80/20 Of Ecommerce – April 22, 2022

China Sourcing Update 4/22/22 

What we know

• There is mass marine congestion on the east coast of Shanghai amid COVID lockdowns.
• Experts warn us for the next global shockwave of China’s harsh lockdowns.
• Chinese lockdowns are starting to hurt the American and European supply chains
• The lockdown status is almost the same as last week

Image credits: MarineTraffic

Amid the city’s COVID lockdown and worries about its financial and social impact, Marine Traffic photographs reveal massive sea congestion off the east coast of Shanghai and surrounding its port.

We received information stating that the river system is still operational for cities such as the Long River. You can still move your shipment through a riverboat to the Shanghai seaport. However, not everyone knows about this information since not all shipping companies offer this service.

Another partner in China shared that the lockdown updates were as similar as last week. However, they expect all operations to go back to normal on the 1st of May. 

As Shanghai was still locked down, Ningbo suffered a lot of pressure for shipping. Many cities are semi-closed or only allow local people in, especially in Beijing and surrounding cities. Everything works fine, except for trucking to the port warehouse, which suffered a lot.

Yiwu, a city in the Zhejiang Province, is okay. There are very sporadic pockets of lockdowns in small towns. There are temporary lockdowns, usually for one to two weeks affecting the manufacturers located in the said cities.

If a COVID case happens in these small cities,  that specific area would immediately be locked down, but it is very irregular. Nobody knows when and where the subsequent lockdown occurred. 

We are seeing delays in FedEx and shipping out of China in air shipping. Some airports are affected, such as the Shanghai Pudong International Airport. So, they may need to route packages to distant airports, which would cause additional delays. Check with FedEx if you are shipping by air. 

We are seeing delays in FedEx and shipping out of China in air shipping. Some airports are affected, such as the Shanghai Pudong International Airport. So, they may need to route packages to distant airports, which would cause additional delays. Check with FedEx if you are shipping by air. 

Amazon added an extra 5 percent fuel and inflation charge for third-party sellers 

Image credits: Bloomberg and Getty Images

Amazon CEO Andy Jasssy discussed on CNBC last Thursday, April 14, that the inflation alongside the pandemic and the war between Russia and Ukraine poses many rising costs for the company.

Because of this, specific supply chain issues have been served to the table. The challenges include expensive and time-consuming product shipping, especially for more extended distance packages. 

Amazon added an extra 5 percent fuel and inflation charge for third-party sellers in the United States who utilize its storage and shipping services to cope with this dilemma. Jassy emphasizes that they cannot keep absorbing all the costs and expect the business to run economically.

The said surcharge will be implemented in two weeks for FBA sellers. Many sellers are not happy with this and have expressed their frustration since it was only in January when they had the recent FBA cost increase.

Takeaway:

The ongoing global problems give businesses a pressing need to increase their product and service costs. The lockdowns in China also contribute to this decision-making of Amazon. Amazon sellers and the company should communicate properly before sudden implementations and changes like this one. It will help lessen the impact for both parties if decisions are favorable to both sides.

Amazon FBA update: Small and Light and extra-large storage types

Image Credits: Amazon.com

On Monday, April 18, 2022, Amazon added news storage types for FBA sellers. The storage types include “extra-large” and tweaks to the “Small and Light” program. 

According to them, the new reclassification of the packages will provide sellers more flexibility in managing their inventory limits, especially for more oversized items. Amazon would like their sellers to check the “Extra-large FBA inventory” to understand this announcement for further information. 

Additionally, there is an increase in the price threshold for FBA Small and Light eligible products from $8 to $10. Amazon expressed that the said change will open the doors for sellers to receive more fulfillment discounts.

Small and Light helps sellers sell more of their low-cost items to the hundreds of millions of Amazon consumers who shop in Amazon shops worldwide by lowering fulfillment costs on eligible items.

Takeaway: 

Amazon sellers should know more about this announcement to understand the expected impacts on their business. You can go to FBA Small and Light Seller Central Help to read about this change.

Amazon product liability insurance: why is it important?

Image credits: Compliance Gate

Commercial liability insurance will protect you from mishaps arising from the items you sell, allowing you to focus on building your business. In doing business, there will always be uncertain times. 

When things go wrong, especially if you are a private label and you manufacture your product, this insurance will help you ensure that no claim can take you out of business. E-commerce sellers, especially those that sell on Amazon, are recommended to have their product liability insurance. 

Sellers are obliged to get and maintain commercial liability insurance within 30 days of exceeding $10,000 in gross revenues in one month on Amazon.com, or if otherwise asked by Amazon, under section 9 of the Amazon Services Business Solutions Agreement.

Sellers can purchase commercial general, excess, or umbrella liability insurance. When choosing insurance coverage, sellers should ensure that it covers all the items they advertise for sale on Amazon.

To avail of this insurance policy, sellers need to meet specific criteria and documents, which can be found in the Amazon Seller Central under the Program Policies > Insurance Requirements. You can choose any insurance provider that fulfills Amazon’s standards if you presently do not have liability insurance or are seeking new coverage. 

However, sellers should make sure that their insurance carriers are inclined to e-commerce, especially Amazon, to represent them in the best way possible.

4 Vital Signs Of Your Amazon FBA Business To Boost Your Profitability And Prevent A Heart Attack – Live Training on April 28th at 8 PM ET with Marc Jepsen, COO of ManageByStats

Do you know your numbers? What is your actual ecom business profit?

One of the keys to running a successful e-commerce business is you need to know your numbers. Peter Drucker said, “Whatever gets measured, gets managed”. Do you know your numbers? What is your actual ecom business profit?

Did you know that according to ManageByStats, about 90% of people do not know what their actual profit is? If you do not know your numbers, it is like taking shots in the dark. You simply will not hit the target.

To help you know your numbers if you are running an Amazon business, I invited Marc Jepsen from ManageByStats to share how you can know your actual profits so you can SCALE and prevent your sales from decreasing over time. 

In this live webinar on Thu, April 28 at 8 PM EST, you’ll learn:

• How sellers can know their actual profit
• Strategies to take if your sales volume goes down 
• Importance of knowing profit down to every penny
• 4 Vital Signs Of Your Amazon FBA Business To Boost Your Profitability And Prevent A Heart Attack

To join, RSVP here: https://forms.gle/VSWojG9XCbFo1mrY9  

Helium 10 Sell + Scale Summit in Las Vegas Sept 20-22, 2022

Want to learn proven strategies that are guaranteed to help your business find lasting success? Then register now at this year’s Sell + Scale Summit!

Sell + Scale Summit is a new in-person ecommerce conference hosted by Helium 10.  

This offline event brings together a community of sellers, experts, and speakers for 3 days of education, networking, and world-class entertainment in Las Vegas.

Taking place September 20-22 at the Virgin Hotels Las Vegas, this year’s event features some amazing special events, including a LIVE Welcome Party performance from Grammy award-winning rap superstar Nelly and an inspiring keynote address from serial entrepreneur Gary Vaynerchuk. 

I think this will be a great in-person event to connect with other sellers and I was able to get a special discount to our readers. 

Helium 10 will offer a $100 discount when you register through this link and use my code: S3PAXGARYHUANG 

Note to be transparent – I’m an affiliate of Helium 10 and I believe that this is going to be a great event.  If you do purchase a ticket I will receive a small commission to help us keep creating the best award winning content to help you grow your ecommerce business.  And it helps pay for my coffee!  Thanks!

To learn more, visit  today!

In case you missed it:

• China Sourcing Update 4/15/22 
• Amazon Delays changes to buyer cancellation process
• How Amazon plans to fix its multi-billion dollar returns problem
• Helium 10 Sell + Scale Summit in Las Vegas Sept 20-22, 2022

Have a great weekend!

-Gary