Thousands of private labels and online stores are entering the Amazon game every day, and only some of them are destined to become successful in their journey. From a payout perspective, success usually entails a triumphant exit to an FBA Acquirer or eventually making it to stand among the Top 1000 Sellers on Amazon. These rewards are great, but it’s a long journey, and the path to success isn’t too different from any other business or, indeed, any other startup.
If you analyze startups, they often fail due to two fundamental reasons. Assuming you have a great product and adequate market demand exists, it’s easy enough to avoid these two pitfalls when selling on Amazon.
First, if you fail to reach your initial goals, that doesn’t mean you will fail in totality, nor that you’ll soon admit defeat. Give yourself the freedom to refine your product listings and experiment with new strategies. No one hits all their goals the first time, and starting a business is no different. Allow yourself a reasonable window to increase your sales on Amazon before considering it hopeless. Declaring defeat is the surest way to guarantee it.
To sell products under a private label requires a try-and-fail approach. It takes time to develop “seller instinct.” Eventually, you’ll intuitively know what products sell better, how to adjust your product title and product details page, the optimal way to market, what price to set, and so on. If you admit defeat too soon, you likely haven’t given your model a chance to succeed. Try adjusting your strategies before cutting your losses, and you may find that small changes lead to a big turnaround.
Second, you need adequate cash reserves to run your daily operations. If you run out of liquidity, you can’t buy inventory or advertise your products. At best, you can only have sub-optimal success, which may not be sustainable. You can always work with a funding platform (like Payability) to request more cash, which is a vital strategy for accelerated growth.
Finally, you also need profit maximization strategies. Profit maximization can happen either by reducing your operational costs or by developing your profits and returns faster. Here are 5 Strategies to make this work:
The revenue from Amazon-owned brands tripled during the last three years. Their prices frequently update because the market is dynamic, and advertising costs are also changing. Still, many private label owners did not fully unleash the power of dynamic pricing, including trend-based pricing, which can significantly impact their overall success.
Dynamic product pricing plays a crucial role in how products on Amazon are managed. Dynamic pricing avoids and delays stock-outs, which can cause your keyword rankings to go down — and they do not necessarily bounce back quickly once you’ve restocked.
Another advantage of reevaluating how you set the price of items is avoiding buy box suppression. Although the private labels keep the same price on Amazon, due to several other factors, Amazon suppresses the buy box even if the listing has a single offer. Sales drop significantly, and certain advertising functionality does not work if you don’t own the buy box.
Amazon logistics is becoming more complex every day, which results in lost or damaged seller products or other process anomalies. Using the power of artificial intelligence to audit such anomalies in a fast and accurate way can result in getting up to 4% of revenue claims back from Amazon. This kind of audit can increase your profit margin and bolster your cash flow options.
Until recently, this process was not transparent and or available in real-time. Although many companies claim to audit seller data, they often fail to understand the complete picture. Without unlimited data access and a full understanding of logistics, Amazon Seller Central users often find themselves with reimbursement-reversals and a less than optimal reputation with Amazon.
One of the biggest headaches of Private Label sellers is when and how much to restock items, and Amazon forecasts help only a little. The main challenge is that it’s not only about replenishing the top-selling item or the lowest available item.
More importantly, it’s about restocking the most profitable item without ignoring a balanced replenishment of the portfolio. Today, many Private Labels do this with multiple Virtual Assistants and many hours of work, and still, they end up being out of stock. Having a data-backed restocking solution is critical to continuously having optimal inventory.
Effective PPC Management
Amazon advertising started small, but today, Amazon is a play-per-pay platform. The breadth and depth of the advertising are growing fast, and Private Labels are investing a considerable amount of money in PPC.
Our analysis shows PPC alone does not impact your growth that much. Still, you can achieve the most effective PPC if you perform creative content, SEO, Feedback management, and pricing correctly. Even if this is the case, PPC still requires optimization to grow fast with reasonable ACOS, which you can satisfy by combining AI and humans to maximize the impact of PPC.
Use an All-in-one Service
Until 2021, there existed no technology platform like Eva.guru. This service delivers Private Labels Price Management, Maximum Reimbursements, Optimized Restocking, and Effective PPC at the same time. Eva’s unparalleled Amazon experts make sure you’re using the platform in the best way possible. Maximize your profits by improving your transactional earnings by 40% and reducing OPEX by half just in 90 days.
Join hundreds of sellers using Eva instead of multiple tools and services that remain unintegrated with each other. Save your time with a wholly integrated Amazon Management Platform and save your money by paying much fewer commissions to reimbursements and software subscriptions. Eva is the ideal technology partner for this long journey. You can focus on your products and supply chain while Eva takes care of the rest. To celebrate you, Eva and Payability want to offer you $1000 in Free Reimbursements.