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Inside Amazon’s In-Stock Head Start and Storage and Replenishment Services
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Amazon is tenaciously committed to the entire customer experience, with a maniacal focus on optimizing delivery speed, avoiding inventory stockouts of sought after products, and ensuring consumers receive their products on time.
The company is taking measures such as adding more transportation vehicles to its fulfillment network — including airplanes and 100,00 electric delivery vehicles — and expanding its product selection in fulfillment centers that are closer to customers. In this article, we provide a detailed look into two of Amazon’s recent services designed to address these issues head on.
What Is the In-Stock Head Start Program?
Amazon is hyper-aware that sometimes even top-selling products can go out of stock, whether attributed to a leak in the supply chain, an unexpected spike in demand, or a hiccup with fulfillment. With the In-Stock Head Start program, which is specifically designed for products that are fulfilled via Fulfillment by Amazon (FBA), Amazon will allow your out-of-stock products to show as available to customers.
How will this work logistically? Amazon will only allow out-of-stock products to be discoverable and ultimately purchased if your inventory shipment is on its way to an Amazon fulfillment center and the company is confident in its arrival date. This is extremely important, as Amazon will not show the items as available to purchase if the shipment does not look like it will arrive on time or contains the anticipated number of units.
Your out-of-stock products will be eligible for the program if you send it to Amazon using the company’s own shipping services such as Carrier Central, the Partnered Carrier program, or Amazon Global Logistics. Amazon will then use the information for these bespoke programs to calculate an estimated in-stock date for your products. Once you have joined the program, you can pause and reactivate it at any time.
Benefits of the In-Stock Head Start Program
The In-Stock Head Start program offers several benefits to your Amazon business:
- Your fees and Inventory Performance Index (IPI) score will not be impacted.
- Products that are en route to an Amazon fulfillment center will still show up in search results, avoiding negative impacts on your product discovery and exposure as well as your organic search rankings.
- Customers are able to buy products that are temporarily out of stock, which can help improve your sales.
- Being able to take in orders while your products are on the way to a fulfillment center can reduce the time between shipment and sale, positively impacting your inventory productivity.
- You can track how many units of a SKU are on their way to the fulfillment center for full visibility. If a product is eligible for the program, it will show up as “Active” on your “Manage Inventory” page.
- While best practice is naturally to ensure that your products are always in stock, this program offers you a solution for products that have temporarily gone out of stock.
What Is the Storage and Replenishment Service?
To help offset the inventory burden that comes alongside increased demand during the Q4 holiday season, Amazon has introduced a new service known as Amazon Storage and Replenishment. The program allows merchants to store inventory near Amazon fulfillment centers so products can be replenished quickly and seamlessly.
Amazon’s warehouses certainly vie for valuable inventory space during the holidays and especially on key sales days such as Black Friday and Cyber Monday, so this program is a good step to help mitigate warehouses being crowded and overstocked and reduce the risk of inventory stockouts. Amazon is piloting the program in Ontario, Canada, which is about 20 miles from its closest fulfillment center, and invited sellers who use FBA to try it out this year. According to Bloomberg, Amazon has plans to expand the program to additional locations across the U.S.
By the end of Black Friday 2019, online sales amassed a record $7.4 billion, coming close behind Cyber Monday 2018 which was Amazon’s most successful sales day in its history. To address the increase in demand and sensitivity around which products warrant shelf space in Amazon’s fulfillment centers, the program helps optimize warehouse space and ensures inventory is close by and easy to replenish.
Amazon is on the list of online retailers who are taking matters into their own hands to own more of the supply chain. By doing so, Amazon is expanding its logistics infrastructure and effectively improving last-mile delivery, which in turn positively impacts consumer satisfaction. Both the In-Stock Head Start and Storage and Replenishment programs demonstrate Amazon’s unwavering commitment to constantly making its vast selection of products available — and delivered — to its audience quickly and error free.