Amazon Repricing – Let’s get the real scoop!
Just as every cell phone provider says their network is the best, so too does every Amazon Repricing software! We at www.storeautomator.com know that every Repricer has its pros and cons – from pricing to contracts to ease of use and to functionality.
But let’s save that debate for another day and get into the truths about Amazon Repricing! Let’s dig into some of the topics that you, as an Amazon Retailer, might be thinking.
What’s preventing you from utilizing a repricer software or preventing you from looking at alternatives? What concerns you the most about the entire process?
If you’re not utilizing a repricing software, is it because you believe you’re not a big enough company or have enough products to sell? Well, your need for a repricer certainly does depend on your number of products, sales price and volume. You’re certainly not going to invest in a repricer if you’re making 20 sales a month! So, when does the need for a repricer come into play?
There are many pricing options out there for repricers. Some have a long-term contract, some, like Store Automator, has a month-to-month structure. Some have large up-front “integration” charges where others like SA have no upfront fees. Then there are those who charge a low monthly rate but take a percentage of your sales. We at Store Automator have a simple monthly rate.
What you need to decide is simple…if, by utilizing a repricer, will my sales and profitability increase and will I reduce the labor cost of doing things manually to the point that it will cover the cost of the service? So ask yourself:
- How many hours a week do you spend on manually adjusting your prices?
- How often am I winning the buy box or at least getting in the top 2 or 3?
- How many items and I selling now?
With a little simple math on your part, you can determine quite quickly what it will take to make a repricing software worth the investment!
Of course, the same thought cycle holds true if you’re currently utilizing a repricer software. How much are you paying per month? How much time is spent working with the program each month? How often are you in the top 3? This is an especially important process if you’re currently under a “pay by percentage” structure.
Are you concerned about losing profitability and/or selling your products at a loss? Well, with the right repricer software, this should actually be the least concerning issue! You see, pretty much every software out there allows you to control your pricing and set parameters that you feel the most comfortable with.
For example, you need to be able to quickly and easily incorporate your product cost, your shipping charges, your commission-to-Amazon rate and your profit margin. You’ll also want to take into account if you’re self-fulfilling these orders or if they’re FBA. The location of your products may also affect your shipping rates and fulfillment times!
By setting the parameters that you’re comfortable with, you can enter the information needed to be sure that you’re accomplishing two things – increasing your chances of winning the buy box but NOT dropping prices so low that you’re losing money!
You’ll need to be able to set your minimum and maximum price. You’ll need to incorporate your shipping costs and even be able to determine the costs if you are competing against someone or if you have no competitors! You must be able to include your commission rates and your bare-minimum profit margin for your product to assure that you never sell something at a loss.
Additionally, you’re going to want a software that can differentiate between your “normal” competitors and those that are “outliers.”
As you know, there will ALWAYS be someone out there that’s looking to reduce or liquidate their inventories. You certainly don’t want to be competing on price directly with those people, right? If you did, then you WOULD probably lose money on every sale.
Therefore, you need to be certain that you’re utilizing a software that has the ability to “ignore” those outliers. That can include such customers as; liquidators, newcomers with no reviews, those with only a handful of products or even someone who mistyped their price and their $50 item is now listed at $500! All of these items, and more, must be considered when you’re automating your pricing structure on the Amazon Marketplace.
Perhaps you believe that working with a repricer is all about lowering your price to the lowest possible level in order to win the buy box? Although that’s a common myth, winning the buy box is not simply about price! Having your shipments fulfilled by Amazon versus doing it yourself will have an impact. Your seller rating and whether or not you offer free or discounted shipping will also figure into the mix. Even your indicated stock level will determine where you appear.
Although price is a huge component (and the easiest one to control), you need to be aware of all the other components that affect the determination. Long story short, it’s not all about low-balling the price…but it is important! That’s why you need a robust, easy to use repricer that can get your products moving up that list!
There’s also another pretty important issue…having a repricer doesn’t automatically mean your price will go DOWN! Imagine if you increased your profit by 10% on every product you sold. What would that mean to your bottom line? Although repricers can (and should!) lower the pricing appropriately, what about having your repricer raise the price?
What if, for example, you currently have 5 competitors and you’re all fighting for the sale. Now, 6 months down the road, and all of those competitors are gone but you haven’t INCREASED your price because you don’t have a repricer tool! How much profit are you leaving on the table because things aren’t being automatically monitored?
Remember, everything you do for your business needs to lead to sales and additional profit…and your Amazon Repricer is no different. This type of software needs to be a solid investment that will save you time, money and effort. You need to have things set up to operate 24/7 without your direct input so you can concentrate on more important aspects of your business…whatever that may be!
So, when you’re selecting your Amazon repricing tool, be sure that it had the ability to meet your needs, make your life easier and improve your chances of increasing sales and profit without having to reinvent the wheel! Your business (and profit) will thank you!