Keep Calm and Maintain Your Inventory: Best Practices for Finding Profit Amid the Supply Chain Disruptions

Ocean freight will never be speedy, but it is consistent. Even when all is calm in the world, the journey from Shanghai to Long Beach takes 21 days. Today, the supply chain is anything but calm. Amazon sellers can see their inventory on ships from the shore at Long Beach, where there is a 13-day delay to unload. Quartile joined forces with Mustafa Cokol of Thrasio to help sellers navigate the storm with the latest webinar in our partner series: “Finding Profit Amid Supply Chain Disruption.”

Amazon marketers have ample reason to be concerned. “Will I lose my ranking? Will I lose the buy box?” Sellers asking these questions are terrified of running through inventory too fast but are also wary of the ample amounts of bad advice making the rounds. There’s a proliferation of voices urging sellers to raise their prices so they won’t sell out. With the natural consequence of increased margins due to supply chain shortages, that is enticing advice for a seller to hear, but it’s wrong. As we approach the holiday season, customers are particularly sensitive to the appearance of price gouging.

Canaan Schladale-Zink, Chief Revenue Officer of Quartile, made the case against using price increases to control inventory and pace sales. “It might feel great to see margins going up as your inventory gets lower, but that process is naturally going to decrease your conversion rate and hurt your sales rank from both a paid and organic standpoint. We strongly recommend that you don’t raise prices. And this may seem counterintuitive, coming from an advertising company, but we recommend you reduce your ad spend, or in some cases just pause your ad campaigns entirely because that won’t actually impact your conversion rate but it will prevent you from selling out.”

An expert in supply chain management, Mustafa joined Thrasio as Senior Global Mile Logistics Manager to handle international logistics in March 2020, giving him a front row seat to the distribution crisis that COVID triggered. During the webinar, Mustafa stressed the importance of planning ahead, aligning with 3PL warehouses, and updating calculations to incorporate the impact of the logistics per product. If sellers are still using the calculations that you had two years ago, they are way off. In the past, a shipping container that cost $2,000.00 now runs up to six times more, depending on freight agreements. And adjusting for new timeframes is key. For those looking for delivery on New Year’s Eve, Mustafa pointed out December 31st is already in the rearview mirror, but there’s still hope for arrival on Chinese New Year on February 1st 2021.

To access our webinar Partner Series: Finding Profit Amid Supply Chain Disruption, please click.

For more from Mustafa Cokol and Thrasio, check out their recent blog post here.

Can’t wait to learn more about Quartile’s margin-based targeting and optimization? Schedule a demo with a Quartile representative today .

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