THE MILLION DOLLAR CASE STUDY

Session #22: Inventory Management Best Practices

Journey to $1MM

July 26th, 2017

100% to Jeremy Biron – Founder @ Forecastly

If you’re enjoying the MDCS -please help us out!

Can we get a little

love?

Mandy Love (JS T-Shirt Winner)

My most difficult is starting with zero knowledge of

selling on Amazon. Amazon is constantly changing

their terms. Even with their support one person will

help you with something and the next person will

tell you it can't be done. The key is to keep trying. I

make a lot of mistakes and learn from those

mistakes.

I am starting soon. My country is not

listed among countries who can sell on

Amazon so that has been a challenge.

I am currently in the US just to register

a company here and get a bank

account. I hope the EIN will be out and

the bank account will be open before I

leave on the 14th July.

What has

been the

most difficult

part of

Amazon FBA?

Kenneth Nkwonta (Standard Web App)

Session 21 Giveaway Winners

Devon Monroe (JS T-Shirt Winner)I have started! Most difficult part is overcoming my own

self doubt. I know without a doubt I'll be successful with

all the tools and resources I have at my disposal. Thank

you Jungle Scout team!

Session 22 GIVEAWAY : Win a Pro Extension or a T-Shirt

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Agenda

▸ Why should we care?

▸ Basic Concepts

▸ MDCS Example

▸ Additional Tips

▸ Free Tools

• Hundreds of Amazon seller accounts analyzed

• Sold on Amazon for almost 10 years

“

”

Why should we care?▸ New Products vs. Existing Products

▸ Profitability

▸ Cash Flow

Lead Time

▸ Jungle Snugs▹ Manufacturing: 30 Days

▹ Sea Freight: 35 Days

▹ Total: 65 Days ▸ Considerations:▹ Likelihood of

Manufacturing Delays

▹ Ground Shipping in U.S.

▹ Packaging/Shipment Prep. Time

▹ Customs

Safety Stock

“Buffer” Educated Guessing

Cash vs. Lost Sales

9

CalculatingNumber of Extra DaysPercentage Extra

Jungle SnugsLong Lead TimeLimited Sales Data

Sales Velocity

Past 30 Days9.8 Per Day (0 Days Out of Stock)

Past 60 Days7.23 Per Day (8 Days Out of Stock)

10

SeasonalityEvery Product has SeasonalityGoogle TrendsCan’t Easily See Q4 Bump

11

Final Calculations – Reorder Point

Current Inventory: 537

Inbound: 0

Safety Stock:

Reorder Point w/o Safety = 65 Days * 9.8 Sales Per Day = 637

Safety Stock = 637 * .25 = 159

True Reorder Point = 796

Final Calculations – Projected Stock-Out

▸ When to reorder?▹ Current Inventory: 537

▹ Inbound: 0

▹ Safety Stock: 159

▸ (537 – 796) ÷ 9.8 = -26 Days

▸ Not Necessarily 26-Day Stock-out

Final Calculations – Quantity

▸ Inventory Gone Before Arrival

▸ 13 Weeks Until Next Order (Post Arrival)

▸ Days of Inventory + Lead Time = 156

▸ 156 * Sales Velocity = 1,529

▸ 1529 + Safety Stock = 1688 Units

Additional Tips

▸ Return on Investment (ROI)

▸ Sea vs. Air

▸ Product Segmentation

▸ Plan Ahead

▸ Know Your Assumptions

▸ Value Your Time

Inventory Tools - Free Downloadhttps://fcst.ly/mdcs

Amazon Seller Calendar

FBA Replenishment Calculator

August 2nd, 201710a PDT /1p EDT / 6p BST

Amazon Product Research, EUROPE!

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