I spent the majority of March, 2019 liquidating products that weren't generating enough profit for me to keep reinvesting money into.
In some cases, it was because the supplier didn't do a good enough job. Some of the units were packaged incorrectly, and in some cases they were damaged in transit.
For one product I launched 3 additional variants after the initial success of the first SKU, including using a new supplier for one of them (but the same product).
It ended up being a clear example of why it sometimes makes sense to pay more for higher quality units (after ordering samples), because the second supplier's lower price still didn't warrant me continuing to do business with them - customers simply didn't like the product.
Launching similar products allows you to use Headline Search Ads to advertise them - something I had been taking advantage of very early on.
Many sellers didn't offer 3+ related ASINs, so there was lower competition on Headline ads... to my benefit!
But after around a year you can usually tell how a product is going to pan out, & it was time for me to cut a few loose.
Liquidating Amazon Products
Liquidating products usually means selling at cost, or even at a loss.
Amazon has a program called "Outlet Deals" that's invite only & seems to be reserved for sellers that have had inventory at FBA warehouses for too longand may be at risk of getting hit by long-term storage fees.
Usually when I get an invite to Outlet deals I accept it and let the products go at a loss. It's OK to recoup money and invest it into new products... remember there's an opportunity cost to letting money sit idle in slow-moving inventory.
Taking part in outlet deals is a simple process that I outlined in a separate article.
Unfortunately, they don't let you adjust you pricing, per their rules:
Outlet Deals are deals of at least 30% off from the price listed on Amazon.com from the previous day and 30% off the average price from the previous 30 days.
This typically means selling at a loss, but I think this is perfectly OK as long as you put your money to work as soon as you get it back!
But it definitely had a negative effect on my March sales:
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$82,716.58 in revenue resulted in a net LOSS of -$195.20!
But it's not all bad.
Now that I've trimmed the fat, check out my recent numbers in April:
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If you haven't read any of my other articles, I use Fetcher to stay on top of my Amazon seller sales analytics & get a daily email outlining my recent numbers, which you can see pictured above.
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After getting rid of unprofitable SKUs, in most cases at a loss, I both freed up capital to be invested into new products AND increased my overall profit margins!
Over the past 7 days, my profits have been pretty impressive:
- April 4: $495.84
- April 5: $403.84
- April 6: $258.41
- April 7: $246.28
- April 8: $520.74
- April 9: $522.73
- April 10: $522.75
Total: +$2970.59 PROFIT in 7 days! Not bad :)
And I'm looking at new products to launch, any of which could be my next best seller!
Remember: You won't know until you TRY! So get going & start launching more products!
