The honeymoon is over for Amazon sellers. The ecommerce boom of the past few years is now over. It doesn’t matter if you are big or small. You must be focused on driving more cash to the bottom line.

Profitability is what everybody is talking about today, not more sales.

In this episode, I am joined by Tyler Jefcoat, the Founder & CEO of SellerAccountant, an eCommerce bookkeeping company dedicated to supporting Amazon sellers.

He also leads the Sellers Roundtable, an exclusive mastermind for 7 & 8-figure sellers.

Prior to this, he built a 100-employee firm in the home healthcare space and exited. The best way I like to describe my friend Tyler is that he’s the CFO, Controller, Business Shaman, and friend of Amazon Sellers everywhere.

Whether you are looking for an exit or financial freedom, there are some basic profit metrics you should be paying attention to. Unfortunately, many sellers don’t know about them.

Yes, Amazon is raising fees, and it sucks, but compared to other channels where you’re paying for Google or Facebook traffic, Amazon isn’t a bad gig when you have a clear strategy. If for no other reason, you should be there to defend your brand.

“I will say that in 2023 for Amazon sellers, the mantra is profitability. Sales have always been vanity, but right now, it’s definitely vanity. Profit is sanity.”

Tyler Jefcoat

Inventory Velocity Metric

One of the most important metrics for tracking Amazon’s profitability is inventory velocity or inventory turn. It is a measure of how quickly products stored in a fulfillment service move off the shelves. It is the rate at which inventory is sold, compared to the total inventory purchases within a given period. In other words, it measures the return on your working capital over a period of time.

A high inventory velocity means that the products are selling quickly and efficiently. On the other hand, a low inventory velocity can indicate that the products are not selling well or are being overstocked.

What Should Amazon Sellers be doing in 2023

There is talk of a coming recession; it might not even be this year or just be a soft one. But now it’s time to do the things you should have been doing anyway. It’s time to trim the fat and prepare to grab the opportunities that will arise. Some of your competitors might struggle and cede their market to you.

“Amazon’s raising fees, and that sucks. But compared to other channels, where you’re paying for Google or Facebook traffic, or a warehouse and Bob to pick and pack, and UPS and FedEx to ship for you, Amazon isn’t a bad gig.”

Jason Boyce

Stay tuned because our guest today is the most knowledgeable person I know when it comes to getting your Amazon financial house in order.

Some Additional Resources…

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