How to deal with Amazon's reform wave, and what's the way forward?

How to deal with Amazon's reform wave, and what's the way forward? How to deal with Amazon's reform wave, and what's the way forward?

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Faced with this year’s complicated situation, whether it is an old seller who has been doing business for several years or a new seller who has come in this year, they are all caught in a deep confusion. The sea freight rate has skyrocketed one after another, and the title wave is one after another. Under the influence of the continuous compression of Amazon’s inventory and the Sino-US trade war, coupled with the continuous increase in advertising and inventory fees, the development of cross-border e-commerce has encountered unprecedented challenges, and has even affected the survival of many sellers. .

Presumably, many sellers face such a severe situation with too much helplessness and helplessness on their faces. No matter what kind of business model, they must be supported by profits in the end. What is causing the current sellers’ profits to increase? Lower or even continuous loss

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I have summarized the following three main factors here:

1. The sea freight for the first voyage continues to skyrocket, and I don’t know when it will come down. There is no hope at all in the short term, and the probability will remain this way next year.

2. Inventory costs continue to increase and eat up most of the product profits. There are two main reasons for this. The first is that due to the good market situation last year, blindly optimistic, a lot of goods were shipped in the past, even five times ten times more than before. In the past, the overall market has turned cold this year, resulting in a serious inventory backlog. The second factor is that due to the overall market downturn this year, sales are far below expectations. These two factors have caused the inventory cost to continue to rise, and the longer the storage time , The higher the inventory cost. Originally calculated as deducting the advertising cost, deducting the first shipping fee, there is still a little profit, but after deducting the inventory cost, everyone must have mixed feelings and misery.

3. The price of the terminal cannot go up. Some people think that since the ocean freight is getting higher and higher, then I will adjust the price of the terminal accordingly. Anyone who has done Amazon knows that the price of your peers' competing products still has not changed, and there are even some Selling at a reduced price, why? The cost is getting higher and higher, and the selling price does not rise but falls. The reason is very simple. The inventory backlog is too serious and can’t be sustained. Coupled with the continuous influx of new sellers, it will further divide the already saturated market share. It is really helpless to cut prices. , As much as it sells and loses as much as it gets worse and worse.

This year is undoubtedly a turning point in the development of Amazon. The dividend period for most categories has ended, and now it has entered a mature development stage. The historical opportunity for relatively good money in the past is gone, and the objective conditions have disappeared. , This is the inevitable result of market development.

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How should we go in the future?

1. Overcome the current difficulties and persevere! This year's banning tide has affected a lot of sellers, and a considerable number of them can no longer survive. In addition, because the market is not as expected, various costs continue to rise, resulting in continuous losses for sellers. Some sellers have the idea to withdraw. Under such a background, the market will clear out some participants, which is good for sellers who can persist, because the competitive pressure has become less. So what we have to do is persist!

2. Reduce costs and expenses, including advertising costs, inventory costs, and first shipping costs, slow down the pace, save costs to the greatest extent, and overcome the current difficult period. For products with a serious backlog, in addition to Amazon price cuts or spikes, you can also Use other promotional channels to speed up product sales, strive to increase sales and reduce inventory costs.

3. Expand other platforms. Don’t be limited to Amazon’s single platform. We can also try other platforms, and we can also be independent stations, but all of these require time to learn and accumulate. Everything is difficult at the beginning. This is our alternative, too Long-term plan to strengthen the security of its own sales channels.

4. Improve our own operational level and enhance the competitiveness of products. In terms of operation, we need to continuously learn and understand the operating logic of platforms such as Amazon. In terms of products, we need to continuously improve the quality of products and the level of innovation and research and development.

Cross-border e-commerce is a long-term practice. You will taste all the ups and downs. In the end, you will find that the essence of business has not changed, and the logic of market operation has not changed. The key is that you learn to use market changes, discover market opportunities, and take advantage of the trend. And for.
FCL sea freight forwarder from china

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