Inventory. Managed correctly, you’re making the most of your money. Managed incorrectly, you’re either missing out on sales or your funds are tied up in products sitting on warehouse shelves. The tricky question is this: as an Amazon merchant, how can you optimize your inventory to maximize profits?
What Amazon Offers
Amazon gives its merchants a basic framework for handling stock. One means is by permitting you to designate a Week of Coverage (WOC) threshold for an item. For example, if you sold 60 units of an item in the past 30 days and had 30 units available to ship from Amazon’s warehouses, you would have two weeks of cover remaining for that product. Amazon defines weeks of cover as “the number of weeks of on-hand fulfillable inventory based on your sales over the last 30 days.” WOC can be adjusted to show ranges from one week and up. Amazon simply advises merchants to restock items that are low on cover and refrain from replenishing products that aren’t selling well or consider removing them from inventory.
Figure 1: Amazon Replenishment Alerts
Amazon also gives merchants the ability to set replenishment alerts. However, Amazon calculates 30 days average sales and bases alerts on that information. If merchants want to see data beyond 30 days, they must calculate average sales and lead time on product ordering and shipping to make replenishment decisions.
Why Amazon Restock Alerts Aren’t Enough
Although Amazon is giving its merchants some tools to work with when it comes to inventory, it certainly isn’t offering what you need for a complete picture. This is where the power of RestockPro can make your sales data work for you. RestockPro consolidates product, sales, and supplier information along with your restocking preferences all in one place on its Restock Suggestions Page to streamline inventory management.
RestockPro saves valuable time by putting you in control of your inventory. It becomes your virtual purchasing agent by allowing you to:
Best of all, RestockPro does the heavy lifting for you, automatically analyzing your data, based on your preferred assumptions. This includes competitive data and estimated margins. Now there’s no need to guess which products are most profitable or crunch numbers in complicated spreadsheets. RestockPro hands the information to you and lets you capitalize your restock dollars on the items that bring the largest profits.
Originally published on August 24, 2015, updated January 13, 2020
This post is accurate as of the date of publication. Some features and information may have changed due to product updates or Amazon policy changes.
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