Then you need to start obsessing about data.
Far too many brands don’t know the exact drivers of their Amazon profitability.
Yet, they unlock margin support because they face CRAP and ASIN suppressions.
That’s a big problem.
When preparing your next Amazon negotiation, here’s what to do instead:
- Access Brand Analytics in Vendor Central
- Download ASP and margin details of your entire portfolio for 2022
- Compare the margin trend of your listings (MoM/YoY)
- Understand which products drive your margin mix and why
Don’t have access to the right time periods or product data?
Ask your Vendor Manager to send you these details. Don’t start negotiating before you have visibility about the facts.
Remember:
Margin support agreements are temporary in nature.
The earlier you understand what is causing profitability headwinds, the sooner you can shift the conversation to mutually beneficial solutions (e.g. supply chain initiatives).
For help conducting points 3 and 4, see: The Amazon Vendor Profitability (AVP) Matrix – Definition and How to Use It
For further insight and support, contact Martin Heubel, Founder and Director of Consulterce, a strategy consultancy for B2C Household & CPG brands (Email: [email protected])
