Understanding commingled vs. de-commingled inventory on Amazon

Amazon, Commingled vs. De-Commingled Inventory

As of July 2018, in a report from MWPVL International, a supply chain and logistics consulting company, Amazon had 122 Fulfilment Centers in the U.S. with another 44 in planned future facilities. Managing your inventory across these warehouse fulfillment centers can reach nightmare levels. If your company has 3rd party sellers on the platform, their inventory is commingled unless you have negotiated with Amazon for de-commingled inventory…something they really don’t want to do.

 

The issue to consider is that a product on Amazon is a single ASIN (Amazon product number) that is shared by all sellers. It’s something that makes Amazon very powerful as a marketplace platform. Also, if a brand is selling direct to Amazon retail (Amazon itself is a seller), the brand gets the right to control their ASIN’s (consumer pricing excluded) through the Vendor Central website. That’s a big deal and one of the leveraging points that Amazon uses to get your brand to be direct with them.

 

Commingled inventory means that any seller that sends a specific ASIN into an Amazon warehouse will find it mixed in with all the other inventory of that ASIN. In other words, the product that is shipped to the customer from the Amazon warehouse might not have originated from you. That’s all well and good if everyone is authorized to sell the ASIN and if it’s all in new and current condition, but imagine if a customer receives your product and it’s not in the expected condition. Well, someone’s in for a bad review. And a few of those can start to hurt, stall your sales and impact your brand.

 

Bottom line… if you have multiple sellers shipping inventory into Amazon’s warehouse and sell direct to Amazon as a vendor, you might want to consider negotiating for de-commingled inventory. If you are tracking product serial numbers or some other unique marking on sales across multiple sellers, you NEED de-commingled inventory. Otherwise, you might find out the seller you’re trying to track down… is YOU.

 

To get the comprehensive “7 Steps to Preparing Your Business for Amazon”, click here.