Amazon has recently introduced two new planet-friendly Fulfillment by Amazon (FBA) programs. This allows the sellers to resell returned items or unsold inventory, giving the products another chance to second life while reducing product waste.
Following are the two FBA programs:
1) FBA Grade and Resell
This program allows the sellers to list returned products as the used products and resell them on Amazon. It prevents the unsold inventory to be disposed of, hence, less waste. Once the product is submitted to resell, Amazon employees will evaluate the product condition and permit to list it. After that, the seller can manage the pricing accordingly.
Currently, this program is only available in the UK. However, it will be available in the US by end of 2021 and in Germany, France, Italy, and Spain by early 2022.
2) FBA Liquidations:
This program enables Amazon sellers to recover value on returned or unsold inventory by liquidating eligible products via Amazon’s liquidation partners. Once the seller opts for this program, Amazon deals with third-party liquidation companies on behalf of the seller. The process takes place and the sellers can see the net recovery value on Amazon’s Payments page within 60 days.
FBA sell-through rate really affects your Amazon IPI score. Excess inventory with low sales brings down your IPI score. For inventory that has very low sales volume cost money by long-term storage fee. FBA liquidation’s core purpose is to recover value from your goods but not profit.
Below are factors to net recovery value:
– Sales History
– Average FBA selling Price
– Sales history of Specific ASIN
Currently, the program is available in the US, the UK, France, Germany, Italy, and Spain.
Before Opting for Any Program, Ask the Following Questions:
- Do the fees and liquidation rates seem reasonable?
- Is your product quality good enough to meet customer satisfaction?
- Are your listing frontend and backend fully optimized?
- Is there enough traffic landing on your listing?
- Is conversion rate optimization of your listing good enough to convert visitors into buyers?
Before opting for any program, get a proper audit of your business with current facilities and goals in mind. The primary focus and effort of the sellers should be towards increasing profits by adopting standard practices.
What Does This Mean for Amazon Sellers?
For those sellers who have tried to liquidate inventory, but find themselves unable to sell it elsewhere, FBA Liquidations might be a better option financially. For sellers who pay Amazon to dispose of products, the FBA Grade and Resell program help to resell under different graded conditions.