If POs aren’t getting confirmed or are getting canceled, it has a huge impact on stocking, and therefore Amazon’s bottom line. Sometimes, Amazon will pick up or “collect” the order, and other times the vendor will use their own logistics network to get the product to an Amazon warehouse.īecause Amazon famously runs a very lean operation when it comes to inventory, confirmation rates are very important to the retailer. Once you confirm it, the vendor agrees on a shipment plan, which depends on the product and how the vendor is set up. Once you get a purchase order, you have about 24 hours to confirm whether you can fulfill that order. Also, you risk future revenue, because Amazon reviews metrics like PO confirmation rates when it evaluates vendors. You have to pay attention to it, because if you don’t confirm those purchase orders in time, you’re losing the orders, and therefore you’re losing potential revenue.
It’s important for vendors to monitor purchase orders (POs) from Amazon – in fact, it may be the most important metric you monitor. Why Are Purchase Orders an Important Metric for Vendors? When Amazon buys the product from the vendor, the retailer submits a purchase order to the vendor, which the vendor then fills. Amazon’s relationship with vendors involves buying the vendor’s product and selling them on the website as an Amazon product, which is beneficial for the vendor as these products get preferential treatment and placement, and customers like to buy Amazon-branded products because they can trust them.
The term “purchase orders” refers to the orders for your products that Amazon submits to you, the brand. This guide discusses some of the nuances surrounding purchase orders, signs of issues within an organization relating to POs, and what you can do to address them.
As a result, it’s critical to fully understand them. It’s the fundamental transaction between you and Amazon, and the reason why you became an Amazon vendor to begin with. Purchase orders are the lifeblood of every Amazon vendor.
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