With 310 million active users across the globe, Amazon provides a massive opportunity for retailers. Wholesale is no exception, with over a quarter of Amazon merchants using this sales model.
Want to get in on the action? In this post, we'll outline the benefits of selling wholesale on Amazon, provide our top tips for wholesale business owners and discuss how Profit4 software can help.
Selling on Amazon gives you access to their massive customer base. It's quick and easy to set up your online store and there's nothing stopping you from adding more products.
To make things even easier, Amazon allows you to use their fulfilment centres for quicker picking, packing and shipping. Fulfilment by Amazon (FBA) is used by a whopping 73% of merchants, though you can also fulfil orders yourself, which is known as Fulfilment by Merchant (FBM).
Many people choose to sell wholesale products on Amazon by sourcing products from wholesalers before selling them. Indeed, you may have had enquiries yourself from stockists that want to sell your products on the popular platform.
As a wholesale business, you'll have a head start with your own products ready to be listed and sold. By selling them yourself, you'll be able to maximise your profit margins too.
First things first, it's important that your current enterprise resource planning system can integrate with Amazon. As a wholesaler, you may already be selling through trade counters, your own website or a network of stockists. Without proper integration, adding Amazon to this list could complicate things.
Integrating sales order management software like Profit4 with Amazon allows you to keep everything accurate and consistent across several sales channels. Inventory, orders, pricing, shipping information and customer data will all be synchronised for Amazon alongside your other sales channels.
Did you know that almost 90% of UK customers use Amazon? And 25% of UK adults are signed up to its Prime membership service for fast, free delivery? In short, that means demand could be much higher through Amazon compared to your other sales channels.
With this in mind, it's important that you have systems in place to track demand for your products. Enterprise resource planning software like Profit4 can automatically calculate how much stock you need to order based on current stock levels and demand across your sales channels.
As a result, you can optimise the amount of stock you have, avoiding stockouts without storing unnecessary inventory. That allows you to make the most of Amazon's customer base without any impact on your trade counter or online store.
Selling through a new sales channel like Amazon will impact more than your sales team. There are implications for purchasing, finance, warehousing and logistics, for example. As such, you should aim to keep all parts of your workforce in the loop.
That doesn't have to mean giving everyone access to everything. Or making people search endlessly for what they need. With Profit4, you can create customisable role-based dashboards, so each member of your team can see exactly what they need. That could be accounts information for your finance team, or different dashboards for purchasing and sales which a member of your team can switch between as needed.
Amazon is renowned for high competition and low prices. As such, you might want to sell products at different prices compared to other sales channels. Thankfully, Profit4 enables you to set different prices easily - not only for each sales channel, but also for different customers or special events.
Crucially, the intuitive software can show you all prices you've offered in the past for each product, including how many wholesale orders were made at that price. That puts you in a better position to capitalise with your product listings on big sales events like Black Friday and Prime Day, which are big hits for Amazon users.
When selling through Amazon, you have a choice of fulfilment by merchant (FMB) or fulfilment by Amazon (FBA).
While FBM refers to keeping everything in-house, FBA gives you access to Amazon's fulfilment centres. Rather than fulfilling orders yourself, you send stock to Amazon and they do everything for you - picking, packing and shipping products.
This has obvious advantages in terms of convenience and simplicity. However, fees can be high for both fulfilment and storage, which can eat away at your profit margins. Amazon also has stringent requirements for product packaging and labelling.
Profit4 can help with both of these options. Our stock management software can help you stay in control of your inventory, making in-house fulfilment easier. The software also supports integration with FBA, including settlement report integration for easier payment reconciliation. With real-time demand forecasting, you can also minimise fees for long-term storage, ensuring that you only send Amazon the right amounts of stock each time.
It's easy to think that more sales equals success. But ideally, you want a bit more detail about what you're getting back from those sales - especially when Amazon charges fees for each item sold plus additional FBA costs if you choose that route.
With Profit4, Amazon fees are recorded for each order, giving you better visibility of profit margins. This allows you to adjust the selling price if needed. It also means you can make an informed decision when allocating stock to different sales channels - so you can prioritise the most profitable method of selling when needed.
If you want to get the most out of wholesale selling on Amazon, OGL can help. Our innovative Profit4 software helps you control stock for FBM and FBA fulfilment and manage orders as you expand your online sales.
If you'd like to find out more, don't hesitate to contact our team or watch our demo.
