Amazon Vendor Central Business Value
Processing Purchase Orders Like a Pro
Section 1: The Purchase Order Cycle
Cheat Sheet
Purchase Orders
• Purchase Orders are the orders Amazon places with you as their supplier or vendor for your products.
• This means that when Amazon places an order with you, they purchase the product from you and end up owning that product once it has shipped.
• A Purchase Order is also a contract between you and Amazon, that is, whatever you accept as quantity and cost per unit of each of the product items on that Purchase Order, as well as the date you select you will be shipping or delivering the product to Amazon on, is all contractual and this is where the Chargeback system arises from.
• If you invoice for a cost that is not on the Purchase Order for that particular item, then you will receive a Price Claim.
• If you do not ship all the units you accepted and agreed to on the Purchase Order, you will receive a Shortage Claim.
• If you ship the product late or not at all, if you ship product not packaged correctly, labelled correctly, etc. then you will receive Chargebacks.
• It is therefore imperative that when accepting each individual line item on a Purchase Order that you are committed to fulfilling that line item by the unit cost and quantity, as well the ship by or delivered by date on that Purchase Order.
• For more detailed explanations of what Chargebacks you can receive during the Purchase Order Cycle as well as how to dispute them, Shortage Claims and Price Claims, check out our “Contesting Chargebacks and Invoice Reconciliation” Course.
• Your Purchase Orders can be found by selecting “Purchase Orders” from the Drop-Down Menu of the “Orders” Tab on the Top Menu of Vendor Central.
How Amazon generates Purchase Orders
• Amazon generates Purchase Orders to you automatically.
• What this means is that Amazon’s systems run a variety of forecasting diagnostics and formulae and a quantity per item is spat out of the machine and a Purchase Order is placed for that amount of that item for a specific Amazon Fulfillment Center where that product is most in demand and has the least number of units in stock.
• This is essential to understand because, when Amazon is not placing Purchase Orders, it’s nothing personal: it just means that there is no forecast for any units for that product because there is no demand.
• Which brings us to the forecasting tool that Amazon generates on Vendor Central for you to use in your own production planning.
The Forecasting Tool
• Whether you have Basic Analytics or the Premium Brand Analytics on your account, both versions do have a Forecasting and Inventory Planning Report.
• You can find this report by selecting “Analytics” from the Drop-Down Menu of the “Reports” Tab on the Top Menu of Vendor Central.
• Located under the “Operations Dashboard”, you will find your Forecasting and Inventory Planning Report.
• This report indicates how many of each ASIN were ordered in the previous 13 weeks as well as how many of each ASIN Amazon’s forecasting model predicts they will need in the 26 weeks.
• You also have options to show which types of forecasts Amazon used in their report and download these reports to include in your own forecasting models.
• The Drop-Down Menus at the top of the right side of the page will allow you to choose which data you wish to have in your report.
• Your Distributor View options can either be “Sourcing”, which means you are viewing the products you sourced from another party and shipped to Amazon or, “Manufacturing”, which means you are viewing products you shipped from your own manufacturing warehouse.
• Your Sales View options can either by “Ordered Units” which are the units Amazon ordered; or “Shipped Units” which are the actual units you shipped.
• When choosing which option here, we would strongly recommend that you use “Ordered Units” as this indicates more truthfully what Amazon actually wanted from you and not what you were able to ship in the end.
• Further-Drop Down Menus will be Category, Sub-Category and Brand (if you sell multiple brands).
• Your Reporting Range options can be Daily or Weekly.
• Your Viewing can then be a variety of options depending which of the Reporting Ranges you selected.
• Once you have selected your data criteria from these Drop-Down Menus, you would need to select “Apply” in order for the reports below to be updated accordingly.
• Once you have the selected views in place, you can then opt to Download the various options for reports by clicking on the “Download” button in the top right-hand side of the page.
• Further to this, the graph below the Selection Criteria Drop-Down Menus can also be amended to show even further data selection.
* You can include or exclude Ordered Units from your report. The Ordered Units shows you what ASINs were ordered in the past and can give you an overview of a trend when compiled over several months to a year. You can then know to build in a seasonality percentage into your forecasting and planning model for that ASIN, so we would recommend you leave it in your report.
* You can include or exclude Mean Forecast from your report. The Mean Forecast is Amazon’s best estimate of customer demand for each particular ASIN and is probably the forecast you would most likely use in your own forecasting model, especially if you are using Amazon’s forecasting report for the first time. We would therefore suggest that you use the Mean Forecast instead.
* You can include or exclude P70 Forecast from your report. The P70 forecast is Amazon’s estimate of a 70% probability that the customer demand will be at or below this value.
* You can include or exclude P80 Forecast from your report. The P80 forecast is Amazon’s estimate of a 80% probability that the customer demand will be at or below this value.
* You can include or exclude P90 Forecast from your report. The P90 forecast is Amazon’s estimate of a 90% probability that the customer demand will be
at or below this value.
• The Table below the graph also allows for further manipulation. You can choose to view by ASIN, Subcategories or Categories.
• You can add additional ASIN identifiers for easier reference to your catalog or other internal reports from your own systems. And you can select your Forecast Option again here too.
• The Premium Brand Analytics version of the Forecasting and Inventory Planning Model does give you additional data, such as:
* Replenishable Out Of Stock. Glance views the product received when it was out of stock but replenishable as a % of total product glance views;
* Glance views the product received when it was out of stock but replenishable as a % of total product glance views across all ASINs; and
* Replenishable Out Of Stock. Glance views the product received when it was out of stock but replenishable as a % of total product glance views from the previous period.
• Your Forecasting and Inventory Planning Model off of Amazon’s Vendor Central can greatly assist you in forecasting and planning your inventory to supply Amazon and thereby reduce the risk of being unable to supply Amazon with certain ASINs, especially if you are outsourcing your product and rely on it to be shipped by sea or air to your own warehouse from where you ship to Amazon or its customers.
• It is also the best tool you have at your disposal to see what Amazon intends to order in the coming 26 weeks.
Confirming Purchase Orders
• Right, let’s start at the very beginning and confirm some new Purchase Orders you have just received.
• On your Vendor Central Dashboard, new Purchase Orders that need to be confirmed can be found in two locations: Under the Required Actions Tab on the Home Page of your Vendor Central Dashboard; and in the “Purchase Orders” menu item in the Drop-Down Menu from “Orders” in the Top Menu of your Vendor Central Dashboard.
• To confirm your Purchase Orders, click on the link under the “Required Actions” tab on your Home Page or select “Purchase Orders” from your “Orders” Menu Item.
• Under “Action Items” in the top left-hand corner of your Purchase Orders Dashboard, select “Confirm New POs” if there is a number within the brackets alongside this item other than (0).
• Select the Purchase Orders you wish to confirm, either singly, or by bulk selection and then click “Open Selected POs”.
• On the next page, you can either singly select items or select all items and do a bulk edit.
• If via Bulk Edit, select all items and click on the little arrow alongside the “Bulk Edit” button.
• Select the product availability from the drop-down menu and the expected ship or delivery date and click “Apply”.
• If singly, under each single line item, click on the “Availability” cell and select the availability from the drop-down menu.
• Then click on the “Expected Ship or Delivery Date” cell and select your date there.
• You can amend the quantities of each line item in the “Accepted Quantity” cell or leave as is.
• Once you are happy with all your edits, you can then click on the “Submit” button at the bottom of the page in the left-hand corner.
• You can also choose to export this information to excel before clicking the “Submit” button by clicking on the “Export this data to Excel for your records” button above the line items table.
• This will allow you to run any cross-references between your warehouse inventory and what items are requested on the Purchase Order.
• Be sure to also check the costs of each item to ensure that they are correct and your system’s Sales Order values match those of the Vendor Central Purchase Orders.
• Finally, once you have confirmed your Purchase Orders, you can then print a pick list by clicking the “Print a Packing List” link.
• This makes it easier for your warehouse to pick and pack the items on the orders.
• All Purchase Orders are to be confirmed within 24 hours of being issued by Vendor Central.
Editing Purchase Orders
• To edit Purchase Orders that have already been confirmed, select “Purchase Orders” from your “Orders” Menu Item in the Top Menu of your Vendor Central Dashboard.
• Under the “Confirmed Purchase Orders” list on the page select the Purchase Orders you wish to edit, either singly, or by bulk selection and then click “Open Selected POs”.
• On the next page, you can either singly select items or select all items.
• Click the “Update Selected Items” at the bottom left side of the table.
• On the next page, you can either singly select items or select all items and do a bulk edit.
• If via Bulk Edit, select all items and click on the little arrow alongside the “Bulk Edit” button.
• Select the product availability from the drop-down menu and the expected ship date and click “Apply”.
• If singly, under each single line item, click on the “Availability” cell and select the availability from the drop-down menu.
• Then click on the “Expected Ship or Delivery Date” cell and select your date there.
• You can amend the quantities of each line item in the “Accepted Quantity” cell or leave as is.
• Once you are happy with all your edits, you can then click on the “Submit” button at the bottom of the page in the left-hand corner.
• You can again also choose to export this information to excel before clicking the “Submit” button by clicking on the “Export this data to Excel for your records” button above the line items table.
• This will allow you to run any cross-references between your warehouse inventory and what items are requested on the Purchase Order.
• Be sure to also check the costs of each item to ensure that they are correct and your system’s Sales Order values match those of the Vendor Central Purchase Orders.
• All confirmed Purchase Orders are to be edited within 48 hours to 4 days of being issued by Vendor Central.
Cancelling Line Items on Purchase Orders
• To cancel certain Line Items completely on your Purchase Orders that have already been confirmed, select “Purchase Orders” from your “Orders” Menu Item in the Top Menu of your Vendor Central Dashboard.
• Under the “Confirmed Purchase Orders” list on the page select the Purchase Orders with the Line Items you wish to cancel, either singly, or by bulk selection and then click “Open Selected POs”.
• On the next page, you can then singly select the Line Items you wish to cancel. Click the “Update Selected Items” at the bottom left side of the table.
• On the next page, you can either singly select Line Items or select all Line Items you wish to cancel and do a bulk edit.
• If via Bulk Edit, select all Line Items you wish to cancel and click on the little arrow alongside the “Bulk Edit” button.
• Select the product availability from the drop-down menu, which will obviously be one of the “Out of Stock” options available and which fit your reason the best and then no expected ship or delivery date will be required and click “Apply”.
• If singly, under each single line item, click on the “Availability” cell and select the out-of-stock availability from the drop-down menu.
• The “Expected Ship or Delivery Date” cell will automatically become grayed out with no date.
• The Line Item in the “Accepted Quantity” cell will become “0”.
• Once you are happy with all your cancellations, you can then click on the “Submit” button at the bottom of the page in the left-hand corner.
• All confirmed Purchase Orders are to be edited – and that includes any cancelled Line Items – within 48 hours to 4 days of being issued by Vendor Central.
Cancelling Purchase Orders
• Say you wish to cancel an entire Purchase Order because you can’t supply any units on it.
• To cancel Purchase Orders that have already been confirmed, select “Purchase Orders” from your “Orders” Menu Item in the Top Menu of your Vendor Central Dashboard. Under the “Confirmed Purchase Orders” list on the page select the Purchase Orders you wish to cancel, either singly, or by bulk selection and then click “Open Selected POs”.
• On the next page, select all Line Items in the Purchase Order and click the “Update Selected Items” at the bottom left side of the table.
• On the next page, select all Line Items on the Purchase Order and click on the little arrow alongside the “Bulk Edit” button.
• Select the product availability from the drop-down menu, which will obviously be one of the “Out of Stock” options available and which fit your reason the best and then no expected ship or delivery date will be required and click “Apply”.
• The “Expected Ship or Delivery Date” cells for all Line Items on the Purchase Order will automatically become grayed out with no date.
• All Line Items in the “Accepted Quantity” cell will become “0”.
• Once you are happy with all your cancellations, you can then click on the “Submit” button at the bottom of the page in the left-hand corner.
• All confirmed Purchase Orders are to be edited – and that includes any cancelled Purchase Orders – within 48 hours to 4 days of being issued by Vendor Central.
Submitting Routing Requests
• In order to submit a Routing Request, go to the “Orders” tab in the Top Left-Hand Corner and Select “Shipments”.
• On the next page, select “Create Shipments”.
• From the list on the following page, select the PO Number you are about to create the Routing Request for and click “Next”.
• Select the relevant Warehouse Address from the Drop-Down Menu in the “Ship From Location” item, type in the number of cartons in the “Number of Cartons” item and select “I will use Vendor Central to print my package labels” for the Label Printing Options as the safest way to ensure all relevant information required by Amazon appears on your labels.
• You can either choose to use these labels as they are or ensure that all information on these labels appear on your own personal labels.
• Click “Next” and on the following page, select all the SKUs that will be shipping and then click “Next” again.
• On the next page, select the Ready Date from the Drop-Down Menu and Complete all fields as per the packing list before clicking “Next”.
• Review all the details on the following page, and, if happy, click “Submit”.
• Something to note here is that some Purchase Orders contain so many units and are being shipped in so many cartons that you would need to edit them in a spreadsheet.
• As this spreadsheet will contain all the line items in all of the cartons, it is imperative that you go through each carton and ONLY enter the units of those items actually packed in the carton.
• Otherwise, if you have 26 cartons for example, you may end up packing the entire order 26 times, that is, all line items are shown to be in each of the 26 cartons unless edited correctly in the spreadsheet.
• Another important thing to note here is that you HAVE to absolutely make sure that each and every unit of each and every product is listed as packed in the correct carton, otherwise this could lead to chargebacks because the mapping of a product and its quantity to a specific carton was incorrect.
• It is also imperative that all information that appears on the Amazon-generated labels also appears on YOUR own labels if you choose not to use Amazon-generated labels for your Purchase Orders.
• Otherwise, any missing, incomplete or inaccurate information on your Carton labels will result in chargebacks.
Submitting Advanced Shipment Notifications
• In order to submit an Advanced Shipment Notice for Amazon, your Purchase Order must have been assigned a carrier by Amazon (if collect) or have an appointment scheduled with Amazon for receipt (if prepaid).
• On your Vendor Central Dashboard, select “Shipments” from the “Orders” Drop Down Menu in the Top Left-Hand Corner.
• On the next page, select “Submit ASN”.
• On the following page that opens, select “Submit ASN and Complete Shipment” from the “Action” Drop Down Menu to the Right of the PO you wish to submit an ASN for.
• Select the PO and Click “Next”.
• All the information from your Routing Request will be on the next two pages so be sure to double check that none of this information has changed before clicking “Next” and “Next” again.
• On the third page, fill out all relevant information regarding the ship date, the shipment type, the volume and weight, your carrier and the tracking number, and then Click “Next”.
• On the following page, select the Tracking Number that you have just filled in on the previous page alongside each Amazon container code from the Drop-Down Menu and Click “Next”.
• If you are happy with all the information on the following page, you can select “Submit”.
• Important things to note are that you HAVE to ensure that each unit of each product is listed as packed in a specific carton with a specific tracking number (if shipping small parcel) otherwise you can receive ASN Accuracy chargebacks as well as shortage claims!
• This is so vital that what you enter in these cartons on the ASN matches exactly what is actually in the box and the items IN the box are labelledncorrectly as per the unit ASIN, Model Number and EAN or UPC as what is on the Purchase Order and that the carton label matches exactly to the AMZNN number generated by Amazon for each of your cartons.
• Using Amazon’s labels for your cartons will at least ensure that you don’t get any chargebacks related to Carton Labelling.
Submitting Invoices
• To invoice your Purchase Orders, select the “Invoices” Menu Item in the Drop-Down section of your “Payments” item on your Top Menu in Vendor Central.
• On the next page, click on the “Create Invoice” yellow button.
• On the next page, select the Purchase Order you wish to invoice, scroll to the bottom of the table and click “Create Invoice”.
• On this page, fill in the invoice number and date as per your own system-generated invoice.
• Ensure that all line items that show on your invoice and your packing list for this Purchase Order are shown on this invoice for Vendor Central.
• Make sure that the relevant tracking number/PRO number shows in each line item as applicable and that all unit costs match the unit cost from the original PO and your own system-generated invoice.
• If there is no tracking number, you could end up with Shortage Claims.
• If the unit cost does not match that on the Purchase Order, you will end up with Price Claims. Ensure that the total of the invoice you are about to submit matches the total of your system-generated invoice.
• Include any miscellaneous charges from the Drop-Down Menu that may be relevant to this invoice and, when happy, tick the acknowledgement box and then click the
“Submit” button.
Shipping from two different warehouses
• It is possible to ship one Purchase Order from two different warehouses.
• It simply involves splitting that Purchase Order into two Purchase Orders when it comes to submitting the Routing Requests, the Advanced Shipment Notices and the Invoices.
• What is incredibly important is that you map the products coming from each different warehouse accurately to the cartons they are packed in for each Routing Request and Advanced Shipment Notice.
• So, essentially, you would create two Routing Requests and two Advanced Shipment Notices from those Routing Requests.
• Only include those items shipping from Address 1 on Routing Request 1 and matching those items identically to the ASN 1.
• Then only include those items shipping from Address 2 on Routing Request 2 and matching those items identically to the ASN 2.
• Essentially, when you create your second Routing Request you should not be able to include those items shipping already in Routing Request 1.
• You would then continue to generate either a single Invoice from the Invoices Tab on Vendor Central or two separate invoices.
• If generating a single invoice, you MUST be sure to include the tracking numbers PER LINE ITEM on the invoice otherwise you are going to end up with shortage claims and chargebacks!
Troubleshooting Tips for When Amazon is Not Placing Purchase Orders
• There are so many reasons why Amazon will not place Purchase Orders for certain ASINs. The reasons could be:
* There is currently no demand for these products by consumers;
* Consumers may not be able to find your products on Amazon because they are not currently showing as available on the Marketplaces;
* These products may have been suspended by Amazon because they are missing the correct content details, such as correct title, features, correct
images, etc.;
* These products may be suspended because they are missing key certifications or documentation that Amazon is waiting on in order for them to be ableto actually sell your product on their website;
* Amazon won’t place Purchase Orders if there is no GTIN number or even a cost for your product as how can Amazon place a Purchase Order for something when they don’t know how much you want them to pay for it; or
* Perhaps the cost you are offering for these products is not profitable enough for Amazon and they will lose on storage, picking and packing fees if they purchase at this current cost from you.
• Now that we know some of the factors that can be causing Amazon to not place Purchase Orders for your Products, let’s look at some of the ways you can fix this, starting off with:
* Contacting Amazon Support to find out what the reason is for Amazon not placing Purchase Orders for your products;
* Checking Forecasting Reports to see whether there is a demand for your products and whether Amazon intends to place orders for them in the future;
* Resetting Availability for your products and then checking whether your product is showing as available on the Amazon Marketplace and that it can actually be found;
* Resetting the Availability Date and then checking back on the site after this date to ensure that your product is showing as available and can be found;
* Resetting the Release Date in case your product is still not showing and then checking post this release date whether your products are available on the Amazon website;
* Making sure that your Product has not been suspended by Amazon because it is missing vital information or images and updating this copy;
* Creating Twisters for any variations of your products that are currently appearing on Purchase Orders and for which there is a demand by consumers;
* Submitting any missing certifications for these products;
* Checking that these products have UPCs and Costs in the relevant fields in your catalog;
* Checking that there are no profitability issues that need to be fixed from your side;
* Considering applying for Direct Fulfillment for these products so you can fulfil them to the consumer yourself; and
* Considering applying for the Born to Run Program to get Purchase Orders in from Amazon for these products.
• For a more in-depth explanation of how to solve the problem of Amazon not placing Purchase Orders with you, check out our Micro Course entitled “Why is Amazon Not Placing Purchase Orders.”