This is the second of our two-part series on how to avoid the most costly private label pricing mistakes and implement an effective private label pricing strategy.
In our first installment, we discussed the main pricing challenges incurred by private label sellers. Now, let’s uncover the solution.
Feedvisor’s automatic algorithmic repricer is specifically designed to help you maximize profit margins for your private label products, ultimately accelerating your private label business growth. There’s no need to input any rules or identify any reference products. Our self-learning algorithms kick in as soon as you enter your ceiling price and floor price, and all the rest is automated.
So how does Feedvisor’s private label solution help you price better? And how can you use the solution to take definite action on, and set out ways to conquer lowballing prices, guessing prices without direct competition, and selling out too fast or not fast enough? Check out the list of benefits below.
1. Save time by going automatic
It’s ironic that while the majority of top Amazon sellers use a repricing solution for their competitive products, until now, no automated solution has existed for private label sellers. Prices were painstakingly and slowly updated manually.
The Benefit: You can save yourself a ton of time and a big headache through dynamically pricing each of your products.
2. Enough guesswork. Ensure your price is optimized
How do you know you’re not leaving money on the table by hitting too low, or encountering lower profits than you should be, because your price is too high?
The Benefit: Because it’s automated, you have complete assurance that your price is exactly right and will be making you the most profit possible. And this price is constantly updated, as necessary.
Basically the way it works is by building a demand curve for your product to find the right price. Then, this demand curve balances the demand for your item (based on historical sales data) with profits (based on your costs and fees). Finally, it identifies the price that maximizes your overall profit.
Example: The current price you’re selling your private label shampoo for is $5.58. You’re debating whether or not to raise the price slightly and risk losing sales, or lower the price slightly and risk lowering profits. A demand curve will help you identify the optimal price for your shampoo so that you’re making the right amount of sales to bring in the most profit possible.
3. Control your pace of sales
As a private label seller, managing your inventory flow is crucial. In order to do so efficiently, you need to control your pace of sales.
The Benefit: You can either set a target out-of-stock date or set the number of items you’d like to sell per day.
Target out-of-stock date– Tell us your target out-of-stock date, and our algorithms will define the optimal price and sales pace that will ensure you sell out by that date.
Example: If you’re due to receive new stock from your manufacturer on the first of next month and need to get rid of your current stock by then, just let us know the exact date and we’ll ensure all your stock is cleared at the best possible price, before the new stock comes in.
Target by velocity – Ensure you don’t sell out too fast or get stuck with slow-moving inventory. Tell us how many items you want to sell per day, and let our algorithms take care of the rest.
Example: Market demand has peaked and you’re selling more items than you’d planned for. At this rate, you’ll sell out in a week but your new stock is only arriving in two weeks’ time. Avoid losing your page rank by making sure you don’t sell out until you get in the new supply. Control the speed of your sales by telling us how many items you’d like to sell daily.
The benefits of automatic algorithmic pricing for your private label products are unparalleled.
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Click here to learn more about how our Private Label Repricer can answer your direct business needs.