The Most Harmful Amazon FBA Sourcing Decision You Could Ever Make

Harmful Sourcing Decision
Did you know that a book on Amazon ranked 10 million yesterday could be ranked 500,000 today?
All it takes is one sale. Just one. One sale of that book on Amazon could change the sales rank drastically overnight.

Would you buy a book ranked 10 million on Amazon to resell? Would you buy a book ranked 500,000 to resell?

I know there are lots of other factors at play in how you might answer that question, but my point in asking it is to get you to look at the sales rank. You view a book ranked 10 million much differently than one ranked 500,000, right?

Yet every day many, many Amazon FBA sellers are making their sourcing decisions based on today’s sales ranks and low prices. They find a book ranked 500,000 and snatch it up, without checking to see that it was ranked 10 million yesterday. Or maybe it’s a toy ranked 100,000 that was ranked 1.5 million yesterday.

There are two main reasons why you shouldn’t base your sourcing decisions on today’s sales rank and pricing data:

  1. Amazon changes their prices often.

LC_OFF_Body_NLPAmazon is known to change their prices across their website 2.5 million times per day. That’s just Amazon’s prices – that doesn’t include 3rd Party seller prices, which are also being changed constantly throughout the day with repricers. Now, Amazon has hundreds of millions of products, and they’re changing those prices 2.5 million times per day, which is mind blowing if you try to think about what that means. The low price on items also change throughout the day when a seller sells out of an item and the low price bumps up to the next seller. If prices are changing constantly on Amazon, why would you make a sourcing decision based solely on this one snapshot in time of the current low price?

  1. Amazon updates sales rank often.

Seinfeld Scene It RankAmazon recalculates their sales ranks every hour. That’s 24 times a day that sales ranks change on Amazon! If I’m looking at an item to resell, it’s too much of a gamble to base my buying decision on what the sales rank looks like on this one hour of this one day. The current sales rank is just a snapshot in time of how this item has recently sold. I need to make my decisions based on broader information than this one snapshot.

Whether you are in a store doing retail arbitrage or you are at your desk doing online arbitrage or looking at a wholesale catalog, you need more information than this one snapshot in time. You need more than just the current low price and the current sales rank in order to decide if you want to buy 1 of an item, 10 of an item, or 100 of an item. Your hard-earned inventory money is at stake here! You want to make your decision based on the best information available.

Making this type of decision on how to spend your sourcing money without using historical data from CamelCamelCamel or Keepa is the most harmful sourcing decision many Amazon FBA sellers are making.

I would be willing to go so far as to say that making sourcing decisions without CCC or Keepa is one of the top reasons Amazon FBA sellers quit their business. They spend all their sourcing money on inventory without looking at the historical data, the prices tank, the inventory never sells, and they throw their hands up in despair and say, “I quit! I tried Amazon, and it just didn’t work for me.” Now, there may be other factors at play, but for many resellers using CCC and Keepa could be a huge game changer in their business. They could find profitable inventory that will sell in a reasonable amount of time and won’t lower quickly in price.

I’m especially disheartened when I hear resellers saying they want to quit Amazon FBA over these types of inventory problems because this problem is so easily fixable. You can learn to read and interpret CamelCamelCamel and Keepa. The graphs can make sense, and you can use them to make smarter sourcing decisions.

CamelCamelCamel & KeepaBoth Camel and Keepa are free, easy-to-access programs that you can use on your computer or your mobile device, either in a web browser or from your 3rd party scouting app like Scoutify, ScanPower, or Profit Bandit (Amazon Seller app does not have links to CCC and Keepa, however). It only takes an extra 20 to 30 seconds (if even that!) to look at the sales rank and sales price history of an item when you’re sourcing. You can take a quick look at how often this item has sold and how it’s been priced in the past, and you can make an educated prediction about how it will behave in the future.

I want to encourage you today if you’re making sourcing decisions without using historical sales rank and pricing data from CamelCamelCamel and Keepa — there is a better way to buy Amazon FBA inventory! You can make smarter sourcing decisions. Your business will hugely benefit if you take the time to learn how to use these powerful free resources.

Book & DesktopTo find out how to use both CamelCamelCamel and Keepa to make smart sourcing decisions, be sure to check out our brand new course, The Reseller’s Guide to How to Keepa Camel: Using Amazon Sales History to Make Smart Sourcing Decisions. This course is a combo ebook and video course where I walk you through everything you need to know to make sense of both Camel and Keepa in ways you’ve never thought of.

How about you? Do you use CamelCamelCamel or Keepa? Do you have a favorite? What are you favorite things about Camel or Keepa? I’d love to hear from you in the comments below.

7 responses to “The Most Harmful Amazon FBA Sourcing Decision You Could Ever Make

  1. Hi Stephen

    Just a shout out to say how much I enjoyed your camelcamelcamel keepa book/video course I invested in this week.

    I bought a ton of books I shouldnt have because I didnt understand ccc and keepa data when doing online arbitrage for books.

    Now thanks to your training, I look at the data and see things so much clearer, and would of not bought those products had I had this insight, and im only half way through the course.

    Im even thinking of flipping more expensive books as I can with good educated decision making buy books more intelligently with the 20 seconds or so I spend on ccc now (havent got to the keepa section yet).

    Thanks again


  2. I expected that you would end the article with the best sourcing decision you can make! I totally agree that pricing data and sales rank don’t give the best information for what to source. But what does? I would say… trust your gut and buy products that you like, while paying close attention to margin based on what a person would reasonably pay based on quality, design, etc….

    I have recently purchased a few products based on inflated pricing such as a yoga ball set retail price of $79.99, or a set of measuring spoons listed at $35.99… only to realize that they are actually “worth” $17.99 or $9.99. Sometimes the high price and high sales rank is based on the fact that the reasonably priced items are sold and you’re left with overpriced listings that no one is willing to buy. So your post was just what I needed to hear today to remind me to choose products with my eyes and brain, not just what an app tells me.

    • Nearly happened to me today when sourcing in TK Maxx.

      I know what you mean. I spent the time today to look at the offers with my app (profit bandit) and clicked on to ccc and saw the massive drop in demand for several items on clearance (probably why they where on clearance), and saved myself buying some duds.

      I think I need to seriously consider online arbitrage as in a quiet home environment I can go through products and make intelligent decisions looking deeper with keepa and ccc.

      • Rebecca Smotherman Rebecca Smotherman

        That’s exactly how I learned how to use Keepa and CCC more in depth, Jason. I had a basic knowledge of how to use them from sourcing RA, but when I started doing OA I saw that my ability to use them skyrocketed. I was able to dig deep on my laptop and play around with the features at my own pace, rather than squinting at my iPhone while under pressure to make a decision in a noisy store aisle. Now I can use them much quicker on my phone when doing RA too!

        • Thanks Rebecca, very helpful insight. I feel kind of guilty though..

          As I wont be jumping into dumpsters in the middle of the night anytime soon, or spending any time for a while in thrift stores scanning hundreds of books looking up the data.

          Worse still, if I go somewhere warm overlooking a beach doing oa I’m going to feel even more guilty. Not fair LOL 🙂

  3. Pingback: Using the CamelCamelCamel and Keepa Google Chrome Extensions - Full-Time FBA

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