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Thanks for Downloading:
Read This First!
Our team of Amazon experts wrote this ebook for passionate, enthusiastic, entrepreneurial Amazon sellers just like you.
We hope you love it and come away with valuable insights that will help you make your Amazon business stronger and more successful.
And we’d love your feedback. After you finish reading, write to us and tell us what you thought.
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Table of Contents
Who is SellerEngine ............................................................ 4 What is Repricing ................................................................. 5 The Intelligent Repricing Advantage ........................... 6 The Truth Behind 5 Repricing Myths ....................... 10 5 Innovative Repricing Strategies ............................. 15 Sellery Success Stories ................................................ 22 Taking the Next Step ....................................................... 26
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Who is SellerEngine?
Since 2002, we've been actively involved in the Amazon seller community, working with, listening to and learning from thousands of successful Amazon sellers all over the world.
We’ve put everything we've learned over the past 13+ years into making our software exactly what Amazon sellers just like you need. We’re here to help you succeed. Whether you’re using Profit Bandit to discover new inventory, SellerEngine Plus to manage your FBA shipments or Sellery to win the Buy Box and maximize your profits.
But enough about us. We’d love to get to know you and how we can help you. Email us your story and we’ll send you a second ebook with our insights into Amazon Sales Rank.
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What is Repricing?
Sometimes I feel like “repricing” is a 4-letter word for many Amazon sellers.
At its core, repricing isn’t anything sinister or scary. It’s just the simple act of adjusting your price on an Amazon offer. Of course, when most sellers talk about “repricing” or “repricers” they mean automated tools, like Sellery.
In this ebook, we’ll teach you about Intelligent Repricing and how Sellery helps you to reprice smarter. Then we’ll pull back the curtain on some of the most common repricing myths-- the scare stories and conspiracy theories you read on message boards and Facebook groups.
Then we’ll introduce you to innovative repricing strategies and show you how Sellery has helped grow the business of Amazon sellers around the world. Finally, we’ll show you the features that set Sellery apart from other repricing software on the market.
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Intelligent Repricing: The Sellery Advantage
Sellery isn’t like other repricing software. Sellery focuses on a subset of automated repricing that we like to call Intelligent Repricing.
Automated repricing can be simple. It doesn’t usually require a lot of input from you and might not require a lot of thought either.
But the possibilities and the results of simple automatic repricing can be limited, and sometimes devastating, if you make a mistake and don’t correct it.
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For some sellers, this is enough.
But for Amazon sellers who really want to succeed, Intelligent Repricing is the key.
Keys to Intelligent Repricing
You
Unlike simple automated repricing, which relies only on software, you’re the most important part of Intelligent Repricing.
You’ll start by using your knowledge of your inventory’s past performance, like seasonal sales trends.
Then you’ll consider your expectations for future performance, as well as your existing pricing strategies to develop an intelligent repricing strategy with the software you choose.
Your Software
Without the right software, Intelligent Repricing just doesn’t work.
Your software needs to be able to:
Segment your inventory so that you’re repricing the right items at the right time.
Accurately track your item costs so that you never sell an item at a loss.
Flexibly adjust prices (both up and down) quickly and accurately.
That’s why we created Sellery. Sellery has:
Smart Lists that allow you to create lists of items that update as your inventory changes.
A Dynamic Minimum Price calculated using your cost of goods sold, estimated shipping costs and Amazon fees. Unless you say otherwise, this will act as your floor price, ending pricing wars before they start.
Nearly infinite combinations of Pricing Rules that you can apply to any combination of Smart Lists.
Real Time Repricing that keeps you ahead of the competition, adjusting your prices in minutes rather than hours.
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Experimentation
Sellery has the power to apply any strategy you can imagine. But it’s up to you to find the strategies that work best for your inventory.
Think of yourself like a scientist. Use the power of software to apply the repricing strategies you create and then quickly make adjustments based on the results.
You wouldn’t sell Christmas decorations for the same price in December as you would during March, would you?
There’s probably room to increase the price of an item that showed up on Oprah’s Favorite Things List, right?
It could be profitable to reduce prices on inventory that’s about to be hit with a long-term FBA storage fees, don’t you think?
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Do you price items with no competing offers the same as items with 10 other sellers?
Applying your knowledge is the key to successful Intelligent Repricing.
That’s what we’ll be talking about in the upcoming chapter on repricing strategies.
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The Truth Behind 5 Repricing Myths
There’s a lot of misinformation about repricing out there. In this chapter, we’ll talk about 5 of the myths we hear all the time. We’ll show you why they’re false and reveal the truth about Amazon repricing.
Myth #1: Repricers only lower prices.
Fact: The best repricing software programs don’t just lower prices. There are many situations where repricing software makes it easy to raise your prices:
Imagine if you made an extra 15% profit on every sale.
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And what would your bottom line look like if you were able to make 10 more sales per day?
You can do this by lowering prices a few pennies and then raising prices again, as the competitive landscape evolves.
That’s just a taste of what’s possible by using automated repricing software!
Repricing software helps you to maximize the value of each sale and it helps you make sales that you didn’t even know you were missing.
Myth #2: I don’t have enough SKUs to bother with repricing software.
Fact: If you’re spending time, every day or even every week, tinkering with your items’ prices, that is time that can be better spent scouting for inventory or doing something else to grow your business.
And on top of the time you’ll save, with the right repricing rules, you’ll be making more money by using repricing software. With the right software, you’ll be able to reprice around the clock, even when you’re sleeping or on vacation.
And over time, as you grow your Amazon business, you’ll be glad that you set up your automatic repricing software sooner, rather than later!
Myth #3: Repricers can make sellers lose money.
Fact: The truth is that repricing software that isn’t configured properly can result in errors that cause you to lose money.
But in our experience, sellers who manually reprice their items can cause lost profits as well. How many times have you heard about a seller accidentally selling an item for $1.00 instead of $100? It’s just a little typo, but the costs to your business can be huge.
Sellery uses your cost, estimated shipping, Amazon fees and more to calculate a minimum price unique to each item. It acts as a lower limit that Sellery won’t price lower than, unless you specifically tell it to.
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And just as important as lower limits are repricing limits. Without them, you might end up with something like this, which was caused by repricing software without an upper limit:
And while that might seem funny, remember that if a buyer came along looking to buy that book, the seller missed out on a sale. Using an automatic repricer that had an upper limit of 20 times the item’s original cost (or any other value) might’ve made the seller $100- $200 or even more.
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Remember, a price that’s too high can be nearly as dangerous as one that’s too low.
Myth #4: I like to be in control and repricers do too much automatically.
Fact: Even automated repricing software programs like Sellery require you to take time to set them up. You’ll input your item costs, set upper and lower limits for your prices and create repricing rules specific to your business. These are the keys to successfully using repricing software.
In the time that it takes you to manually reprice all of your SKUs, you can talk to a member of the SellerEngine Help Team.
Tell them about your business, let them know your unique needs and learn how to set up pricing rules, strategies and schemas to reprice listings exactly the way you want them.
Myth #5: Repricers are why penny books exist.
Fact: Penny books are caused by a number of factors. The biggest is competition. If there are a 100 sellers out there all trying to sell the same Stephen King book, you better believe that some of them are going to cut their prices to make sales.
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Some sellers of penny books will have warehouses big enough to let them make a few cents on a book (by cutting costs on shipping and packaging) as long as they can do it a few hundred (or a few thousand) times a day.
Then there are sellers who use penny books as a way to build up positive feedback, accepting a small loss as the cost of getting good feedback, which can be valuable over the long run as they sell items with higher returns and risks.
Penny books may also be sold by sellers who use their sales to market their own websites or other products to their buyers.
And then, don’t discount the sellers who just don’t know or care that they’re losing money, for whatever reason.
As one of the most knowledgeable Amazon sellers I know says, “Not everyone is selling on Amazon for the same reason that you are.” You can’t know their motives or business just by seeing a paperback being sold for $.01.
The Truth about Amazon Repricing Software
Just like every tool that you use to run your Amazon business, from a pair of scissors to your laser printer, an automated repricer should make your life easier and should add value.
Remember that all automatic repricing software isn’t created equal. Repricing software is an investment of time and money and like any investment in your business, do your research. Find software that you’re comfortable with and commit the time needed to learn how to get the most out of it.
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5 Innovative Repricing Strategies
Strategy #1: Raise Prices at Night
A big fear of many sellers is that as competition increases, prices will race towards the bottom. And there is some truth to this fear. But you can fight the trend of lower prices, by periodically raising your prices.
Now, you don't want to raise prices at a time when you'll be at risk for losing lots of sales! But, you can look at your order history and if you have a few hours a day when sales are slow (usually late night/early morning on the East Coast of the United States), use that opportunity to raise your prices just a bit.
As you reprice upwards, sellers who use automatic repricing software may follow your lead and raise prices as well. That way, when the next day begins, you can lower your prices a bit to be more competitive, if necessary, and hopefully avoid that never-ending race to the bottom (or to your floor price).
This allows you to see which of your competitors follow you up and which don't. This strategy works well for maximizing profit on items when Amazon themselves is one of your competitors. Amazon is often willing to maintain a low price (which can minimize profits as it approaches your floor price) but at the same time, has been known to increase prices to be near other 3rd-party sellers. Repeat the process and track the results. Over time you may begin to see an upward trend in your products' prices, as well as your profits.
Strategy #2: Win the Buy Box at the Best Price
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Winning the buy box can be tricky. Nobody, other than Amazon themselves, knows exactly what it takes to win the buy box. But over the years, we've done research into how the buy box works. And we've developed a strategy that has helped many sellers win the buy box and maximize their profits at the same time.
Staying in the Buy Box Rotation
You don't always have to be the lowest priced offer to win the buy box. Most sellers know this already.
The tricky part is knowing exactly how far above the lowest priced offer you can be and still stay in the buy box rotation. And that changes due to a variety of factors:
Your feedback and shipment times. Your FBA status. Your response rates and times to customer inquiries. Your in-stock quantities (both current and long-term).
Since you'll never be able to calculate the exact price you'll need to stay in the buy box rotation, our strategy relies on consistent adjustments and experimentation.
Our Proven Strategy
1. Start by lowering the price on an item until you win the buy box. 2. Then raise your price until you lose the buy box. 3. Repeat the process.
This ensures that you'll spend maximum time in the buy box rotation at the best price.
Strategy #3: Pricing with No Competition
Setting prices when you're competing with other sellers can seem simple. You can lower your price to be more competitive, raise it to preserve your profit margin or leave it alone at your preferred selling price.
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But what about when you don't have any competition? What do you do when…
Selling your own branded or private label products? Creating hard-to-replicate product bundles? Your competition has sold out and you're the only seller left?
Time to Experiment
Setting a price when you don't have any competition depends on many factors. The biggest is whether or not you expect competition in the future. If you're making your own branded products or selling bundled products, you may not ever have any competition! That's a great situation to be in. In this situation you need to consider your stock situation. Do you have a never-ending supply of products? Or are you limited in the number of bundles you can create?
If you're constrained by limits to your stock, you need to maximize the total value of that stock. You don't want to sell your last 10 items for $10 each, when you could've sold them just as fast at $13 each.
Time to Capitalize
If you believe that your time with no competition is limited, you need to strike while the iron is hot. Don't raise prices too much, or you risk missing sales during your best opportunity to make them. At the same time, if you're the only seller on a popular item, there may be no price that is too high. Our recommendation is to start by pricing lower than you normally would. As you make sales, try to raise prices until the sales velocity decreases. Sales velocity is the rate of sales you make in a given time period. If your sales velocity decreases, lower prices until it picks up, then begin raising it again. Rather than just setting a high price or a low price, adjusting your price in this way will help you to maximize your overall profits.
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Leverage List Price & Unit Session Percentage
How often are you looking at the business reports provided by Amazon? To improve your sales when you have no competition, look at the Unit Session Percentage report. Unit Session Percentage (USP) is the number of units sold relative to the number of customers who viewed the products. If you have a low USP, then customers are looking at the item, they just aren't buying it. The first adjustment to make is to lower your price. Alternatively, if your USP is high, then try increasing prices. List Price is available on most items in the Amazon catalog. It's also known as the Manufacturer's Suggested Retail Price (MSRP). If you don't have any competition, then use the MSRP as a pricing guideline. When you don't have any competition, take advantage of the data available to you. Use list price and unit session percentage to help you zero in on the optimal price for your items. Create a smart list in Sellery that can help you see the items in your inventory that have no other offers. Then price those offers however you like!
Strategy #4: Avoid Long-term FBA Storage Fees
Hopefully by now, you realize that repricing is about more than undercutting the competition and racing to the bottom. The goal of repricing is to maximize your profits. And one way to maximize profits is to minimize costs. A potentially huge, and often overlooked, cost are the long-term FBA Storage Fees.
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Calculating & Assessing Long-term Storage Fees
Long-term storage fees are applied to inventory units which have been in an FBA warehouse for 365 days or longer. These fees are assessed on August 15th & February 15th. On hose days, you'll pay $22.50 for every cubic foot of inventory that that has been in a fulfillment center for 365 days or longer. Important Exception: One unit of each ASIN is exempt from Long-term storage fees.
Reports & Tools You Can Use
The Recommended Removal Report and the Inventory Health Report, found in Seller Central, can help you identify items that are at risk for incurring these large fees. You can always pay to have Amazon destroy the inventory, but why not reprice instead? As the 365-day deadline draws closer, start lowering prices. Any sale you make will be money not spent on long-term storage fees.
Automate the Process with Sellery
Sellery makes it easy to see the length of time products have been in an FBA warehouse. You can even set different strategies for products that have been sitting for different amounts of time. Start by creating smart lists that leverage FBA age. Then use your pricing overview to offer increasing discounts on those smart lists.
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Strategy #5: Let Sales Rank Dictate Margin
Amazon Sales Rank is a lot of things. It can help to show you an item's popularity and the rate at which it sells. And believe it or not, it can even provide you guidelines for pricing your items.
Segment Your Inventory
The first step to implementing this strategy is to segment your inventory by category sales rank. This is easy to do in Sellery. Create smart lists that filter for category and a range of sales ranks.
Important Note: Keep categories separate. Different categories have different numbers of items.
Prime the Pump!
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Items with the worst sales ranks need a boost! Set a low margin so you break even or turn a small profit on each sale in order to build momentum and improved sales rank with each order. As sales occur, the items' sales ranks will improve, moving them into new smart lists (remember that they're dynamic and update themselves). Important Notes: Make sure to use multiple pricing rules and pricing strategies to ensure that your margins change as sales increase. Also note, that this strategy only works with items where you have a large supply, or where the inventory is replenishable.
Margin not Competition
By setting your prices according to profit margin based on your items cost, you're avoiding getting caught up in pricing wars with your competition. Instead you're relying on the nature of sales rank to ensure that you're making money. On items with a good enough sales rank, you'll make sales at your desired margin, almost regardless of the competition.
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Sellery Success Stories
Don’t just take our word for it. Meet Chip and Anthony from Tunes Online. They’ve been successfully selling online and offline for over 10 years. They use Sellery and want to tell you how Sellery and SellerEngine have helped their business.
Q: When/Why did you start selling on Amazon and what types of products did you sell?
A: We started selling on amazon in 2002. We mainly sell media. CDs, DVDs & Video games. We started selling on half.com in the 90’s but realized we were missing the boat. Amazon is a much larger marketplace than any of their competitors.
Q: How did you first find out about SellerEngine & Sellery?
A: It was my New Years Resolution to find a new repricer. I did a Google Search and emailed SellerEngine. Your CEO, Ioan Mitrea, took the time to call me and discuss our needs. He also delivered what he promised. I respect that.
Q: Why did you choose to work with us?
A: I felt confident after many conversations that Ioan would come through for us. The team at Seller Engine delivers what they promise.
Q: What features and benefits of Sellery have given you the most value?
A: For us, Sellery is set it and forget it. Once the Sellery Help Team knows what your goals are they will do everything in their power to help you achieve them. I really appreciate the customer service. Also, the pricing is spot on. That is the most important thing for us.
Q: How has Sellery and SellerEngine improved your business?
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A: Sellery gives us better pricing than our former repricer and SellerEngine Services has helped us open up on markets that were not accessible to us previously, especially Amazon Japan.
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The Proof is in the Pudding Results
Check out real results from real sellers.
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Taking the Next Step
We asked the community of Sellery users what they liked most. These 5 features came up again and again:
1. Lightning Fast Repricing - Respond to changes made by your competitors in minutes, not hours.
2. Infinitely Customizable - Create repricing rules and strategies that are as unique as your business. Maximize your profit on every sale. Not sure how to get started? Ask us!
3. 24/7 Repricing - Sellery works around the clock. It frees you up to focus on growing your business and finding new inventory to sell.
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4. Never Sell too Low - Sellery calculates a minimum price for all your items. You won't get caught up in pricing wars and you won't worry about your prices getting too low.
5. World-Class Support - Our Help Team will show you everything Sellery can do and will answer all of your questions. They're here to give you everything you need.
Try Sellery free for 2 weeks. You’ll see for yourself how Sellery will make your business more profitable and more successful.
Stay in Touch!
Thanks again for taking the time to read this ebook.
We’d love to hear from you. Here’s how to stay in touch with us:
Facebook: http://facebook.com/sellerenginesoftware Twitter: @SellerEngine
Twitter: [email protected]
