How has Coronavirus (Covid-19) Affected Amazon Sellers
As you are probably aware, a lot has been happening over the last few weeks on Amazon due to the ongoing pandemic caused by the coronavirus. Many sellers, both large and small, are questioning what will happen next and what options they have to keep sales going and prevent their business from being affected by the health pandemic.
What are some of the most recent changes and updates from Amazon?
Temporarily Prioritizing Products Coming into Fulfillment Centers
Amazon announced that they were limiting shipments into their fulfillment centers to products that were classified as household staples, medical supplies and high demand products. The goal was to mirror what was being done in brick and mortar retail locations. Most of those products fell into one of the following categories:
- Baby Products
- Health & Household
- Beauty & Personal Care (including personal care appliances)
- Industrial & Scientific
- Pet Supplies
This change led to a lot of sellers panicking and not sure what to do. They couldn’t replenish inventory for several weeks even though sales were not slowing so they had to make a change. Many sellers started to shift from using Amazon to fulfill their orders and instead went back to fulfilling their own orders. This allowed them to maintain inventory in stock and prevent any potential lost sales and revenue.
Fulfillment Times by Amazon Slowed Down Significantly
With the increased focus on essential items, fulfillment times for non-essential and high demand items started to slow down significantly. The normal 1-2 day fulfillment time we have all been accustomed to started to creep out as far as 30 days on many items. This led even more sellers to shift their strategy from using Amazon FBA to merchant fulfilled options or 3 rd party logistic companies. The goal was to get more products to consumers, as fast as possible, while still using the increased traffic on Amazon.
Removal order delays and long-term storage fee waiver
To ensure the capacity to receive, restock, and ship high-priority products like household staples and medical supplies, Amazon temporarily paused removal orders in some of their fulfillment centers.
Sellers can continue to create removal orders, but there will be delays in completing the requests. These delays are not only hitting the US but also UK, EU and the Czech Republic markets. This means inventory that many sellers were hoping to remove and fulfill on their own is now becoming more difficult to access and could be weeks away from returning. Sellers again had to adjust and focus on new ways to get those orders delivered to customers. Many sellers adjusted their strategy to have Amazon act as the 3rd party and fulfill their own website orders from an Amazon fulfillment center. This allowed for faster delivery without the delays of Amazon ordered products.
Should We Anticipate More Changes?
As we continue to adapt and change to what the economy and pandemic provides, we anticipate more changes. Amazon has started to slow down their own promotion and advertising of products to allow for more time to catch up on orders. They also announced the hiring and training of over 100k new employees to meet the demands on their system. As health concerns grow and more areas of the country become quarantined, traffic and sales will continue to fluctuate.
Maintaining inventory available for sale, whether on Amazon, through Amazon fulfillment or via your own website is going to be crucial to sustaining your business. Making sure you have a plan for fulfillment, SEO, PPC, and all other channels in place for the next few weeks, months and even into Q4 will be critical but we can all get through this together!