The majority of Amazon sellers earning over $2.5 million per year utilize some type of automated repricing system. Low-volume sellers and products with prices that don’t fluctuate may manage with manual repricing, but the majority of the high-volume sellers and wholesalers are susceptible to the underlying dynamics changing how well products sell in the Amazon marketplace at the moment. In order for high-volume sellers to succeed on Amazon, their products need to be repriced immediately and accordingly with what’s currently reflected in the marketplace.
Value of Repricing
High-volume sellers with thousands of products listed on Amazon require repricing applications that help ensure their products are priced in accordance to what’s currently happening with the dynamics affecting Amazon’s marketplace. In order to maximize profitability, the best repricing solutions help high-volume sellers identify the optimum price for each product based on their own specific priorities.
Need for Repricing
Since Amazon prices can change every 15 minutes, high-volume sellers need repricing solutions that can adjust to competitors new prices on a real-time basis. These sellers also need to confirm that the repricing solution is equipped to manage a high-volume of SKUs and large catalogs. Some repricers may accrue additional fees for sellers with too many SKUs. It’s also worth noting that some repricing systems tend to value winning the Buy Box over profitability, and will reduce high-volume sellers’ prices in order to meet their target.
Repricing the Right Way
This rule-based repricing system is also susceptible to human error, bias and inaccurate pricing decisions based on the limitations of the people who designed the application. Repricing solutions driven by self-learning algorithms make more accurate pricing decisions because they rely heavily on Big Data analytics. When setting up minimum pricing in automated repricing systems, high-volume should factor in expenses like indirect costs, labor, storage, shipping and handling packaging and fulfillment.
Managing Repricing Systems
Automated repricing applications help with daily pricing changes and freeing up sellers for other tasks, but they still require attention to operate optimally. Many times automated repricing solutions will have to be adjusted because the current data no longer supports the original strategy, the trends have changed or the initial cost structure. High-volume sellers should reassess the strategy settings, minimum pricing and maximum pricing thresholds on automated repricing solutions on a monthly basis.
In order to be sustain success, high-volume make monitoring their automated repricer an ongoing process. Analyzing sales numbers and strategy settings for the repricer multiple times a month helps high-volume sellers reprice their products much more accurately. It’s also worth noting that setting the repricer to the lowest price is not always the surefire way to win the Buy Box. Some of the other factors in determining who wins the Buy Box includes seller rating, feedback score, shipping and handling and fulfillment method.
The market for high-volume sellers and wholesalers on Amazon is far too competitive to thrive without an effective repricing strategy. In fact, much of the separation in this sector is based on each seller’s ability to utilize automated repricing solutions effectively and stay one step ahead of the market and their direct competitors.