Amazon repricing is the act of changing the sales prices of Amazon products multiple times. A common aim is to maximise the profit made over a given period. And that’s what this series is all about: maximising your profits on Amazon.
Most sellers – the vast majority in my experience – have rigid Amazon pricing.
Here are some knock-on effects:
1. You’ll run out of stock more quickly…Usually of your best-selling products!
2. Weeks (months?)of zero cashflow and Zero profit while out of stock.
3. leaving profit on the table
4. no presence on Amazon while out of stock
5. Handing market share and sales to competitors
6. it can be hard to rank again when back in stock
1. Low sales velocity – which ties up a ton of cash.
2. Lower ranking, which can be hard to regain. Which in turn leads to lower visibility…and lower sales
3. You can lose the buy box – and sales – to your competition! (and YES – that IS a thing for PL sellers, not just resellers)
4. Slow-moving stock in FBA incurs inbound stock limits. That’s a peak season nightmare!
Selling more units is the hardest way to drive more profits. Small pricing changes can drive BIG profits.
Say your product sells at $20 for a $4 profit. Increase the sales price by just 10% to $22, (assuming costs stay the same), and you get an extra $2 profit.
That’s a FIFTY % increase in profits – for just a TEN % increase in price!
This applies across all categories: Health or supplements; home & kitchen; sports and outdoors, pet care… you name it.
One mastermind member employed a full-time member of staff to do their repricing. Granted, they had over 2000 product lines. This is nonetheless an expensive, difficult way of doing things!
Apart from the expense, it means you can only practically reprice products once a week with a large catalogue (say over 1000 SKUs) at most. With a small catalogue, say 10-100 SKUs, there is still a practical limit of daily adjustments.
Humans also have a bad habit of changing prices abruptly in substantial amounts. To be fair to humans, this is partly because of the low frequency of changes, meaning they need to be bigger when they happen.
But it’s very unwise. Amazon’s algorithm can remove the buy box from even private label sellers, for repeated movements of over 1-2% of the price. For most products around the $20 price mark, that means movements of even 25-50 cents could trigger problems. (Oh and losing the buy box means losing 80% of sales – not good!)
Manual repricing is impractical so it has to be (90%) automated.
For resellers (RA, wholesale etc) the traditional solution has been a rules-based automated system. But that’s primitive – often winning sales but losing profits! Also, it just doesn’t account for your stock level!
Why obsess over winning the buy box when going out of stock is usually the single biggest hit to your profits?
What you need is a system that integrates repricing and stock levels. That understands the dynamics of Amazon and changes actions based on results.
Intelligent repricing for private label gives you the biggest and quickest extra profits.
That breaks down into two parts:
1. repricing: this means adjusting product prices daily, in tiny steps. So it won’t annoy Amazon or customers – or start price wars with competitors.
2. “Intelligent” means NOT rules-based; It learns from experience.
If you set a certain profit aim, it will adjust over time, to get that profit. Costs for such systems are also less than 1/10 the cost of hiring people to do this job.
The best people for Amazon repricing for Private Label sellers I know for this are the guys at Eva. I believe they are the only people who really deal with private label situations.
If you head over to Eva using this link, you will see my coupon code over there, and I’m happy to get you a large discount on your first month’s subscription.[www.amazingfba.com/repricer]
But that is really the only with the right tool that repricing that it is an easy win.
Manual repricing, repricing by hand, is probably the hardest of the repricing tactics the mastermind members use.
Both approaches to repricing, by the way, are used in the mastermind. Some people have manually repriced using a member of staff full-time. In some cases, other people have used a repricing engine like Eva and are getting strong results with it.
Many Amazon sellers aren’t even sure where to start with their profit maximising. We’ve created a special assessment to help you understand where to start. Just click here to take our quiz – and in about 120 seconds, you’ll know exactly where to focus for the quickest and biggest wins.
Episode 1 in this series was an overview of profit maximization on Amazon sellers.
The last episode ep 2 was about Amazon pricing strategy in general
Next we’re going to talk about stock control, why it matters and how to achieve it manually. We will also talk about how you might want to look into using systems to do that.
After that, we’ve got profit measurements to give you clarity about the numbers that you need to make informed decisions.
Later we have Reimbursements; then Amazon ads and how to cut waste from that- very big cost to a lot of us at the moment.
After that, Branding, as I’ve mentioned today, already and conversion rate optimization are next.
Last but not least, we’ll discuss business model clarity as well.
All of which is to serve one aim: maximise your profits. Or to protect your profits in the coming economic storms.
If you want to be kept in the loop, the best thing is to take the Amazon profit quiz.
Happy hunting and good profits!