By Martin Heubel, Amazon Strategy Consultant at Consulterce
Amazon’s P70 forecast is not a buying forecast. It’s a demand forecast.
So you cannot just use Amazon’s forecast to ring-fence inventory and inform your account budgets.
Instead, your teams also need to consider their:
- Buy Box Win Rate
- Vendor Lead Time
- Inventory Turnover
- Seasonality Patterns
- Upcoming Ad/Promo Campaigns
- Expiration Risk of Existing Amazon Stock
Amazon has also drastically reduced its inventory coverage in the past six months.
On average, the online retailer now holds between 3-5 weeks of inventory. For some products, it might even be less.
So to avoid running out of stock on your (profitable) listings, make sure to:
- Avoid sending Amazon products close to their expiration date
- Negotiate seasonal upfront buys with your VM/AVS
- Ensure any deal funding is tied to minimum ordering volumes
- Review your Buy Box win rate through virtual shelf monitoring tools
- Stay within Amazon’s vendor lead time requirements (<3-5 days)
Bonus tip: Want to get access to Amazon’s buying forecast? Ask your Vendor Manager to get onboarded to the commitment ordering programme.
For further information and support, contact Martin Heubel here
