Now, KeaBabies is overstocked on everything, incurring $300,000 in extra storage fees in the fourth quarter of last year. KeaBabies, which sells baby products online, ran out of inventory in May of 2020, and dramatically upped its orders to compensate, says Ivan Ong, the company’s co-founder.
Read More: Why Is Everything More Expensive Right Now? Let This Stuffed Giraffe Explain Getting rid of goods often means forking over more money to Amazon, to pay for advertising or influencer marketing. The excess inventory is one of the biggest problems Amazon sellers are dealing with right now, since storing stuff that consumers don’t want is prohibitively expensive. “We had kickboards stacked up three, four pallets high.” “At one point we had too many jars of Brain Flakes that we just had pallets and pallets literally in our office against the wall,” says Mike Molson Hart, the CEO of Viahart, which sells toys on Amazon.
Dailysales amazon provider full#
Retail sales actually fell in December of 2021, which is unusual for the holiday season.Īs a result, Amazon sellers were left with warehouses full of products no one wanted. Scared of missing what they were sure would be a lucrative holiday season in 2021, they paid tens of thousands of dollars to get their products to warehouses on time.īut then, of course, consumer demand started to slow, as inflation took a bigger bite out of Americans’ paychecks. Third-party sellers and big retailers like Target and Walmart who ordered more and more to satiate consumer demand couldn’t get it to the U.S. The pandemic-induced retail bonanza also contributed to the transportation nightmares that clogged shipping lanes and idled trucks at ports. Nobody has any sense of how long we’re in this alternative universe-it’s not just COVID, but also that people are buying different things than they did.” But the pandemic changed shopping so abruptly that “you’re pretty much flying blind,” says Beckham. Typically, retailers figure out how much stuff to order based on how much shoppers bought in previous years and the trends of the previous few quarters.
“Sellers are increasingly feeling the squeeze from all ends, given the heightened competition in the marketplace, rising ad costs, rising input costs, and a softening e-commerce market,” Lipsman says. And they competed for customers, trying to offer the lowest prices even as their costs rose. It’s also because 2020 made e-commerce seem like such a sure bet that more than 200,000 new sellers from around the world joined Amazon in 2020, a 45% increase from 2019.Īll those new sellers drove up advertising rates, since they were competing for limited spots. That’s partly because the e-commerce giant raised fees in January, February, and April of this year, and then in May added an extra fee for items that had been sitting around too long in warehouses. But Amazon sellers are facing an influx of costs. That’s something all retailers have to face.
It would be one thing if consumer demand were just slowing.
0 kommentar(er)
