A premium natural skincare brand transitioned from a 1P to a 3P direct-to-consumer sales model in September 2021, resulting in logistical delays and inventory shortages that impacted their Amazon inventory limits. Sales and reviews suffered due to slow fulfillment and out-of-stock listings. Cart.com collaborated with the brand to resolve these issues before the crucial holiday season.
About The Client and Background
This premium brand partner offers natural and organic skincare and personal care products. The company encompasses two brands: one that blends certified organic ingredients with raw honey and propolis for deep skin moisturization and rejuvenation, and another that focuses on 100% natural feminine care, utilizing organic active ingredients to restore moisture, balance pH, and rejuvenate intimate skin. Previously operating successfully as a 1P business, the brand decided to switch to a 3P model to enhance their direct-to-consumer sales.
Challenges
The transition to a 3P business model proved challenging, as the brand faced logistical delays and inventory shortages, preventing them from increasing their Amazon inventory limits. Their third-party logistics (3PL) provider took approximately 3-4 weeks to process shipment requests, leading to slow fulfillment and frequent out-of-stock listings. With the holiday season approaching, swift solutions were necessary to meet holiday cut-off dates and prevent critical sales revenue losses.
Solution
Cart.com developed a strategy focused on improving efficiencies and resolving inventory issues efficiently.
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Reducing Reliance on 3PL Provider
- Cart.com reduced the brand's dependency on their 3PL supplier by splitting inventory between two reliable fulfillment options. The distributor began shipping products both to Amazon and to the Cart.com warehouse.
- Cart.com reduced the brand's dependency on their 3PL supplier by splitting inventory between two reliable fulfillment options. The distributor began shipping products both to Amazon and to the Cart.com warehouse.
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Creating an FBM Backup
- This strategy established an automated backup plan, enabling orders to be fulfilled from either FBA or FBM from Cart.com’s warehouse. The Fulfilled by Merchant (FBM) listings covered 95% of the catalog, allowing continuous sales even when 3PL stock was low.
- This strategy established an automated backup plan, enabling orders to be fulfilled from either FBA or FBM from Cart.com’s warehouse. The Fulfilled by Merchant (FBM) listings covered 95% of the catalog, allowing continuous sales even when 3PL stock was low.
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Increasing 3PL Stock Limits
- By minimizing out-of-stock periods, overall account health improved, resulting in significantly increased stock limits. This prepared the brand for the holiday season with a healthy supply of Prime Eligible products.
Impact
By the end of September, the natural skincare brand saw significant improvements. Amazon Prime delivery times were now displayed on listings as orders were fulfilled by Amazon. Out-of-stock issues were eliminated, thanks to the Cart.com warehouse’s ability to fulfill orders until the next distributor shipment arrived. This led to a dramatic increase in FBA storage limits from 2,000 to over 58,000 units, achieving a 97.5% FBA in-stock rate.
Conclusion
With Cart.com’s intervention, the natural skincare brand resolved their inventory and fulfillment challenges just in time for the holiday season. If you're facing similar issues or need expert assistance in managing your e-commerce operations, please reach out to us for tailored solutions.
