Amazon Peak Season Fulfillment Planning Coin Flip: Heads You Lose, Tails They Win
Amazon has announced their peak seasons policies and updated pricing. In just the last couple of weeks.
First, peak season fulfillment fees have gone up for the third year in a row. In a year where they are doubling free cash flow, this feels like a kick in the teeth. Thank you, Sir, can I have another?
When should I send items to FBA for peak season?
Amazon recommends sending items to FBA facilities in August and September (with a deadline of October 19th). In September and October, Amazon will ensure those items are in the proper facilities. November and December the focus will be on processing orders.
What happens if I send items to FBA in November or December?
If you wait until November and December to send items to FBA, your items may not be processed in time for Black Friday.
How are the "Goldilocks fees" changing during the holiday season?
Amazon seems to realize that the "Goldilocks fees" they introduced for having too many items in FBA storage cannot apply during holiday. They are waived starting in July this year. That's the entire second half of the year. Given that, one might wonder the future of these fees, period.
What should sellers know about the shortened peak season?
Many people may not realize that peak is shortened this year. Cyber Monday 2023 was Nov 27th. This year, Thanksgiving falls on November 28th! Cyber Monday 2024 is December 2nd. You are losing like 5 days of peak.
How does the shortened peak season affect fulfillment and processing costs?
The cost of fulfillment and processing mistakes is higher this year because there is less time to adjust.
What impact does Amazon's policy have on other sales channels?
This is kind of a power move by Amazon to get their committed inventory which effectively locks out other channels. If you aren't thinking about Seller-Fulfilled Prime, perhaps now is the time to start thinking about it for 2025.
How should sellers prepare for the holiday season and Amazon's policies?
Holiday is starting earlier and earlier, and basically kicks off with Amazon's Prime Big Deal Days Event in October - so you are going to need your items there anyway.
What are the implications of Amazon's timing for sending items for Black Friday?
They want you to start sending items for Black Friday in August, and they announced this policy in August. Completely unacceptable. No. Stop. Ridiculous.
Will these changes affect Buy With Prime?
Will this affect Buy With Prime? Asking for a friend.
What does Amazon's peak season policy mean for third-party sellers?
Amazon is preparing for a big third-party peak. How is this not positive news in some sense?
Why is having a multi-pronged Amazon fulfillment strategy important for 2024 and beyond?
Wrapping up -- the world seems to be flipping out on this. If you want to know the reason I think more than any other reason this is an issue: CASH. Inventory is cash. More inventory is more cash. Better guess correctly?
The ideal in retail is a "flow/agile" model rather than a "big bang" model which this seems to be encouraging. It will force some sellers out of FBA into self-managed SFP or SFP providers. In nature, this would not be a snake eating a pig -- it would be more like a snake eating a barn. And by the way, that barn is your cash flow.
If you don't have a multi-pronged Amazon fulfillment strategy in 2024, you just inherited a new top priority in 2025.
Expert Consulting: How Will You Grow Your eCommerce Company?
When growth is elusive, I am an expert at asking incisive questions to surface the real issues and then present straightforward ideas that your team can actually implement.
Mistakes are expensive. They cost money, of course. What’s worse is the opportunity cost. I work with investors and management teams worldwide to help them get a handle on their digital business plans to execute a clear path forward.
For more on Amazon Insights, you might also like: