Amazon FBA Industry Terms

Key Amazon Selling Terms and Concepts

Amazon Repricing:

• The process of adjusting the prices of products on the Amazon marketplace dynamically to stay competitive and maximise sales, often done automatically using repricing software.

Repricing Software:

• Specialised tools or programs designed to automatically adjust product prices on Amazon based on predefined rules, competitor prices, and market conditions.

FBA (Fulfilment by Amazon):

• A service provided by Amazon where sellers can send their inventory to Amazon's fulfilment centres, and Amazon takes care of storage, packing, shipping, and customer service.

FBM (Fulfilment by Merchant):

• An alternative to FBA, where sellers fulfil orders themselves rather than using Amazon's fulfilment centres.

ASIN (Amazon Standard Identification Number):

• A unique 10-character identifier assigned to products on Amazon, used for product identification and search purposes.

Buy Box:

• The prominent and coveted purchase button on a product detail page. Winning the Buy Box increases the likelihood of making a sale as the default option for customers.

Competitor Analysis:

• The process of evaluating and understanding the pricing strategies, product offerings, and overall performance of other sellers competing for the same market share on Amazon.

Minimum Price:

• The lowest acceptable price set by a seller for a product. Repricing software may use this as a baseline to ensure prices never go below a specified threshold.

Maximum Price:

• The highest acceptable price set by a seller for a product. Repricing tools may use this to cap prices and prevent overpricing.

Seller-Fulfilled Prime:

• A program that allows sellers to offer products with the Prime badge without using FBA. Sellers handle the fulfilment, ensuring fast and reliable shipping for Prime members.

Dynamic Pricing:

• A strategy that involves adjusting prices in real-time based on various factors such as demand, competition, and market conditions to optimise sales and profits.

Price Wars:

• Intense competition between sellers that results in frequent and rapid price changes as they continuously adjust prices to outdo each other.

Algorithmic Repricing:

• The use of mathematical algorithms and automated rules to adjust prices on Amazon dynamically, allowing sellers to stay competitive without constant manual intervention.

Inventory Management:

• The process of overseeing and controlling the quantity, storage, and movement of products in an Amazon seller's inventory, ensuring optimal stock levels.

SKU (Stock Keeping Unit):

• A unique identifier assigned to each product in a seller's inventory, facilitating efficient tracking and management.

MAP (Minimum Advertised Price):

• The lowest price at which a seller is allowed to advertise a product, as set by the manufacturer or brand.

Conversion Rate:

• The percentage of visitors to a product detail page who make a purchase. A higher conversion rate indicates effective product listings and competitive pricing.

Profit Margin:

• The percentage difference between the cost of acquiring or producing a product and the price at which it is sold, representing the profit percentage.

Shipping Time:

• The estimated time it takes for a product to be delivered to the customer, including order processing, packing, and transit time.

Return on Investment (ROI):

• A metric that measures the profitability of an investment, calculated as the ratio of net profit to the cost of the investment.