Introduction:
When it comes to selling on Amazon, having a strong supply chain is crucial to success. As a seller or vendor, you need to ensure that you're sending legitimate stock into Amazon's fulfilment centres while also accurately meeting demand. In this article, we'll break down Amazon's supply chain control into two parts - for sellers and vendors.
Sellers' Supply Chain Control:
Sellers must maintain a healthy level of stock in Amazon FBA centre while factoring in lead times to receive, prep, and dispatch stock. To effectively control your supply chain, you need to understand demand patterns and adjust your distribution accordingly. Keep an eye on your stock levels and implement a system to manage overstocked or slow-moving items.
Overstocking can result in charges, and under-stocking can cause long-term sales losses and negatively impact your supply chain metrics. Therefore, it is essential to maintain the right balance and ensure that you're meeting demand accurately.
Vendors' Supply Chain Control:
As a vendor, you may think that Amazon handles everything, but that's not the case. Amazon can return your stock at any time or for an agreed-upon fee, which can affect your profit margins. To avoid this issue, monitor and track your consumption rate on Vendor Central and fulfil only the necessary Purchase Orders from Amazon.
Conclusion:
Managing your supply chain on Amazon can have a significant impact on your sales, and it's essential to get it right. By understanding demand patterns, maintaining the right balance of stock, and tracking consumption rates, you can effectively control your supply chain as a seller or vendor. If you need more information on how to assess the right consumption rate or manage your vendor purchase orders, book a free audit now.
