What is Amazon’s new OTDR policy?
Amazon’s policy on the new OTDR requires sellers to maintain an OTDR of 90% or higher on Amazon.com for fulfilled products without the promise of an extension. The goal is to achieve an OTDR of 95% or higher for all sellers’ fulfilled orders to ensure that customers are implied to receive their orders.
PS: This policy does not apply to Fulfillment by Amazon (FBA) orders, so sellers are not responsible in such cases.
OTDR Calculation Formula
OTDR=(Total Number of DeliveriesNumber of On-Time Deliveries)×100
First of all, most of the sellers expressed “stepping” on this policy, which is enough to show the attitude of most sellers towards this new policy.
Currently, there are still a lot of sellers whose on-time delivery rate is under 90%, and there is less than a month left before the new rules come into effect.
It is worth noting that Amazon only counts orders from the past 21 days, but also excludes the last 7 days, which means that for those sellers who are not yet up to standard, there will be less time for them to make adjustments.
Impact of New OTDR Policy on Amazon Sellers
Eligibility to list products
Sellers must maintain at least 90% OTDR (No Commitment Deferral) in order to list their seller-fulfilled products on Amazon.com.
By ensuring that only sellers with a high OTDR can list products, Amazon aims to improve overall customer satisfaction. This policy helps to ensure that customers receive their orders in a timely manner, which increases repeat purchases and positive reviews.
Seller Performance Metrics
OTDR is an important performance metric that Amazon uses to evaluate sellers. A lower OTDR can result in a warning, account suspension, or removal of selling privileges on Amazon.
Sellers with a higher OTDR are more likely to receive priority treatment in search results and the “buy box” because Amazon’s algorithms favor sellers who provide reliable and timely delivery.
Customer Trust and Reviews
Consistently meeting or exceeding OTDR requirements leads to positive customer reviews, which are critical to maintaining and improving seller rankings.
Timely delivery reduces the likelihood of negative feedback due to shipping delays and helps maintain positive seller reviews.
Account Health
If a seller’s OTDR falls below the minimum requirements, they will receive notifications and recommendations. Amazon provides tools and insights to help sellers improve their OTDR.
Sellers can monitor their OTDR and other performance metrics on the Account Health dashboard. Maintaining a high OTDR helps maintain a healthy account status, ensuring ongoing visibility and selling privileges.
Use of Amazon Tools
Shipping Setup Automation (SSA): sellers can improve their OTDR by automatically calculating shipping times to set accurate delivery dates.
Automated Processing Time: Enabling Automated Processing Time helps sellers accurately set processing times for each SKU and reduce late deliveries.
Amazon Purchase Ship: Reliable shipping with Amazon Purchase Ship labeled “OTDR Protected” “can help maintain or improve OTDR.
Amazon also offers some solutions for sellers with OTDR below 90%.
Self-delivering sellers shipping from China can use the Shipping Setup Automation (SSA) tool and Buy Shipping to meet order promise timelines. Sellers in the U.S., on the other hand, can use all three tools at once – SSA, Buy Shipping, and Automatic Stocking Time (AHT).
In addition, sellers need to strengthen inventory management, to ensure that the goods are sufficiently stocked and can be shipped in a timely manner, and optimize the logistics and distribution process, as far as possible, to choose a reliable logistics carrier.
As Amazon’s logistics services continue to evolve, the future direction will focus more on technological innovation and service optimization, the implementation of the new policy will undoubtedly prompt sellers to pay more attention to customer demand and optimize product supply, and cooperation with Linktrans can provide you with the advantages needed to meet these challenges and remain competitive. Don’t let Amazon’s rules get in your way – take action now to keep your business growing on the platform.
30 Aug, 2024
