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From Vendor to Seller Central: Navigating the Transition and Thriving on Amazon · Selling on Giants: The eCommerce Marketplace Podcast

• 0:07
  SPEAKER_00: Hey everyone, this is Ellion Giants, the e-commerce marketplace show, where we chat with experts in the e-commerce industry and talk about the latest insights and strategies and best practices you need to succeed on major e-commerce marketplaces.
• 0:20
  SPEAKER_00: I'm your host, Richard Dwyer, and today we have a very special guest who's making his third appearance on our podcast.
• 0:26
  SPEAKER_00: We're delighted to welcome back Will Hare, co-founder of Elivix, a full service marketplace marketing agency that helps brands grow on platforms like Amazon and Walmart.
• 0:36
  SPEAKER_00: Will's been a valuable contributor in our past and sharing his expertise and insights of the world of e-commerce.
• 0:41
  SPEAKER_00: We are thrilled that he's returned to provide us more invaluable knowledge.
• 0:44
  SPEAKER_00: I'm super pumped for it.
• 0:46
  SPEAKER_00: Before we dive into our topic from vendor to seller essential, navigating the transition and thriving on Amazon.
• 0:51
  SPEAKER_00: Will, it's an honor to have you back.
• 0:53
  SPEAKER_00: Please tell the audience who you are for the ones that don't know you yet.
• 0:56
  SPEAKER_01: Awesome.
• 0:57
  SPEAKER_01: Thanks so much for the great introduction.
• 0:59
  SPEAKER_01: I'm shooting to be a regular contributor, and then eventually we just will stop chatting and just be like, Will's back here again.
• 1:06
  SPEAKER_01: For those of you guys who don't know me, I'm the co-founder and CEO of Bellavix.
• 1:10
  SPEAKER_01: Bellavix is a marketplace management company, and we specialize in helping brands uh navigate and scale sales on platforms like Amazon, Walmart, and Target.
• 1:20
  SPEAKER_01: And we specifically here to talk a little bit about Amazon and the transition between vendor and seller central that I would say has become a hot topic for us, at least in the last couple of years.
• 1:30
  SPEAKER_01: And I'm sure uh Victor, you might have some similar experiences with uh just the pain our one-piece sellers are going through as they're as it's becoming less and less profitable and harder to operate.
• 1:41
  SPEAKER_00: Yeah, when I hear of sellers on vendor central, I usually go, ooh, I'm so sorry for you.
• 1:46
  SPEAKER_00: That's that's usually my first reaction when it comes to vendor central.
• 1:50
  SPEAKER_00: And starting out, I love to hear that what are the key differences between vendor and seller central for the people that don't know the key differences between them.
• 1:58
  SPEAKER_01: Yeah, beautiful.
• 1:59
  SPEAKER_01: I mean, the biggest thing is just a business model.
• 2:02
  SPEAKER_01: One P is pretty sweet, it's wholesale.
• 2:04
  SPEAKER_01: Amazon buys your products up front, they handle the end customer, the whole end customer experience, and Amazon has high standards, so you better believe that package is getting there in two days, and they have the returns and everything down pat where they handle a lot of these issues that you would normally have to handle under a seller model.
• 2:23
  SPEAKER_01: But it also limits your ability to control pricing, the ability to control your inventory management, and product launches can be difficult.
• 2:31
  SPEAKER_01: They have programs like Born to Run, but generally it's harder to navigate if your launch products don't have traction.
• 2:38
  SPEAKER_01: And you have the better chance of winning the buy box, and annually you're able to renegotiate your contracts.
• 2:45
  SPEAKER_01: Typically, sometimes it's harder than that.
• 2:47
  SPEAKER_01: On the seller side, you know, you're the brand and manufacturer, you control your inventory, the pricing, the customer relationship.
• 2:54
  SPEAKER_01: Like all that is done by you.
• 2:55
  SPEAKER_01: It's like a consignment model.
• 2:57
  SPEAKER_01: So you're just using Amazon's marketplace to get your products in front of active shoppers in market.
• 3:03
  SPEAKER_01: Outside of that, it varies, but I like to say that three P sellers have better margins, and a lot of that comes down to their ability to control pricing.
• 3:11
  SPEAKER_01: But keep in mind Amazon does have the fair pricing policy.
• 3:14
  SPEAKER_01: So if it is listed cheaper anywhere else, it doesn't matter if you're a vendor or seller, they're gonna suppress your listings or match that price either way.
• 3:20
  SPEAKER_01: But those are keep it a high level.
• 3:22
  SPEAKER_01: I'm not making this a podcast about difference between vendors and seller centrals.
• 3:25
  SPEAKER_01: I think I've covered most of it.
• 3:27
  SPEAKER_01: Do you hear anything I might have missed, Vic?
• 3:29
  SPEAKER_00: Yeah, like the biggest thing for me when I hear about vendor central is the ability to renegotiate your pricing is so difficult on vendor that people like literally can't be profitable because they go to Amazon because there's inflation, that's a thing, and where the cost of goods are rising and Amazon isn't budging on raising their prices.
• 3:48
  SPEAKER_00: So they basically can't make money.
• 3:50
  SPEAKER_00: They go, Victor, I can't make money on vendor central.
• 3:52
  SPEAKER_00: Like, I was making millions of dollars, my cost of goods went up.
• 3:56
  SPEAKER_00: Amazon's not changing my price, I can't do anything.
• 3:58
  SPEAKER_00: And then they're saying, like, I have to go to seller.
• 4:00
  SPEAKER_00: It's like not a choice at this point.
• 4:01
  SPEAKER_00: I will have a business next year if I keep going through vendor.
• 4:05
  SPEAKER_00: And that's the main uh concern I've been seeing on the vendor side.
• 4:07
  SPEAKER_00: What do you think about that?
• 4:09
  SPEAKER_01: I mean, hit it on the head.
• 4:10
  SPEAKER_01: I mean, we're gonna kind of go into that as we talk about the reasons why a lot of vendors leave.
• 4:14
  SPEAKER_01: We have successfully increased pricing on a couple vendor accounts, but like it's almost like a plan of action that justifies why you need to raise the prices.
• 4:23
  SPEAKER_01: And it's like, you know, to be as simple as inflation, you know, it's it costs more than it did five years ago.
• 4:29
  SPEAKER_01: But obviously, Amazon's in the business of making money, so uh it sometimes comes at the cost of their vendors and sellers, obviously.
• 4:36
  SPEAKER_00: Yeah, and I'd love to hear from you what is the point to where people should start considering this transition?
• 4:42
  SPEAKER_00: Because it's a long transition when they go into it, we'll get in the deep dive of that.
• 4:46
  SPEAKER_00: But where should the vendor start saying, like, hey, we should really start thinking about a seller transition?
• 4:51
  SPEAKER_00: What are the factors you see there?
• 4:53
  SPEAKER_01: I have a couple scenarios that I'll dive into, but just like pull it back so it's super high level, improving your margin.
• 4:59
  SPEAKER_01: So, like, if you're not getting enough purchase orders or you're unable to renegotiate your contracts and your prices are going up and Amazon's staying the same, if you're getting crushed with chargebacks as that happens, you know, we're profitable until Amazon gets their blood from all these different ways they could take money from you.
• 5:17
  SPEAKER_01: If you need to control the pricing because Amazon is violating that policy, they really don't.
• 5:22
  SPEAKER_01: They'll find it somewhere else.
• 5:23
  SPEAKER_01: So usually it's somewhere else, it's being violated.
• 5:26
  SPEAKER_01: But if you're consistently not having buy box, that could be an issue.
• 5:29
  SPEAKER_01: And then if you need to control your inventory, so typically those are the major reasons, and I would say like the number one reason that we have transitioned.
• 5:37
  SPEAKER_01: I think this year alone we've transitioned three accounts, and it all had to do with profitability and control and pricing.
• 5:43
  SPEAKER_01: So that has pretty much, and you brought it up early in the conversation, like that's really when you're not making as much money, it's usually a good reason to start considering a shift.
• 5:52
  SPEAKER_00: Yeah, and I would say 95% of the time, it makes more sense to do seller central versus vendor central.
• 5:58
  SPEAKER_00: But I love to hear from you what are the five percent where it does make sense to go on vendor central?
• 6:03
  SPEAKER_00: Do you ever find a scenario where that happens?
• 6:05
  SPEAKER_01: Uh, if the usually if it's a manufacturer and they just don't have the ability to handle the customer service aspect of it, if it's a super small team, if there are uh distributors selling to wholesalers and the wholesaler has that agreement and they just have like a really large catalog and they don't want to deal with all the minutiae of maintaining so on and so forth.
• 6:27
  SPEAKER_01: If you have an Amazon rep that you're working with, that's usually a great place to be.
• 6:31
  SPEAKER_01: You might want to stay.
• 6:32
  SPEAKER_01: Usually it's like I think the retail analytics team is like the upper level of the vendor team.
• 6:37
  SPEAKER_01: If you can, if you're working with somebody on that team, you're in pretty good shape, but you're probably spending and making a lot of money.
• 6:42
  SPEAKER_01: We're gonna talk about a couple and we'll dive deep into strategies.
• 6:45
  SPEAKER_01: But typically we we'd recommend a hybrid strategy if it makes sense, whether you're using your seller to launch products or to put products on that you know you have good traction with, but just need improved margins.
• 6:56
  SPEAKER_01: And if you're profitable and it makes sense, because there are benefits to vendor, you know, you're gonna rank better from a search engine optimization perspective.
• 7:04
  SPEAKER_01: Amazon committed, so they're gonna want to sell through your product more.
• 7:08
  SPEAKER_01: So, like there are benefits to it, but obviously, if you're not making money on those, it doesn't matter how sweet the benefits are, you know.
• 7:14
  SPEAKER_00: Yeah, 100%.
• 7:15
  SPEAKER_00: And I'd love for you to dive in.
• 7:16
  SPEAKER_00: Can you share some tips about best practices who are transitioning from vendor to seller central and what that transition looks like?
• 7:23
  SPEAKER_01: Definitely.
• 7:24
  SPEAKER_01: So, I mean, first of all, I think it's fun to call out.
• 7:26
  SPEAKER_01: So, like anybody who's been in Amazon knows like the third-party seller game has been stepped up.
• 7:31
  SPEAKER_01: So, Amazon has consistently invested in third party from transparency with their fees to giving benefits like A plus content that used to only be for vendor central.
• 7:43
  SPEAKER_01: So you can see, like Amazon likes the third-party seller model better.
• 7:48
  SPEAKER_01: And so when you're thinking of the transition and like where best practices, if you don't mind, Vic, I just want to talk about these four scenarios real quick and then I'll jump into kind of the best practices.
• 7:59
  SPEAKER_01: But you know, number one, what we see is like Amazon erodes your pricing.
• 8:03
  SPEAKER_01: And like I said, that might be a map policy issue.
• 8:05
  SPEAKER_01: I wouldn't have to dive as deep into that, but the biggest takeaway is like if you're not winning buy a box or Amazon keeps violating your map policy, it's most likely that you know you need to figure out how to manage your wholesalers better.
• 8:18
  SPEAKER_01: And switching from vendor to seller is probably not going to help because your listing will get suppressed because the fair pricing policy, regardless.
• 8:25
  SPEAKER_01: The second, so the cost to serve Amazon, so their fees become unsustainable.
• 8:31
  SPEAKER_01: So you may have good regular fees, but your you know MCF fees or your reimbursements or anything else is just out of control.
• 8:39
  SPEAKER_01: You're getting hit with a lot of chargebacks.
• 8:41
  SPEAKER_01: And if you're unable to reduce these fees, Amazon isn't playing ball, you're not able to increase your prices.
• 8:47
  SPEAKER_01: And this is like the main reason we have transitioned a lot of sellers over.
• 8:52
  SPEAKER_01: It's usually because of this.
• 8:53
  SPEAKER_01: The third scenario, Amazon's given up on you, and this actually happens.
• 8:58
  SPEAKER_01: Anybody who's in vendor central and you don't have any access to a vendor manager, you're an auction.
• 9:03
  SPEAKER_01: Welcome to Amazon's abandoned product ideas.
• 9:07
  SPEAKER_01: But it really does happen and it becomes an issue.
• 9:10
  SPEAKER_01: We work with a pet manufacturer who you know had some great sales.
• 9:14
  SPEAKER_01: Over time, they didn't take care of their catalog like they should have, and we lost our vendor rep.
• 9:18
  SPEAKER_01: And when it came time to negotiate certain aspects of our catalog, it became very difficult.
• 9:23
  SPEAKER_01: So if you're in this scenario where you have no support, you might want to be on uh seller central because you have the customer service, it is a lot better, you'll be able to get answers.
• 9:32
  SPEAKER_01: We'll talk about the transition and some of the heartache there.
• 9:35
  SPEAKER_01: Uh, and last but not least, and I recommend this for really anybody, if you want to diversify your Amazon business, so not have all your eggs in the 1P.
• 9:42
  SPEAKER_01: It doesn't hurt to open a 3P account.
• 9:44
  SPEAKER_01: You can list all the ASINs in there and set it up as if you were ready to take it over.
• 9:49
  SPEAKER_01: And then if Amazon decides they're gonna go crazy, they're gonna shut down the program, they're gonna just raise all their fees for the sake of raising their fees.
• 9:56
  SPEAKER_01: You don't have to start all over.
• 9:57
  SPEAKER_01: You'll have a contingency plan in place and you can just move over and we could talk about the different business models.
• 10:04
  SPEAKER_01: But really, just wanted to share with you guys, you know, the four scenarios we've seen.
• 10:08
  SPEAKER_01: Vic, have you seen anything on your end?
• 10:09
  SPEAKER_01: Because I know you guys do some consulting of your own.
• 10:13
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• 10:18
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• 10:19
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• 10:26
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• 10:32
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• 10:38
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• 10:42
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• 10:48
  SPEAKER_00: When it comes down to the vendor, you covered a most of them when it comes down to like a lot of the scenarios when it comes down to vendor and seller.
• 10:55
  SPEAKER_00: I have not heard of uh someone being left in the dust, just like shadowed basically on the vendor side.
• 11:02
  SPEAKER_00: So that's a new one for me.
• 11:03
  SPEAKER_00: But everything else is basically what I've seen on my side, but I've never seen uh someone shadowed.
• 11:08
  SPEAKER_00: So that's the only thing I haven't seen there.
• 11:10
  SPEAKER_00: Beautiful.
• 11:10
  SPEAKER_00: And then what are some common challenges they might encounter when switching over from vendor to seller central if they have any at all?
• 11:18
  SPEAKER_01: Beautiful.
• 11:18
  SPEAKER_01: Yeah, there'll be uh scenarios for sure.
• 11:21
  SPEAKER_01: It's never that easy.
• 11:22
  SPEAKER_01: So, like consider what you want.
• 11:24
  SPEAKER_01: So there's two ways there's the hybrid, which we recommend, and most of the brands we push to hybrid only.
• 11:30
  SPEAKER_01: And this makes sense if you're struggling with running out of stock, not getting purchase orders, launching new products, cost structure is too high.
• 11:38
  SPEAKER_01: You want to test products and ideas, or you sell seasonal products that just Amazon's not going to buy on a seasonal basis.
• 11:45
  SPEAKER_01: So that would be like a good idea to use a hybrid approach for sellers only.
• 11:49
  SPEAKER_01: So you want to make a hard switch, done with vendor central.
• 11:52
  SPEAKER_01: Typically, you're you have high trade terms, so it's just no profitability whatsoever.
• 11:57
  SPEAKER_01: You're receiving small POs that don't justify the cost.
• 12:01
  SPEAKER_01: Uh, you sell to a wide portfolio range, multiple products and multiple categories.
• 12:06
  SPEAKER_01: So it's a big catalog to manage on vendor, which already has its own issues because it's its own ecosystem.
• 12:11
  SPEAKER_01: It's Amazon.
• 12:12
  SPEAKER_01: You're focused only on private label products.
• 12:15
  SPEAKER_01: You want to use Amazon as a direct-to-consumer channel instead of a wholesaler, and you want to avoid annual vendor negotiation.
• 12:22
  SPEAKER_01: So those are the two categories of like some of the reasons you might want to go hardcore seller only, or you'd want to start this hybrid approach.
• 12:30
  SPEAKER_01: And it's really important, I want to call it out now before we jump into challenges.
• 12:34
  SPEAKER_01: But like if you're considering this, you need to notify your vendor team whether you're terminating the relationship.
• 12:39
  SPEAKER_01: If you're not terminating, it's going hybrid.
• 12:42
  SPEAKER_01: You still have to let them know you're considering selling products on Seller Central through the third-party marketplace.
• 12:47
  SPEAKER_01: Um, you got to migrate your listings over from vendor and you have to mark the products that you don't want available on vendor central as permanently unavailable so that you you'll still get orders, but you won't have to fulfill them and you won't be penalized.
• 13:00
  SPEAKER_01: It does take some time to phase out.
• 13:02
  SPEAKER_01: And keep in mind, I'm gonna share a story with you about this 3P.
• 13:05
  SPEAKER_01: It's in brand registry, but essentially Amazon has the right to tell you you cannot sell 3P, period.
• 13:11
  SPEAKER_01: So that's why it's important to kind of just do it now as opposed to Amazon finding out and just cutting you completely out of both.
• 13:18
  SPEAKER_01: We have found that most companies they're pretty flexible, they don't really want 1P anyway, so it's pretty easy.
• 13:23
  SPEAKER_01: But as an example, we work with a pet manufacturer and they wanted the transition from 1P to 3P, but their agreement that they worked out with Amazon was that this brand was solely for Amazon, so they weren't allowed to fulfill it or market or sell it anywhere else.
• 13:40
  SPEAKER_01: So essentially what they had to do, because you know, over time they became less profitable, less profitable, is they had to just open a completely new brand on Seller Central, new logo, trademark, all that other stuff, and they just let the other brand die.
• 13:53
  SPEAKER_01: They stopped fulfilling inventory, and that was it.
• 13:56
  SPEAKER_01: And it was a shame because the products they sold good because they were below market price, because it could have raised prices, but they had a lot of good reviews, the listings were healthy, they were optimized for search, and like all the years of effort that it took for them to get there was a wash.
• 14:10
  SPEAKER_01: So it's important that you understand before you get too deep, like, can we even do this?
• 14:14
  SPEAKER_01: And then in this pet scenario, like if it's not gonna be profitable and you can transition, then maybe Amazon's not the platform for that brand, and you need to be able to decide to move on, cut your losses.
• 14:24
  SPEAKER_00: Yeah, I completely agree with that.
• 14:26
  SPEAKER_00: And how long does that transition usually take?
• 14:29
  SPEAKER_00: So once you realize that, hey, maybe you want to transition and things like that, how long do these transitions usually take?
• 14:36
  SPEAKER_01: It doesn't take crazy long.
• 14:37
  SPEAKER_01: Like generally, you can start the transition, send the messages out, get all that approvals and stuff, like four to six weeks.
• 14:43
  SPEAKER_01: It's nothing too crazy.
• 14:45
  SPEAKER_01: You're using ASIN, so you can essentially use a flat file upload, input all the ASINs that are historically on there.
• 14:51
  SPEAKER_01: You can upload it, provided you were optimized for search on vendor, it'll be there.
• 14:56
  SPEAKER_01: The advertising is a bit of a process because, like, you're only gonna be able to advertise where you have the buy box.
• 15:01
  SPEAKER_01: And unfortunately, your advertising account's gonna be linked to your vendor account.
• 15:05
  SPEAKER_01: So that if you're doing hybrid, you'll have to manage two advertising accounts.
• 15:09
  SPEAKER_01: If you're completely switching over to seller, you'll need to make sure that uh you're launching new campaigns and pretty much starting from scratch and understand that they don't have the maturity and the campaigns probably won't operate and perform the same way right away.
• 15:22
  SPEAKER_01: It'll take some time to build up some data and it's a seller account, not a vendor, so you have to handle that.
• 15:27
  SPEAKER_01: But I would say, like a full transition where sales are coming in and you're looking and feeling pretty good, advertising's up, probably it's closer to six months, to be honest with you.
• 15:36
  SPEAKER_01: Yep.
• 15:36
  SPEAKER_01: Uh, I think is reasonable, could take longer, but a lot of it's just the transition, the approval, getting things up, provided you have inventory ready to go to FBA if you're gonna use fulfillment by Amazon.
• 15:47
  SPEAKER_01: So if you have a lot of that prep work done, it's gonna be a little quicker.
• 15:50
  SPEAKER_01: If you have to get things transitioned, work through brand registry, which you will.
• 15:55
  SPEAKER_01: You have to get the storefront transferred over and stuff too.
• 15:58
  SPEAKER_01: They take a little longer, but you can generally knock that all out in the first six weeks, as long as you're proactive with uh account and case management.
• 16:04
  SPEAKER_00: Yeah, I've never heard of Amazon actually allowing a vendor to go on Seller Central before.
• 16:10
  SPEAKER_00: All the experience I have is it's always had to have been covert, like different EIN, different brand name, and basically acting like a reseller under Seller Central.
• 16:17
  SPEAKER_00: Are there ever cases that you find where you can use the same brand name on vendor that you have on seller when it comes to the transition?
• 16:25
  SPEAKER_01: Yep, you do, and we've had experience with that.
• 16:27
  SPEAKER_01: We have a couple brands that have the hybrid model and they're listed both the same.
• 16:31
  SPEAKER_01: A lot of that's gonna happen on brand registry and brand services.
• 16:34
  SPEAKER_01: And I believe, and I could be misinformed, to stay within Amazon's terms of service.
• 16:39
  SPEAKER_01: You wouldn't want to have any rogue EIS.
• 16:41
  SPEAKER_01: I mean, if it's completely disconnected and you're a reseller, I mean, you've got to be you you're probably good to go.
• 16:46
  SPEAKER_01: But we work with a private equity company that bought brands and they um instead of rolling them up under their main account and setting it up the right way, they just new AI and new addresses, but they made the mistake of using common email address, and it went on for like four years, you know, they got away with it for a while, but eventually they stopped getting away with it and they shut down all the accounts at once, and then it became, you know, plan of actions, unsuspended.
• 17:11
  SPEAKER_01: And we got a form that said we could do this.
• 17:13
  SPEAKER_01: Uh, we're we're grandfathered in, and then they keep suppressing us anyway.
• 17:18
  SPEAKER_01: So then we eventually just had to work through case support and through Amazon to just get it set up the right way.
• 17:24
  SPEAKER_01: That took like, I mean, probably 18 months.
• 17:26
  SPEAKER_01: It took that's crazy, you know, that they weren't down the whole time, but like to get it to a point where we weren't having issues, the accounts weren't randomly shutting down, it took a long time and a lot of case management.
• 17:35
  SPEAKER_00: Got you.
• 17:36
  SPEAKER_00: Yeah, that's crazy.
• 17:37
  SPEAKER_00: And what are some recommendations that you have for someone that wants to go through this process?
• 17:42
  SPEAKER_00: What would you kind of say to them, to those people that want to start this process?
• 17:46
  SPEAKER_00: What would be your advice to those people?
• 17:47
  SPEAKER_01: Yeah, what took you so long would be the first thing.
• 17:52
  SPEAKER_01: I mean, the first thing I'd just say like be smart about it in terms of like analyze your business analytics.
• 17:57
  SPEAKER_01: Like, do you have good profit margins to support this?
• 18:00
  SPEAKER_01: How much stock does Amazon have available?
• 18:03
  SPEAKER_01: Like, if they have thousands of units and you're not selling that much regularly, you might not want to transition right now because they're just gonna take the buy box from you anyway.
• 18:11
  SPEAKER_01: Be ready for the extra responsibilities and manage your account health, customer service, maintaining listing, managing inventory.
• 18:18
  SPEAKER_01: Great opportunity to sell uh to work with an agency.
• 18:21
  SPEAKER_01: That's what I would recommend.
• 18:22
  SPEAKER_01: But you know, I drink the Kool-Aid as an agency owner.
• 18:24
  SPEAKER_01: There's cash flow considerations, so just make sure you know your vendor terms you're getting paid out, seller terms.
• 18:31
  SPEAKER_01: I believe you're paid bi-weekly, but a couple, you know, you're being paid for what you actually sell minus Amazon fees, pretty much.
• 18:37
  SPEAKER_01: And then listing contribution can be difficult, hybrid or even going away from it.
• 18:43
  SPEAKER_01: You know, it's just you have to communicate with the brand services team.
• 18:46
  SPEAKER_01: And like the biggest thing we've learned over time is that um Amazon uses algorithms.
• 18:52
  SPEAKER_01: So even though you're like, hey, my new seller account is the main contributor, we've transferred over brand rights, the vendor account should not have the rights to anything.
• 19:01
  SPEAKER_01: The algorithm will just one day pick it up and say, Oh, this account's mature, has more sales history and velocity.
• 19:06
  SPEAKER_01: You're in a contributor and you'll see all your titles and stuff changed to the old version, and then you try to edit it in seller, and you're like, it's not taking it.
• 19:13
  SPEAKER_01: You do case management, they're like, Yeah, you don't have brand rights.
• 19:16
  SPEAKER_01: And you're like, What do you what do I mean?
• 19:17
  SPEAKER_01: And then you go over, and lo and behold, it's just back to vendor central.
• 19:21
  SPEAKER_01: So what we end up doing a lot is just maintaining consistency on both platforms, but it's just something to be aware of.
• 19:29
  SPEAKER_01: And the advice, you know, obviously is just make sure that from a business perspective, it makes a lot of sense because as much as we complain about vendor central, if you have the right terms in place, it's pretty sweet.
• 19:39
  SPEAKER_01: You know, it can be relatively hands-off, and you know, you're getting that check from Amazon.
• 19:43
  SPEAKER_01: And there's strategies you can use to increase purchase orders, there's programs you can be a part of that help.
• 19:50
  SPEAKER_01: But obviously, the more money you spend, the more attention you get from Amazon.
• 19:53
  SPEAKER_01: So it's not for every type of business, uh, unfortunately.
• 19:56
  SPEAKER_00: And another thing that uh you made me think of is the amount of inventory that the purchase orders that Amazon requests in that you don't have control over.
• 20:05
  SPEAKER_00: So let's say I've what I've seen in the past, Amazon's warehouses get too stacked up, then them only doing like I've seen only like a 50 unit purchase order where like and it's like right before prime day.
• 20:17
  SPEAKER_00: So everyone's like sitting in an inventory and Amazon will request less purchase units, less purchase orders to keep their warehouse from being overstacked.
• 20:25
  SPEAKER_00: But you're you're going in prime day with like 50 units, you're just like, Victor, what do I do?
• 20:29
  SPEAKER_00: Like it's like the worst thing in the world.
• 20:31
  SPEAKER_00: So that's another disadvantage that you might have is the inventory control side.
• 20:35
  SPEAKER_00: Like before a big event, sometimes if Amazon's warehouse is too stacked, they won't send any purchase orders and it's gonna be really scary for you.
• 20:42
  SPEAKER_00: So that's another thing that you gotta be aware of.
• 20:44
  SPEAKER_01: Yeah, that's the I mean you nail the one of the big drawbacks, like you don't have control of the inventory.
• 20:49
  SPEAKER_01: You can't just flood the market with an extra thousand units and be like, we're ready for prime day.
• 20:53
  SPEAKER_01: If they didn't they'll do usually a bulk purchase order before, so you'll know, like, okay, this is prime day's coming up, that's why this order came in.
• 21:01
  SPEAKER_01: But there are times where they just don't order enough, and like, believe it or not, their uh P90, P80, P70, they're uh they're forecasting, like, sometimes is way off.
• 21:11
  SPEAKER_01: Like, and if you use that to forecast, especially with your clients, they're like, you told us this, and Amazon purchased half of that, and Amazon's like, sorry.
• 21:20
  SPEAKER_00: That's so true.
• 21:22
  SPEAKER_00: And is there anything that you see that people do wrong uh most of the time when it comes down to the vendor-to-seller central transition?
• 21:29
  SPEAKER_00: What do a lot of people get wrong these days when it comes down to it?
• 21:32
  SPEAKER_01: The biggest thing is the inventory they have on vendors, so they don't always account to that.
• 21:37
  SPEAKER_01: They usually, by the time they're ready to move on, they're just really frustrated.
• 21:41
  SPEAKER_01: And a lot of times they're like, just get me off.
• 21:43
  SPEAKER_01: But like, we'll get them off, and they just have way too many units of their top sellers.
• 21:48
  SPEAKER_01: Generally, they won't want to buy back or do anything like that with Amazon.
• 21:51
  SPEAKER_01: So they end up hurrying up and waiting because it's like, all right, we have this inventory, we don't have buy box.
• 21:56
  SPEAKER_01: You don't want to start any type of really strategic advertising.
• 22:00
  SPEAKER_01: or marketing strategies when you know you're not winning the buy box it up it just messes with the algorithms and all that other stuff so it becomes difficult so the first thing is like a make sure they don't have a ton of inventory and the transition will be smooth time it for when they're going to be low mark those listings permanently available and the second thing and why we brought up earlier communicate with your vendor team to say we're terminating this agreement we no longer want to be part of Amazon vendor central program and just get that ahead of time are they going to let you are they going to let you list which ASINs can you list because that may dictate if like okay we're going to go to a hybrid model or maybe we have Amazon only ASINs that we're going to roll on seller that are just slightly different from some of our evergreen products and it could just be as simple as known approved formulas or just better packaging or something along those lines.
• 22:45
  SPEAKER_01: But I think those are the two major things usually they don't talk to anybody they list products on seller they get shut down or they just have way too much inventory and it's just it's too soon to make the move.
• 22:56
  SPEAKER_00: And this is a very specific question so I don't know how much we we want to go into this but I didn't know if you knew where to check if they're an exclusive to vendor central or if they're not because it's like I assume that it's really hidden somewhere inside Amazon's contract and it's like this like one line type of thing.
• 23:13
  SPEAKER_00: But I didn't know if you knew where you could see their exclusive or not in vendor central.
• 23:18
  SPEAKER_01: I'm not sure off the top of my head but I do know that it's in like inside vendor central you could view all your contracts and it's in there.
• 23:25
  SPEAKER_01: There's like a page where you can view your current contracts I know it'll list out you know it could be four or five different contracts associated with your account.
• 23:32
  SPEAKER_01: You would download those and be able just to kind of run through them.
• 23:36
  SPEAKER_01: I'm unaware of anything on the back end that says like exclusive brand it's likely because I've seen them on some accounts it's like their vendor number will start with these three digits and that's indicative of like you're exclusive but basically we've we manage a ton of vendor brands and we've only read one scenario where they've been exclusive products to Amazon.
• 23:57
  SPEAKER_01: So I'm not sure if it was like a program they did and then they stopped doing it but we haven't ran into a lot of that for the most part that Amazon doesn't have exclusively yeah that makes sense and is there any other challenges we talked about some other challenges when it comes down to the vendor the seller transition.
• 24:12
  SPEAKER_00: Is there any other things you want to add on to that either what it may be advice or challenges when it comes down to doing this vendor to seller transition.
• 24:20
  SPEAKER_01: I would say one of the other bigger challenges that I'd like to just talk about and we kind of touched on it a little here is your advertising.
• 24:27
  SPEAKER_01: So it's important that if you're making this transition, how to kind of scale back and then understand that you know on seller central you're most likely making a bit of an investment up front.
• 24:37
  SPEAKER_01: So like there are going to be other fees your return on your investment may but may not be as lucrative.
• 24:43
  SPEAKER_01: So you just got to understand realistically like depending on how fast the transition goes where you're you're not losing buy box due to Amazon owning stock you know six to eight weeks after that give or take you should be in a position where it's more profitable and the campaigns are baking and you've done enough of your systems and proxies to know like this is how I could control ACO's or tacos.
• 25:04
  SPEAKER_01: So just being ready for the upfront because there are scenarios where you might be advertising on vendor central and focusing on just getting their inventory out while at the same time launching new products on seller and just kind of trying to work both at the same time.
• 25:18
  SPEAKER_01: But I think a lot of vendors they're just used to like we've been running advertising and we're at a 10% ACOS because our product's killing it and then to understand like you're kind of starting over I mean it helps if you have a lot of brand equity uh but it doesn't guarantee that you're gonna be we're gonna hit the start button and by the end of week two you're gonna be back at that 10% ACO.
• 25:37
  SPEAKER_01: So there are things that need to change and then keep in mind on seller it's great but there's a lot more than just pay-per-click advertising you know manage your customer experience Amazon post we're getting our brands into the creator connections which is the ability to work with influencers so like there's more layers to what you can do and to keep that in mind that once you're on there you're now responsible for the request review emails following up with launches and just being more strategic.
• 26:04
  SPEAKER_01: It's a benefit you got a lot of control uh but if you weren't handling that before you may not have the capacity and each of those levers will make a difference over time.
• 26:13
  SPEAKER_01: So you want to make sure you focus on the most important but you also understand there's going to be a lot more responsibility on the brand to make sure you have a cohesive and good customer experience that'll lead to more growth on the platform.
• 26:25
  SPEAKER_00: Yeah and I'd love for you to talk about like the workload.
• 26:27
  SPEAKER_00: So obviously vendor central is pretty hands-off as Amazon does most of the stuff can you go into the seller central transition of you talk about um having customer support like that's important like also it sounds like having um someone doing the advertising a little bit more and someone managing possibly the content can you go into a little bit about what that workload difference is between vendor and seller transition and how much that increases there?
• 26:50
  SPEAKER_01: Yeah that's a really good question.
• 26:52
  SPEAKER_01: Like vendor is busy in its own ways and I feel like for vendor at least in our experience a lot of it comes down to case management.
• 26:59
  SPEAKER_01: Like if you want to do anything with like start opening cases here we go.
• 27:02
  SPEAKER_01: But there are some benefits but I would say you know reasonably you're probably looking at like 2x the time you're putting from vendor going over to seller if you're doing everything you're supposed to do.
• 27:12
  SPEAKER_01: So we mentioned this we do full service so you know customer service takes a lot of time responding to customer inquiries making sure you have fax pages responding to returns if you're doing fulfilled by merchant uh understanding the shipping issues make sure everything's listed properly so like a lot of that adds up and a lot of times like you need somebody you know ideally in advertising and somebody in operations working together to make sure that all these pieces are being addressed by the necessary teams but those are going to be like customer service is a huge time suck that you don't have to deal with the marketing strategies and initiatives there's a lot more which is great but like somebody needs to be consistently doing it.
• 27:53
  SPEAKER_01: They have softwares that can kind of make some of this easier but it depends you know what's your budget, how big is your team advertising inventory management now so you'll need to make sure you're consistently flowing in inventory to make sure you're never out of stock but you're not too much stock.
• 28:11
  SPEAKER_01: So you're not uh so you're minimizing your storage fees and making sure you're able to do for the most part we love FBA only but like if you can't like FBA FBM is ideal so if you run out of FBA stock you can fulfill by merchant and never you know really impact your BSR running out of FBA will a little bit but not as much as like being completely out of stock because that will really hurt your listings, your momentum and what you're building.
• 28:36
  SPEAKER_01: So that's why I would say give or take at least two extra time you're putting in now and you probably want at least two people somebody advertising marketing somebody operations to manage that experience on Amazon where before you know typically a single person could probably manage a vendor account and just leverage either your vendor manager or just case management to get a lot of what you need done completed.
• 28:58
  SPEAKER_00: Yeah and I love for to hear the difference between when it comes to advertising strategy on vendor versus seller central and are there any differences and if so like love for you to talk through them.
• 29:09
  SPEAKER_01: I don't believe there are any differences.
• 29:11
  SPEAKER_01: That's why the advertising console is the same whether it's vendor or seller it's just like the vendor accounts assigned to this niche this specific advertising account that's why you can't just like add a seller central account to that it's two separate.
• 29:24
  SPEAKER_01: So that would be the only thing to consider the advertising strategy is going to be the same it's gonna be based on your product maturity what your goals are KPIs so on and so forth.
• 29:33
  SPEAKER_01: But I'm unaware that there's any differences other than if you're new to seller central you're essentially launching campaigns.
• 29:39
  SPEAKER_01: But what's nice that ASIN owns the customer reviews the product details so like even though you're transitioning to seller central your your products aren't going to have zero reviews and no optimization done for them.
• 29:51
  SPEAKER_01: So that will certainly help speed things up.
• 29:53
  SPEAKER_00: Yeah and this is a little bit complex of a question but you know how Amazon's algorithm goes off sales velocity and things like that.
• 30:01
  SPEAKER_00: So when it comes down to this vendor seller transition if you have a high sales velocity on your vendor account will the sales velocity pick up like will it like for example let's say you have 1000 units a month um that go through and will you expect the first month of once you completely switch to seller central to be at 10,000 or is it a little bit of a dip?
• 30:19
  SPEAKER_00: I know we touched on this a little bit but I would like from a numbers perspective how does that transition look from a sales velocity?
• 30:26
  SPEAKER_00: Does it stay the same?
• 30:27
  SPEAKER_00: Is it going to be a little bit less um love to hear your thoughts on that.
• 30:30
  SPEAKER_01: That's actually a really good question.
• 30:31
  SPEAKER_01: I love your curve balls today.
• 30:32
  SPEAKER_01: All right we were we would expect it to recover be about the same so the first month you might take a little bit of a dip but at the end of the day the demand's still there.
• 30:42
  SPEAKER_01: I would say you'll be more impacted if advertising sales makes up more of your sales because there'd be a transition there.
• 30:49
  SPEAKER_01: But if you have strong organic sales like your your typical 80-20 split uh 80% of the sales come organically 20 from advertising you're gonna be minimally impacted and we consider most mature brands are at that level and you'll be able to measure that you you know your your advertising so I would say that's the biggest determinant like how much you'll be impacted but the brands we transitioned because a lot of them were you know between 70 to 85% coming organic it was pretty minimal it was pretty smooth sales pick back up.
• 31:18
  SPEAKER_01: The hardest part was like that actual like when Amazon's like we're not taking buy box anymore and then being able to really implement some advertising and marketing strategies.
• 31:26
  SPEAKER_00: Yeah and we talked about a lot of different topics is there anything else that's been top of mind for you lately or any topic that you want to go into a little bit more that we didn't dive in as much?
• 31:37
  SPEAKER_01: Uh when it comes to vendor and seller central I think we dove pretty deep.
• 31:40
  SPEAKER_01: I'm pretty happy with uh the topic today what I will say is um the time we're recording this Prime Day just happened I think a week or two ago and we were pretty excited about the results.
• 31:51
  SPEAKER_01: What I will say is that they've already kind of released said Prime early access sale PEAS Prime Day 2.0 is coming and that you can submit your deals now for that and for Q4.
• 32:02
  SPEAKER_01: So we're excited that you know it's hard to believe it's July it's going to be August but by September we're gonna be back into Prime Day mode talking about strategies to kind of get ahead of it.
• 32:11
  SPEAKER_01: And what I'm really most interested in is like will Amazon's PES sale get the same marketing hype that Prime Day does and will it truly be like the kickoff in the Q4 shopping so like will people you know use all their budget in October and then like we won't see as much impact during T5 the Black Friday through Cyber Monday and into December or will it just create like an economic bump where we're gonna see more shoppers buy and then continue to see that behavior as we go into T5.
• 32:41
  SPEAKER_01: So for me just like from an economic standpoint like what is going to happen?
• 32:46
  SPEAKER_01: I love we're doing this here.
• 32:48
  SPEAKER_00: So super exciting yeah and from Prime Day usually summer prime day usually I I did a poll on LinkedIn it most people saw between like a five or 10x and I had some people that saw like sometimes a 13x uh day overday sales which was really good and it usually during the prime day 2.0 it was usually less like last from what I remember it was like 30 or 40 percent less from the other prime day for most brands and that obviously this changes drastically by brands if you're in the tech space obviously it's gonna be a little bit higher and it it's gonna be different by each category.
• 33:22
  SPEAKER_01: But from what I remember the Prime Day 2.0 was lower than the first Prime Day is that what you saw also yeah that's funny you mentioned that and what we notice is like Amazon didn't promote it the same way they promote Prime Day.
• 33:35
  SPEAKER_01: So part of me because I still had friends and I'm like doing Prime Day sales and they're like Prime Day's in the summertime I'm like so it I agree we saw it just wasn't as strong.
• 33:46
  SPEAKER_01: So we'll see I think comes out of how much Amazon's gonna put behind it.
• 33:50
  SPEAKER_01: Yeah you know for us either way it's gonna be good either way you see a bump you know just because I'm not selling as much as Black Friday it's still an opportunity to just get more sales more customers coming to the platform ready to purchase which is pretty exciting and more importantly for you know advertisers to utilize like full funnel make sure you're targeting audiences you're using DSP and you're just getting eyeballs prior to these major shopping events.
• 34:12
  SPEAKER_00: Yeah and to bring that full circle that's why you need to have a vendor to sell or transition to self inventory during Q4.
• 34:19
  SPEAKER_00: Yes sir and unfortunately that's all we have time for today.
• 34:24
  SPEAKER_00: Will please tell the audience how to find you and how to find more about Belovix.
• 34:28
  SPEAKER_01: Excellent Victor thanks so much for having me it's been great.
• 34:30
  SPEAKER_01: You can check me out on LinkedIn Will Hare like on your head with an E.
• 34:34
  SPEAKER_01: I post pretty regularly I have an awesome newsletter on the website feel free to sign up for it.
• 34:39
  SPEAKER_01: We post news on a bi-weekly basis and a monthly basis summarizing how it impacts changes on the platforms impact sellers.
• 34:47
  SPEAKER_01: And you can always check out our website bellovics.com if you're interested in working with an agency trying to help you scale on platforms like Amazon, Walmart and Target.
• 34:56
  SPEAKER_01: Awesome.
• 34:57
  SPEAKER_00: Well thank you so much for joining and thank you everyone for watching this is the Selling on Giants the e commerce marketplace show catch you next time