In this blog, we are going to have a look at six instances when all sellers, big and small, should consider repricing to increase Amazon sales and profits.
We will cover:
- Repricing when Amazon is a seller
- Old inventory
- High-quantity inventory
- High-priced inventory
- New inventory
- Seasonal inventory
1. Repricing When Amazon is a Seller
FBA seller, Ryan Grant, who recently wrote a really interesting guest blog around pricing strategies, offers some great advice on how sellers should reprice when competing with Amazon as a seller. Ryan’s uses three main factors when pricing an item: competition, sale rank and price history (he uses the camelcamelcamel website for this).
Ryan is only focused on other Prime offers as this is his direct competition. He doesn’t want to undercut Amazon as he know they have the ability to price match and take a more aggressive approach to pricing. And who wants to be in a pricing war with Amazon?! Not me, that’s for sure.
Instead, he finds by matching Amazon’s price he can win a share of the Buy Box and stands a good chance of selling his product quickly whilst protecting his profit margin.
In another example, Ryan decides to price above Amazon for an item that is in the top 1,000 for most popular toys and games. In this instance, he is hoping that Amazon will sell out and buyers will turn to FBA sellers like himself.
He sees the next cheapest seller only has four in stock, therefore also likely to sell out so he chooses to price match with the next group of FBA sellers.
2. Old inventory
Do you have old stock that has been sitting in your warehouse for a long time?
If it hasn’t sold in a reasonable period of time (varies depending on the product), then you may need to price more competitively.
You can find the oldest products by clicking on the Date Opened column.
3. High-Quantity Inventory
If you’re an FBA seller, you’ll want to help boost sales and avoid any long-term storage fees.
Sort your inventory by availability and see what items you have the most of. Pricing these products more competitively should result in a boost in sales.
4. High-Priced Inventory
If you’re an FBA seller, and you’re priced way above the current FBA low price, you’re unlikely to get many sales.
Consider repricing these high priced items to give your sales a boost.
5. New Inventory
Got a new product that’s selling really well? Consider increasing your price to help improve your profit margins especially if you’re the lowest seller by some margin.
6. Seasonal Inventory
This will require you to do some manual work to find your seasonal products by typing keywords such as Christmas. If it’s coming to the end of the season and you still have seasonal products, consider reducing your prices so you can move this stock out and bring in capital to invest in new stock. Otherwise, you could be waiting 12 months before you can sell these products again.
Overall, pricing is determined by a number of factors: cost price, price of the competition and current sales ranking. Use your knowledge and experience to ensure you get the best sales and profits possible.
If you’re a small seller, you’ll be able to implement repricing manually however, if you’re an experienced seller with a large inventory, repricing so many products can be time-consuming and boring.