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Amazon invoice sample for Operations

one of the things I just want to talk about is in general is it to get widgets this is a calculator so let's just pretend this is a product we're selling to get a widget from point8 whether it be from you know the the docks out in Long Beach California to a warehouse or from a warehouse to Amazon or from a warehouse to a customer as part of fulfillments or just a package that I take to The UPS Store and have it shipped how how does the price of goods and how it the shipping how is that all factored how do they get determined I would say the simplest way to look at it is how many times is that product touched from the Port of Long Beach until it hits the customer porch okay so the amount of the amount of time you can reduce those touches throughout the supply chain or the value chain is how you're going to lower your cost got it yeah because you know when you send things into Amazon um or whatever you're being charged a fee to send things in or you know maybe there's a receiving fee whether be by Amazon or by someone else if you can reduce some of those touch points that's a good point but even more basic than that I have a widget is it based on the size of the widget is it based on Dimensions weight a combination of both like how how is that determined from like if we had to explain this to my nine-year-old son how much space does it take up and how far is it going okay so that's the simplest way to look at it yeah and the space it takes up is a great point because that does impact not only storage but Dimensions start impacting shipping rates as well so on a little widget you'll have you know it'll be a lot less expensive because it ships on what we call actual weight but as you start getting into heavier products or bigger and bulkier products uh you actually get build on dimensional weight as opposed to actual weight so that could impact the shipping cost significantly got it so you start looking at dimensional weight so for example and I'm sure most people probably familiar with this if you had let's say a bunch of um lampshades shipping them from point A to point B especially if you have a bunch of them is going to be a lot cheaper if they're like stacked together somehow as opposed to individually boxed because that's going to take up a lot more dead space because you have all that dead space and they're probably not that heavy so is that a fair way to phrase it versus you got some like a couch is also going to have some dead space on it if it's you know the back of the couch is up and things like that so the more you can reduce the size of things the better but what about when you can't reduce the size of things the best answer is to get that product as close close to the end consumer as possible okay and Amazon is gotcha and Amazon is famous for that and with Amazon you know we all know you ship ship stuff in and then they move it all over the country to get it as close to the C customer as possible and that's how they were able to uphold their Prime uh discount or prime offerings to you know people like I sometimes order something and you know it's often within two days more often than not sometimes not as much as they used to say it was going to be um so it how how are they able to do that or actually let me say this you guys offer seller fulfilled Prime what is that program and how are you able to do whatever the program does it starts with the technology and the ability to Route orders to the correct location okay and then the next step is actually having access to that space in optimal location with where to go we have 25 warehouses Nationwide those are optimally placed near population centers to drive up next day delivery while also leveraging UPS ground economy service levels so there's no need for air shipping there's no need for splitting inventory 20 or 30 times the way Amazon does it we can make that much simpler by placing product in upwards of five or six warehouses usually along the coast near the population centers and in the where too Network we actually have 15 sell fulfilled Prime enabled facilities uh which cover the entire us and they have special requirements where they need to be able to process shipments on Saturdays they need Sunday pickups so we help with the logistics and fulfillment pieces and the requirements of seller fulfilled Prime to be part of that so we can meet those um you know slas you know service level agreements and um those are the highest within the industry and that's why we could leverage that same network to other channels and use that same in inventory pool that we would use for seller fulfilled Prime to start looking at additional channels to expand within so you can use that same inventory pool for multiple channels besides asset okay got it that's great now let's take it even further back um what is seller fulfilled prime it is meeting the service levels that Amazon requires while not using Amazon FBA to fulfill those orders okay and what is the benefit to the seller of having seller fulfilled prime or what does the customer see where do we start Evan well I think the the inventory pool would be the be perfect starting point Matt yeah I think let me take it back even more simple I'm looking on amazon.com I see two listings one is if I'm a customer one is FBA it has the prime badge want to seller fulfilled Prime does it have the prime badge it does it does okay so it still has the prime badge can I make any difference of knowing between these two listings you know if they both arrive two days later or whatever the promise shipment is so I'm on the search results page I see two different listings they both have the same delivery time do I even know as a customer that one is being shipped by Amazon from the page and another one is being shipped by a seller fulfilled Prime network if you're Savvy enough to look under the buy box and see who it's fulfilled by then yes that's the only difference got it but you'd have to go onto the listing to see that but if you're just on on the page so to the customer there's no difference so a lot of customers might see you know there's a couple listings one is arriving in two days and another one's says it'll arrive in a range of time and there's no Prime badge so that would potentially hurt the clickthrough rate but in this case you're you're saying people would be able to have both correct the seller fulfilled Prime badge and not have Amazon um fulfill the order that's right okay awesome all right so we're starting to get some questions coming in here so let me um get to them and some of these are outside of your wellhouse uh let let me know we can always uh punt on them um so David Bermudez asks with all the possible changes let me take a step back David I promised I would reward participation since you were the first person to ask a question here uh email podcasty amu.com and let me know that you were picked and I will give you uh a coupon for free $100 course at mag school so magy school.com um just because you asked a question and I promis to reward participation and I will fulfill that promise so uh David asks with all the possible changes in logistics and production coming up related with tariffs uh do you think it's better to start looking for national production or other countries without tariff fees uh would love your opinion with this subject what are you guys's thoughts I'm for sure you probably get questions about this yeah I'll I'll jump in first um I it's a great question and there's a lot of variables that go into that one right off the bat average order value what's the value of your product does it can it sustain additional tariffs uh number two what's the logistics cost to get it here and what's the differentiating in labor cost to have it produced within the US uh a buzzword you hear a lot of now and moving forward is near Shoring a lot of people are looking into Mexico um into South America to Source Products now some of the products are becoming uh you know better quality but you still could take advantage of some of those um you know labor costs and India also has been on the rise over the last couple years especially for Believe It or Not electronics and textiles so in those categories it could be uh very advantageous to look at additional uh sources and manufacturers outside the US um so that would be my take on that you also need to figure out logistics so if you're bringing in product what does it look like from a logistic either ocean Freight air freight Trucking they all play a big part in that so although labor costs may go up by producing locally your Logistics cost should be reduced you're eliminating certain legs of that supply chain turn it over to Matt from there if he wants to add I have nothing to add Evan what a great what a great answer um there's a ton of variables and I think that until those tariffs are in place and the length of time that those are in place we won't really know um but there's a lot of activity globally uh but especially here in the US with those upcoming tariffs looking at near Shoring as an option never hurt to have what's that never hurts to have a backup plan yeah never hurts to have a backup plan um and one of the things I would also say is um it doesn't matter whether you agree or disagree with something that may or may not be coming in um I think Matt hit the nail on the head by saying you know could be the reality of the situation um so what you want to do is maybe have a backup plan but also know that it's not it's not set in stone so I would say if you've never read the book The Art of the deal by our former incoming president uh read it and you'll see that a lot of the maybe the first four years and then the next coming four years kind of the mindset that's probably different than a lot of previous presidents at least in my lifetime um and how they approach things so sometimes it's throwing things out there and then kind of trying to meet in the middle so it may or may not happen but if it does you got to be prepared for it and if it's not it's business as usual but still have some sort of other plan but just know something's going to change and if it changes it's going to change for everyone but you probably also want to start looking into other options that might save you money in other places too the other piece I would add Kev so sufan yeah go ahead I was just going to say one other item is a lot of times those tar uh tariff are uh category or product specific so you may want to disc think about maybe looking at additional categories that maybe you didn't play in that space before but because of tariffs you could still stay with where you're sourcing from but you need to switch the product category so that's another option around some of the tariffs yeah I I one time was at a conference and that similar topic came up and this is not my words this is just an attorney who is on the stage and he said legitimately most products could be in multiple codes so just review the codes that you're the you know the Tariff codes that you're putting in for that product or your you know shipping agents doing you may not know and they might even have the wrong one or there's four different ones and you could legitimately argue now you have to be very cautious about this make sure when in doubt consult an attorney not Kevin on the internet said to do this um I'm just regurgitating what a lawyer said um you might want to look and see are there other codes that could apply legitimately um and don't play with this and say oh I'm selling iPhone cases and you're selling you know uh steel or something you know don't don't don't play with that you know what whatever it is don't try to get around the system work with the system um all right so so next up sufan uh Tahiri asks I want to know the requirements for sending dangerous hazardous Goods any tips that's a good question I have no idea because nothing I ship is dangerous or hazardous but do you guys deal with dangerous hazardous goods and what tips would you have for folks hazardous goods are something we stay away from for the most part lithium Island batteries come up a lot in discussions with merchants and Prospects and and we can certainly support those up to a certain size battery and a certain amount of that battery that lithium ion um it's all very dependent upon the safety data sheets so I think the first step is to always make sure you have a very good well documented safety data sheet that can be reviewed by a 3pl uh partner uh to fulfill those orders we know Amazon stays away from that product we've had discussions directly with Amazon supporting some of that um within where to go we have some facilities that can support it but for seller fulfilled Prime and the service levels that are required it's not something that we can support across the entire network and and when you look at Hazmat there there's really two sides to it it's the requirements uh on the warehousing piece like what are the requirements what are the sprinkler requirements you know the the the the the fire preventive measures you know what type of fire suppression do they have and then you also have the logistics and transportation piece where some hazardous materials can um be shipped via ground not air not internationally but ground it's very acceptable the other piece is is the Hazmat does it qualify for a special type of Hazmat called OMD which is a regulated amount that can be stored and shipped instead of paying extra to have a Hazmat certification and that's where it gets very specific with the warehouse requirements and packing and Shi but all the OMD products need is basically a sticker an extra sticker on the outside of the box and can go through normal Transportation networks excluding air okay got it what are some examples of those type of products um I I'll just give one example I'm sure Matt can give a few more I was just looking at somebody who was selling oxygen in a bottle okay if you ever go skiing snowboarding out in Colorado wherever you like to play Snow games um those those altitudes really get to you you know you get up to 14 15,000 feet up so they got these you know oxygen uh tanks to to breathe in portable um but they're under pressure so that would be one I believe can be sent under OMD and then there's just certain packout inst structured you can't have go over a certain amount of quantity uh so that's just one example Matt might want to add a few more yeah I spoke to a prospect a couple months ago that was shipping non-spillable lead acid batteries so when you just say that out loud it's like uh that's not something that sounds aw but as written on it probably serves a purpose I should say it correct it does you think and there's a market for it there's a huge market for it this was a major seller um but again Amazon did not want to bring that product into their buildings and he wanted more control over his inventory to be able to place that inventory port side but still get that coverage on the outbound side on the Fulfillment side to meet those one to two day metrics um as you read the SDS sheet there was really nothing dangerous about that product and because they sold in quantities of one prepackaged with a label on it it was perfectly fine to be stored and shipped through the UPS ground Network okay good to know so basically with hazardous best thing to do is make sure you got a good MSDS sheet um and then you know whether it's Amazon or fulfillment partner you know make sure that they have that documentation um this is side note but I was in the forums on the Amazon Seller Central page the other day and it was not related to hazardous but it was some guy trying to argue that he selling a supplement would have no idea what documentation was needed ahead of time and it wasn't fair for Amazon to come to him later and people usually are kind of very proeller and anti- Amazon um but in this case they were very like people ripping him to shreds like dude like here here's the list and he was trying to like die on that hill of but I wouldn't know so whenever in doubt check with Amazon especially if they're fulfilling it you know even if they're selling it or you know if even if you have it on your own website like what disclosures do you need and one in doubt it's better to you know have all that available and not need it than to need it and not have it is that a fair statement right yeah 100 perc I mean the customer is gonna want to know what's in the product that I'm buying yeah and in that space Kevin FDA regulated you know the the requirements are very strict especially if those items are being produced outside the US but there's actually Partners out there that specialize specifically on bringing in products that are either FDA type products from overseas they're regulated there's certain information that needs to be exposed on a label you know ingredients and contents um they could um advise you if there's any red flags you know that's going to be flagged by FDA on the inbound uh you know Ocean or Air Freight so there's really Partners out there that are experts in that area and I would advised to reach out to one of those especially if you play in that FDA regulated space got it because at the end of the day you don't have to figure all this out your own like you know especially in this business a lot of people you know start off they listen to podcasts they watch myam guy Amazon guy YouTube channel and they try to figure everything out on their own and they get to a point like there's just no more they can really you know figure out on their own so they they need to reach out to others for help so uh you don't have to figure it on your own it's really the moral that's story so sufian also follows up with I want to start selling perfumes in this case I won't get a safety data sheet from my supplier what can you recommend thanks a lot so yeah so in your experience is there anything you need if you're selling you know fragrances perfume cologne Etc you probably got more experience with that than I do yeah you know what it's a tough it's a tough one there's a lot of requirements to to play in the fragrance space and you know they're alcohol they're flammable in most cases so there's a lot of Regulation around it and both on the the Fulfillment and storage piece of it bringing it in um again there might be some OMD limited quantity uh workarounds for the fragrance space but uh I feel like um you know hopefully there's a lot of margin in on those products because there's going to be a lot of different additional charges that they'll need to um um you know that they're open to including additional um warehouse and fulfillment charges because it's a specialty type fulfillment process got it so point being um says I can't get a data sheet from my supplier well you're going to need to get one from a third party somewhere so you know what you don't want to do is order like a bunch of products and then and you know realize like Amazon needs it in order even just to sell it or if you want to put it into FBA they need some you know other requirements you know you have a supplier that needs to you know help you get it you know into a 3pl warehouse they need something you know to get it through customs if you're importing this from outside of the US they probably need something so this is not some one of those things you want to just figure it out when you get there this is something you want to figure out ahead of time before you place an order and if your supplier can't give you that stuff then maybe they're not the supplier to work with and if you find a vender that doesn't matter red flag yes and and like you exactly Matt and like you said Kevin start with the MSDS that's like that's the starting point and just to let you know though there are fulfillment Warehouse networks and partners out there that specialize in the fragrance industry so you need to Source one of those specialty fulfillment Partners in warehouses okay well good deal all right so let's get back a little bit more into uh seller fulfilled Prime this is a question that always comes up now used to be Amazon didn't allow seller fulfilled Prime options for a while um well they did but then they weren't allowing a lot of new ones and now they seem to kind of opened that back up so every seller has this LoveHate relationship with Amazon and they was want to take away some of that control with Amazon Amazon wants to bring themselves into more places um in your uh Journey um they want more information um but for folks who want to say I'm at least interested in exploring the idea of taking some of my Logistics away from Amazon um what are the right type of products that tend to work best in a seller fulfill Prime environment I'll take this one Evan um first is it starts with the size of the product anything bigger than a shoe box okay just visualize a shoe box if it's bigger than that it can be a good fit for seller fulfilled Prime from a financial standpoint that's where you'll start to see savings over FBA fulfillment and delivery we then start to look at average order values can your product support uh out sourcing that to to an alternative to FBA often times the the process of getting product into FBA can be pretty cheap especially with Amazon Global Logistics it may cost a little bit more to bring that product into a fulfillment partner like where to go um but there is the alternative of that inventory Readiness when will that product be available to sell we talk to sellers all the time who are saying man my product's being held up for six to eight weeks within FBA before it's even available on the website on the marketplace we make that product available within 48 hours so there starts to be kind of this give and take between the additional cost versus the cash flow that's opened up we find many brands that play in both spaces you know they'll they'll keep their you know smaller lighter items in FBA because that's really the way to go in most cases um you know there's some exceptions to that as average value start increasing or you want to add bundling uh strategies um but as the weights get heavier that's when it's really and and a little bit bigger and bulkier bigger than the shoe uh you know the The Shoe Box like we spoke about but Matt's had some clients that played in specific categories you know 50 pound bags of grain um you know baby products car seats strollers those type and Amazon really doesn't want those products anyway and then you could take a subset of your asens and really we could evaluate those and we also do a side by-side comparison for you as well so we'll look at your asens that look like they could be good fits for um seller fulfilled Prime and we'll do a side by-side analysis and show you what it looks like in FBA and what it looks like to transition those products over to where to go I'd say the next step so to use Amazon terminology I'm sorry Kevin go ahead okay so so no I was gonna say go go ahead I think the next thing to look at is volume and velocity of those SKS um as Evan mentioned I've worked with a lot of our seller fulfilled Prime clients um we've shown savings upwards of a million dollars at one skew over FBA when switching to SFP uh one example is a steam mop that weighed eight pounds but it was long was kind of outside of that size category that FBA likes and we were looking at 80 cents a skew but they sold a lot of volume and so that 80 cents per unit really started to stack up over a years worth of uh of velocity the alternative is the stroller where we showed $40 50 a unit in savings over FBA that also equated to about a million dollars a year in savings okay 3400 a day so yeah that that's a big savings you know because if you're doing 3400 a day uh that's let's say you know 10,000 units a month is if my math on the Fly is correct 80 cents that's $8,000 um you know who wouldn't like to have an $8,000 raise so Amazon starts to become very expensive when you're getting into um higher pric products and that's not just the FBA fee you're also talking about the fee to get it um you know into the warehouse the inbound uh fee of just the the actual sending it in then if you're subject to the inbound placement fees which a lot of times we're stuck with that all starts to add up so and then you also have Amazon's you know uh charges on cubic storage which as I mentioned earlier in this stream I had the biggest Bill I've ever had this month um because those fees are going up so it's worth starting to explore it so basically if I'm understanding correctly if you're selling a computer mouse and it's small inside The Shoe Box you're probably best with FBA unless you just want like FBA backup so you have a skew that's seller fulfilled Prime so if FBA Runs Out you could uh at least have still Prime eligible stock ready to go and then also that stock could be sent to Shopify orders Walmart orders Etsy orders or whatever yep 100% you know it speaks Kevin just to the situation we were talking about earlier before we jumped on the uh the the live stream is you know the backup with G with um Amazon AGL and the mcf and people not being able to get product into uh you know even into Amazon for peak season where a lot of our clients will utilize where to go just as a contingency plan so they actually have product the other piece to think about what you just talked about was really the hard costs of you know of selling you know this is a specific cost but how about the soft costs or the oportunity costs where your product is made sellable within 48 Hours instead of waiting four to six weeks what does that mean you you you you need to analyze that piece as well to to to to to see what makes best sense because if you can get a month's worth of sales you know if it's taking six weeks to get into Amazon what does that mean to your Topline Revenue yeah I make a face because I've had that happen to me and I invite every seller uh go into your manage inventory and you see like if you have FBA inventory just hover over where it says reserved and see how many are in FC processing or FC transfer which means the Fulfillment center is either processing it when it came in which you might be like I haven't sent anything of that in a month and you probably still have units that are processing and you probably still have units that are FC transfer which means they're sending it from you know uh Charlotte to uh Texas and California and Michigan and everywhere else and it might be on a trailer that's you know stuck in the middle of somewhere and it they may not ever get to it until February and that happens and that's happened to me every single year so all right so if you have any especially seller fulfilled Prime questions get them in now we're starting to run out of time um because uh uh I will be respectful of the time of our two guests here and they got to be uh off at 12:45 but they wanted to both come on here and answer any questions regarding Logistics and things of that nature so this is a a really good conversation because I think it definitely helps folks understand some of those other options and things to think about um with FBA because everyone has those FBA frustrations of you know it happened to in 2020 when that thing that went around you know that we all know about um and all of a sudden Amazon went from you know two-day shipping to they were advertising six week shipping in some cases and you know that that can be brutal and if they have a monopoly on your Logistics you're kind of stuck with it so um if folks want to learn more at least get a comparison of you know what their cost might be where should they go so any sellers that are interested in chatting with us welcome to reach out to Evan or I uh we can connect you with the right person on our sales team to run that full evaluation side by side skew level pricing analysis FBA versus where to go typically that's where we start where we end is usually talking more about the growth plans of that brand we have many customers that are trying to get more traction with walmart.com trying to get on target plus trying to increase Shopify sales from the Brand's website those are things where we can start to look at cost-saving measures outside of mcf using alternative carriers using alternative shipping speeds those are things that are acceptable outside of the Amazon Marketplace so we try to give a comprehensive view of your supply chain and your sales strategy and I would just add that analysis is a no cost analysis it's free uh if it makes sense we you know we have our initial Meetup we explore their strategy and their products and their you know skew catalog and it makes sense we we'll put that out there for for no charge to any uh any interested parties awesome and as I mentioned earlier for those who weren't on the stream at the time where where to go is a UPS company so you guys are backed up by the uh um the logistics of um UPS because you're in their umbrella as opposed to a part another partner of theirs that just works with them it gives us a big Advantage especially when we're talking about managing capacity within the carrier Network as much as Amazon's grown they've got a huge Fleet they run out of space just like everyone else in our model we have access to additional warehouse space but more importantly we have second priority behind UPS Healthcare on pickups so season starting to look in the rearview mirror a little bit on Peak we're able to manage that capacity with a with a major carrier best in the business from an ontime delivery standpoint awesome and I would just add just the major brand right like we're going to be here now and moving forward sometimes when you work with three PLS um they're more local mom and pop and not to say they don't do a great job but you know we you have a brand that's behind where to go uh you know we're going to be here now and into the future data security you know just everything that comes with a Fortune 50 company when it comes to clients data and the way we go about doing our business awesome and um you know speaking of uh places uh any places that you might be people can connect with you uh in the upcoming future in the e-commerce uh conference landscape you want to take that Matt yeah we're going to be at the Prosper show March 25th through the 27th Booth 717 um so we're excited to be there uh we'll be presenting along with some other seller fulfilled Prime experts so looking forward to meeting many of you there uh and continue in the conversation awesome definitely recommend folks uh go check you guys out if they're um at Prosper show and if they just want to at least get you know whether it's peace of mind that I have the best rates with FBA or maybe there's a better option available which it could go either way depending on the size of your products and a few other factors but it's least uh worth checking out and that's wo.co uh.com right just make sure we typo that exactly and if you do reach out to us please let anybody if you you fill out a form or just call us directly or send us an email let us know that you heard about us through the U my Amazon guy um you know live webinar please because we we appreciate our partnership with uh you Kevin and my Amazon guy and appreciate the partnership and thank you for uh having us on the uh live stream today awesome well thank you very much gentlemen thanks Kevin have a great one happy peak season everybody