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In a flash, the first quarter of 2024 has come to an end. In January, cross-border logistics was hit by the red ocean situation at the beginning, and the frequent adjustments of Amazon's new regulations in February caused sellers to fall into a review storm. In the past March, the fierce competition for traffic between China's "Four Little Dragons" and local giants in overseas markets continued. Now it is the first day of April, the "joke-like" April Fool's Day collides with the "funny version" of Easter, and the performance of cross-border people who are wavering between opportunities and risks seems to have been "fooled".
On the first day of April, "Has Amazon entered the off-season?" became a common greeting among cross-border sellers on social platforms. It was observed that when opening the Amazon backend today, many sellers were puzzled by the low traffic: "When I opened Amazon today, the number of orders was so low that I wondered: Is it the off-season? Is it fading out of the universe? Has the advertising mechanism changed again?" "The number of orders hit a new low for the whole year... Did Americans celebrate Easter and April Fools' Day at the same time?" “The same is true for Canada and Europe, which are 40% lower than usual.” But in fact, the story of platform orders encountering a "late spring cold snap" has been unfolding serially since the end of March. Looking back at the Spring Sale held in mid-to-late March, according to survey data, more than half of the sellers failed to get the expected traffic from this first spring event , another 30% of sellers did not even participate in the sale, and only 10% of sellers achieved an increase in orders. This has caused many sellers to complain: Amazon forgot to notify consumers about the sale again. After the spring promotion ended, more sellers fell into a trough of shrinking sales and plummeting traffic. Especially on the weekend of March 30th to 31st, many sellers found that orders on Amazon's US site plummeted. From the above, it can be seen that this year's new spring promotion did not bring much traffic bonus to sellers on Amazon's US site. Compared with the same period in previous years, at the end of March this year, sales not only on the North American site but also on the European site seemed to be lower than expected. In this regard, based on the feedback from sellers, the following three reasons may have led to the recent decline in Amazon's order volume: 1. Overseas consumers take a collective holiday during the Easter holiday As one of the important festivals in the West, Easter refers to the first Sunday after the spring equinox every year. The holiday usually lasts for 4 days, starting from the Friday before the holiday. People in most regions such as the United States, Canada and Europe will close their markets, take vacations or even travel during this holiday. According to the calendar, March 29 to April 1, 2024 is the Easter holiday in the United States . Therefore, many sellers believe that the recent sharp decline in order volume may be related to the arrival of Easter. It is understood that during the Easter holidays in previous years, sellers in most categories did experience a decline in order volumes. 2. Amazon verification and ID scanning controversy According to Amazon's global store opening notice, the 2024 annual verification of the "U.S. Consumer Act" has started at the end of March . Relevant sellers are required to submit relevant information as required within the specified time, otherwise their accounts may face the risk of deactivation. At the same time, since March 20, sellers have received scan-number emails from Amazon, being accused of unfair behavior or abusing Amazon's functions , and their accounts have been deactivated. To date, most sellers have not yet resumed operations. In response to this, many sellers have said that they are "exhausted" just dealing with Amazon's sudden policy adjustments. How can they calm down and consider how to adjust their operating strategies and increase order volumes? 3. Multiple e-commerce platforms share market traffic As we enter March 2024, the "traffic war" among major e-commerce platforms is still in full swing: AliExpress launched its first major promotion of the year on March 28, and preheated it a week in advance; Temu launched semi-hosting business on the US site on March 15, offering a number of discounts to attract sellers to join; Wish held its hottest promotion "Wishmas" from March 29 to April 6, open to all categories... Based on this, some sellers believe that these e-commerce platforms, while taking away part of the traffic from the Amazon platform, also easily cause consumers to develop "discount fatigue" , thereby leading to a decline in the number of orders for Amazon sellers in the same category during the same period. However, in response to this point, some senior sellers have stated that the results of Amazon's holiday orders have been getting worse in recent years. Many people blame it on the decline in Amazon's traffic or the fact that other platforms have snatched away traffic, but in fact this is not entirely true. The seller further mentioned that the essence of the decrease in orders is actually that the market is changing, but the operating strategies of most sellers have not changed. We also learned that some sellers actually achieved an increase in orders during the Easter period, partly due to product categories (Easter-related) and partly due to adjustments in operational strategies: either deepening supply chain capabilities or having financial advantages. It can be seen from this that for Amazon sellers, if they want to break through the current bottleneck of order growth, it is more about improving their own capabilities, paying attention to Amazon's policy adjustments, and waiting for opportunities based on compliance. Today, Amazon has several new policies that came into effect.
At the end of 2023, Amazon issued a notice on the update of sales commissions and logistics fees. In addition to adjusting logistics delivery fees and sales commissions, the notice also added several new charging items, including warehousing configuration service fees, low inventory fees, etc. Following the warehousing configuration service fee that came into effect in early March, another new charging item - low-volume inventory fee - was officially implemented this month. According to the fee update notice released by Amazon, starting from April 1, 2024, Amazon will charge a low-volume inventory fee for standard-size products whose inventory levels remain too low compared to sales for a long time. The key points about low inventory fees are as follows: Scope of application (meeting the following conditions at the same time):- Both the long-term historical supply days (past 90 days) and the short-term historical supply days (past 30 days) are less than 28 days.
Historical supply days = average daily inventory quantity / average daily shipment quantity (parent ASIN)- The average daily number of items in stock = salable inventory + quantity of goods delivered from the warehouse + reserved inventory (excluding unsalable goods).
- Average daily shipment count refers to the number of all units shipped from Amazon's US fulfillment network.
- For standard-sized products, tiered charges are made in real time based on size and historical supply days ;
- The larger the size and the lower the historical supply days, the higher the fee , with a minimum of $0.32 and a maximum of $1.11;
- The low inventory fee will be deducted together with the logistics and distribution fee: FBA fee = low inventory fee for each item + standard FBA fee.
The low volume inventory fee can be waived in the following situations: 1. Meet the exemption conditions: Sellers who maintain more than four weeks of inventory based on product sales can be exempt from the low-volume inventory fee. 2. Some sellers and product types:- Within one year after the first inventory (first shipment) of a new seller is received;
- Within 180 days after receiving new SKUs registered for the Amazon Logistics New Product Warehouse Promotion Program;
- Items that are automatically replenished through Amazon's warehousing and distribution services.
- The product is out of stock (i.e., there is no available inventory of the product in the Amazon fulfillment network);
- The product has not been sold in the past 30 days or 90 days (i.e. the average daily number of goods delivered is 0), etc.
It is worth mentioning that Amazon stated in the announcement that if the seller’s inventory level is always too low relative to product sales, it will hinder its ability to distribute products to the distribution network, thereby reducing delivery speed and increasing delivery costs. Therefore, most sellers believe that Amazon’s additional fees are intended to require sellers to have higher inventory turnover capabilities . However, in general, in order to avoid being charged low inventory level fees and raising logistics costs, sellers are reminded that starting from April 1, they need to pay more attention to the inventory status of the past three months and the past month. If you are not sure whether the product will be charged, you can check the historical supply days in the Amazon logistics inventory to make a judgment. I wonder how the recent order volume of all sellers is going? Welcome to share in the comment area~ |
