Hopefully by now everyone’s had a chance to get out there and scan some product. I know some people in the Facebook group have had some problems interpreting the data they get from the Amazon Seller App on their phone. Let’s delve into that and see if we can make some sense of it.
Here we have a screen shot of the page you see after you scan a product in the Amazon Seller App. Well, it doesn’t look exactly like this. This one has a little more color…
Up top of course is the product title. This is of little importance to what we’re doing here. Personally I don’t care what it’s called or what it is. I tell people I don’t sell products. I sell bar codes. If I scan a bar code and my phone tells me it’s a good bar code, I buy it to sell.
The red arrow is pointed to the seller rank. This is one of the greatest mysteries in the world of Amazon. The actual data that goes into figuring this number is not made public. This is what I can tell you. This number is a reflection of how well this product is selling compared to other products in it’s category. The category is listed to the right. The lower the number is, the better it is selling at that moment. A higher number would be a slower seller. The same number does not mean the same thing from one category to another. That is because not only are there different numbers of items in each category, but some categories sell better than others. I recommend you get your feet wet in one or two categories so that you can get comfortable with those rankings before branching out into other categories.
To the right of that, the black arrow is pointed to the customer reviews of the product. This is especially useful when Amazon doesn’t provide sales rank. If there are no reviews here with no sales rank, you can be fairly certain that the item has never sold. If there is no sales rank but the reviews look like the one in our example, you may be fairly certain the reason it has no sales rank is that Amazon simply chooses not to provide the information.
Down below the item picture, you have all the pricing information. The green arrow is showing you the lowest price by a third party seller. The calculations that follow assume you will be matching this “Low Price”. Just to the right, you see the total fees that will be charged to you when the item ships to the customer. Moving further to the right, the calculation is done for you to show you how much you will be paid when the item sells after fees are deducted. If you want to explore what it would look like if you changed this recommended price, you may click anywhere in this area and it will take you to a calculator page. Once there, you can enter in prices and the calculator with automatically deduct the fees that would be associated with that price and give you the amount you would be paid at that price.
Moving further down the screen, we get to the blue arrow that is pointing to Amazon’s current price. This particular item shows some interesting information. Normally, you’ll see the third party sellers set at a lower price than Amazon to try to compete with them to get sales. In this example, the third party seller is five dollars more expensive than Amazon. This may indicate that Amazon goes out of stock frequently and that third party sellers don’t have to try to compete so hard to sell, they just wait till Amazon is out of stock. That’s just a theory at this point without having more information, but something different is going on with this product for sure.
The purple arrow is pointing to another important piece of information you should take into account when making your decision. There is only one FBA seller on this listing. This means you would have minimal competition and that you may be able to actually price a bit higher than them and still make some decent sales. When there are too many sellers here, people have to be patient waiting for sales. There seems to always be one that can’t wait and starts dropping their price. This starts what we call “the race to the bottom”. Everyone starts lowering their price to either meet or beat the first person and then the first person lowers theirs again in a desperate attempt to get the very next sale. Unless there is just a ton of profit in a product, it’s usually better to stay away from items with a lot of FBA competition.
Moving to the right, you’ll see how many total sellers there are. This shows there are eleven sellers. This may be somewhat alarming if there were eleven sellers with FBA offerings. But on this listing, all we need to worry about is Amazon and the one FBA seller. All of the other sellers just don’t matter. Merchant fulfilled offerings are rarely competition for an FBA seller. Few customers are interested in buying from them.
Moving on to perhaps the most important thing this app tells you. If you are eligible to sell the product. Certain products are banned from being sold by third party sellers by their manufacturers. Gillette razors is one that immediately comes to mind. These brands are such big companies that Amazon is happy to honor their request.
Moreover, sometimes entire categories are locked down from you selling in them. Amazon does this to protect the integrity of the product catalog. There are certain categories that require a more experienced seller to offer a customer experience that lives up to Amazon’s standards. One such category is grocery. Amazon was having problems with new sellers sending in inventory that was expired or had various other problems, so they decided to close down the category to new sellers. This is commonly called “gated categories”. There is a process for each category that one may go through to be approved by Amazon to sell in that category. This is referred to as “ungating”.
I put a bunch of pretty stars around this area because this is what you want to see. “You can sell this product in new condition.” This area will also let you know if you are approved to offer the product in used, collectible, or any other condition that may be available. This particular item is in the beauty category where the only option is new.
Now that you are familiar with the app, you will probably want to learn about Keepa charts and how to read them. They will give you a better understanding of sales rank.
I hope this sheds some light on a subject that is so intricate to our chosen business. If you have any questions, or need clarification on anything, please leave a comment below.