As an Amazon seller, the backbone of your business is also a common pain point: inventory.

What should you sell? Who are the most reliable suppliers and where can you get the best price? What prices should you set? How do you know how much to order at a given time? What if you go out of stock?

Chances are, you’ve had to ask yourself these questions at least once, but most likely more. To make sure your business is growing — and continues to grow — you need to consistently think about your inventory strategy, and tweak it as needed.

But where do you start? Keep reading to learn how you can maximize your inventory management strategy, increase your profits, and grow your Amazon business.


Part One: Figuring out What to Sell

The first step to maximizing your inventory management strategy is to figure out what you’re going to sell, and how you’re going to source it (retail arbitrage, drop shipping, wholesale, etc.). A classic chicken-or-the-egg scenario, sometimes you won’t know what to sell until you figure out your sourcing strategy, while other times you won’t know which sourcing method to use until you decide on a product.

To figure this all out, you’ll need to do some research. What are the top selling products and/or categories on Amazon? What’s a must-have everyday item? What’s currently trending? Where can you get the best price?

To start, use your Amazon Scanner App to check an item’s pricing and selling history, look up the best-selling items on Amazon, check out your competition, then research suppliers. There are also a variety of tools such as Jungle Scout to help you find the most lucrative products.

*Pro Tip: Whether you’re just starting out or are looking to expand your product line, make sure you’re familiar with Amazon’s category and product restrictions. In other words, you may need to get approval from Amazon. Learn more about Amazon’s Gated Categories and how to get approval in “Smart Inventory Management for Increased Profitability” from Payability.


Part Two: Setting the Right Price

There are two prices to think about here: your selling price AND your buying price. After all, having a healthy margin is key to a growing Amazon business. Depending on your sourcing method, you’ll want to a) shop the clearance aisle at discount stores or b) negotiate with your suppliers. It goes without saying that you want to acquire your products for the lowest possible price.

Once you’ve done that, you’ll want to find the optimum selling price — one that wins you the Buy Box and keeps your storefront growing. This may sound like a daunting task that involves trial and error as well as manual price changes in Seller Central — but it’s not. Just as there are tools to help you find the right products, there are tools such as Appeagle to help you set the best price.

*Pro Tip: There are several ways to increase negotiating leverage with your suppliers so you get the best price on product. Read more about them in “Smart Inventory Management for Increased Profitability” from Payability.


Part Three: Acing Your Inventory Management

Now that you have your products and price, it’s time to make sure you never experience an Amazon stockout. Here are five ways to ace inventory management and never go out of stock:


  • Know your lead times and other manufacturing considerations: How long does it take you to get product in hand or to the Amazon warehouse once you’ve placed an order? This will help you determine the best time to place a resupply order without letting your shelves run empty in the process.

  • Know Your Sales Velocity and Amazon’s: How quickly are you selling product? When are your busiest days? When are Amazon’s? Knowing this will help you determine how much inventory (at a minimum) to have on hand at a given time.

  • Invest In Safety Stock: Order an extra amount of inventory — i.e. an inventory buffer or “safety stock” — to keep on hand for emergencies. It doesn’t have to be large and could save you from a stockout when you least expect it.

  • Take Desperate Measures: If all else fails, you may need to slow your own sales. Do this by pausing marketing campaigns like Sponsored Products or Lightning Deals, or by temporarily raising your price.

  • Invest in Inventory Management Software: Don’t worry about manually updating an Excel spreadsheet after every order. Using Amazon’s inventory reports and other third-party tools like Teikametrics can help you keep tabs on your stock levels and reorder points.



All this said, a huge roadblock to a successful inventory management system — especially for Amazon sellers — is cash flow. Waiting two weeks for payment doesn’t make it easy to reinvest in more inventory when you need it. Thankfully, there’s a solution for that, too: Payability.

Payability gives Amazon sellers access to their income within one business day of making a sale. All you have to do is connect your Amazon account as well as your business bank account, then Payability will take care of the rest. And it’s not a loan or a cash advance — for a small flat 2% fee, they’ll pay you in real-time, allowing you to reinvest in product, maximize inventory turnover, and grow your business. Hear how one Amazon seller uses Payability to keep inventory on her shelves, or learn more about Payability at

*Pro Tip: For all the information you need to maximize your inventory management strategy, download your free copy of Payability’s eBook “Smart Inventory Management for Increased Profitability”.


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