Amazon is one of, if not the biggest ecommerce portals as of late. Because of the pandemic, people have either resorted to purchasing stocks and supplies through ecommerce portals, or have started selling as a way to make ends meet.
With that said, Amazon has been one of the most visited ecommerce sites for customers to purchase their supplies. Last year, Amazon’s earnings report for 2020’s fourth quarter, or Q4, generated a total of $125.56 billion in sales. That’s from October to December 2020 alone!
This goes to show that Amazon has been the most go-to site for online purchases. It is important to note that Amazon raked the highest earnings during Q4.
However, therein lies the questions:
What is Q4?
What happens during Q4?
How to prepare for Q4?
If you wish to know the answers to these questions, then, this article’s for you. Let’s start!
What Is Q4?
According to Investopedia, Q4 - also known as quarter four or the fourth quarter - is the last quarter of the financial year for both corporations and other organizations. Traditionally, most companies' Q4 dates follow the calendar year and start on October 1 and end on December 31st.
Amazon, and Amazon sellers alike treat Q4 with utmost importance.
What Happens During Amazon’s Q4
Seasoned Amazon arbitrage sellers already know what to do, or how busy Q4 is. However, if you are new or just starting out, then you might get confused as to why Q4 is the most important time within the Amazon selling ecosystem.
It has been established that Q4 starts October 1st and ends December 31st. Here are the reasons why each month within Q4 is important:
1. October is a great month for buying as a lot of retailers will run sales days, for example 3 for 2, 50% off. If you haven’t done so yet, sign up to retailer newsletters via their websites to be alerted with their up and coming sales and events. Sales in October are better than average. Expect competition on the retailer sales lines you purchase, so price wisely. Go wide and not too deep and be quick to get your items in if you want to flip them quickly.
Sales event for this month: Prime Day, Halloween
2. November sees two BIG sales days - Black Friday and Cyber Monday which fall on 26 November and 29 November this year. Never underestimate these days as stocks get sold out fast. Use Keepa to carefully determine your inventory pricing and rank across this period, and use a repricer to automate your product pricing for you. Sales will ramp up this month.
Sales event for this month: Black Friday and Cyber Monday
3. December is where the real magic happens and you’ll experience crazy sales. Sales will definitely increase in December, so make a start on thinking about your income target now. Be sure to replenish product lines that are selling fast, and plan for shipments regularly to keep up with your sales. Fulfillment centers will be extremely busy so shipment check-ins may be delayed. People like the convenience of online shopping and those who are “lastminute.com” will still be purchasing products right up to Christmas eve / month end, so expect consistent sales on well ranked stock.
Sales event for this month: Holiday Sales
How To Prepare For Q4
The most important step in preparing for Q4 is planning. Make sure that all your ducks are in a row as you head on to the busiest time of the year.
Here are some tactics you can follow to help you prepare for Q4.
1. Focus On Top-Selling Categories
Q4 for consumers primarily means that Christmas is just around the corner. As we all know, with Christmas comes gifts! Because of that, the most relevant categories to focus on are:
Toys & Games
Beauty, Health & Personal Care
If you haven’t already, then make sure to get ungated within these categories before you head on to Q4. These categories will definitely increase your sales this quarter, faster than previous months.
2. Keep An Eye On Major Retailers For Sales During October And November
It goes without saying that major retailers would also want to increase their sales during Q4, hence, they also come up with sales. You have to keep an eye on these so you don’t get left behind. Be warned though, stocks during these sales really run out fast. Your best bet is to sign up for the retailer newsletter to keep you updated with their events.
3. Manage Expectations
Q4 starts October 1st, but it doesn’t necessarily mean that your sales will automatically skyrocket during this month. It will be steady during October, and will ramp up by November. You have to ensure that items running out of stock faster than your other items should be replenished as soon as possible.
You also have to set proper expectations when setting your sales target. It has to be realistic and attainable. Just because Q4 will be busy, doesn’t mean you have to set goals that are really unrealistic. Lastly, you have to expect that this will be a very busy time for everyone including prep centres and couriers. Because of that, get your items to Amazon as soon as you can to avoid any potential delays. You have to expect longer delays to get products processed by Amazon Fulfilment Centres. So to alleviate these delays, send your items as soon as you can.
4. Historical Data
For seasoned sellers, look at your last year’s Q4 data. Look at which items sold really well last year. Stock up on products that sold well last year, and avoid getting out of stock. If this is your first Q4, consider acquiring last year’s data sheets from companies like FBA Deal Source to get an idea of what sold well during Q4.
As a general rule of thumb, as soon as you sell half of your inventory - restock! This way, you can be guaranteed that you have items to fulfill customer orders. Do not underestimate the traction of orders during Q4 because items really sell fast during these times.
Each seller has their own strategies whenever Q4 approaches. The bottom line is that you have to be fully prepared so you do not miss this once a year opportunity to massively increase your sales.
It has been mentioned time and time again within this article that Q4 brings a lot of sales. However, increasing your sales during this period doesn’t come for free. It doesn’t come without any effort and work put into it. As with other things in life, you do not get successful overnight. Start by planning, then everything else will follow.
How will you prepare for this year’s Q4?
Need More Help? Here Are Some Additional Resources
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