Due to the effects of COVID-19, Amazon temporarily freezes certain shipments coming into their fulfillment centers. This move will allow them to prioritize household staples, medical supplies and other high-demand products coming into their warehouses, as well as focus in the reception, restocking and delivery of these items to customers. Needless to say, thousands of FBA sellers may be negatively impacted by this new policy.
Limiting nonessential items is just one strategy Amazon has taken in response to increased demand and workloads for products following the coronavirus outbreak. This will be in effect until April 5, 2020, although the limitations could extend depending on how the pandemic progresses.
How can this move affect FBA sellers?
As of this writing, FBA sellers will not be able to create shipments to be received at Amazon’s warehouses. If you created your restock order before March 17, Amazon will still accept it. While Amazon will still pick, pack and ship non-essential products, it will give utmost priority to essential items.
Prior to this announcement, FBA sellers of nonessential products have already seen a 40% to 60% reduction in their sales on the Amazon marketplace due to the impact of COVID-19 to the supply chain, as Business Insider reports. Although many of these sellers have adequate stock to last them up to 60 days, they are uncertain how to deal with the changing shopping behavior. Instead of using Amazon’s FBA program, other sellers have started storing and shipping their items on their own and some opted to use third-party fulfillment network.
Similarly, Amazon encourages FBA sellers to use their own resources and carriers for shipping products and to take advantage of the Fulfilled by Merchant (FBM) program while the company gives priority to high demand orders. This may pose a challenge for many FBA sellers, but this is the only option left for them if they want to sell their items on Amazon until April 5.
Can FBA sellers still sell non-essential products?
Yes, if your products are already on its way and/or in any of Amazon’s fulfillment centers, you can still sell them. Also, any shipments created before March 17, 2020 will still be received. The only change is that you are no longer allowed to send non-essential inventory into Amazon’s fulfillment network starting March 18.
How can FBA sellers profit from their excess inventory?
Regardless of the size, niches or stage of your eCommerce business, there are lots of opportunities out there that will help you sell your excess inventory. We share a few alternatives that can turn FBA sellers’ extra inventory into cash.
Tophatter is one of the most popular mobile discovery marketplaces today. It offers a unique 90-second auction model that moves products really fast since customers participate in 90-second auctions to win and buy an item. Unlike in Amazon, customers in discovery marketplaces are not looking for an exact match. Instead, they go directly to the app and pick in a seemingly endless feed an item that interests them most
Depending on your excess stock, you may list them individually or sell them in bulk. The more optimized your listings are, the more they sell. Tophatter uses intelligent analytics to offer personalized product suggestions to shoppers. For example, a customer who frequently buys accessories, will be shown more accessory items. Besides displaying relevant products, the platform also shows the breadth of inventory. Apparel, fashion & beauty, home & hobbies, jewelry, and electronics are some of Tophatter’s top performing categories.
Consignment is when a shop sells products for an owner. You can keep ownership of your items until they sell, that is if they sell. As the owner, you need to pay a small amount to the shop as compensation for them selling your products. You can list anything and once an order is made, you can schedule a pickup or ship the item to the corresponding location. In most cases, shipping costs are handled by customers.
Here’s what Payability has to say about online consignment marketplaces. If you sell clothing, shoes, home goods, toys, or anything remotely in those categories, consignment marketplaces such as Tradesy, Poshmark and Mercari are huge selling opportunities both for your excess inventory or even as an additional selling channel depending what you sell. The channels are open to both new and used items. Just be honest about the condition the items are in when you list them, and if you are selling new items, be sure to make it clear that the item is new so buyers immediately recognize the value they are getting.
If you want to get rid of your inventory but want more control over the sales channel, then consider local marketplaces such as Facebook Marketplace. Facebook Marketplace offers sellers a ton of advantages – such as free listings, real-time communication through Facebook Messenger, and the opportunity to interact with potential customers. With the Facebook app, it is also easier to create unlimited listings on your phone. No need to go to a local flea market and open your own brick-and-mortar shop.
OfferUp and LetGo are also great alternate marketplaces for FBA sellers, as these can connect you to a buyer within your area without any fees. You can negotiate prices with potential buyers and set up a meeting place. These selling apps don’t charge the commission for registration, profile creation, and not even for the number of ads. More than that, they don’t take a commission for a deal. You can also upload photos of the items you want to sell immediately using the built-in camera in the apps.
If you have excess inventory, don’t panic. Instead, be patient, strategic and savvy when it comes to selling them. We are not sure until when this COVID-19 pandemic will end, so for now take advantage of the marketplaces we shared above to get your excess, slow-moving, or out-of-season inventory off the shelves. If you need help managing your inventory more efficiently, try SellerMobile’s inventory manager free for 30 days.