As an Amazon seller, having access to various materials and tools is critical for success. Amazon's Vendor Services (AVS), formerly Strategic Vendor Services (SVS), is one such resource that has sparked debate due to its expensive price tag but may have advantages for larger brands.
According to Amazon, AVS (which has Essential and Signature packages) offers premium support to help sellers manage and grow their business by identifying critical operational improvements.
Knowing the pros and cons is vital if Amazon invites you to join the AVS program. This article guides you through what AWS is, its advantages and disadvantages, and whether it is worth your investment.
What is Amazon vendor services?
Amazon Vendor Services (AVS) is a program developed by Amazon to empower 1P sellers by increasing their visibility on the platform, improving operations, and increasing sales. AVS provides vendors with increased control over product listings, advertising activities, and inventory management through its comprehensive array of tools and services, which includes A+ Content, Amazon Marketing Services, and the Vendor Central platform.
Participation in the Amazon Vendor Services program includes being allocated an Amazon Brand Specialist (sometimes referred to as a Customer Success Manager) as a dedicated contact person. This person is a vital link, connecting vendors with Amazon's many support departments. These teams can assist with everything from improving product pages and dealing with delivery concerns to helping with assortment selection and driving traffic to vendor pages.
Amazon Vendor Services — Signature is an upgraded version of the Amazon Vendor Services (AVS) program that offers vendors a higher degree of service and support. The account manager becomes a strategic partner, working together on promotions and operational strategies to increase sales and profitability on the Amazon platform.
How to utilize Amazon vendor services
Enrollment in the Amazon Vendor Services program is exclusively by invitation, as Amazon actively seeks vendors well-suited for the program. To capture Amazon's attention, embrace key factors such as a strong sales history, building a brand identity, always meeting demand, and providing excellent customer service.
There are several ways to make use of the services.
1. Selection: The Customer Success Manager evaluates the catalog for completeness and suggests increasing the product line.
2. Content: Help improve product detail pages, suggest additions such as product photos or A+ content, and assist with establishing new deals.
3. Availability and operational excellence: Delivering data, monitoring delivery speed, recognizing out-of-stock situations, and evaluating product quality. In addition, options such as Partner Integrated Carrier Services (PICS) or Direct Import should be discussed.
4. Promotion and financing: Assisting in generating traffic through techniques such as discounts and discount promotions, focusing on events such as Prime Day.
5. Core services: Amazon provides centralized services such as weekly meetings and regular email contact and addresses operational difficulties and challenges such as banned ASINs.
6. Advertising Support: Optimizing advertising campaigns and finding products that need better promotion
How much does Amazon Vendor Services cost?
The pricing structure is determined by various factors, including business size, annual sales, the extent of covered marketplaces, and the level of assistance needed.
Negotiation is crucial in establishing the final cost. Vendors often pay Amazon a percentage of their cost of goods sold (COGS) for AVS, which ranges from 2% to 6%. Amazon asks that potential vendors contact their account managers to discuss pricing structures.
These expenditures can quickly add up, potentially reaching large sums. For example, if you sell $1 million to Amazon via AVS, the mandatory fee to Amazon could range from $20,000 to $60,000, highlighting the importance of understanding and factoring in these costs within your business operations.
Advantages of Amazon Vendor Services
One significant benefit of using Amazon Vendor Services is the direct connection it allows with Amazon. Vendors benefit from a dedicated Brand Specialist as an excellent resource for improving their Amazon presence and optimizing business operations. On the other hand, small and mid-sized sellers who do not use AVS do not have this direct channel to Amazon, necessitating the constant opening of new cases for support.
The Brand Specialist, who can access internal tools, reports, and teams that regular vendors do not, may quickly give the information needed to navigate Vendor Central or other technologies. This direct access enables the Brand Specialist to address and resolve concerns more rapidly than the traditional case management process.
Disadvantages of Amazon Vendor Services
The success of the AVS experience is dependent on the expertise of the assigned brand specialist, who introduces a variable factor. The Specialist's proficiency may influence problem-resolution success.
Because a specialist oversees several vendors, proactive management is essential. A clear definition of priorities and themes is required to ensure alignment with the vendor's current demands, preventing the Specialist from focusing on less critical concerns.
It is crucial to note that the Brand Specialist is an Amazon employee. While providing assistance, any proposals should be reviewed for alignment with Amazon's overarching aims. Amazon, for example, promotes merchants to grow across multiple countries, but this may contradict a vendor's rights or price plan, necessitating caution.
Is Amazon Vendor Services worth it?
Determining the merits of investing in Amazon Vendor Services (AVS) requires meticulous consideration. The intrinsic value of having an internal Amazon contact who can navigate and optimize many elements is undeniable. AVS has an advantage in other areas since it frequently solves problems that would take weeks to fix. For example, AVS can quickly pay for itself if a popular item is out of stock during this time.
However, it is critical to recognize that this representative primarily represents Amazon's interests. The question then becomes whether opening up channels for possible funding corresponds with your company's goals.
Several factors influence the selection, including the sufficiency of internal or agency resources, the caliber of the recruit, and the complexity of your company's requirements. To estimate the return on investment, these factors must be thoroughly evaluated to see whether the benefits of AVS outweigh the possible negatives.
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