Amazon Bulk Buy Orders
Amazon Bulk Buy Requests are special orders from Amazon Vendor Central that may be offered to your company a couple of times throughout the year. Amazon does not disclose much info about this process, so in order to help explain this process and the pros/cons of these orders, we have put together this post based solely on our previous experience with the program. We have worked with many clients that have accepted bulk buys various times and these are the typical results and issues we have found with Amazon's Bulk Buy program. Please feel free to do your own research and contact us if you are one of our clients and want more information specific to your products.
If you’re not a client yet, check out THIS page to learn more.
What Amazon says about bulk buys
According to Amazon, the Bulk Buy benefits can include:
improved operational efficiency
controlled inventory risk
increased sales volume
The Bulk Buy Process
Before we get into the pros and cons, I want to walk through the logistics of a typical Bulk Buy order set.
01. Accepting the Orders
You will receive an email notification letting you know that your company has been sent a Bulk Buy Request. In the email, there will be a link to the order in your Vendor Central portal. Here, you will be able to see what products they are requesting, how many, and what date(s) the order is to be sent. You will also see the price of each product (usually at a steep discount of 15% - 80%).
You typically get three to five business days from the time the Bulk Buy is offered to the time you need to accept the requested order. From there, you have 24 hours to accept the purchase orders in the Vendor Central portal (this is the part MacPac takes care of for you). You only have 24 hours REGARDLESS of the bulk buy date. For example, if it was March 1st when you accept the bulk buy offer but the bulk buy order wasn't set to ship until May 27th, the purchase orders still need to be accepted in full by March 2nd or you will be subject to receive chargebacks from Amazon and the order will be canceled.
Because of this tight timeline, we always recommend you work closely with our team and your MacPac account manager as soon as you receive a bulk buy request to ensure Amazon's deadlines are met and everything submitted correctly.
Once the purchase orders are accepted, quantities, prices, and other changes CANNOT be made. This is why we suggest the following inventory before accepting any bulk buy requests.
02. Managing Inventory Levels
MacPac Fulfillment does not accept bulk buy orders for any product that is not currently in the warehouse. While the orders might be up to three months out from the acceptance date, bulk buy orders are a massive project that requires inventory to be accessible well before the week of shipping.
If you do not have the full product inventory already at your fulfillment warehouse, we recommend canceling or shorting that product on your bulk buy order because of the issues that can arise in production and shipping. If you have specific questions about this or know you have product on the way, please work with your account manager to make sure all product will be here on time.
If your product is not produced, shipped, or arrived at the warehouse in time, your bulk buy order will be short-shipped to Amazon which can result in up to 6 different chargebacks totaling up to 120% of the product price. You will lose money on orders that are not shipped properly. While the MacPac team does everything in our power to reduce chargebacks, we cannot help if the product is not here when the order is built, which is why this policy is in place.
03. Processing the Orders (Our process at MacPac Fulfillment)
If you do decide to accept a bulk buy request, below is the process we ask that you follow this process to help us meet all of Amazon’s requirements:
Let us know as soon as you receive the bulk buy request so we can do a physical inventory as needed to get you the most accurate inventory numbers.
Once you have accepted the bulk order, we only have 24 hours to accept then in Vendor Central. We will process the PO’s in the vendor central portal and prep them in our office.
We will adjust your inventory spreadsheet to properly show the bulk buy orders in line with your regular weekly orders. We can schedule a phone call to walk you through this updated spreadsheet as needed.
Our warehouse team will pre-build these up to 6 weeks in advance and get them fully prepared for shipping.
Once your bulk buy orders go out, we will upload all the typical Amazon paperwork into your google drive file so you can invoice.
Pros and Cons of Amazon Bulk Buys
There are a lot of things that go into Bulk Buy Orders, the Pros and Cons might be different for every product & company.
PROS
If you have a new product that you want to get exposure to, Bulk Buys can help boost sales
If you have a lot of products in our warehouse that you’d like to clear out to make room for something else, Bulk Buys can get a large quantity of stock out in a relatively short period of time.
Bulk Buys can generate large invoices fairly quick for some cash flow.
Bulk Buys can help you plan ahead of time what Amazon wants to order and gives you the chance to pre-sell the product at a discounted price.
CONS
Bulk Buys will lower the amount of product ordered on your weekly Amazon purchase orders, but usually, do not replace them entirely. You will likely still receive smaller PO’s on your typical schedule.
Continuously accepting bulk buy requests can lead to Amazon lowering your product pricing, or continue to request lower coupons, be mindful of this while accepting new price offers.
The process of Bulk Buys is very strict and any missing product, dates within 90-days of expiring or mislabeled items are subject to much larger fees than typical.
If you are interested in accepting a bulk buy request, even just for one single product, we would love to chat with you and help you decide if it is a beneficial move for your company specifically.
Again, if you have any questions, feel free to contact us.
