Covid-19 update 6/2

Click here to download a pdf of the slides,Navazon Inc Amazon Updates – Current Environment – COVID-19 2020_06_02 (1)


The current environment of Amazon and online retail is unique in the company’s history. COVID-19 has changed that landscape for many businesses, including Amazon. Going forward, Amazon continues to adapt to the concerns and needs of governments and customers. Vendors and sellers need to be aware of all these changes to make the most of their online business.


Amazon Business and Operations

The retail environment is still changing with the bankruptcies of J. Crew, Pier One, Nieman Marcus, and J.C. Penny. Nordstrom is also closing several of its locations. Target and Walmart temporarily closed hundreds of locations over protest concerns. With more business flooding online markets, Facebook Shops is strengthening its position by enabling customers to buy from them or other companies’ website.


Stores across the country and world are opening their doors once again as phased re-opening of economies begins. This still leaves Amazon in a strong position as the only method of getting some products.


Amazon’s $4B+ investment in battling COVID continues to expand from higher wages for workers and providing free masks to Whole Foods customers to scalable testing that they may offer to provide to those outside its business. They have prioritized social distancing in operations, which has made those operations less efficient, despite its constant ideal of efficiency.


Amazon continues to align its ordering to reflect customer demand and actual purchases. With many stay-at-home orders still in place and the slow return of many companies to working environments, those orders remain focused on products people want in that environment. But the depressed purchases of group and community related products are gradually increasing as restrictions lighten.


Product suspensions continue to be prevalent, some still related to COVID-related issues. Other suspensions occur because of suspected counterfeiting or price gouging. Amazon continuously battles these issues, and vendors can help by participating in programs like Project Zero, Transparency, Brand Registry, and a new program using video conferencing to validate sellers.


Amazon has reopened various non-core physical businesses, including Amazon Books, Amazon 4-Star, Amazon Pop-Up, and Amazon Go, though some suffered and need repairs following riots and looting of the past week.


Internationally, Amazon India is considering investment in Future Retail Ltd., an Indian retailer. Also in India, the proposal of Walmart’s Flipkart to enter the food retail business there was rejected, strengthening Amazons position in that market.


Vendor Business and Operations

On nearly all accounts, minus those that deal with group activities, orders are increasing. Along with this, many of the tools and programs that they have access to are reopening as well. However, there was one incident on Monday, June 1st, where Amazon’s Inventory Planning and Control system failed to generate orders for many vendors. The issue was fixed, and many


vendors received those POs late. Amazon has extended the ship/delivery window for instances involving late POs.


Drop-ship demands remain high, so ensuring that is available for products can help ensure customers can buy products.


The Bulk Buy program has resumed in both Europe and the U.S., and POs for that are set for the end of June, July, and August. Another program, Vendor Initiated Orders, is currently unavailable, but is showing up on many accounts.


Born-To-Run still has limited availability, but it is expanding. Amazon is waiving retention fees and shipping/handling charges on returns for offers with a sellthrough end date between March 1 and April 16. They are also extending the sellthrough period by 70 days for offers with a sellthrough end date between April 17 and June 15.


The chargeback policies for “Not on Time” and “Down-confirmed” types of On Time Accuracy have been temporarily altered as of June 1. In June, Not-on-Time chargebacks are relaxed up to 5 days after the window ends, and that window will be shortened to 3 days in July. Down-confirmed chargebacks are relaxed to 10 days after the window start date in June. In addition, be aware that the trailing 4 weeks of on-time performance will take these policies into account in the future. SIOC chargebacks are back to normal for all categories as of June 1st, including those who previously had waivers.


For customer ordering, Amazon is now winning the BuyBox for many products again now that they have begun ordering them again. This is accompanied with resumed delivery speeds for many products. Amazon Pantry and Prime have resumed normal deliveries for customers, but Amazon Fresh still only has limited delivery slots.


Promotions are back on Amazon. All self-service promotions are available once again. Deal of the Day slots are available, and Category Deals have resumed. Prime Day is expected to occur in September. June 5th is the submission date for LDs. June 17th is the new date for self-service deals.


The recent trials and economic upheaval that has occurred across the world has shown that if you want to succeed in your online business, you need the knowledge and specialties to adapt and change fast. Navazon is continually monitoring Amazon and the entire industry to make sure its clients can make the right choices grow and increase profits. If you have questions or need a little help to adjust to this new environment, contact a Navazon representative today.