Amazon’s inventory capacity skyrocketed during the Spring Festival, with some sellers expanding their capacity by 80,000 at once!

Today is the second day of the Lunar New Year. Many people are still immersed in the Spring Festival holiday, enjoying the lively atmosphere of the New Year and gathering with family and friends. But as Amazon sellers, business does not stop during the holidays. They not only have to keep an eye on the backend, but also pay attention to the various policy adjustments of the platform. Recently, Amazon's policies have undergone two changes. Sellers have lamented that Amazon has changed too fast and cannot be idle during the Spring Festival. However, even if sellers are complaining about the frequent changes in Amazon's policies, it does not hinder its increasingly important position in the online market .

Storage capacity is growing rapidly, and sellers are confused

Over the past year, sellers have been troubled by storage capacity constraints and have lost a lot of hair in order to ship goods. Unexpectedly, Amazon suddenly sent warmth during the Spring Festival holiday.

One seller reported that Amazon updated its inventory capacity on New Year’s Eve, and he found that his own inventory capacity had increased significantly.

Other sellers also said that Amazon’s inventory capacity had exploded. Some said it had increased by 20,000, and some even said it had increased by 80,000.

Amazon's sudden "generosity" confused the sellers. Many people speculated that after a year, the inventory had been cleared out and the warehouse was now empty, so they were in a hurry to let the sellers ship.

In fact, Amazon had been releasing inventory capacity a few days before the Spring Festival, and some sellers said at the time that the inventory capacity of all their accounts had increased a lot.

Although it is the Spring Festival holiday and freight forwarding and logistics have stopped, it does not prevent sellers from creating shipments in advance. One seller said that he did not waste any shipments and created all shipments. Another seller said that he is also stepping up his efforts to create shipments in advance.

Some sellers even reminded that the shipments that can be built now should be built in advance as Amazon’s policies have changed significantly in recent years and there is a possibility that the storage capacity will be suddenly tightened after the holidays.

At present, the pressure on sellers’ storage capacity will be much smaller after the Chinese New Year. It can be predicted that after the Chinese New Year, the main task of sellers will be to take advantage of the large storage capacity to ship goods in large quantities.

However, sellers should be reminded to prepare stocks rationally and rhythmically, and proceed step by step. If they are as aggressive as last year, they will have a lot of inventory that will give them a headache.

After all, the economic situation in Europe and the United States is not optimistic under the epidemic, and Amazon cannot be immune to it. Recently, sellers of auto parts reported that their traffic has decreased by a quarter compared with the same period last year, and the same is true for orders, while the Google index has also been declining. He is also thinking about this year's operating model.

In addition, many sellers were driven crazy by out-of-stock last year. As storage capacity opens up, sellers are stocking up and shipping in large quantities. Various promotions are coming again, and fierce competition is about to begin. Therefore, sellers must proceed according to the actual situation and not blindly stock up in large quantities.

In addition to storage capacity, product policies have also changed.

ASINs without FCC information will be removed from Amazon starting March 7

The latest announcement released by Amazon US stated that starting from March 7, all ASINs of electronic or electrical products without FCC information will be removed.

The announcement shows that sellers can now use the FCC RF device compliance attribute to add their own FCC compliance information to RF devices sold on Amazon.

Amazon policy states that all radio frequency devices (RFDs) must comply with Federal Communications Commission (FCC) regulations and all federal, state, and local laws applicable to these products and product listings.

Sellers may not know that they are selling products that the FCC has identified as RFDs. It is reported that the FCC broadly classifies RFDs as any electronic or electrical product that can emit radio frequency energy. According to FCC regulations, almost all electronic or electrical products can emit radio frequency energy. Products regulated by the FCC as RFDs include: Wi-Fi devices, Bluetooth devices, radios, broadcast transmitters, signal boosters, and devices using cellular technology.

The announcement states that if sellers sell RFDs on Amazon, they must perform one of the following actions in the FCC radio frequency emission compliance attributes:

1. Provide evidence of FCC authorization, including the FCC certification number or contact information of the responsible party defined by the FCC.

2. Declare that the product cannot emit radio frequency energy or does not require FCC radio frequency device authorization.

Otherwise, starting March 7, 2022, Amazon will remove ASINs that are missing the required FCC information until the seller provides that information.

As soon as the announcement was made, sellers immediately complained. Some people thought that Amazon has been making it more difficult for sellers to sell products. Once this policy is released, it will become more difficult to sell electronic products on the platform. Some sellers also said that if Amazon continues to set barriers for sellers to sell, more people will flow to other online platforms.

However, some sellers said that this problem is not difficult to deal with. For example, someone said that he had asked the supplier to fill out the FCC form before shipping.

It is reported that some sellers have received relevant emails. However, according to feedback, some sellers who do not sell radio frequency devices have also received emails. For example, a seller who sells CDs looked confused when he received the email. This shows that emails may be sent by mistake, so if the seller is not selling related products, he can ignore the email.

However, although Amazon's policies change frequently and become increasingly strict, and sellers' complaints are growing, it cannot change its increasingly important position in the online market.

Amazon's third-party marketplace accounts for 25% of the US e-commerce market

Of every $1 spent on online shopping, 25 cents goes to Amazon’s third-party marketplace. If Amazon’s marketplace were a standalone platform, it would be the largest online retailer in the United States.

According to eMarketer, Amazon accounted for 41.4% of total U.S. e-commerce sales in 2021. Since the marketplace accounts for at least 60% of Amazon's GMV, its share of the U.S. e-commerce market is 25%.

Amazon's share as a retailer is 17%. However, in theory, it would be the largest online retailer even without this market. The closest competitor, Walmart, is less than half the size. To reach Amazon's scale, you would need to combine Walmart with the next five mass-market retailers.

It’s no secret that eBay’s market share has been declining in recent years, and Walmart and Target operate marketplaces that are orders of magnitude smaller than Amazon. As a result, Amazon essentially owns the marketplace, meaning its share of total sales across all marketplaces is probably as high as 90%. This is why sellers selling through the Amazon marketplace often fail to diversify.

As you can see from the above chart, Shopify does not appear on the list because it is not a retailer or a marketplace. However, if all Shopify merchants were a retailer, it would be the third largest retailer in the United States with a market share of about 10%. The significance of this is not whether Shopify competes with Amazon or other retailers, but it represents the viability of direct-to-consumer retail.

The 25% market share is a recognition of Amazon's position in the e-commerce landscape. Although it is made up of millions of sellers, they sell through Amazon rather than directly online.

Amazon's storage capacity has skyrocketed