• Amazon has been transparent about its challenges and is making no bones about what it’s up against
• Small businesses have a unique opportunity right now to provide better service and faster shipping
• You surely won’t put Amazon out of business, but you may prove that, when things get tough, David can hold its own despite Goliath
As difficult as the COVID-19 crisis has been for all of us, this may be a once-in-a-lifetime opportunity for you to grow your small business out from under the shadow and yoke of Amazon.
By taking a look at Amazon’s current challenges, you may be able to implement strategies that could keep you from eternal dependence at the very least. We’ll share some of those small business ideas here.
First, realize that Amazon has been transparent about its challenges and is making no bones about what it’s up against:
“To serve our customers in need while also helping to ensure the safety of our associates, we’ve changed our logistics, transportation, supply chain, purchasing, and third-party seller processes to prioritize stocking and delivering items that are a higher priority for our customers,” an Amazon spokesperson said in a statement to Vox. “This has resulted in some of our delivery promises being longer than usual.”
Amazon has just recently started to allow third-party sellers to resume sending some non-essential products to its warehouses. A temporary pause last month was a result of prioritizing pandemic-related essential items, such as health-care products and shelf-stable food. Due to the nationwide quarantine, Amazon warehouses were struggling to keep up with demand for essentials. Shutting out non-essentials was not a small thing for the company: third-party sellers account for 58% of Amazon’s sales.
Although the non-essential seller shutdown was relatively brief, it left many Fulfillment by Amazon (FBA) sellers behind the eight-ball. The move could affect the delivery of products by weeks and even months. For many small business owners, that may mean lost sales and revenue.
All told, Amazon is not exactly buckling under the pressure; it’s ramping up to meet the demand of both essential and non-essential purchases. The company has been adding an additional 175,000 workers to meet the new capacity. It’s also raising pay for warehouse and delivery workers through the end of April.
In your favor, though, the crisis has tapped empathy in the hearts of consumers. Many people recognize the challenge that small business is currently facing; choosing to patronize a smaller business instead of automatically going with Amazon is finally becoming a thing.
If you serve your customers well during this crisis, they may stick with you long after the world returns to normal. You surely won’t put Amazon out of business, but you may prove that, when things get tough, David can hold its own despite Goliath.
The Dilemmas Amazon Faces During the Pandemic
As noted above, Amazon has held many merchants at bay with the FBA inventory issue. There are reports of unfulfilled orders and significant delays in third-party sales that are warehoused by Amazon.
A slowdown in Prime delivery
For the duration of the crisis, one-and-two-day Prime orders are a distant memory. In some cases, items are delayed up to two weeks or more. Nobody predicted our current crisis, but a delayed Prime goes against the very idea of subscribing to it.
A cease fire in the delivery wars
Amazon is discontinuing its third-party shipping service in the United States (it continues to do business in Great Britain). The service, called Amazon Shipping, was piloted in a few U.S. cities and was positioned to go head to head with FedEx and UPS. As of now, the program is on hold until June.
As Amazon Readjusts During COVID-19, Opportunity Abounds for Independent Businesses
As Amazon struggles to meet deadlines and demands, smaller businesses have the benefit of being agile, and ample access to carriers and services to be able to quickly process and ship domestic orders. And on top of that—deliver better service, communication and faster shipping.
In many cases these days, it may be more convenient for consumers to patronize smaller businesses as opposed to the massive retailers, who’ve obviously hit some logistical bumps during this time.
Providing certainty in uncertain times for consumers is huge.
Promote better service and faster delivery
This is your window to promote your commitment to your customers. Be communicative about how quickly you will process and ship their items. Of course, don’t overpromise, but be up front with your intention to serve them better.
Remember that, because you are smaller, you can communicate more personally with customers and let them know you are working hard to get orders to them. If, for any reason, the package is going to arrive late, be upfront and let the customer know (and give the reason why). More than likely, customers will be more understanding these days as we all work together to flatten the curve.
Convert from FBA (fulfillment by Amazon) to FBM (fulfillment by merchant)
If you’ve been leveraging Amazon’s FBA program, you may want to give it some further thought for the time being. While Amazon will start allowing some non-essential third-party fulfillment, conventional wisdom suggests that it’s not going to just go back to normal overnight. As long as you can plan for and manage your existing stock until things go back to relative normal, consider shipping yourself.
Also, Amazon may look more kindly upon FBMs now: its “Buy Box” algorithm now gives preference to FBM offers from merchants who can fulfill the order faster.
Market your shipping estimated time of arrival (ETA)
Despite the current circumstances, are you able to achieve a pretty impressive shipping arrival time? Don’t keep it a secret. Let everyone know about it in your social media and marketing. If a customer is happy with your shipping ETA and is willing to give a testimonial, then by all means. (And don’t be shy to ask your customers to give reviews as well.)
The times are scary. The best way to stand with your customers is to communicate with them. Check in on them, give them updates, and connect with them regularly on social media. Be sure your tone is right since this is a dicey time for everyone. As we have already seen, the news is coming at us in crashing waves and times are changing fast. Re-evaluate your communication plan on a daily basis and roll with the punches.
Steering your business is always challenging, even under normal circumstances; the current crisis is simply uncharted, and it’s difficult to find proper guidance and strategy when no one is sure of the outcome. Still, lemonade can be made of lemons. Often, out of the most dire circumstances come new ways to live and thrive. Experience, struggle and survival mode may be just what it takes to show your customers how you’re working for them.
And remember, David took on Goliath with just a slingshot.
Explore Shippo for efficient and cost-effective shipping solutions to help you provide the best customer experience available.