I think you should be testing various things asap (and continue to periodically test in case things change) because the earlier you know, the better you can plan things out. Like let’s say you KNOW you need to ship X pallets/units/what have you in order to get a good split, you have more time to plan for that, versus “product’s ready to go, scramble at the last minute to repack a bunch of stuff because you got a shocker on what you need to do to avoid a $5000 placement fee.”
I have several shipments I need to create in the next couple of weeks. I’ll see what the costs/options are and try to also compare it to a comparable shipment from last month.
I would argue that it’s in the category as well. When you treat those selling auto parts, shoes, books, vitamins, and jewelry all with the same criteria, there’s bound to be some groups that are more adversely affected than others.
I’ve slowed way down on FBA; it will be at least a few days before I would ship any, I don’t think I’ll be in a hurry. Then I can see just how much it affects me. If it triples my inbound cost, then I’ll likely go 100% FBM.
I agree; I archived Butler’s post Friday myself, and have been analyzing what I’m going to advise our people to do at next weekend’s bi-weekly conference.
I’m glad I saw that. This is still going to present a problem for us though with our LTL which is the bulk of what we do. Out pallets cannot be split 5 ways and still be above the 150lb min.
If they were evenly split I suppose they could be but they would be really short. The work around for that would be the single sku pallet template method X 5 pallets. That’s an option.
The placement fees might end up being cheaper though because a pallet that was $97 to ship suddenly becomes $485 which actually is cheaper than 1 70" pallet X 27 cents a widget. (thinking and writing out loud lol)
What a mess…
Our batches for our best seller are 2 full pallets so we can make 5 double (single) pallets which will make this the most optimized but still much more expensive.
I think a lot of people will be facing this. Shipping 5 pallets is a LOT of inventory, so people might need to break 1 pallet into 5 SPD shipments rather than pay the placement fee which is likely higher.
That’s 41 shippers per pallet. That’s a lot of work and people don’t work for free.
It is an option but what a PITA and for every additional shipment you send, the bigger chance you have of something getting lost, damaged, “shipment problems”, etc…
Would be funny if this is how sellers decide to go though. That will be A WHOLE BUNCH more labor for Amazon. Serves them right!
It seems that those selling volume per product, should have the flexibilty to manipulate their shipments to eliminate or reduce the placement fee.
But those that sell (lets say) 50 - 100 units per year of a product really have no options.
In my case I sell 30,000 - 40,000 per year of a line of 500 items.
Send to many of an item, and of course one has storage costs, or removal costs,
so I optimize and calculate, and send what I believe will sell.
Now, if true (I need to test). If I send in 2 dozen of one item, and split into 6 shipments of 4 each, I must break down the dozen which costs $$.
(or for a dozen - ship 2 in each box)
I just do not see this as a solution - TO MY PRODUCT.
and I do not see how this is good for Amazon. They would then need to “check-in” 6 times for each item received.
Imagine the time difference of checking in 1 pallet / shipment of 6000 units vs. who knows how many SPD shipments of 41 shippers for the same 6000 units?
I haven’t done a multi-SKU shipment in a long time (they tend to be a disaster when you use amazon labeling service), but if you can pack 2 of each of 20 different items in a box that wouldn’t cost an insane amount to ship.
That of course, would involve a lot of work repacking things.
I know you’ve stated you don’t want to do this, but this is the reason that when I can, I get supplements packed as 50 - 100 per box. Hell of a lot less work than repackaging things.
We did a test on this and at least for us it is still
an option when they are like items that Amazon
has determined can be packed together.
We also observed that we can get the “split” easier
and avoid placement fees when we reduce the unit
counts in our case quantities.
Unfortunately for us with the products we tested
the shipment cost is still well above what we had
just a few days ago for shipping the same items.
It broke down like this for us:
Previous cost / no split / all to 1 FC:
22.46
Now:
1 shipment 49.37 (includes placement fees)
2 shipments 40.73 (includes placement fees)
4 shipments 43.55 (no placement fees)
After doing some reading here, we are going to
try reducing our case unit count even more and see
what the 5 shipment option looks like.
However even the author of that workaround stated that
the costs were still higher even without placement fees
because they are asking them to ship further away than
they used to.
That is also the case with us.
They literally have us shipping across the entire country
when before we shipped only a state or two away.
Bottom line is that it is going to cost more to ship in inventory
and sellers are going to have to raise their prices or just absorb
the increase into their margins if their margins can withstand it.
Finding the sweet spot to still make the pricing / margins work
will be the goal and will be different for each seller / product.
P.S. - I am pleased to see you again, Desperado, and am hopeful that you’ll find the SAS to be the BSFE ("BEST Seller Forums Experience " as opposed to the ever-more execrable NSFE) that so many of your fellow members of our Seller Community obviously do.
This is REALLY bad advice. If Amazon catches you sending shipments from a location other than the one specified in your shipment, they could deny reimbursement for lost inventory, or even worse, block your ability to create new shipments, regardless of the shipment method / carrier you use.
You should refrain from jumping to conclusions or making broad statements so lightly. In many Amazon categories, profit is low dollar-wise by definition, such as for small, cheap household items, where 20-30 cents could represent a significant percentage of the profit margin. This does not necessarily mean that there’s been a race to the bottom for those products.
I want to know one thing - what’s the max weight Amazon allows for a “carton” of products? One would assume that the OSHA 40-lb limit has some influence, but does anyone actually know? I ship loose cartons, never pallets.
