Successfully Reviving an Amazon Aggregator: Brankit’s Data Driven Solutions providing a 138% Sales Boost & 50% Amazon IPI Score Surge

Project Summary

Brankit conducted an analysis of Inventory Management Process for an Amazon Aggregator Business, struggling with lost sales & decreasing IPI scores.
We drafted an inventory management dashboard that accumulated key information required for 625 SKUs across 8 Amazon brands in one place providing a birds eye view to the team.

Initial Hurdles

The team was not able to make focused decisions as it was a hassle to gather all the required data to make decisions that would contribute to improving overall IPI scores.
This decrease in IPI score caused a range of consequences for the client to face,

  1. Reduced Visibility in Search Engine Results Pages (SERP): Decreased prominence in search results, leading to fewer clicks and potential customers seeing your products.
  2. Exclusion from Buy Box: Ineligibility to compete for the “Buy Box” on Amazon, reducing the chances of winning sales for products in competitive listings.
  3. Sales Shortages and Losses: Insufficient inventory resulting in unfulfilled orders, leading to revenue loss and unsatisfied customers.
  4. Adverse Impact on Seller Account Health: Negative consequences for your overall seller account performance, potentially affecting account privileges, reputation, and trustworthiness.
  5. Increased Long-Term Storage Fees and Automatic Removals: Accumulation of excess inventory in Amazon’s warehouses, incurring higher storage fees and the risk of Amazon automatically removing items that don’t sell quickly, impacting profitability.

Plan of Action

Brankit Analyzed the client’s current manual inventory management processes and recognized Key Influencing Factors that were negatively impacting their IPI Scores and contributing heavily to lost sales, these included: Low Sell-through rates, Highly Aged & Excess inventory, coupled with Unstable Instock Rates and Frequent Stranded Events.

  1. Located the root cause, “Aging inventory”: Despite not incurring surcharges until after 180 days (180 days for US, 270+ days for EU & UK), aging inventory for even 90+ days indirectly impacts IPI scores and directly adds to overall holding costs.
  2. Developed a dashboard: This dashboard provided consolidated access to Sales Tiers, Sales Velocity, Amazon and 3PL DOH, and Aging inventory data across all marketplaces, all in one place so as to enable the decision-making process.
  3. Facilitated Q4 demand planning:  Pinpointed low-stock items and estimated optimum lead times to maintain necessary DOH inventory levels for smooth Q4 sales.
  4. Leveraging the Dashboard’s Insights: Utilizing the dashboard’s insights, Brankit collaborated with brand managers to refine sales techniques, optimize PPC campaigns, and bolster marketing efforts for previously overlooked inventory items that may have been adversely affecting sell-through rates.

Outcomes Achieved

Empowered the client to identify and address the low selling items, allowing them to focus on improving sales of aging excess inventory.

  1. Enhanced average sell through rates, increasing them from 0.59 to 1.63
  2. Quarterly Inventory Turnover rate increased 2.67 times (from 3 to 5.67).
  3. Achieved a remarkable 42.8% overall reduction in Aged Excess Inventory:
    Tier A Products: 76.61% decrease
    Tier B Products: 43.34% decrease
    Tier C Products: 27.98% decrease
    Tier D Products: 23.49% decrease
  4. Effectively boosted in-stock rates to 99% and in turn Increased Q4 YOY sales revenue by 138 %.
  5. Improved IPI scores, increasing them by a significant 150%, from an initial average score of 422 among all 8 brands to an excellent average score of 610, reflecting substantial enhancements in inventory management and sales performance.

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