Making the Most of Q4 on Amazon

It's already time to start preparing for Q4 on Amazon! Watch this webinar to learn what you should do now to set yourself up for success and get tips to maximize your profits this holiday season. Our panel of experts includes industry leaders from Cahoot, eComEngine, Kaspien, Tinuiti, and Wholesale Sourcing Experts.

Top Amazon seller, Charlene Anderson, shared advice on the most important things a 3P seller can do now to ensure Q4 success!

Watch the webinar to learn:

How to align inventory & promotions around key shipping deadlines
How to use distributed fulfillment to offer free 1-day shipping on top SKUs
Advertising trends and benchmarks so far in 2021
New features to consider right now, including Amazon Posts
Best practices to audit Amazon mistakes and get the money you're owed
How to stay in stock so you don't lose out on Q4 sales
What to expect when it comes to product reviews on holiday purchases
And so much more!

The team also shared exclusive offers at the end of their discussion. Want to learn more? You can watch the webinar above or check out the show notes below for the recap.

Webinar Recap

Are you ready for Q4? If you think it’s too early, you’re wrong! Don’t miss out on the lucrative holiday season by waiting until the last minute. It’s important to plan ahead to ensure that you’re making the most of Q4 on Amazon. Fortunately, we’ve got a great webinar to help you get started!

eComEngine’s Colleen Quattlebaum hosted industry experts from Cahoot, Kaspien, Tinuiti, and Wholesale Sourcing Experts. They shared insight into the unique challenges sellers face in 2021, including how to overcome them! Hear insider tips for creating an Amazon advertising strategy, managing restock limits, diversifying inventory management, and more. Let’s recap some of the highlights!

Start Prepping for the Holiday Season

With the end of the year jam-packed with holidays, you already know that people are shopping more. But did you know that the top three days for Amazon orders in 2020 were Prime Day, Black Friday, and Cyber Monday? By the time December rolls around, the biggest sales opportunities are behind you!

Drawing from 20 years of Amazon selling experience, Charlene Anderson of Wholesale Sourcing Experts said that Q4 preparation should happen all year round. Summer is a good time to reach out to suppliers and solidify your relationship. There has been a lot of disruption to the supply chain over the past year. You need to always be sourcing.

“Give them a call. Send them an email. Send them a text and just check-in,” Anderson said. You need to know if your suppliers are experiencing any issues. Another perk? You put yourself in a better position during uncertain times. “If they get a pallet of product in and it’s assigned to two people — who are they going to give it to first? The person they’ve got a relationship with.”

Plan for Inventory and Fulfillment Challenges

If there’s one thing we can all agree on, it’s that you should never run out of stock on Amazon. This is especially important during Q4 when sales, interest, and competition are high. Anderson compared Amazon to a river, explaining that, “They want the products flowing in on one side and flowing out on the other.”

What does this mean? You have to strike the right balance, which can be tricky, especially with so many unexpected disruptions within the supply chain. Anderson recommended finding the right software and automation tools to maintain control over inventory management. She noted that eComEngine's own RestockPro “has helped us a lot to keep our products constantly moving through the pipeline.”

As Manish Chowdhary of Cahoot explained, “Every Amazon seller is dealing with a massive amount of challenges.” In the webinar, he shared tips for FBA management, carrier relationships, and efficiency in your warehouse.

Strategies for Gift Giving Season

As Katie Keyser of Tinuiti explained, Q4 2020 was impacted by increased lag times and shipping delays. As a result, the value of ad clicks dropped, and customers shifted their buying habits in order to avoid purchasing items that might not arrive.

Keyser pointed out that Q4 is expected to be even bigger this year as travel restrictions have been lifted. People are planning to spend the holidays with their loved ones, which means they will probably be buying more gifts.

“It is really important to understand what the current advertising trends are and how Amazon is continuing to evolve,” Keyser noted. “Just on average, this past quarter advertisers have to pay more for that same click to get a good return.” In the webinar, she provided specific data and guidance for making the most of your marketing budget for Q4 2021.

Why It’s Important to Do FBA Auditing

Does Amazon owe you money? If you’re an FBA seller running your business through Seller Central, they might! Fourth quarter is busy for sellers, but it’s just as busy for Amazon. Sometimes mistakes happen. This is exactly why you should always do FBA auditing, especially after Q4 and busy selling periods.

As Kelsey Gruis of Kaspien pointed out, Amazon isn’t perfect, and with nearly a million new sellers joining the platform last year, things can go wrong. There's still a lot of room for error, despite all the algorithms and automation.

The most common issue Kaspien sees is discrepancies between how much product was shipped to Amazon and how much was actually recorded. Another example is when a customer returns a product, but Amazon never reimburses your seller account. It’s up to sellers to flag these issues so that inventory numbers are either corrected or they are compensated for the mishandling.

Watch the Making the Most of Q4 on Amazon Webinar

You need to do everything you can to protect your Amazon business. One of the best things you can do is prepare for a successful fourth quarter. This webinar will help you come up with strategies to improve sales and boost your brand so that you can end 2021 stronger than you’ve ever been before. Don’t miss this!

Recommended Resources From This Webinar

Article: How to Drive Sales on Amazon in Q4
Article: How to Use Prime Day to Prepare for a Killer Q4
Guide: How to Enable the Amazon Gift Wrap Option
Calendar: Amazon FBA Seller Calendar

Colleen: Okay, welcome everybody. Thanks so much for joining us today for our webinar on Making The Most of Q4 on Amazon. So, we have a great team of industry experts here to share all of the different tips, advice. And definitely some actionable items that you can do now to prepare for fourth quarter. So, before we get started, I'll briefly introduce to you all of the guests that we have here with us today. So, my name is Colleen Quattlebaum and I am the marketing manager at eComEngine. Joining me today is Manish from Cahoot. He is the founder in CEO of Cahoot, which is the world's first peer-to-peer e-commerce fulfillment company. And they actually received an award from Fast Company. They were recognized as one of the top 50 most innovative companies. So, he's got some great information to share with you about how to take advantage of a fulfillment network like his.

Colleen: We also have Kelsey from Kaspien. She has over eight years of sales and management experience in eCommerce, and she's the VP of business development at Kaspien. And she works closely with brands to help them identify and implement strategic opportunities to grow their business on all of the online marketplaces. For Tinuiti joining us is Katie Keyser. She is a marketplace specialist at Tinuiti and has eight years working in the digital marketing industry. And she works closely with clients to grow their revenue, working across multiple verticals. And she works very closely on executing a very tailored strategy for her clients. And last, but certainly not least is our good friend, Charlene Anderson. She has been in the e-commerce space as a seller herself for 25 years. And she runs a group called the Wholesale Sourcing Experts, which is a one-of-a-kind private group with a great network of sellers.

Colleen: And so she'll be sharing her advice with us today as well. So, we'll go ahead and just briefly share here the agenda. We're going to talk about what you can do now to prepare for fourth quarter, the big holiday season that's coming up before we know it. We will talk about Amazon advertising trends and some new features that you should consider. We will discuss how to you align inventory and promotions around key dates this holiday season. And inventory and fulfillment challenges we know are top of mind for a lot of sellers. And so we'll talk about what you can expect or what we anticipate for you to expect in Q4 and some solutions on how to solve for that. And how to get free one-day shipping for your top SKUs. We know that two-day shipping is not enough in a lot of cases these days.

Colleen: So, we will give you some tips on how to get one-day shipping. And FBA auditing strategies for the fourth quarter errors that Amazon makes. They're just as busy as the rest of us. So, making sure that your FBA auditing will have some best practices there to share. As well as review strategies on how to get more product reviews during this gift-giving season. And lastly, I just wanted to mention that there will be some special offers at the end, as well as some free resources. There is a Q&A section here in Zoom. So, please feel free to use that throughout the webinar and we will try to address your questions throughout, but we'll definitely have time at the end as well. And this is being recorded. People always ask me if this is being recorded. So, the answer is yes. And either tonight or tomorrow morning, but within the next day, we will send out an email with all the special offers and a video of this recording so that you can watch it again or share it with your peers if somebody wasn't able to join today.

Colleen: So, before we jump into our guests, I just wanted to share some data that we looked at last year from fourth quarter. It's no surprise that fourth quarter is obviously one of the biggest times of year for Amazon. Last year and fourth quarter, they said it is the biggest quarter for Amazon yet. And it seems like they say that every year. So, the 2021 fourth quarter will probably be even bigger. But last year in fourth quarter, that was Amazon's first $100 billion quarter. So, I can only imagine what this 2021 fourth quarter will look like. Now of course there was the prime day in the fall last year. There are rumors that Amazon could have a prime day this fall, but nothing has been commented on or confirmed from Amazon. So, it's just something to kind of keep your eyes and ears open for that may or may not happen.

Colleen: But regardless we know fourth quarter has the most volume. So, you need to be prepared for all that increased traffic. But taking a look at feedback, one of our tools where we have thousands of Amazon sellers using that tool. We looked at the average daily order volume in fourth quarter and the top three days last year in fourth quarter for order volume was Prime Day, Black Friday, and Cyber Monday. So, that's probably not shocking to anybody. But what this graph showed, which we thought was pretty surprising is we looked at the average daily order volume throughout the entire quarter. And it's pretty surprising to see on Cyber Monday, for instance, that on that one day, the order volume was 81% more than the average daily order volume in Q4.

Colleen: So, we know in Q4 the order volumes already my much higher than the rest of the year. But on these specific days, we saw a much larger spike. So, again, probably no surprise, but just wanted to reinforce that fourth quarter is obviously where you need to really make sure you have all of your Is dotted and your Ts crossed and you are prepared. So, I'm going to go ahead and close these slides here so that we can just talk with the other guests as a team and hear from them. So, first I want to start out with asking Char what should sellers be doing now? It's July 22nd today. What can they do now to be prepared for fourth quarter?

Charlene: For me, fourth quarter is an all year round thing. And I think it really should be for everybody. But right now you really need to cement those relationships you built with your suppliers, give them a call, send them an email, send them a text. And just check in to see how their supply chain issues are faring. We all know that there's been a lot of disruption in products. And not just products but shipping in general, it's been crazy. So, you need to work on building relationships with your suppliers, and here's why. If they get a pallet of product in, and it's assigned to two people, who's going to get it first? The person that they have a relationship with, that they know in a more personal way than just a general business relationship. And I can tell you that's happened with me.

Charlene: Containers have come in and my people at one of my biggest suppliers have said, we're going to give it to you, even though you're second on the list. So, be mindful that business is a relationship and even more so now with disruptions, it's really important that you build that relationship, not just be an invoice number that orders from somebody once every two weeks. Build a relationship. And that means from the top down, not just the CEO of the company, but with person who takes your orders, the guy who runs the warehouse. All of those things really matter in making sure that you have enough product to send into Amazon.

Colleen: Okay. And so you mentioned suppliers, but should you be looking for new suppliers right now, and as we move into Q4? Or is it not the right time?

Charlene: No, it's always the right time. I like to say you have to always be sourcing. And for those of us who run a business in the wholesale model or reseller model, things can change, businesses can close, new businesses open up, new products come out. So, I am always looking for new suppliers in my particular field, which is arts and crafts. Always looking for new products, new suppliers. And you will find that a lot of people are launching businesses now. For whatever reason, they feel like this is the right time and they're developing new products and all that. And you want to be the person who brings this product to Amazon for them. You don't want to wait until it's on Amazon and then you say, oh, well, maybe I should sell that product.

Charlene: Be in the lead. Follow up contacts with those people you built the relationships with, ask them if they know of anybody who's moving into the space that you might want to take a look at. Because I have found some of my best per products that way, just this kind of referral thing. And you will find small businesses, especially the Mom and Pop inventor, developer business don't want to deal with Amazon. They want to be on Amazon, but they have no clue how to do it. And that's where we, as resellers, come in. We can take that off of their plate so they can do what they do best, which is develop products. And we can do what we do best, which is sell the products online.

Colleen: Right. Yeah. So, there's a big learning curve to selling on Amazon. So, it's hard for small businesses to find the time.

Charlene: Right. This is my 20th year on Amazon. Believe it. And it's learning every single day. And it's like this hyper warp speed learning now. Used to be, you could like think you knew everything that was happening and what was going on. But over the past three, probably three years, it's crazy. It's like you're on this Fred Flintstone treadmill thing where you can't get going fast enough to keep up with everything. So, that's where you need solutions, whether it's software solutions, whether it's people solutions in the form of virtual assistance or whatever. But it's a tough thing to keep up with. And I don't know if I was an inventor, if that's what I want to be doing, I'd rather be inventing more stuff.

Colleen: Well, so you mentioned software or solutions. Are there any processes or procedures that you recommend changing during third quarter or fourth quarter as that approaches?

Charlene: I don't ever run out of stock. I think that's probably the thing I can say most importantly is do not run out of stock because that will bring everything to a screeching halt, from metrics on down to receiving to all that. So, don't run out of stock. And I kind of made a bad analogy many years ago about Amazon acting like a river, right. And I didn't, until I said it, I go, I was really stupid. But Amazon wants your products in the river. They want the products to be flowing in on one side and flowing out on the other. So, as you ship them in, they're selling. So, there's this constant movement of product. They don't want to get three months worth of product in. They want this product constantly moving in and out. And I think that's where you have to develop your own processes and find the software tools that work for you to be able to keep that constant flow.

Charlene: We ship every single day. We don't ship huge amounts every single day, but we ship every single day. So, things are constantly flowing. And I think it's paid off for us because we have no restock limits or skew level limits on anything, because the stuff constantly keeps me moving. And not to put a plug for RestockPro, but I can say that has helped us a lot. Keep this product just moving constantly through the pipeline. We work with our suppliers to set minimum orders where we get free shipping. So, we know when we've hit that minimum, that we can get free shipping that we reorder again. So, we just keep moving product. And that's the whole name of the game. That's what Amazon wants is they want product in, product out.

Colleen: Right. I love your analogy with Amazon obviously is a river. But ...

Charlene: I know. Bad, right?

Colleen: Wonder if Jeff Bezos was thinking about that years ago when he came up with a name.

Charlene: But you picture things floating down a river and that's what you want your products to be and I guess they go off the waterfall at the end when they go out the door but you got to keep more coming in. So, there's always stuff moving in that river.

Colleen: Good. Any other advice that you have for third-party sellers or anything that they should be concerned with as we approach ...

Charlene: Yeah, there's a few things that I have been dealing with this past week. And one is supply chain issues with shipping supplies, boxes, tape, labels, all of that. They're getting harder to find and they're getting more expensive. So, don't let yourself get caught out, not having what you need as you move into fourth quarter. Things are not going to go down in price in the shipping side. So, get the stuff now, take a good inventory of what your warehouse has so you can extrapolate how many you need at you through fourth quarter, and get them now. And the other thing I would say is look at your suppliers and talk to them, build that relationship and ask about any upcoming price increases, because I face three big increases from three different suppliers in the past two weeks. So, that's a pattern for me, right?

Charlene: If three have done it, more are going to. So, I'm going to be communicating with the other suppliers to see what they have in place for price increases so I can get orders in before those hit. If I have to store the stuff here, it'll be worth it to save on those price increases. And then you have the stock here to keep it flowing down the river to Amazon. You're not waiting on shipping supplies or trucks to get to you, or whatever. I don't think it's going to get better until mid-2022. I think we're going to be facing all of this for at least eight to 10 months more.

Colleen: Yeah. Because right after the holidays, then we have Chinese new year. It's just, yeah.

Charlene: Right. Exactly. And even though very few of my products come from China, things that are part of the products do. I carry a glue, a craft glue, that has not been able to produce product for eight months, because they can't get the bottles. And then when they could get the bottles, there was that freeze in Texas that messed up the pipelines of one of the products that they use to make this glue. So, they've been out of product almost a year now. Who would think glue, a basic kind of white PVA glue, but there you go. So, now they can't get the bottles again, or they have to use the different style bottles. And they're saying to alert customers that these are going to look very different, but it's the same products. So, it's all a juggling match. And we at being the last stop before the consumer have to put all the pieces together and I think it's fun, but it's also tedious and time-consuming and a bit frightening sometimes.

Colleen: Well, great advice, love hearing directly from sellers. And again, Char runs the group. Wholesale Sourcing Experts as an awesome private group for sellers to share their pain points or challenges and how they're solving for them. So, we'll continue to hear more from you throughout the webinar, I'm sure. But I want to turn it over to Katie from Tinuiti to talk to us a little bit out some of the notable events that your team or your agency saw last year in Q4 and during that holiday shopping season.

Katie: Cool. Yeah. So, as we know, obviously 2020 was an unprecedented year and the same theme carried throughout Q4. So, not only did Amazon choose to hold Prime day in October a month before Black Friday and Cyber Monday. There was also a lot of concerns around the increased lag time for shipping delays. So, due to that concern, many advertisers found the value of ad clicks actually declining on the lead up to Christmas day. So, they shifted their buying habits to avoid purchasing products that might not arrive given those mail delays. So, that isn't usually how consumers behave. It will be interesting to see this year, if they will go back to their old shopping habits or if it will have in lasting effect on how they'll approach e-commerce over the holiday season, especially because we know Q4 is going to be even and bigger this year.

Katie: One of the other things too is due to the travel restrictions for last year. The average number of gifts shoppers were purchasing were down just based off of, they weren't able to go to their loved ones. They had to rely on shipping to get the presence there. So, it will be really interesting to see if that theme continues to play out for this year. Another one was that given the fact that Prime Day was in October, Black Friday and Cyber Monday in November, and Christmas in December, it was a much longer prolonged holiday shopping season. And we saw Q4 long promotions. So, this actually caused sponsored products clicks to spike in October and November. And then they were down considerably in the stretch of December, but then we saw it pick back up before the New Year.

Colleen: Okay, good to know. So, that's talking about historically what you saw last year. What are you seeing this year in terms of trends and what new features were advertising should sellers consider here for fourth quarter?

Katie: Yeah. So, it is really important to understand what the current advertising trends are and how Amazon is continuing to evolve. So, year of year CPC growth has absolutely exploded across all formats and several product categories. So, most are actually finding clicks increasingly expensive over the last three quarters. So, actually say a couple stats that will help to frame what is going on and then let you understand what ad types are going to be best to leverage this next Q4. So, average CPC for sponsored products rose 33% year over year, just in Q2. It's actually the highest growth of serve since Q1 of 2018. So, just on average, this past quarter, advertisers are having to pay more for that same click to get a good for return. So, also ad console advertisers spent 81% of their ad budget on sponsored products followed by 17% for sponsored brands and the remaining 2% going to sponsored display ads. But given all of the distinctive ad placements and targeting options for those different ad formats, each of them actually does provide an incremental value to round out your whole advertising strategy.

Katie: So, as far as if we look comparing this year's Prime Day versus last year's Prime Day sponsored products and sponsored brands spend outpaced that of last year's Prime event by 16 and 22% respectively, which is crazy. Sponsored display, although it's still a small part of the advertiser's budget was outpaced each of the other ad console formats with 51% spend growth this past Prime Day. So, on average CPCs stored 46% for sponsored display, 19% for sponsored products relative to last year holiday and only rose about 4% for sponsored brands. So, all of that is basically leading to the advertisers or advertising is actually going to play a huge role in brand success this year. And retailers world definitely have to be on top of their game to get as much value out of advertising as they can. That's why actually taking of new ad types will help just stand out amongst the competition and actually optimizing your current sponsor ad campaigns is going to be more important than ever.

Colleen: Okay. And a lot of that data is in your Amazon benchmark report, correct? Amazon ad benchmark report. So, we'll be sure to share a link to that. So, if you're a more visual person to see all of that, they have it all buttoned up into a nice report with infographics and such. But great data. And so given all these shifts and the trends that you've seen this year also, I know like Amazon posts is new. What do you recommend is a best strategy for sellers here for the holiday season when it comes to advertising?

Katie: Yeah. So, I would say out of all of the newer ad types that have become available, leveraging sponsored brand video, sponsored display, and actually utilizing DSP along with promotions and coupons is actually going to be your best bet this year. So, sponsored brand videos actually accounted for 30% of all sponsor brands spend in Q2. The video is great because especially if you have a product that might need a little bit more education or you need to see exactly what a consumer would be using it for what it looks like, what it feels like. You can leverage that video to showcase what that product is. And then once they are aware and they see that video, once they get to that detail page conversion rate actually tends to be higher, because they're very familiar with what that product is and why they would actually purchase it.

Katie: Also, Amazon came out with another targeting tactic most recently, I think in the last like month or two, where you can actually target ASINs. So, you can leverage sponsor brand video, and actually target competitor detail pages of relevant products or complimentary products. So, if somebody is looking in market for something, they can actually see your video on that detail page. And it gives you another layer of product viability or ability to compete with those additional competitors. So, sponsored brand video would be great to implement. Another one is sponsored display like I mentioned before, it's the least adopted ad type. However, Amazon has spent the most time recently updating a lot of their features. So, you can not only target products, you can actually target audiences. So, audiences actually offer you a way to reach new perspective clients through awareness and consideration campaigns. You can also leverage this if you have any consumers who have gone to your detail page but have not yet purchased your product, you can re target those shopper after Prime Day or after Black Friday and Cyber Monday.

Katie: So, you can reengage a lot of people who have been familiar with your product, but just haven't converted yet. One last thing to know is for DSP. So, spend on the platform actually doubled year over year in Q2. So, if you're not already, I would have highly recommend considering getting active on the DSP platform. It allows you to promote on and off Amazon. It also allows you to showcase the products that are in stock. So, it will automatically dynamically display anything that is, or it will omit anything that is not in stock. So, you really are taking advantage of guaranteeing the fact that you're only advertising in stock products. So, as we know, obviously over Q4 out of stock is actually a big thing that advertisers have to worry about. So, that's another way to really utilize your spend dollars against things that are actually available for this.

Katie: And then just the one last thing to note is really important to set up promotions and coupons on your focus products. So, this will allow you to help stand out against competitors. It also, you'll see a coupon displayed on the surf or you'll see it displayed on the ad types like sponsored brands, sponsored display, and DSP ads will showcase that coupon. So, it's a really good eye-catching way to entice consumers and capture their intention, entice them to let them know that there is a discount on that product. And it allows you to be competitive over that timeframe.

Colleen: Okay, great. Great suggestions. Thank you very much. We do have a question here from Joseph, are there any best practices for sponsored brand videos in terms of video length, content, or aspect ratio?

Katie: Yeah, no, definitely great question. So, we typically see the sweet spot in between the 15 second and 30 second link depending upon what your product is. So, if it's a product that is going to need a little bit more education behind it, you would definitely want to leverage a little bit longer of a video. But if you think about consumers and the timeframe that you have to really to capture their intention, if they're scrolling through their phone, they're going to look at a video usually between five to 10 seconds. So, if you can showcase what either, if it's your brand or showcase the highlight the key features of that product initially, that's going to really capture or attention and allow them to be like, okay, I'm interested in this, click. And then go to your detail page and on your detail page, that's where you're going to be able to leverage the content that's on there to really explain what is your product and have them be confident in purchasing it.

Katie: But that first like 10 seconds is really going to be key. You can also use, if you think about how you use your phone, I have my phone on silent pretty much all the time. So, when I am scrolling through looking at the mobile app, I am not going to hear any audio. So, you can actually use text overlay in your sponsor brand video that will say, highlight key features. So, you can call out, call variation of color, or you can call out this comes in different sizes, or this will be used for this, or perfect for your camping trip. Or whatever you want that's going to showcase why you would purchase that product. So, I would say if you just have to think about the consumer and how they actually shop on the app or how they're going to actually look and see your product, you could use audio, you can use that text overlay. Really highlight the first 10 seconds to showcase those key features. That's really going to allow you to have a higher conversion rate.

Colleen: Okay, great. And one other question from Joyce, it's a question on Amazon running a coupon. Is that available for vendor central as well?

Katie: Yeah, so you can run a coupon if you're a vendor, as well as a seller. I would say from what I've experienced managing clients and just seeing what works best over the past couple Prime Days that I have worked on. Leveraging something that is in between a 20 to 30 ish percent off range, tens to perform well or better than something if you're just offering like a 5% off. You just have to decide obviously what works within your profit margins.

Katie: Are you able to offer that extended discount or are you really looking to push volume? If so, a bigger discount would be better if you're trying to be a little bit more efficiency focused, that's when you would really look at your profit margins, but also depending upon just your price of your product will depend. But I always see too, offering a percentage versus an actual dollar amount tends to have a higher click through rate or performs better as well.

Colleen: Okay. Thank you, Katie. Again, Katie from Tinuiti, very helpful information and we'll certainly circle back with any other questions related to advertising. I want to turn it over to Manish from Cahoot to talk a little bit about inventory and fulfillment. Because we've talked about sourcing and supplier relationships and promoting our products, but then once you get the orders, how do you fulfill them? So, Manish, what are some of the inventory and fulfillment challenges that sellers should anticipate here in fourth quarter?

Manish: Colleen, thank you. As Char and Katie both mentioned, don't go out of stock and that's the supply chain logistics fulfillment is on the top of everyone's mind. Every Amazon seller is dealing with massive amount of challenges. So, my recommendation is going to flow in these four buckets. One is FBA, how to manage your FBA restock limits and inventory. And what to do if you run out of luck and you can't get your products into FBA. And to Char's point, never go out of stock, never go out of stock, because that will kill all your advertising. It will kill all the coupon. It will kill everything. You'll never get this amazing holiday season that is going to be one of the biggest. We know that. Number two carrier relationships. So, if you're going to do hybrid fulfillment, FBA and fulfilling orders yourself, I'll share about out what's happening in the world of carriers.

Manish: We work very closely with several of them. Then let's break it down to your warehouse, fulfillment labor, and efficiency in your warehouse. That is also going to be a big portion of how you should think about. And then finally software and tech technology. So, those are the four pillars that I want to talk about today. So, let's start with the very top, FBA. Everyone knows, every seller except Char or most of them are dealing with massive inventory, restock constraints. This is a big, big problem because Amazon made some massive changes to its restock limit in April. About two and a half, three months ago, Amazon changed the way, how much inventory can you send to FBA. And as Char has mentioned, it's like a river. Amazon only wants your fastest-moving SKUs, period. If I had to explain it in simple words, they don't want stuff sitting on their shelves and bins.

Manish: They just want to take inventory in and then push those inventory out. But even that there's massive delays in receiving inventory. And I just want to share a little bit of the background what's happening, why it's happening. Because a lot of sellers do not have a background or appreciate why is it happening? By just way of context, basically FBA warehouses are bursting at the seams. Amazon has been opening warehouses at record speed. However, what happened was COVID. COVID doubled the demand for products and there were three quarter of a million new sellers, 750,000 new sellers that joined Amazon last year. So, Amazon has to make room for those new sellers because most of them rely on FBA. So, what did they do? Basically lower stock limit for everyone so that everyone gets a little bit of the action.

Manish: Nobody gets a disproportionate share. So, that's really the basic fundamental problem Amazon is dealing with. And what is that leading to is now you have storage type limitations and this can be a massive compounding problem. And I want to share with what if our audience is familiar with what we call the inventory performance index, which is basically Amazon's way of measuring how fast your inventory is turning. And that is a huge factor as to how much restock limit you're going to get. So, let's say you have your best sellers. If your best sellers go out of stock. The rank of that ASIN, the sales rank of those SKUs is going to drop. If the sales rank goes down, the sales through rate is going to drop. If the sell-through rate drops, your IPI score is going to drop.

Manish: If your IPI score drops, your storage limit declines. Now when you try to replenish that stock, you cannot because your storage limits declined. So, it creates a massive compounding problem from a FBA perspective. So, what are some solutions similar to what Char has been mentioning that you're sending smaller inbounds very frequently. Because there's limited FBA space. You to stay on top of your IPI score. You cannot just set it and forget it. You have to watch that very, very closely. You have to manage that space in a highly strategic fashion. Otherwise, you're going to get your best sellers out of stock and you will not be able to replenish it. In order to deal with this problem. We recommend that every seller should have an alternate fulfillment strategy. So, make sure to have an FBM strategy set up. If you have your own warehouse, that's great.

Manish: If you don't have your warehouse you contract with the 3PL right now, because there's a massive demand for 3PL services and you don't want to wait till you're out of stock. And then you're scrambling trying to make this all happen. In fact, I would go even as far as having dual listings ready to go, an FBA listing and FBM listing. Have your fulfillment partner ready to go if you don't have your warehousing yourself. If you want to go and take full advantage of this holiday season, you also need to offer fast shipping. That is very crucial, because FBA is all about Prime. And we know Amazon sellers love Prime members because they make up a huge majority of the sales. So, in order to target those Prime members in shopping and we all procrastinate and sellers, and buyers, and consumers are waiting till the last minute to buy.

Manish: So, if your account as Seller Fulfilled Prime status, you want to take advantage of that. You absolutely want to be set up and you will need some services like a 3PL network that can spread your inventory out. And it has dual benefits. One, your shipping cost goes down because your shipping from a closer location. And second, if you have Seller Fulfilled Prime you can offer the Prime badge, even if FBA is not taking your inventory. So, that is one on the FBA side. So, manage that very, very strategically. Now let's move down to the carrier side. So, if you are going to do your own fulfillment gone are the days you could just call UPS in the morning and say, hey, I've got 200 packages. Can you come pick up? No, that's not going to happen because carriers are completely packed to the gills.

Manish: In fact, they're turning down business. I mean UPS CEO has gone on television, nationally television and said we are reducing the allowance for the very large shippers. These are people that are shipping millions of packages a week, and even they cannot get capacity. So, you need to talk to your reps at these carriers, make sure you have the relationship lined up. In fact, I would even suggest that test that and have a dual fulfillment strategy in operation working live. Even if it's a trickle of orders, you don't want to call your FedEx or UPS rep out of the blue two days before the deadline for Cyber Monday. That's going to be too late. So, that is a very, very important. And I think Char touched on packaging supplies, making sure you have that in stock.

Manish: Don't wait till the last minute. Shipping costs are going up so you have to also make sure you are updating your product pricing and all of those. Be armed because they're going to be surcharges. Q4 is all about carrier surcharges. You're going to deal with that. You don't want to lose your margin erroneously because you did not factor those considerations. Then if you go back into your warehouse, if you have one, labor. Fulfillment labor is in short supply. In fact, you cannot find fulfillment workers right now. Fulfillment wages for those workers is at a record high. You have to pay them more than a typical store associate at the mall. Fulfillment experience, fulfillment workers are not available. And if they're available, they command a lot of money. So, be ready for that. Hire those workers. Don't wait for the last minute. Very, very important.

Manish: And then software and technology you need to have great technology in your warehouse that allows you to do more with less. Ability to rate shop. So, for example, you might think that historically you've used USPS priority mail for that package, but with all the surcharges adding up, including surcharges from USPS, which we have never heard of in the last a hundred years, except last year. Even USPS introduced new surcharges. So, all your old notions and all the old learnings are not quite up to date or valid anymore. So, you might have to rate shop every order to make sure you're picking the cheapest cost and the lowest cost service that will get to the customer on time. Because if the order doesn't get to the customer on time, you're not going to get a positive review. And that will also further affect your sales rank. So, shipping and logistics is literally at the heart of all this. And that's real. I mean the short, I'm sure they have more questions. But that's kind of the four pillars.

Colleen: Okay, good. Very, very insightful information. We do have a few questions from some of the attendees. So, one is asking about the IPI score. So, if you have a high IPI score, but this person is experiencing stock limits, how can he improve his IPI score? Should he let inventory run down before replenishing to boost your suer rate?

Manish: Yeah. So, there are a couple of high-level tips and we are actually doing a webinar together with Kaspien next week, where we are going to talk about managing these storage limits. So, you can find a link on cahoot.ai. I'm sure you can go to Kaspien website if you're interested, but at a high level, here are four tips you can do. Reduce excess inventory. Basically, anything that's not selling, you got to remove it because that's actually hurting your IPI score because the debt stock. So, number two, anything that's stranded, that's not selling, you might want to turn off those listings even, because you don't want those to be contributing towards your restock limits. And if these are abandoned listings, you got to clean house, remove those so that Amazon doesn't penalize. Improve your rolling 90 day sell-through. So, basically, find ways if you can boost and boost sales of the items.

Manish: Because Amazon is always looking at the last 90 days. And fix the listings that are stranded and anything that is excess, meaning you have unusually high amount of stock at Amazon as Char pointed, it's a river. So, if you got lucky, you got a lot of stock sitting there, but it's actually hurting you. So, you might want to even do some removal and Amazon gets pretty generous around September, October, right before Q4, where they allow you to bring that stock for free. So, take advantage of that and basically do everything you can to make the most of your FBA storage limits. Because I can tell you, it is going to get worse, is going to get a worse before it gets better.

Colleen: Okay. Thank you. Couple other questions. What are the implications if sellers ship over the restock limitations?

Manish: Well, if you want to pay $533 a pallet, that's the cost. $533 a pallet. I don't think any of us can afford that. So, Amazon is going to start charging a very high excess fees. So, you want to be very careful. You don't want that stock to get abandoned because Amazon warehouses are very, very busy now. You don't want to be in a situation where the inventory's stranded. You can't get it into Amazon, or you're getting charged this insane amount of fees and you're going to have trouble bringing inventory back. So, I would even go and recommend if you are an Amazon FBA only seller, think about up an alternate sales channel, because at least you can direct those customers elsewhere. You've got inventory sitting and it becomes a very compounding problem and Char about suppliers.

Manish: One thing that we need to be very mindful of is let's say, I have an open PO with my supplier, purchase order. And I'm expecting inventory, because you build that relationship with that supplier and the supplier is expecting, give you, you were number two on the line, but you got the stock. You can't get the stock into Amazon. Now, what are you going to say to the supplier? Hey, you know what? I don't want that inventory anymore. That relationship is going to go sour very quickly and you will not get a second chance. So, this logistics and shipping is at the heart of the problem at Q4. And you need to think very strategically. Do not put all your eggs in one basket. Even if you are an Amazon-only seller, make sure, try to have another channel set up, have the FBM strategy set up, whether you do it yourself or through a partner like Cahoot or elsewhere.

Colleen: Okay. And with all of the delayed receiving challenges and warehouse constraints, Kevin is asking, "When would you recommend to ship out inventory to FBA to make sure that they're in time for Black Friday and Cyber Monday?"

Manish: So, we have the dates from last year, and this is of course last year. And the deadline for Black Friday, Cyber Monday is November 6th. But that is, Amazon hasn't published the dates for this year. And I can only assume that it will be earlier. It certainly won't be later. So, November 6th was last year's date. For Christmas latest arrival at the fulfillment center at Amazon is December one. And you will not be able to replenish anything for 2021 until the second half of December. So, while we are so focused on Q4, don't let your January sales disappear because we have not thought about January. So, we need to think long and short. So, long lead time, expect, be ready, be prepped, avoid exceptions. When you're prepping your inventory, the more exceptions there are the longer the receiving delay's going to be.

Colleen: Okay. And one more question here for you, Manish. "Can sellers use multi-channel fulfillment, the MCF channel, to get rid of excess image that's sitting in FBA?"

Manish: You can. You can, but we all know multichannel fulfillment is very expensive. Sometimes twice as much the cost of Amazon order. So, if you have the orders and you can do the math. If the math works out, that might be a clever way to get rid of inventory as quickly as you can. But you don't want that inventory sitting there, because if you cannot replenish your best sellers, you can be in a pickle and you want to avoid that. So, certainly do the math to get a more scientifically accurate answer.

Colleen: Okay, great. Thank you. All right. So, assuming all of your inventory does make it to FBA. I want to turn over to Kelsey to talk about why it's important to do FBA auditing, fourth quarters busy for sellers, but it's just as busy for Amazon and mistakes are made. So, tell us about why Amazon owes many FBA sellers money.

Kelsey: Yeah, I think it's a foreign concept too, right? I think all of us in this room and probably a lot of us listening are used to giving Amazon a lot of money. We're used to owing them money for something, be it marketing or paying for storage or what have you. But really quickly, I just want to set an expectation here that this is primarily talking about sellers who utilize FBA, Fulfillment by Amazon, through seller central, which majority of the sellers on the platform are. But Amazon owes us money and Colleen you started out the webinar by saying Amazon makes mistakes, they are humans too. They have a lot going on. And that's exactly what happens here and why Amazon owes us money. Manish, you mentioned nearly a million new sellers last year alone. That's probably not really going to slow down.

Kelsey: We'll continue to see an increase of sellers, which means Amazon with all their algorithms and all of their automation. There's still a lot of room for error with all the different priorities that they are working towards. So, quite literally where Amazon owes us money, the largest discrepancies that we see are maybe my, myself as a seller, I send in a hundred units of product X, Amazon checks it in so it's great, we got all 80 of them. There's a discrepancy there.

Kelsey: I have to kind of raise my hand and make sure that we work to have those it's either back into our inventory allotment or reimburse for Amazon's mishandling there. A few other reasons would be maybe a customer returns a product, but Amazon never actually reimburses your seller account for the money's owed there. Some other ones would just be like damaged product in the warehouse that is marked as damaged, but you never get the funds back to you from Amazon. So, there's a few different reasons. We see that that inventory discrepancy on inbound makes up about 90% of the cases that we actually make for sellers. But the real crux of why does Amazon owe us money? They're humans too. They make mistakes and we're definitely throwing a lot at them. They try to do what they can for these reimbursements, but there are specific times where we need to identify these areas on our own and make cases or work directly with Amazon to get reimbursed.

Colleen: So, if you're a seller, where can you go to see how much money that you're potentially owed from Amazon?

Kelsey: Yeah. There's a couple different ways. You can use a software, which is what I would recommend if you're trying to keep any ounce of sanity that you have. Otherwise, manually, you can do it. You can choose the major case types, like the inbound discrepancies. What you would want to do is look at the actual statements that Amazon's reimbursing you up against all of the actual shipments that you're sending out. So, the short answer is you're cross-referencing multiple different Amazon reports, which requires a lot of manipulation, Channel Auditor, which is the software that Kaspien not only uses internally, but developed internally to cure this issue that we were seeing across the board is looking at over 17 different case types and therefore at least 17 different reports from Amazon, that it is automatically cross referencing on your behalf so you don't have to manually.

Colleen: Nice. And then with Q4 approaching, how does a seller reimbursement strategy integrate with fourth quarter?

Kelsey: Yeah. Everyone here has mentioned that everything that we're talking about, especially in light of the recent COVID events and all the supply chain and inventory restraints we're seeing. This should not be thought of as just a Q4 strategy. Although, it's a very important time to implement something like this. Channel Auditor specifically actually looks back 18 months. So, we're looking back 18 months in the time that you set up to see has Amazon owed you money within that timeframe. And if so, let's work to make cases and get those dollars back. That's important to know because it's not just like you have to start from ground zero, but it's also important to know that these case types have an expiration date. So, there's only so long that Amazon will let you work on these types of cases. And some of them, the higher dollar value they are, the longer you're going to have to be pushing back and forth with Amazon.

Kelsey: So, it's not uncommon for these types of cases to actually expire while you're in the midst of working on them. So, that's sort of why it should be in all the time strategy. But Q4 specifically, I mentioned that the largest case type or largest area where we see dollars come back through Channel Auditor is an inbound discrepancy. So, sending inventory in. We as sellers on Amazon and marketplaces are sending in a majority of our inventory, or I should say the largest influx of inventory we're sending is in Q4.

Kelsey: We are preparing for high-velocity sales here. So, we, along with every other seller who's selling on Amazon are sending in loads of inventory, which just escalates the amount of error that Amazon can make in handling these products. And I think just one more thing to add on that. We've all been talking here about cost increases to sourcing or having a problem sourcing products, or parts to begin with, or slowed supply chains. So, every single dollar counts, or like I mentioned, if we can find an item in Amazon's a warehouse and put it back into your inventory assortment, that unit goes a long way as well. So, this is huge, again, not only for Q4, but ongoing as well.

Colleen: Okay, great. And so to do the FBA auditing or to use a tool like Channel Auditor, what is that cost for a seller?

Kelsey: Yeah. There's a few different tools out there. I think if you're doing it manually, your cost is going to be time. And a lot of it, if you're using Channel Auditor, one of the great perks about it is that it's completely free. So, we are doing the actual setup. We're researching how many dollars Amazon owes you. And we're actually doing the casework on your behalf as well. And then we just take a percentage of whatever is actually paid back to you. So, Channel Auditor specifically takes 25% of funds recouped into your seller central account, which means we'll work our hardest to get every dollar back. But until it's actually in your pocket, nothing goes into ours.

Kelsey: But I think something to point out here. So, Kaspien, we do a lot for brands that we partner with. We are a brand partner for brands who are selling on marketplaces, Amazon, obviously being the largest. But this platform that we developed about eight years ago, we've actually been utilizing in-house for our retail side of the business. And so far have recouped over 5 million, which is a lot for Kaspien alone. Not even to mention the dollars that we're getting back for the brands that we partner with currently on average, we're seeing is about 2% of top line sales from a brand that's running through Channel Auditor. So, seems like a small percentage, but when you think about that, as an average out across all of the sellers and across all year, that really is a big number, knowing that a majority of that comes from Q4, which is such a short timeframe.

Colleen: Yeah. That's amazing. That's a lot of money.

Kelsey: Yeah, I know.

Colleen: All right. Good. Well, thank you so much. I was just taking a look at some questions. We have a few more good questions that we'll get to in just a moment. I just wanted to share some tips from my perspective. I know I talk about product reviews all of the time. And so as you approach fourth quarter one of my tips is always just make sure you're asking for reviews. You'd be surprised how many sellers still don't request reviews. But with the one-tap ratings now, we are seeing a much higher response rate from sellers, getting ratings and reviews. It's very mobile-friendly. But as you get into fourth quarter, instead of asking for a review within a few days after that order is delivered, think about how many people who are purchasing items in November are actually giving a gift at the end of December.

Colleen: So, if you ask for a review five days after the order's delivered, they're probably not ready to leave a review yet, because they have not given the gift to the recipient to even see if they're ready to give a product review. So, timing is everything when it comes to reviews. So, while I typically recommend to send a product review request a few days after that order delivery, when it comes to Q4 or mid-November at least, I would recommend adjusting the timing of your review request to be 30 days after delivery. That's the maximum amount of time that a seller has to request reviews. And that way, at least if somebody purchases a gift on Black Friday or around Cyber Monday, then they'll receive the product review request at the end of December when they most likely would be more motivated to leave a review, because their recipient has received the gift. Hopefully, they've loved it.

Colleen: And then when it's mid-December, then I would recommend adjusting your timing back to request a review still just a few days after delivery. So, it only takes a second to adjust your timing if you're using a tool like FeedbackFive. So, it's a very simple thing that you can do, but it also just helps to maximize the potential that they're more motivated or willing to leave you a review. And what I wanted to do is just go ahead and just share one slide here. Again, we looked at some data from fourth quarter 2020, and we talked about how the order volume is very high in fourth quarter. And this graph shows from users in FeedbackFive, their order volume is in the green trend line. And then the number of reviews that they received is in the orange bar graph. So, there's a trend, obviously when there's more orders then about a couple weeks following that, then the reviews increase. But the very biggest week that we saw for reviews was the first week in January.

Colleen: So, that just goes to show that people are more motivated are going to leave a review after that Christmas holiday, when they've received the gifts. So, just want to set yourself up for success and try to time your messages so that they're receiving them around the end of December. All right. So, we do have some special offers from everybody here on our team. So, I will be sure to send an email out with a recording of this webinar, as well as links so that you can take advantage of these special offers. I will also share them in the chat here as well. But definitely we'll get to some questions here in just a second after I share those links. There you go in the chat. All right. So, we have a question about video. So, for you, Katie, what is the text feature called for the video?

Katie: I don't think it's actually called like a feature. It's just when you're actually adding the video creative, you would just have some sort of text in it, like is exactly how you would include an audio or music or anything in the background, whatever the product is or whatever the video is featured. It's not actually like called something. It's just whatever you're including in that actual asset and that creative asset, that's where you would include the text.

Colleen: Okay, good. Thank you. All right. And then a couple questions about Walmart. So, I think these came up when Manish was talking. But Walmart in-store delivery through 4,000 stores as an alternative to Amazon. How can Walmart sellers use this? Is it for everyone in Walmart fulfillment or limited by invitation? I'm not sure if are you familiar with that?

Manish: I'll have to get back to the user on that one. Walmart has Walmart Fulfillment Services, which is relatively new. And you can, whether you can have your products distributed to 4,000 Walmart stores. To me that doesn't like a solution for most sellers. Because you could not possibly distribute your products into 4,000 Walmart centers. But we can research it and get back with more accurate information.

Colleen: Okay. And we have another seller that I think was helping to answer that and said that store delivery is only available to products that are in stores. So, that might be the case. All right. That's all the questions that I see as of right now. But any other tips that anybody else wants to add as we're approaching fourth quarter. Feel free, I'm happy to open it up and we'll hang on for another couple minutes in case there's any more questions.

Charlene: I have one for you.

Manish: Well, the-

Charlene: Oh, go ahead, Manish.

Manish: No, I was just going to say that fourth quarter is really not fourth quarter anymore. September, I would say, is part of the fourth quarter and you don't want to wait that long, because everything is being moved up because shopping behavior, shopping season, shipping delays, all of those. But in short, think of September as part of the fourth quarter in my view.

Colleen: Great. And Char, you had something to add as well.

Charlene: Yeah, I totally agree with Manish on that one. You'll start seeing traction coming, I think, in late August now. People are planning for delays and let's hope they plan early, and we have products in Amazon warehouses to sell them. But I wanted to do two quick things. Once someone asked about shipping in over your shipping limits and what backlash there might be. Be very careful because that could be an inbound shipping. You'll get cut off from doing that for X number of days if you consistently do that or there could be account suspension. So, that's something I wouldn't play with personally. Better to stick with the restrictions than not be able to ship inbound at all.

Charlene: And then the last thing I did want to say is put something into place now, whether it be a software solution, whether it be a checklist, whatever, to make sure you don't run out of inventory. As Manish said, that is the most important thing that we as sellers have to make sure that we don't run out of inventory. And I'll just say, I use the RestockPro solution. I've used it since it was brand new and I still use it every single day. If you do use a solution like RestockPro, take advantage of whatever training they offer. As a six or seven year user, I did a 30 minute, answer all my stupid questions call a few days ago, and it really did help me adjust in finetune settings so I can make sure I don't run out of inventory, but make sure I don't have too much inventory neither.

Colleen: Great, great advice. Good. All right. Well it's 59 minutes in, so I think we did good on time. Kept it right at 60 minutes. So, thank you to everybody for joining us to all of the attendees and all of the presenters. This is a great group of software solutions and services that can help your business grow. So, please reach out to these spaces and people on this call and their companies. Take advantage of are special offers because they truly are here to help. And if you have any questions, obviously reach out. But we'll be following up with an email and thanks again, everybody for joining, and best of luck to you in Q4.

Kelsey: Yeah. Thanks so much.

Colleen: Thanks.

Charlene: Bye everybody.

Meet the Experts:

Charlene Anderson is the owner of The Anderson Group, LLC, an online retailer with over 25 years of eCommerce experience. She has been an active seller on Amazon since 2001. Charlene is the author of “Wholesale Sourcing: A Step-by-Step Guide for eCommerce Businesses”. She manages the Wholesale Sourcing Experts Facebook group, a small, curated coaching group for eCommerce sellers focusing on wholesale product sourcing.

Colleen Quattlebaum is the Marketing Manager at eComEngine and she is committed to helping Amazon sellers succeed. Colleen reviews the latest market trends and strategizes on how to improve eComEngine’s offerings, so she can pass that insight and value on to Amazon merchants.

Katie Keyser is a Marketplace Specialist at Tinuiti. She has 8+ years working in the digital marketing and tech industry and has become an expert across multiple verticles effectively helping clients grow their revenue. Katie excels at taking a data-driven approach and executing a tailored strategy to meet her client’s specific goals.

Kelsey Gruis has over eight years of combined sales and management experience in eCommerce. As Kaspien's VP of Business Development, Kelsey helps brands identify and implement strategic opportunities to optimize and grow their business on today's leading online marketplaces.

Manish Chowdhary is the founder and CEO of Cahoot, the world’s first peer-to-peer eCommerce order fulfillment network that enables top-rated eCommerce merchants on Amazon, Walmart, eBay, and Shopify to win sales by offering superfast nationwide shipping - for less than the cost of ground. Cahoot was recognized among the top 50 most innovative companies and awarded Fast Company’s World Changing Ideas for 2020.

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