Dive Brief:
- Amazon will begin cracking down on inaccurate handling times for sellers' self-fulfilled SKUs starting June 29, according to a notice to sellers last week.
- Amazon said the handling time — the time between when a customer places an order and when it's given to a carrier — is deemed accurate when the actual time consistently matches the configured handling time for each SKU. SKUs consistently shipped at least one day faster than stated will be flagged by Amazon and need to be updated within 30 days.
- "If accurate handling time is not provided, we'll start managing the SKUs on your behalf and provide [late shipment rate] protection for 180 days," Amazon said.
Dive Insight:
The initiative aims to push sellers to offer more accurate delivery dates, as that can drive additional sales, according to Amazon. The e-commerce giant said more than 87% of seller-fulfilled orders received in the U.S. are handled within a day, but "many sellers set longer SKU-specific handling times than needed, leading to overestimated delivery promises."
"Fast and accurate delivery builds customer trust and is a key factor in purchase decisions," Amazon added. "In fact, every one day improvement in promised delivery time leads to an average 5% increase in sales."
To comply with the new requirement, Amazon recommended sellers enable an automated handling time setting. Through that option, Amazon monitors and adjusts the time based on recent shipping history and helps sellers avoid having to monitor individual SKUs, the company said.
Alternatively, sellers can manually set handling times at the SKU level. However, Amazon said it will monitor the SKUs over a 30-day period to ensure the stated time matches the actual shipping speed. Through that evaluation, Amazon will determine the fastest handling time a seller can process without exceeding a 4% late shipment rate, according to the company.
The new requirement doesn't apply to custom, handmade and bulky less-than-truckload shipments.
Amazon's push for sellers to provide precise handling time estimates is one of many tactics the company is deploying to woo customers with faster and more accurate shipping. The company is expanding its 30-minutes-or-less delivery offering to more U.S. cities and has touted strong demand for same-day delivery.
