Episode # 121 – Cushioning Your E-commerce Margins – Cathleen Woodall – Amazon Legends

04/21/22 Nick Uresin
Cover art for Cathleen Woodall on Amazon Legends

What do you do when your company has a 400% increase in orders after surviving a down year? Cathleen Woodall faced the same challenge and came out on top! Cathleen is now sharing lessons to help Amazon sellers avoid many of the pitfalls she has come across in her own entrepreneurial journey. You’ll learn about how to set up deals with distributors for long-term success, the importance of controlling your brand, and how to maintain critical metrics to keep your listings thriving.

Takeaways:

  • When a wholesaler tries to sell your product, they are only looking for 30% margins and will charge drastically less and undercut your own listings for the same products.
  • You need to have agreements in place with your distributors that bar them from being able to sell your product on Amazon. The terms of these agreements need to be clearly spelled out. If the distributors violate it, you need to stop doing business with them.
  • Firing distributors may seem like a hard thing to do, but it helps your company in the long run. This gives control of your brand back to you and helps longer-term profits by avoiding being undercut on price.
  • Your Listing Quality is very important to your success on Amazon. It’s crucial that you check the quality of the product and its packaging before it is sent to FBA warehouses. Track how many items you check and how many are sent in to find your inspection rate.
  • If you are shipping products directly from your manufacturer to the FBA warehouse, you run the risk of missing quality errors which could lead to your listing being suspended.
  • If your price point falls for non-sales-related reasons, it can be a long journey to work the price back up to its initial price point.
  • When you are offering several similar products of varying quality and or value, you need to have a wide enough margin between the products so that the lower-priced products do not cannibalize the sales of the higher-priced products.

Quote of the Show:

  • “We have to have control of our brand. We have to have control of our pricing. You can’t be on Amazon and not have control of it” – Cathleen Woodall

Links:

Shout Outs:

  • Jason Langston

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About the Host:
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Nick Uresin is the Founder and CEO of ArgoMetrix, a New York based software and consulting company established in 2013. Nick is an Entrepreneur, Electronics, Communications and Computer Science Engineer, who has a passion for problem solving with technology. Nick built an online retail company with annual revenues of over $10 million. He developed his vision to organize the knowledge and technology he developed to become a large Amazon Seller and provide it as a service to manufacturers and sellers of consumer products. Let's get social! Follow us and get ArgoMetrix's latest updates on Twitter, Facebook or LinkedIn.

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