Here's why Joint Business Plans (JBPs) with #Amazon don't work. And what to do about it 👇

Let's face it:
Your leadership teams have repeatedly asked for a meeting with Amazon to discuss the joint business and set a strategy for the partnership between your two companies.

The problem is:
Even if you held such a meeting, the impact is almost non-existent.
The priorities discussed were not followed up. And when you ask for another meeting, the request remains unanswered.

The reason why JBPs don't work is this:
» 𝗔𝗺𝗮𝘇𝗼𝗻 𝗶𝘀 𝗮 𝘁𝗲𝗰𝗵 𝗰𝗼𝗺𝗽𝗮𝗻𝘆 𝗳𝗶𝗿𝘀𝘁. 𝗔𝗻𝗱 𝗮 𝗿𝗲𝘁𝗮𝗶𝗹𝗲𝗿 𝘀𝗲𝗰𝗼𝗻𝗱. «

Vendor Managers rotate positions every 12-15 months. And Directors and Category Leaders are too disconnected from daily business operations. Moreover, Amazon wants to drive efficiencies. And JBPs are seen as an unwelcome way to interfere with automated processes and algorithms.

We can like it or not: Amazon is not going to change its business model.

So don't try and force ways of working onto a retailer that isn't dependent on you.

💡 𝐌𝐚𝐤𝐞 𝐬𝐮𝐫𝐞 𝐲𝐨𝐮 𝐚𝐝𝐚𝐩𝐭 𝐲𝐨𝐮𝐫 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐭𝐨 𝐛𝐞𝐭𝐭𝐞𝐫 𝐨𝐩𝐞𝐫𝐚𝐭𝐞 𝐰𝐢𝐭𝐡 𝐀𝐦𝐚𝐳𝐨𝐧 𝐢𝐧𝐬𝐭𝐞𝐚𝐝.

Here's how:

𝟭- 𝗙𝗼𝗰𝘂𝘀 𝗼𝗻 𝗮𝘂𝘁𝗼𝗺𝗮𝘁𝗶𝗼𝗻

We're entering a future where Vendor Managers only knock on your door to ask for investments. Everything else will be handled via automated processes or offshored (cost-effective) Amazon specialists.

If you require your VM or AVS to conduct manual tasks to enable sales for your 1P business, you're well advised to automate these tasks in 2024.

Whether it's the onboarding of EDI or the automation of data reports. The less you depend on Amazon managers, the more you future-proof your vendor business.

𝟮- 𝗙𝗼𝗰𝘂𝘀 𝗮𝘃𝗮𝗶𝗹𝗮𝗯𝗹𝗲 𝗿𝗲𝘀𝗼𝘂𝗿𝗰𝗲𝘀 𝗼𝗻 𝗯𝗶𝗴 𝗯𝗲𝘁𝘀

When negotiating annual terms, leverage the direct contact with your Vendor Manager. Focus on the big bets and identify what inefficiencies need to be addressed.

For example, if forecasting demand is your biggest challenge, focus your resources on onboarding to Amazon's Commitment Ordering Programme.

Or if you want Amazon to source your products directly from China, focus trade discussions on a Direct Import model.

𝟯- 𝗙𝗼𝗰𝘂𝘀 𝗼𝗻 𝗱𝗮𝘁𝗮 𝗮𝘃𝗮𝗶𝗹𝗮𝗯𝗶𝗹𝗶𝘁𝘆

If Amazon does not partner with brands to conduct JBPs, you need the right data to make strategic decisions independently. Amazon understands itself as a marketplace that simply connects existing demand and supply.

So if you lack access to data dashboards or require more visibility into the performance of your virtual shelf, make sure you partner with solution providers to help inform your decision-making.

But the biggest takeaway?

Understand that Amazon won't change their business for you. This outright ignores their core business model.

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What's your experience with running Joint Business Plans with Amazon?

Let me know in the comments!

#amazonvendor #amazonstrategy