goods you plan to ship this time. After we fill in the quantity (for example, 200 pieces), if we find that Amazon has allocated our goods to a warehouse, the most effective way is for us to build the warehouse N times.
According to Amazon’s warehouse allocation method, when your 200 items are allocated to three warehouses, you will triple the warehouse. Amazon will probably allocate you the same three warehouses. These three warehouses generally fluctuate around 200, so you can choose the one that best suits you for shipment. If you want to ship less goods, you can choose a warehouse with a capacity of less than 200. If you can ship more goods, choose a warehouse with a slightly larger volume. In this way, you can save a lot of shipping costs.
Of course, if you use this method to build a warehouse, you cannot delete the remaining plans in time, because this will affect your inventory performance. Frequent deletion will result in a warning from Amazon or even deprivation of the right to issue FBA. Therefore, the remaining positions can be reserved for next shipment. When this batch of goods is sold out and needs to be replenished, you can use the last position to replenish the goods directly. This is completely in line with Amazon rules and is easy to master. Purchase volume.