Podcast transcript
Introduction
Hi, everyone, and welcome to Marketplace Masters, the podcast where we dive into the strategies that fuel success on Amazon.
Paul Sonneveld
I am your host, Paul Sonneveld, and today we're tackling one of the most important topics for Amazon vendors the annual vendor negotiation process, and specifically, how to best prepare to improve the commercial terms for your business.
Now, quick word from our sponsors. This episode is brought to you by MerchantSpring, the top analytics platform for Amazon vendors and their agencies. Vendor profitability is no easy task, but MerchantSpring's new vendor profitability module simplifies this by integrating COGS, rebates, chargebacks, and advertising costs. Now you can quickly assess profitability at the vendor code and ASIN levels from both a sell-in and sell-out perspective.
The early release program is now live and has limited spots. Head to merchantspring.io or visit http://bit.ly/vendor_pl to register. All right, that is it from our sponsors. Let's get on with the topic. I am really thrilled to introduce today's guest, Oliver Tomaschewski. Let me bring him on here. Oliver is the Founder and Managing Director of DiCommerce, a top consultancy for Amazon account management. With over eight years of AVN experience and more than 60 sessions, and negotiation sessions under his belt, Oliver is a trusted expert in guiding vendors through Amazon's AVN landscape helping them secure favourable terms and grow their market share.
This year, in fact, you'll be in Bratislava supporting clients through the AVN negotiations, you know, whether that's leading, supporting remotely or sort of fully managing the entire process. So he's certainly well versed to tackle this topic with me today. Thank you so much for being on the show today, Oliver.
Oliver Tomaschewski
Thank you very much for the invitation. It's always great to be here. Thank you.
Paul Sonneveld
It's a fantastic guy. Definitely a wealth of experience, and I can't get way to really get into it. I do want to remind everyone that this is a live episode. For those of you watching live, we have lots of time for Q&A as well. So if you do have questions, please pop them in. I think LinkedIn works best. Pop them into the LinkedIn comments section, and Oliver and I will do our best to try and answer them either towards the end of the show, or if it's super relevant to what we're talking about, I will try and do my best to throw them in there. With that in mind, let's kick off. And let me start with high-level question here, Oliver, which is, you know, what are the trends you are seeing around the annual vendor negotiation process? You know, particularly around, you know, what's Amazon's agenda and how has it changed over the years?
Oliver Tomaschewski
Yeah, so when we take a look back, let me take a look back maybe for about six, seven years ago. In my former life, I was working for a big company called Rohr, and I was managing also the AVNs. So during this time, the AVNs were really more focusing on growth and on really beneficial topics. So for example, if there was a vendor without A-plus premium term set up, so in this case, Amazon offered it. And during that time, it was really beneficial also to use these topics.
But since, I would say, three years ago, we strongly see that Amazon is really pushing more and more the margin in Net PPM situation. So we never had so hard discussions regarding this topic since the last three years. But basically, when we take a look back, during the last two years also when the Ukraine war started in Europe, the margin situation was even worse due to the high inflation topic and we also saw that Amazon tried to decrease prices with the vendors increasing in the same time terms. So last year it was really tough to get yeah to close the AVN.
And then Amazon is also trying to create new services. So for example, two years ago, we saw quite often during the AVNs that Amazon is pushing the Amazon business topic. So for example, to get a term 1% on all the B2B sales to push the B2B business, as this is a big growth lever, not only for vendors, but also for Amazon in general. And basically last year, Amazon introduced also new services like installment service or any, yeah, I would say, these services are not really growth-focused, but Amazon is trying to create new services like this to increase their margin.
Paul Sonneveld
The million-dollar question, of course, is what do you think is on Amazon's agenda for this round of negotiations?
Oliver Tomaschewski
I would say it's not the price for everyone, but Amazon will try again to save some costs, to increase their margins. So I expect that Amazon will try to fight against any price increases that vendors will have this year. And they will introduce new terms or increase existing terms with the same argumentation that vendors are using to increase their prices, because Amazon has higher labor costs, higher logistic costs and all this stuff. So this year, I think it will be again very, very tough to discuss.
Paul Sonneveld
Let's see. So let's maybe set the scene as well in terms of the negotiation. I mean, there's lots of different terms, rebates, lots of things being thrown out there. Maybe can you just paint a bit of a picture of what are all the different things you can negotiate around as part of this annual process with Amazon?
Oliver Tomaschewski
Yeah, very good question. Maybe before we jump into the exact topics, how to negotiate them, maybe just let me share my screen because I prepared a slide for this so that we can see which different terms Amazon is offering. Perfect. Yes. So, basically, we created an overview of the most relevant terms and contract condition terms Amazon is offering. And we tried to summarize them in different categories. So for example, when we go to marketing, not all of these categories are still existing anymore. So some of these Amazon just have from a historic perspective with some vendors but some of them are also quite new.
So I think most of the vendors will know the so-called MDF, market development fund, or also sometimes it's called automated marketing. So this is what everyone has to pay, at least it's about 5 to 10 percent, sometimes also even more. This is where Amazon just taking the money, at the end to be fair it's more module-related for Amazon, but Amazon tells us that they invest this money into marketing activities on the platform.
But there are also other topics, like mentioned before in the introduction, A-plus premium, which costs normally between 1% to 3%. But there are also other things like manual marketing, semi-marketing, on-demand marketing. At the end, there are different possibilities to give Amazon money from a marketing perspective.
Then we also have the bonus topic. On bonuses, we have different types of bonuses. So this is the VIR, Volume Incentive Rebate which can be conditional. So for example, from a sell-in perspective, so this would be the net receipts perspective to say it in the Amazon KPI language. So if Amazon will order 10 million, you will spend 1%. If they order 50 million, you will spend 2%, something like this.
Then there is also the other way around, which is a sell-out bonus, But this is, to be fair, very hard to negotiate. I just know maybe five vendors which negotiated this part. And in most cases, we see very often that there is an unconditional VIR, which is just if Amazon is ordering more than one euro, they get 3%. So at the end, to be fair, it's the same like the MDF. It's just completely unconditional and it's marginal.
Then what I'm a big fan of is AVS. Yes, to be fair, it's quite expensive to have a personal contact and to pay for it. Amazon is one of the only companies on the world which was able to create a program where you have to pay to get a real person at the other side. But it's really beneficial. And if you have the right person, they can really help you and influence the business. So there are also different historical names like AVS Essential, AVS Light, AVS. But in most cases, every vendor should already have the AVS Pani EU term.
And then we are coming to logistics. Beginning this year, we had also a separate session about logistic optimization. So there we already talked more deeply about all these different programs. But I don't want to go too deep now here. So depending on the logistics that you have with Amazon, you have to pay different terms. This can be PICs, super PICs, no return agreement, overstock agreement. So at the end, you have to pay for this service level that Amazon is offering to you.
But you can also align other topics, like, for example, warranty repair, pre-order discounts, delivery window. This is not a traditional term, but you can also align within the AVN. And one of the worst things, to be fair, that we also saw within the last few years quite often is the so-called CSA, cost-saving agreement. In that case, Amazon is just asking you to pay 100,000 euro without anything that you get. So it's just margin compensation to help Amazon cover the missing margin. Yeah, this is basically everything beside of the terms. Sorry, this is in Germany, I still see. So this is the payment terms, the so-called QPD, quick payment discount.
Paul Sonneveld
That's a pretty extensive list there. I guess, you know, one of the challenges is trying to get creative right around the negotiations and being aware of all the different things that you can negotiate around, which gets us into preparation, right? course, anyone's involved in negotiation for a long time, though, the key to successful negotiation is preparation, preparation, preparation, right? What does that look like? What does it look like in your mind when it comes to preparation for AVN?
Oliver Tomaschewski
Yeah. So in general, you should be prepared for every discussion you have with your clients. But basically, for Amazon, it's even more important to know all the KPIs which are relevant. And it's good that we had the introduction also about the tool. So we highly recommend also in that case, for example, the MerchantSpring tool, where you get all the KPIs. But even if you don't have such a tool, you can just use Vendor Central. Within Vendor Central, there are some basic KPIs. But knowing data, knowing KPIs, this is the most relevant part to be successful. Maybe you already recognize the AVN with Amazon. They are not really interested in products and the discussion about new products that you launch and so on. So they are really, really KPI driven.
So be prepared on this. You should know how your net receipts development is, how your Peacock's development is, basically the net PPM, because if, for example, you increased your net PPM or Amazon increased with you the net PPM from, just give me an example, 45% to 48%, a discussion about reduced pricing is completely nonsense because Amazon increased the margin with you as a vendor. So you need to know this KPI. This will help you a lot.
But also category development, competitor sales, So you should, at the end, know how important are you for Amazon. And even if you, so if you're more important, it will be easier for you to negotiate at the end a successful AVN. So this is about KPIs and data. In general, also the topic about negotiation skills. So it shouldn't be the first negotiation that you have. And the best would be also if it's not the first Amazon negotiation. Therefore, you can Yeah, it takes someone who has already done it or do a training with an external expert. We also offer such trainings, for example, to really be prepared from a negotiation skill perspective for these negotiations.
Then what is also quite important is just to be, sorry, not to be dependent from Amazon. So understand which sales share you have with Amazon. At the end, I would say It's quite okay to have 5 to 15, maybe 20%, but 20% is already quite high of your total sales should go to Amazon. The lower it is, it's better. Because this will just help you to not be dependent from Amazon.
What Amazon also likes is when you have a sales growth plan. So not only telling Amazon to increase sales from 10 to 15 million, but show a plan, really showcase it. So think about how you want to achieve it. At the end, Amazon, they can help you but there is no button that the vendor manager can press to increase your sales to 50 million.
You need to develop together 10 with your vendor manager showcase them Okay, we have new launches all the new launches and please don't create 15 slides of these new products. No one cares about it Just create one slide where you say we have 70 or 700 new agents these agents will help us to increase our sales by 1.5 million. This is enough then we want to increase our advertising budget. This will lead up with the current existing ROAS by 1 million in addition. So really showcase all these different topics that you're working on to increase sales and make a transparent revenue.
Then when you have this overview, I'm also a fan of creating a terms proposal. So terms that I just showed, you know which terms you currently have. Think about what was not successful last year. So for example, if you had an AVS support, but you were not happy with this, just terminate this contract or discuss with Amazon that you don't want to pay so much for this because it's not beneficial. So prepare a new trade term setup, prepare the percentages you would like to pay and which supports your goals, this will help you.
Paul Sonneveld
As you were talking there, Oliver, I think there's a big theme here around being proactive and setting the agenda in terms of the negotiations, really setting forth your plan, what you want to achieve, what you're going to invest in, what you're not going to invest in, and try and be in the driver's seat as part of this negotiation as opposed to sort of taking the defensive position and just waiting for Amazon to deliver their ask and then trying to, you know, play defense from there. So I think, philosophically, I think that's a really important point that you're highlighting.
Now, Probably one of the stickier points. And actually, before I go on to that, can I just say thank you for everyone who is asking questions in our chat. We already have a lot of them. Please keep adding to them. I will make sure that we'll probably have some extra time at the end of this to really go through all of them. So thank you. I'm seeing them, and we'll get to them.
So my next question for you, Oliver, is around when things get tough, when the negotiations get heated, difficult and Amazon is pushing really strongly for margin increases or lower costs. What can you do? Sometimes it's the David versus Goliath type situation. So what advice do you have in these sorts of situations?
Oliver Tomaschewski
There are different tactics you can use. At least, I will repeat just myself, be prepared, know your numbers. So just to give you a concrete example, if your price increase is 6.8% and you need to deliver at least minimum 5%, communicate in the first step the 6.8% and be prepared because Amazon will check if you are right. So be prepared that you can explain that labor costs increased, that logistic costs increased, that material costs increase. So really be prepared, make it also transparent, because if it's really transparent, and in addition, Amazon will see that the market price increased.
So coming from the increased pricing that you also offer your other clients, then it will be much easier for you to increase pricing also with Amazon. Because at the end, Amazon is always a market price follower. They don't really influence the market price. They just take a look on the market price. And if they see it increases, then it will be much, much easier for you to increase prices.
But there are also other techniques. So if you really feel we can't continue like this and I need to put any signal into the discussion, into the AVN, you could, for example, also stop delivering Amazon. But I always recommend not just doing it without thinking about consequences. It could lead up that you stop delivering five, six, seven, eight months. The longest delivery stop I ever saw with the vendor was 10 months. So nearly one year of sales was lost.
In such a case, you need a backup plan. A backup plan can be that you have a broker, which will do the sales for you. Could also be that you have a 3P seller you work with and they will do the sales with you. Or my personal recommendation is that you have an own seller account so that you can just switch from the vendor model to the seller model and also with FBA. It's not so hard as everyone thinks. The only thing is that everyone will know that you directly sell products to end consumers. So this is always a sales political discussion you will have with your clients.
Another thing you can do, what is also quite successful, offer Amazon that they have one last order for all the prices. So new prices take effect from 1st of January, but they have the chance to place one last order within January with all prices to just have Amazon to increase their margin.
Paul Sonneveld
So one last gift to smooth things over just a little bit. Now, I'm curious around the broader relationship with Amazon here. So obviously, you know, things get pretty intense with your vendor manager during this negotiation process, right? What role does communication with Amazon play, you know, outside the sort of day-to-day communication, outside the negotiation cycle? You know, how important is, and is there a way to leverage kind of relationships, communications, you know, outside the NBN process for AVN purposes?
Oliver Tomaschewski
Yeah. Amazon is a machine, and it's quite hard to have humans there to talk with. But if you have a vendor manager, really try to have a good relationship to him. I'm always recommending also to all our vendors, visit this vendor manager at least once a year, if it's possible, also more often. But at the end, if you have the chance, go for a personal AVN discussion to the office as you introduce or as you had also introduction. I will be this year, for example, for some days in Bratislava because some of our clients are managed by vendor managers which are sitting in Bratislava. And there we will have each day vendor negotiations. I will be also, for example, there to discuss with the client together the terms for the next year with Amazon.
So this is the first thing, really try to have personal communication with this person. If that is not possible, then try to have regular meetings with your vendor manager through the QIIME program. So at least once a quarter, just have a positive feeling during the year, so at the end of the year it will be easier for you to negotiate whatever you would like to have.
At the end, I would say your vendor manager is your main point of contact. So really try to be friendly and helpful and when you have meetings with them, don't only talk about problems also talk about successes so when he helped you for example to onboard the PICS program and everything is now successful you saved a lot of logistic workload and just everything is better the KPIs are better deliveries shortages chargebacks reduced and something like this. Be friendly, tell it to him, say thank you, and within the AVN it will be easier for you.
And if it's really necessary to push the discussion to the next level, try to find out during the year, not during the AVN period, then it's late, but try out to find out who is the European sponsor for your AVN. This is mostly a senior category leader, senior vendor manager, European leader. So know this person so that you can escalate in any case that it is necessary.
Paul Sonneveld
Relationships are still important, right? So it's good to maintain them throughout the year. Can I just ask about advertising? Actually, Patrick is asking a very similar question. I might bring his up in a sec here. You know, often we hear that, you know, the advertising team is super separate to the vendor team, to the seller team, they never talk, they have separate budgets, all of that.
So my question to you really is, you know, what is the role of Amazon advertising and perhaps some of the other promotional tools as part of AVN strategies? You know, do you think, do you combine them? Do you look at them separate? How do you tackle those two separate pieces within the negotiation?
Oliver Tomaschewski
That's not so easy to answer because it depends. So from a terms perspective and from the resulting net PPM perspective, advertising doesn't influence the net PPM. So in terms of the traditional term setup that you have with your vendor manager, it's completely unimportant if you spend 1 or 10 million or even zero euro because there is nothing that is cross-charged to the Amazon vendor manager to increase the net PPM.
But advertising is very important to influence sales. So always when I have the decision or I need to take the decision, if I spend 5% into something that Amazon offers, like automated marketing, on-demand marketing, or something like this, I would always use the AMS part because this is much, much more or better invested than into any term that Amazon is offering to us.
But the problem, as I mentioned, this is not helping to increase the margin with Amazon. So you need to find a middle way. Some years ago, I would say maybe six, seven years ago. This was the case or a small percentage of the AMS budget was really Transferred to the net PPM, but this is long time ago so at the moment you need to find the middle way to have an acceptable net PPM for the for the vendor manager with good terms that you also have benefit of and on the other side invest a lot of money into AMS To really have yes sales and sell out at the end.
Paul Sonneveld
So I just wanted to acknowledge Patrick's question here, which I think you answered. Now, which of the marketing terms would you say are the best? Does AMS still exist as vendor terms? My info is not accepted as part of Net PPM. So yeah, that's exactly what you were saying before.
Oliver Tomaschewski
And that challenge of drivings. Sorry, go ahead. Sorry, please.
Paul Sonneveld
Now, just the challenge between advertising is great for driving sales, but the reality is none of that money goes into the vendor manager's budget or KPI. So at one level, they probably couldn't care less, unless I guess you can demonstrate that it's really going to move the top line and thereby it's going to drive a lot of the margin dollars towards the bottom line.
Oliver Tomaschewski
This was what I mentioned before when I said, be prepared and showcase what your growth plan is. So if your growth plan is to increase, for example, the sales by 20%, and 10% of this is coming out of AMS investment, this will be positive for the vendor manager because it increased the total sales perspective and the absolute margin. So this helps you. But to answer the first question from Patrick, where would I invest? And maybe you can just share the slide again that I have open.
When we take a look on the terms within the marketing Yeah, thank you very much. Within the marketing area, you always have to invest into automated marketing. But to give you an example, if you currently just invest 10% into automated marketing, try to reallocate bonuses from automated marketing into other parts that gives you additional service level.
So for example, reduce automated marketing by 2% and just take 2% into A-plus premium if you currently don't have A-plus premium. Try to reallocate them and just get better service level out of these marketing investments. But again, try to reduce them as low as possible. Every euro that you spent in advertising is better than in these marketing terms.
Paul Sonneveld
Thanks for your question, Patrick. We'll get on to some of the others very, very shortly. Oliver, I want to come back to one of the points you really made at the start around, you know, reducing your reliance and share of your Amazon vendor channel. The more other options you have outside Amazon, the more leverage in terms of the negotiation. I mean, if 90% of your business is through the Amazon vendor channel, you really don't have much leverage.
So my question to you is really around, how do you actually reduce this dependency? I mean, I know you've sort of worked for a vendor in your past as well. How did you tackle this challenge of reducing the dependency? And I don't think it necessarily means reducing the sales of Amazon, but the overall share, how do you reduce that for improved leverage that you can then apply as part of this AVN process?
Oliver Tomaschewski
Yeah. Yeah, so at the end, this is not something that will take him from today to tomorrow. It's a long period and a long time that you need to really reduce your dependency from Amazon. But how can you do it? So in my former life when I was working for a big brand, I was responsible for e-commerce business and there we defined a strategy that for each channel or for each specification within the channel we want to have two big partners to be independent.
So for example, if we take a look on marketplaces for sure Amazon is one of the relevant partners But in Germany, there's also auto for example or in France there's Manu Manu and So also take a look outside of the Amazon business and try to reallocate the sales to different market places. So this is the marketplace topic.
Then in the second step, we also defined from the online peer players who is relevant. And there we also defined two big online players and pushing different product portfolios with each of them so that we don't have any problems that they fight against each other. So also try to increase online peer player e-commerce sales.
And at least there are also hundreds of indirect e-commerce businesses defined which are relevant. I call it in my former life the business intelligence what is behind it. So not only a small e-commerce business who is bargaining all the day, I am the cheapest, I am the cheapest, but really find the relevant one who really have marketing, who have good content. So where just the business intelligence is behind it and they can have a strategical business approach.
Paul Sonneveld
Fantastic. OK, we're at half past 12, or at least here in Europe, depending on where you're watching us from. Let's get to some questions. So we've got a lot of them there. So thank you, everyone, for submitting your questions. Let me start off with Susanna. Good to see you again, Susanna. She's asking, any tips to move ineffective co-ops to try and get AVS for free?
Oliver Tomaschewski
The best hack here is to be fair, if you have inactive co-ops, terminate them. Many vendors forget it. Within the terms that's written, if you want to terminate this contract, please open a case and then you can just terminate it. I think at the moment it's 45 or 60 days in advance. So it shouldn't be too late. You can still terminate this agreement until end of the year if your agreements are valid until the end of December.
So this is the most powerful weapon you have to push Amazon to renegotiate a term. But for free will be quite hard. So at the end, maybe as mentioned before, this was an example we had also with Patrick. If you have 10% automated marketing, take 2% out of it and maybe increase in addition by 1%. So 3% would be for ABS. And at the end, it's a plus 1% instead of plus 3%.
Paul Sonneveld
Perfect. Next question from Kunal. Are there any new programs you can expect for the AVN cycle next year? Any new things that you think Amazon will be pushing?
Oliver Tomaschewski
Yeah, so we saw already in the beginning of the year when we had a discussion about the logistic programs that Amazon is pushing more and more logistic operational parts. So for example, there is a direct fulfillment program where you can directly deliver without stopping at any warehouse directly to Amazon. This was a beta program which started this year. I think that Amazon will start to offer it more and more customers within the AVN for next year.
Paul Sonneveld
Thank you for that. There's another question here that's just similar to what you're asking for. From Sadbh, apologies, I can't pronounce your first name there, but can you change pre-existing terms that has moved 1% from, say, damage allowance into marketing? Is that possible and how to go about it?
Oliver Tomaschewski
This way, it will be very easy because damage allowance always cover costs on the Amazon side. So if you exclude or now stop the damage allowance with 1%, so Amazon will be allowed to ship everything back to you. This will be the best situation that Amazon can have. And if you push it then into marketing, marketing terms are always more margin-related. So this way will be very, very easy for you. But I wouldn't recommend it because then you have all the damaged products there. And the marketing return of invest is quite low. But the other way around, it will be very hard.
Paul Sonneveld
Thank you. Now, there are a few questions on AVS here. So that usually comes up. We have one from Patrick. How much do you pay for AVS? Now, I did say maybe we should, if you want, we can bring your slide up again. There are different types of AVS programs too. So I suspect, without preempting your answer, it probably depends on the type of program too, but some benchmarks would be useful at this point.
Oliver Tomaschewski
So the general benchmark from Amazon is 3.8% for a European AVS. But it's depending how long you already have an AVS. So if you have already an existing term, it can be also low. In the past, there was also a fixed payment. It started, I think, with 80,000 and 180,000, 350,000. So it really depends on which time you've started with Amazon on the AVS. But the last percentages that we saw last year, so at the moment, we're kicking off all the AVNs with our vendors, but there wasn't any vendor renegotiation so far for this year. So last year, we saw quite often percentages between 3.5% and 4%. Mostly, it was 3.8%.
Paul Sonneveld
So I was just going to ask, Oliver, here, around AVS here, obviously, you've got your essential light Pan-EU, which is what you were referring before. The essential and the light programs, are they still available and they much more affordable or are they the less.
Oliver Tomaschewski
No, no. So this is just historic. So if you start now, it's just in European areas.
Paul Sonneveld
Great. Thanks for applying that. Question on NetPPM from Jorge here. Can you give some insights around the healthy NetPPM to have on our account? I mean, this is a question we get a lot, which is, how do I know whether Amazon should be happy with my net PPM or not? Because for sure, they'll tell you they're not, right? How can I actually understand if there's a real issue there or actually I'm in a good position?
Oliver Tomaschewski
You don't like the answer I will give, but it depends. So for example, if you are within electronics or computer devices, the net PPMs are always quite low. But if you're, for example, in offices or in DIY, margins are higher. So it can be that 15% net PPM is quite OK, but it can also be that Amazon requests you to have 45% net PPM because this is within your category.
I always recommend to, this is why I mentioned that you should have a good communication with your vendor manager. Try to get this information during the year so that you are prepared and know what is the net PPM within the category and also maybe get some insights from the market or from tools. So there are a lot of tools available to get such data. But at the end, it really depends on the category where you're selling.
Paul Sonneveld
Thank you. Just another benchmark question here around PICS, and I appreciate there's PICS and SuperPICS, but what's a good benchmark for the perfect inbound consolidation service?
Oliver Tomaschewski
Yeah, again, it depends. So you always have to ask yourself, what is the starting point where you're coming from? If your vendor central price is already by 30% increased compared to the other clients, the percentage will be higher. So it's not really easy to answer all these percentage questions because it always depends where you're starting from. But to give you a general overview, it's something between 2% to 6%. And it depends also if it's sortable, unsortable, are the products big, are they heavy, and how many of these products are shipped to the Amazon FC network. But if there are some detailed information necessary, you can just contact us afterwards, and we can really deep dive into this.
Paul Sonneveld
Thank you. Thank you, Oliver. I really appreciate you at least putting some numbers out there. Sometimes there's a real reluctance. So at least it's good to have a benchmark, but obviously with some caveats and exclusions there. Now, I apologize, but there are still a couple of questions that we won't get to today. But maybe, Oliver, if I can ask you maybe later today, you can jump into the comments on LinkedIn and provide some answers there. That would be absolutely awesome.
I wanted to finish our podcast perhaps with a final question from me, which is, I know we've talked about the theory and the process and sort of holistically, but I'd love to hear some hacks, right? So any, you know, many, many vendors were about to go through this process, what are some of your hacks or things that you've learned over the years that are worth considering and taking into account? You know, what's your, I don't know, top three, top four, top five hacks that you wish to share with us?
Oliver Tomaschewski
Two things I would like to share with you. First is, I already mentioned it, by the way, this is terminate existing agreements. This is one of the most powerful weapon you have. So if you terminate unhealthy terms or terms that you don't, that doesn't bring any return of investment, terminate them. And then you have a base for discussion with Amazon, because from a legal perspective, you are allowed to terminate it. It's a contract and the contract is limited.
And in addition a second thing is basically this is much much more interesting for European vendors instead of US vendors in Europe So if you have a seller account in parallel to your vendor account then it's called a hybrid setup and you can just push products from the vendor model to the seller model if you stop delivering within the vendor or also to have more pressure on your vendor manager.
So at the end they need the sales with you if they don't have sales with you. They also have a problem so if you tell them If we can't find a solution, I have to move the most relevant product to the seller model. Then you have more pressure. In US, it happens that then seller accounts were blocked. In Europe, this is not legal from the European government. And so in that case, it will be easier for European vendors.
Paul Sonneveld
Perfect. Thank you so much, Oliver. We are out of time, so I'm going to have to wrap it up here. Thank you so much for sharing all of your experience. Lots of practical insights, tools, and tips, tricks, things that we can put into action. Really appreciate you demystifying AVN and sharing all of that valuable expertise for free. Now, for anyone who's listening live or maybe on demand after, and would love to learn a little bit more about how you work with vendors or they want to discuss some specific avian topics with you. What's the best way for them to get in touch?
Oliver Tomaschewski
Can you repeat?
Paul Sonneveld
Yes. I was going to say, for those that are listening to today's episodes or attending live, what is the best way for them to get in touch with you if they have some follow-up questions?
Oliver Tomaschewski
Yeah, so the best way would be just to send us an email. So it's info@dicommerce.de or just visit our website at dicommerce.de. We also have a special offer for all guests that were listening today or listening afterwards. So on your first consultation, you will get a 100% discount. So just drop us an email or just call us for numbers below the website. Or if you also like, you can directly book a session on the website on the right side. There is a button to book directly a meeting with me.
Paul Sonneveld
Fantastic. All right. Thank you so much, Oliver. Really appreciate your insights and appearance today. Thank you.
Oliver Tomaschewski
Thank you very much, Paul. Thank you.
Paul Sonneveld
All right, everyone. That is a wrap for today's episode of Marketplace Masters. Thank you so much for tuning in on the topic of AVN preparation. Now, for more insights, be sure to visit our video-on-demand library at merchantspring.io. It is packed with valuable content to help you succeed. Now, if you're looking to sharpen your analytics or gain more actual insights or help you prepare for some of these AVN negotiations and want to explore how MerchantSpring can help with that, feel free to send me a message on LinkedIn or contact our support team via our website.
Finally, I would love to hear from you if there's a topic we haven't covered yet and you'd like us to do so. I'm very happy to try and find the relevant experts. So just drop me a note and I will do my absolute best to continue to bring amazing Amazon vendor value to you. On that note, thank you so much for listening. And until next time, please take care.
