The Problems Encountered
Whisps came to us with a number of difficulties.
1 High Rate of Negative Reviews
Large production runs and 3PL storage, coupled with Amazon’s <60 days to expiration policy, resulted in unfulfillable items, disposal fees, and a persistent high rate of negative customer reviews.
2 Bad Cash Flow
The need for large production runs and 3PL storage strained cash flow due to disposal fees, lost sales from consistent out-of-stock (OOS) scenarios, and liquidation efforts, adversely affecting financial stability.
3 Incorrect Forecasts
Inaccurate forecasting led to constant OOS issues, especially for top sellers, causing lost sales, high spoilage rates, disposal fees, and liquidation efforts, contributing to financial instability and a high rate of negative customer reviews.
The Solutions We Provided
- Strategic Partnership with Luminize: Luminize, as a full-service agency, applied proven software and processes to Whisps, adapting successful strategies implemented for Healthy Pantry to optimize their Amazon account.
- Preventative Liquidation Strategies: Implemented effective liquidation strategies for products with over 60 days at FBA, preventing bad reviews and maintaining a positive customer perception.
- Comprehensive Forecasting and 3PL Management: Took charge of forecasting and initial shipment creation for Whisps’ 3PL, utilizing long-term forecasts for production planning, ensuring efficiency and accuracy.
- Remarkable Results Achieved: Substantially reduced average inventory levels at FBA, improved partner’s cash flow by 13% through YoY reduction in overstock, decreased labor costs by handling forecasting, enhancing operational efficiency, and slashed spoilage rates from 9% to an impressive 1%, concurrently enhancing customer reviews through proactive liquidation efforts.
Luminize Results
13
%
Improvement in Cashflow
1
%
Spoilage Rate Obtained
Decreased Labor Costs for Vendor
Decreased Cash Conversion Cycle
