If you’ve been selling for at least 6 months then you might have long-term storage fees for inventory sitting in the Amazon warehouse.
Yep…Amazon will charge you for having inventory sitting in their warehouse that’s not selling.
On February 15 and August 15 of every year, FBA conducts an inventory cleanup.
Why do they charge you for long-term storage?
Amazon says that slow moving inventory limits their ability to provide space for fast moving products customers want.
Which of my products will be charged the long-term storage fee, and how much will I be charged?
You can use the Inventory Age and Inventory Health report reports (sign-in required) to identify which ASINs in your inventory are subject to the long-term storage fee.
Products will incur a long-term storage fee of $11.25 per cubic foot of shelf space occupied if they have been in an FBA warehouse between six and 12 months. That number doubles to $22.50 if the product has been in storage longer than 12-months.
The fee is based on the date an item is received in the fulfillment center.
How to Find Out Which Items Are Going to be Charged LTSFs
- Log in to Seller Central.
- Hover over Inventory and click on Manage Inventory.
- Click on Inventory Dashboard.
- Scroll down until you see the FBA Inventory Age box. Then, click View Details.
1. Pricing Strategies
About a month before an Amazon long term storage fee date, aggressively price your inventory so you get items sold so you don’t have to pay an extra fee
2. Use Amazon Promotions & Sponsored Product Ads
Run promotions and ads or offering a discount to get them sold.
3. Take Advantage of Free Removals
Checkout the Amazon liquidation program and you might recover some money. But you may have restrictions selling that product for several months. Note there is a deadline that needs to expire before you can send the item back to FBA warehouses. Typically this is 3 to 6 months in the future.
Try to use popular discounts sites where you can sell excess inventory. One platform, Honeysaver, is free. Other popular sites include Vipon.com, Snagshout, and Jumpsend.
4. Manage In Stock Levels from the start
One of the best ways to avoid long term storage fees is to manage the amount of inventory that you send in to FBA warehouses in the first place. If you only send in quantities that are likely to sell in 6 months or less then you should have minimal long term storage fees to worry about.
5. Time When You Send in Inventory
One other thing that can be done is timing when you send in your inventory to FBA warehouses. For example, on August 15th you will be charged a long term storage fee for items that have been in stock for exactly 6 months. However, you will not be charged for items that have been in stock for 5 months and 29 days. So if you have items hit the warehouse on say August 20th, you have nearly a full year before you will be charged LTS fees. This is as opposed to having an item hit the warehouse on August 14th, then you will only have 6 months and a day before a LTS fee will be charged.
The referenced article is here
Other resource: Seller Forums: Tips to avoid FBA long storage fees thread
Looking to write product descriptions that sell? Read on…
Many sellers write product descriptions that ‘describe’ their product. For example, give the dimensions and general information.
That’s a weak strategy.
As a seller you need to SELL your product. This is your chance to create the impulse buy.
The following are the summarized points in how to write to persuade your visitors with product descriptions that sell:
1. Focus on Your Ideal Buyer
Answer questions that your ideal customer has in their mind.
2. Entice with Benefits
Consider the benefits of each of your product features. Sell an experience.
3. Avoid Yeah, Yeah Phrases
Instead of using “excellent product quality”, be specific in describing it.
4. Justify Using Superlatives
If your product is really the best, provide specific proof why this is the case.
5. Appeal to Your Readers’ Imagination
Let your reader imagine what it would be like to own your product.
6. Cut Through Rational Barriers With Mini-Stories
When it comes to telling a story about your products, ask yourself:
- Who is making the product?
- What inspired creating the product?
- What obstacles did you need to overcome to develop the product?
- How was the product tested?
7. Seduce with Sensory Words
Restaurants have known it for a long time: sensory words increase sales, because they engage more brain processing power.
8. Tempt with Social Proof
When your web visitors are unsure about which product to purchase, they look for suggestions what to buy.
9. Make Your Description Scannable
Here’s some areas to focus on when designing yours:
- Entice your web visitor with headlines;
- Use easy-to-scan bullet points;
- Include plenty of white space;
- Increase your font size to promote readability;
Need a professional to write your product descriptions? Click Here to learn more.
The article being referenced is here.
The following is a summary of the key takeaways from a blog post about the shopping experience of an actual Amazon customer.
Meet “J” a health-conscious mother of three (and closet chocoholic) who agreed to document her every move and thought while in search of a bread/loaf pan. Here’s her enlightening journey highlights:
I clicked on the more popular one first, but the bullets and description weren’t impressive. It basically just told me the dimensions. It didn’t include any features, benefits, or uses, so I didn’t stay on that page long.
I went back to that first pan and noticed the highlighted “Product Features” right there on the search results page.
It caught my eye because it said “extra large loaf.”
Seeing those words under “Product Features” made me click.
Continuing the search, I came across one that had little grooves along the pan’s interior.
Having never seen that before, curiosity once again got the better of me. I clicked on it, primarily, to see what those grooves were used for. The bullets and description didn’t provide any explanation. The whole reason I clicked was to learn about those dimples, and they didn’t even mention them. Were they for cooking evenly? Easier release? Texture? Had they explained their purpose and/or benefit, I may have considered this pan.
I almost always look at the pictures first.
I noticed the reviews next. They have a 5-star rating with over 900 reviews. Impressive! The bullets were well-written and informative.
I read the description, which explained the purpose of the lid in creating perfectly shaped sandwich bread.
The line about peanut butter and jelly sandwiches sold me. The whole reason I’m looking for a bread pan is to make healthy bread for my kids, who just happen to devour PB&Js like they’re going out of style. I scrolled back up and added to cart.
I’m pretty sold on this pan, but I always like to look and make sure it’s not being sold cheaper by another seller.
I don’t usually go past the third page of results.
I clicked back over to the USA pan and read some reviews before making my final decision. They were overwhelmingly positive, and dozens of them included pictures of beautiful, just-like-the-store loaves.
At this point, I purchased with confidence and am looking forward to our house smelling of fresh-baked bread!
As you can see there’s several factors determining the buying behaviour.
- I clicked on the more popular one first, but the bullets and description weren’t impressive
- I noticed the highlighted “Product Features”
- I almost always look at the pictures first
- I noticed the reviews next
- I read the description, which explained the purpose
- The line about peanut butter and jelly sandwiches sold me
- The whole reason I’m looking for a bread pan is to make healthy bread for my kids, who just happen to devour PB&Js like they’re going out of style. I scrolled back up and added to cart
- I’m pretty sold on this pan, but I always like to look and make sure it’s not being sold cheaper by another seller
- I don’t usually go past the third page of results
- I clicked back over to the USA pan and read some reviews before making my final decision
For info on optimizing your product listing click here.
The convergence of two of the worlds continues with Amazon acquiring Whole Foods and Walmart acquiring Jet.com and Bonobos.
What does this mean for Private Label Brands?
There is now plenty of potential that brands could be dis-intermediated, if you will, from the retail position that they have helped defined over the past century.
These major online companies now have a presence in offline stores, where before they didn’t. Now they can promote their own private label brands.
Imagine the convenience of Amazon leveraging their Alexa products (the wireless dot and echo speakers and dash button):
An example of this is that Amazon has used their own position as the starting point of shopper-consideration to push their own private labels through the Amazon website and through their Alexa products.
We’ve already seen it with batteries:
As Whole Foods private labels enter the fray, it’s possible that products such as cereals and cookies could be subjected to the same fate as battery companies. Battery companies were left completely battered following the loss of Amazon as a key e-commerce foothold once the company debuted their own product line to rival the battery companies.
Jet.com is already doing it after being acquired by Walmart:
Jet.com has also been phasing out any Costco private label products following the takeover by Walmart, so there is certainly precedent to suggest that Amazon could do the same with Whole Foods.
So get ready, if you have a great product that sells well on Amazon, you could have the opportunity to get product placement in Whole Foods and drastically improve your brand exposure.
Referenced Article: https://www.forbes.com/sites/steveolenski/2017/07/21/what-the-amazon-and-walmart-acquisitions-could-mean-for-retail-brands/
Nike just partnered with Amazon to sell their products. WOW…
Not too long ago Birkenstock decided to remove their products, and now Nike is partnering with Amazon.
Because Nike know’s the future of retail is in a massive shift…
Amazon has mastered the new internet retail distribution channel like WalMart did the discount retail channel. As a result more and more buying activity is associated with the Amazon brand than the manufacturer brands. This means that customers are now associating more brand equity to Amazon, and not the major brands. If you have an optimized listing with images, copy, reviews and everything else, you can bypass the traditional big brands and piggy back off Amazon’s brand.
If you have an optimized listing with images, copy, reviews and everything else, you can bypass the traditional big brands and piggy back off Amazon’s brand.
If Nike is not on Amazon, it risks its customers losing interest and them ‘seeing’ the brand.
Nike has to be constantly in front of where the shoppers are, and with over 40% online buyers shopping at Amazon, big brands know Amazon is where they need to be.
The companies that don’t adapt to Amazon and learn how to leverage it will eventually ‘fall’ to obscurity. As FBA sellers selling private label brands, now is one of the best times in history where you can compete with big brands. Time to crush it 🙂
Here’s the original article: https://www.forbes.com/sites/quora/2017/07/19/amazon-and-nikes-partnership-could-mean-the-end-of-big-brands/