hi and welcome back to another amazon selling video if you're new to my channel my name is
nikki kirk and today we're going to be talking about pricing price tanking and how to avoid it
so i'm going to be covering how i've always done my pricing for the last five
years as well as things you can do to see if it's possible a price tanking might happen before you
buy it and what to do if you have something in the amazon warehouse that is tanking in price now
obviously if you have something that's fbm or that you're fulfilling yourself fulfilled by merchant
then you can just return it to the store right you can take your listing down but once it's in the
amazon warehouse it's a little more difficult so i'm just gonna go over my strategy for pricing one
of the number one questions i'm often asked is do i use a repricer and the answer is no i have never
used a repricer i actually think that because of the way they're set up and they're pretty
difficult in fact i tried to do one recently i couldn't figure it out so i just didn't even do it
is that if you don't set it up correctly you're actually causing the problem and making that race
to the bottom and possibly losing out on profit through the whole process so if you are going
to use a repricer please do your research i'm sure there's youtube videos out there and make sure you
set it up properly so you're not causing a raise to the bottom and losing profit so if you are
selling on amazon i'm sure you've had it happen where you send something into the warehouse it's
making a great profit and then all of a sudden all these other sellers pop on and the price is going
down down down and suddenly you are out of profit and you're like what the heck how are these people
even making any money assuming you all got it at the same place right so it's really frustrating
but unfortunately it is just an everyday part of selling on amazon but these are the strategies
that i use so that that doesn't happen or if it does happen at least i'm covered and i'm
not losing money so right off the bat when i'm outsourcing i have my five dollar minimum profit
rule the reason i do that is because of this example right so if it's gonna at least make me
five dollars profit fifty percent roi then i know i have some buffer room so say i got something for
five dollars and it makes five dollar profit if i sent it in and the price came down a dollar or
two and i'm still making three dollars that's pretty good at least i'm not losing any money
so that's why really why i have that five dollar rule if you buy something from the dollar store
and it makes a dollar profit but now the price is tanked you're really quickly losing money
on that instead because now you've sent it into amazon that obviously cost to ship it in right
you had to put a label on it you had to polybag all these different things are cost of that item
and where if you're only having a dollar profit to begin with then it's a lot more chance that you're
gonna lose money totally so that's why i have my five dollar minimum profit roll as well as fifty
percent roi and that really comes into play if i'm buying something for twenty dollars i wanna
at least be making ten dollars profit otherwise is it really worth my twenty dollars to only
make five dollars profit probably not so those are just my personal rules and that's why i have them
for this specific thing price dropping so do what you're comfortable with but that's what
my rule is personally also when i'm sending stuff into amazon i'm always pricing it a dollar or two
above the buy box so if i buy it the buy box is 19.99 i'm gonna make five dollars profit
that's great i'm gonna i'm bought it because i'm good with that right but when i send it in
amazon i'm actually gonna send it in at 22.99 or 21.99 the reason i do this is so that if the
price should actually go up i'm not the one now at 19.99 when i sent it in even though the price has
gone up to 22.99 when mine hits the warehouse now i'm that person dropping the price right
and i didn't mean to do that it might just because i didn't pay attention i sent it in at 19.99 i
was good with that profit and but if the price has gone up i obviously want to match it up so
i send everything in i list my stuff a dollar or two above the current buy box when i'm listing it
that way it just accounts for that and i won't be the one dragging it down should the price go up
another thing i look at in the first place before i ever buy a product and i send it in
is where did i get it and how widely available is it if it's an item a seasonal item at walmart
when any seller can go into walmart and scan it that has a higher ability probably that more
people are going to go find it and send it in and as of course the more sellers that are on
the listing the more chances are that the price is going to come down because everyone freaks out
and drops price to make that sale we'll get into that in a second but that is if it's more widely
available it's going to be harder to find now there's some local discount stores that are only
here in this state so that's going to be a lot harder for every other seller to find right now
they might have them in discount sellers different stores in other states but they might not so that
is a pretty much safer bet that the price is going to be held steady of course i always recommend
using keepa to check price volatility you can see the price over time on keepa and if it was
always kind of at twenty dollars it's probably pretty likely that'll still be at twenty dollars
for you know you'll be good to go but if it was at twenty dollars and eleven dollars then it went up
to twenty four dollars and back down to twelve dollars that is not a very stable price and so
it's a lot more likely that the price will to go down now if it all checked out i'm still going to
buy it and listed at 20 but i'm not going to buy as many of them maybe i'm going to test it at four
just to see so that if they do tank i'm not losing a lot of money in that product because
i went too deep and bought too many of them keepa will also tell you if amazon is sold out of the
product if they were selling it before now when amazon sells out it's really great because the
price will actually go up and a lot of times that's when you want to fbm to take advantage
of that however if it looks like amazon sold out for just a week or two and then they went back on
and they sold out for a week or two and then they're back on it again that might tell you
that they might be coming back on it again it's up to you if you want to try and sell it with
knowing that but if amazon has been sold out for three or four weeks that's a pretty good bet that
they won't really come back on anytime soon so at that point it's find it it's more fine to like go
and grab it if that makes sense so keepa will be telling you a lot about a product's history
which will help you know if the price is stable if amazon was selling it and different things
that might have happened to cause it so when the rank goes higher usually means that the price went
too high and so it stopped selling as much so it doesn't mean that it won't sell but you might see
on the graph that okay the rank went high and the price was also high but when the rank is low it's
because the price was lower that'll just tell you if the customer is wanting to buy it for that much
of course if the rank is in a comfortable rank zone go ahead and sell it and list it higher
when i'm sending my stuff in fba i want it to sell quickly but quickly is an ambiguous term
right what does that really mean it doesn't mean i'm trying to flip it like that i'm not
trying to like sell it lower a penny lower a penny lower penny just to make a quick flip
when i say i want to sell it quick i mean before three months so for the first month it's gonna
be i so i bought it one week i sent it in it takes about a week to get to the warehouse
and the warehouse has to receive it in at that point it's probably an fc transfer which
means the thing is transferring around to where amazon wants it and their different warehouses
then after that it might become available while something is an fc transfer i am not
trying to price match or hit the buy box price or anything like that and i'll show you why in
just a second but so that's about a month of it right there so i obviously i'm not going to
sell it within that first month unless it gets available faster which does happen if you're
sending it directly to a warehouse and it'll be available like that however if it is transferring
around that's one set of time frame once it's available that's when i start actively pricing
and managing my prices more proactively than just when it's moving around and in route to
the warehouse so from the time it's now available i would like to sell it within four to six weeks
hopefully if it's a good product it's got the right rank and all that it should sell itself
after three months is when it starts to become excess inventory which does not have any
additional long-term inventory fees or anything like that you still have your monthly inventory
fees on it however it does amazon does start to flag it as excess and so if it hasn't sold by
90 days of being in the warehouse it's probably got an issue and at that point i'm just pricing
to move it but that's what i mean by quick so some sellers or youtubers out there i think are trying
to teach people to make a quick flip and make that quick buck but if you're trying to really do this
as a business and make money and be profitable that's not going to work in the long run it might
make a flashy video but it's not really going to make you money on amazon and if that's what you're
trying to do with your business then you really want to be smarter with your pricing strategies
okay so you did all that checking everything looked good you went ahead and sent them in
and then all of a sudden all these other sellers come on and they're dropping it for half the price
and you're like how how are you making any money on this what should you do then first of all don't
panic don't try and drop your prize don't like just match their price don't panic instead do
a little bit of research and price accordingly things to look out for what is the current rank
how many sellers are there how many sellers have that much inventory all of these things
are available to see on the amazon product page so you can click in when you're manage inventory you
want to click over into the product and just take a look at what the sellers have how many they have
all this extra research which i know is extra time but if you're trying to make a profit it might be
worth this time especially to figure out in the beginning so that you kind of know what you're
doing and you can minimize any profit loss okay so here's an example of a product that i scanned last
week and of course i bought it because you can see here the low price for fbm is 90 but fba which
is what i'm gonna send it in four sellers at 122 dollars it cost me 39 so obviously this is a great
product right i should be making almost 100 roi on 39 then i get home and i'm packing it up and i see
that the price is now 52.99 and 57 with nine fba sellers what the heck like literally i'm not even
gonna make i'm losing nine cents at this point if i sent it in now of course at this point i
could take it back to walmart where i got it and just like cut my losses and not even deal with it
but how does this happen like in a week in a week it lost what is that 60 dollars people cut
it undercut it that fast so this happens not all the time this bad but it does happen pretty much
every day where amazon the prices will drop as sellers drop their price so what can we do and
what happened in this situation i'm gonna give you what i think and what i would recommend doing
so what i'm gonna assume happened with this one is that some fba seller now they could have got it
for cheaper somewhere else but what i'm thinking is that an fba seller just blindly matched the low
price so when you're in your manage inventory you'll see there that it's like featured offer
your price and then the lowest price and you can just go ahead and click match but if you're not
paying attention and you just go ahead and click match you're matching an fbm offer when you are
fba and you are more likely going to get the sell not only that what if that seller only had one
let them sell out and then the price is going to go back up to that 122 dollars so
those are all different things that might happen and when i say don't blindly match the
buy box that is exactly why okay so here's how you can look at a product page and see
how many inventory people have where their inventory is if you should even be matching
them or if you should just wait them out or if you actually will win the buy box above the price that
they have because yours is available so here's an item that i found at walmart so if you happen to
find it i'm pretty sure it still makes a good profit so definitely check it out but you can
see here this delivery date when i click in so we've got this fbm seller here for 17.99
you can see the product page the buy box right now is 16.99 but the fbm seller
which again you can see here it's golden treasure shop sold from and shipped from the same people
and just launched means as a new seller that doesn't necessarily mean anything but it does
come into account because a new seller is less likely to be smarter with their pricing
unfortunately if you're not watching my videos but anyways so just know that if they are just
launched let those people sell out so we have they might be trying to do that quick flip thing
you don't want to do that you you want to flip it quick but quick you know in three months not
quick like i need to get rid of it the same day i listed it that fbm seller is 17.99 then down
here we have an fba seller this is a keepa extension add-on so i can see that she has
in stock for 16.99 but you see here that the ship date so we are on march 26th right now and you can
see that their ship date is actually april 6th or 7th that means it's still an sd transfer so
it's transferring around the amazon warehouses and the quickest the customer will get it when
it settles at a warehouse where amazon can take it pack it and send it to them
is april 6th or 7th so that is not someone i would be price matching and this person probably just
price matched another lower one without looking what i would actually be doing is look at this one
18.99 and it's gonna ship april first that's like this week that's a lot sooner
so that would be who would i consider competitive because a customer if they want their product they
might be willing to pay a dollar to more not only that the way the buy box works is if the product
is closed in a warehouse to the customer amazon's just going to offer that one up to the customer
anyways so it's all the more likely i'm selling stuff above the buy box all the time because mine
is available right now the customer wants it right now amazon is showing it to them as that
also fbm offers are less likely for a customer to buy i know for me personally i have amazon prime
so i would like to have it in two days from amazon that means i don't really buy from an fbm seller
unless it's my only option so that's just me personally but i think that probably happens a
lot because i'm sure there's a lot of customers out there like me who have amazon prime because
they want to get it quickly so you can see here that the two sellers are both fba offers so they
would both be considered competitive however the 1899 one is the one that i would be matching to
more than the 16.99 and again using the keepa extension here we can see how many they have so
what i would do is i would let those two sellers the 17.99 actually i wouldn't even consider them
necessarily competitive since i'm doing fba and they're fbm so i'd probably just overlook that
one but i would let this 16.99 seller fba let them just sell out with their one because then i
the price is going to be up to 18.99 and i will be getting that buy box at 18.99 instead of 16.99
but if you are just in your manage inventory and you're not noticing these things you're
just clicking match price match price or you're using a repricer and it's not set up correctly
since that one is 8 16.99 it's probably gonna price to do to that one instead of knowing hey
this is an fc transfer and i don't really need to match that price because the customer's going
to buy mine because it's available right now all different things to consider when you're pricing
here's a quick look into my inventory manage inventory for those keto bars so you can see here
this is what i'm talking about where it's just would say of course i don't have any right now so
if i hadn't it would say match right here and if i just clicked match i'll just go to 16.99 not even
knowing what's really going on on the product page and now potentially causing a raise to the
bottom if those other fba sellers also match and we're all just matching matching matching causing
that race to the bottom now if somebody is priced at 98 like 1898 1998 whatever and you're at 19.99
just let them do it that is so silly let them be that penny under amazon is gonna offer up
your offer if it's buy box eligible now if someone has a lot if all of a sudden all the sellers are
matching it's a really high ranked product it's already slow moving and you just kind of want to
be done with it then of course you got to do what you need to do with your pricing if you want to
match it and go lower there has been times when i needed an fbm order for video so i dropped my
price really low hoping people don't just match me because i just need to get that sell some people
might be hitting expiration dates and they need to move their inventory so many different things come
into play with your pricing and what other people are doing which is why you really shouldn't just
match take into account how many they have if the rank is really high but at the end of the
day you of course have to do what's best for your business but again hopefully we're all in this
to make profit and make money there are different things that can come into play for example really
large sellers who have you know where we saw just launched but some people might have thousands of
reviews next to their name that's probably a really big seller because you know reviews
don't come on that often and they probably maybe got it wholesale and they got it for cheaper and
so they have more room with the margin if they had thousands of them well now you have to decide do
you want to match and hope to sell through them all or do you want to hold out while they sell
a thousand all different things to consider but it all comes into being active participant in your
business not just using a robot to price match or just blindly matching the buy box so hopefully
this video was helpful and let you know literally that's how i do it i will go down it if i think
want to know why price has dropped so much then i will click in to see what's going on if it's
still an fc transfer i just leave my price as is making sure it's above what the buy box is when
stuff gets to that available column then i'm more actively pricing seeing am i comfortable with that
profit and price do i want a price to move do i want to hold out do i want to keep it above all
different things that you should decide for your business hopefully this was helpful and let you
know how to be more active in your amazon pricing if you like this video go ahead and subscribe
comment and let me know and i will see you back here for another amazon selling video