By Martin Heubel, Amazon Strategy Consultant at Consulterce
Want to know Amazon’s red lines in annual vendor negotiations (AVNs)?
There aren’t many.
Amazon can move on most things:
- Reducing trade terms
- Increasing cost prices
- Operational Commitments (AVS)
But how can you push the boundaries of your negotiation?
By using this simple 3-step framework:
Step 1: Know your Category Position
Vendor Managers will be more flexible if they need you to deliver their category targets. So you need to understand your position in Amazon’s category.
If you are one of their top 5 vendors, you can pretty much ask for anything. But even if your position is less dominant, you can place your requests and move to step 2:
Step 2: Ask
State your request, and don’t immediately back down when your Vendor Manager says No.
Instead, listen carefully.
Are there any commitments your buyer needs from you? Or do they need more information to understand your request?
It’s unlikely they will just say No. But even if they do, you still have:
Step 3: Escalate to Senior Stakeholders
Amazon’s leadership team wants one thing: Developing your business long-term.
That’s why they will search for creative solutions to overcome gridlocked negotiations. So do your research and develop a relationship with them early.
If you show the same level of flexibility that you expect from Amazon, you will likely move the original red lines in your trade discussions.
For further information and support, contact Martin Heubel here
