Top 5 Amazon News for February 2023
Each month, we monitor Amazon news and updates to seize opportunities as well as to avoid potential problems before they become an issue for us and our clients.
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Here we share the top updates and news for February 2023:
1. Updated Amazon Supply Chain Standards (USA & Canada)
“We’ve updated our Supply Chain Standards, which take effect on January 19, 2023. These standards are updated every three years as part of a regular review.
Our Supply Chain Standards apply to all selling partners and suppliers. Products sold in Amazon stores must comply with these standards and be produced in a way that respects human rights and the environment and protects the fundamental dignity of workers.
The updates include additional requirements, expectations, and clarifications, such as:
- Additional requirements to protect workers from harmful recruitment and engagement practices, which include providing workers with clear, understandable documentation of the employment terms and conditions before the start of their employment
- Further clarification that suppliers must have effective grievance mechanisms that workers can use to raise concerns without retaliation
- Mandatory remediation if any cases of child labour are identified
- Further clarification that suppliers must provide workers with a safe and healthy work environment that avoids harm to workers’ health
- The prohibition of land-grabbing and any illegal use of natural resources
- Clearer specifications that suppliers must comply with applicable privacy and information security laws and regulations.”
ProMerit Tip: As we all know, Amazon is committed to conducting business in a responsible manner, which is the why these updates are being requested for our products sold on the platform. There is a sustainability section on Amazon’s platform where you can find more details about their standards and commitments.
2. Switch to the Inventory Ledger report by January 31 (USA & Canada)
“Our FBA Inventory Ledger report gives you a comprehensive view of six inventory reports in one place.
On January 31, 2023, the Inventory Ledger report will replace the following six reports:
- Daily Inventory History
- Monthly Inventory History
- Inventory Event Detail
- Inventory Adjustments
- Inventory Reconciliation
- Received Inventory
We recommend that you switch to the Inventory Ledger report now, to avoid disruption to your business when these reports are discontinued. Starting on January 31, you’ll no longer have access to these reports.
You can view historic and near-real-time inventory events in the Inventory Ledger report by using the Summary view and Detailed view.
Data in the Summary view is refreshed daily, weekly or monthly, depending on the time period that you choose to aggregate the report. Events in the Detailed view are updated in near real time.
(…) Based on your feedback, we’ve also updated the Inventory Ledger report: How to get the information you need help page. The page now shows how to calculate your in-transit inventory quantities.”
ProMerit Tip: As of February 1st, this Inventory Ledger report has replaced 6 other reports that were shown and used by brands individually. It contains historical and real-time information, and also displays your starting inventory balance, inventory that was received in the fulfillment center, customer orders, customer returns, adjustments, reconciliation events, removals, and ending balance. It’s a useful place to monitor and analyze all your inventory data, enabling you to make accurate forecasts for future or special events.
3. Fine tune your detail pages with Potential Sales Lift (USA)
“Potential Sales Lift, a metric just launched on the Listing Quality dashboard, can help you make decisions on how to fine tune your detail pages.
If your product listing is missing key attributes, such as brand or material, on the Listing Quality dashboard, the Potential Sales Lift metric estimates the impact to your sales of adding the missing attribute. The estimate is based on how much adding the missing attribute impacted sales for sellers similar to you in the past. With Potential Sales Lift, you can prioritize making the listing improvements that offer the most value to you.”
ProMerit Tip: On the Listing Quality Dashboard, you’ll be able to see all your products with recommendations and instructions to help you complete those fields, as well as an explanation of the benefit each provides. As described above, all this information helps to best prioritize where to start optimizing your listings.
4. Simplifying FBA capacity limits for your business (USA)
“Effective March 1, 2023, we’re replacing the weekly restock limit and quarterly storage limit with a single monthly capacity limit per storage type to give you more predictability and control over your inventory.
Based on your feedback, this new capacity management system will provide the following improvements:
- A single, month-long FBA capacity limit. You’ve told us that having weekly restock limits can make it difficult for you to plan how much inventory to procure and manufacture and that navigating two sets of limits that are measured differently, storage limits and restock limits, can be confusing. FBA capacity limits will resolve these pain points by offering a single monthly limit to determine how much inventory you can send to and store at Amazon. Capacity limits for the upcoming month will be announced in the third full week of each month via the Capacity Monitor in Seller Central and an email notification. To learn more, go to FBA capacity limits.
- Estimated capacity limits to help you plan three months in advance. In addition to your upcoming monthly capacity limit, we’ll provide estimated limits for the following two months to help you plan. Estimates may vary up or down based on how efficiently you are using capacity, as measured by your Inventory Performance Index (IPI) score, and how much space and labor we have available to support you.
- The opportunity to request a higher limit. With our new Capacity Manager, you can request additional capacity based on a reservation fee that you specify. Requests are granted objectively, starting with the highest reservation fee per cubic foot until all capacity available under this program has been allocated. When your request is granted, the reservation fee is offset by performance credits that you earn from the sales you generate using the extra capacity. Performance credits are designed to offset up to 100% of your reservation fee, so you don’t pay for the capacity as long as your products sell through. Our goal is to provide you with more control over how much space you can have while limiting unproductive use. We’ve piloted this feature with certain US sellers, and we’re excited to expand it so all sellers can request higher FBA capacity limits. To learn more, go to Capacity Manager.
- FBA capacity limits in volume (vs. units) to better reflect your capacity usage. We’ll set capacity limits and measure your inventory usage by volume, which better represents the capacity that your products use. We know many sellers prefer to plan in units, so we’ll continue to show inventory usage in units and provide an estimate of how many units your capacity limits permit. Like restock limits today, capacity limits consider inventory that is on-hand in Amazon’s fulfillment centers and shipments you’ve created that have not yet arrived.
Like storage limits today, overage fees will apply if your on-hand inventory in Amazon’s fulfillment centers, not including open shipments, exceeds your capacity limit. Overage fees are calculated based on the highest estimated or confirmed limit that we provided for the given period. Overage fees help prevent excessive inventory levels and shouldn’t affect sellers who maintain healthy inventory levels. To learn more, go to FBA inventory storage overage fees.
Your FBA capacity limit is influenced by your IPI score, as well as other factors such as sales forecasts for your ASINs, shipment lead time, and fulfillment center capacity. You can view your capacity limit that will take effect on March 1, as well as your estimated limits, in the FBA dashboard.”
ProMerit Tip: As of March 1 of this year, there will be a single monthly capacity limit per storage type that will help us to better control our inventory. It will also help us plan the future.
The new Capacity Manager feature helps estimate our limits per size (standard, oversize, extra-large, apparel and footwear). There, you’ll also be able to submit Capacity limit increase requests, should you wish to apply for them.
Always take into consideration all the factors that affect your capacity limit, such as your IPI score, in order to best manage and understand how to improve it.
5. Vendor central: Frustration-Free Packaging (FFP) incentive pilot extension (Canada)
“The Frustration Free Packaging (FFP) / Ship in Own Container (SIOC) program has extended the incentive pilot until December 31, 2023.
The incentive pilot offers payments ranging from $0.08 to $6.49 for ASINs that are newly certified as FFP or SIOC, which maintain or reduce their overall packaging dimensions. The program is eligible for all uncertified Sortable and Non-Sortable ASINs with rigid packaging, such as packages in a box, and dimensions equal to or greater than 6 x 4 x 0.375 inches.
Vendors with qualifying ASINs will receive financial incentives per certified unit shipped between October 1, 2021, and December 31, 2023. The incentive per unit is the cumulative sum of three components of the program: 1) SIOC certification incentive, 2) cube (box volume) reduction incentive, and 3) and the FFP incremental incentive, if applicable.
To learn more about the pilot, such as how to qualify for the FFP/SIOC incentive and how to calculate the anticipated annual incentive, go to our packaging website.”
ProMerit Tip: In Vendor Central, there is an incentive pilot program for packaging, which has been extended through 2023. The program is eligible for all uncertified Sortable and Non-Sortable ASINs with rigid packaging, and there are financial incentives for participating in it. You can find more details on the packaging site, such as a step-by-step breakdown of how it works, how to optimize your packaging, how to enroll your certification, and how to calculate your estimated incentive, with many examples to help you understand how the program works in detail.
We hope this article is helpful for your businesses. Please note that the above announcements have been sourced from Amazon’s official channels as well as from some well-known business blogs.
If you have any questions related to our services, please contact us. Remember to sign up for our newsletter to receive more exciting news every month!