Session Transcript
Paul Sonneveld
All right without further ado, I'm going to welcome onto the stage Oliver Tomaschewski. He has been a regular guest on Marketplace Masters over the last two years. It's always a pleasure to have him. Oliver is the founder of DiCommerce and former head of e-commerce Central Europe at Grower. I may not be pronouncing that correct, but... That's my best shot. He specialises in helping vendors really navigate the logistical supply chain and cost challenges in running Vendor Central across European markets. He's going to take us through the models that work, the options, and maybe some of the ones to avoid. Oliver, it's great to have you with us as part of our summit on day two.
Oliver Tomaschewski
Thank you very much for the invitation. It's always great to be here. Thanks.
Paul Sonneveld
I do know just to the audience, I know Oliver has agreed to delay his family holiday a little bit in order to do this. So I really appreciate you making that sacrifice.
Oliver Tomaschewski
You're welcome.
Paul Sonneveld
I'll have to send an apology to your family a little bit later. All right.
Oliver Tomaschewski
Absolutely fine.
Paul Sonneveld
The stage is yours. I'll add your presentation, and we should be good to go. I need to remove... There we go.
Oliver Tomaschewski
Great. Perfect. Thank you very much. So welcome, everybody, to the next hopefully very interesting and important session that will help you to increase your profitability, as Paul already mentioned, and it can even help you within your AVN. So if your AVN already started or you're already within negotiation, please listen carefully, as there might be some new ideas that I bring onto the table in terms of supply chain optimisations. So my name is Oliver Tomaschewski, and I'm the managing director of Germany's leading Amazon conversion consultancy, named DiCommerce.
So, before we jump into the session, I would like to give you some more background in the interviews myself. I have now more than ten years of Amazon experience within the vendor, seller, hybrid and broker model paired with manufacturer know-how. And before I founded the company, I had fourteen years of corporate experience in various roles, most recently as the head of e-commerce at Grower. So there I was responsible since 2016 for the Amazon account, developing it to a very big yeah account now. And in 2018 or since 2018, I've then also started to advising other companies in the area of Amazon venue negotiations and also the logistic topics beside of this in parallel since 2019.
I was then also active as an Amazon seller myself to also understand the other way around because go was in the in the beginning just or when when i started there just a vendor so i wanted also to fully understand the seller model. And as I was really passionate about the whole e-commerce part and all the topics connected to this area since 2020, I also started as a university lecturer and teaching young people, inspiring them in the field of e-commerce at the FOM University here in Germany. Then I become, yeah, that.
So my first son was born and in 2023, together with my wife, we've decided to found to get to create the company DiCommerce. So this was the start of DiCommerce as a unique German Amazon consultancy with a clear focus on conversion optimisation based on clear processes and great content. So if I really summarise it into one sentence our mission is to grow to deliver growth without ads for relevant big brands on Amazon, and this went quite successfully. So, in 2025, we're currently managing approximately six hundred fifty million of Amazon sales for more than one hundred fifty brands within the last years apparently with thirteen employees and yeah. Our clients are brands like Nespresso, WMF, Tetesept, rotho, VTEC. So yeah, successful brands in European area, also with an important retail background. And we help these brands to be successful on the Amazon side.
Perfect. You are here to hear a little bit more about Amazon logistics topics. So let's jump into the European vendor logistics options, which can help you to increase your profitability at the end. So within the next approximately fifteen minutes, I will go through all of these programs and explain them quickly. On some of them, I will deep dive as there is a big potential in terms of profitability increase. But I will try to give you really a hands up of all the topics as fast as possible. And if you are using one of these programs already within your vendor setup, please feel free to just put the name of the program while we're talking about the program into the chat box so that I have a better feeling how relevant the program is for you and that we can maybe also deep dive a little bit more on these programs. Great.
So I will give you a short overview of all of these programs in the first step. So let's talk in the first category about inbound and outbound delivery options. So this is everything how the products go to Amazon and how partly the products go to the end consumer. The first one, and I would here already say approximately eighty percent of the audience which is here in this session, and they are using TheyPay. Some of you maybe already use WePay. TheyPay means in the term or from the disability of Amazon, they pay, so the vendor is paying for the carrier. You're responsible for booking delivery slots or the carrier is, you're responsible that all the goods arrive at the Amazon site. This is a traditional classic setup that most of the vendors are just using. And you pay for sure for your own, the carryables.
The opposite to it is WePay. WePay means from the Amazon perspective, they pay for it. So Amazon is paying for the carrier. At the end, it's just a term of your AVN, for example, one, two or three percent. And Amazon will then come to you, pick up the goods and bring it to their own FCs. It's quite interesting program, and we saw quite often this year within the AVNs that we've already started that Amazon is trying to push the program into the current AVN session. Why it's so interesting? Because it can be an alternative to PICS and SuperPICS, which is here in this area located. So we will talk later about it.
PICS just means that you deliver not to all the FCs, but to a smaller amount. And with WePay at the end, it doesn't matter where the truck is driving because Amazon is always coming to you. So it's like a super PICS or PICS setup light because you are not responsible for this. This is the first topic then the second one for bigger vendors is FC direct FC direct means that you directly ship products from your FC to the Amazon FC maybe some of you already know full truckload or something like this.
This is also partly like this but this is a combination of different programs. So first of all Amazon guarantees that if they all are within the FC direct vendor code that there is a full truck, so full truck load. Secondly, they guarantee that every single pallet is at least minimum one product on that pallet. So it can be that at the end, maybe thirty different products are on the truck, but also every single pallet has the same product, so thirty times the full pallet.
There's one thing you need to know in FC Direct. You need at least minimum forty, forty-five minutes between your FC and the Amazon FC. We had one client in our portfolio that we worked with on that topic, and the issue there was that just the truck arrived too early at the Amazon FC. The data meanwhile didn't arrive, so the truck always needed to wait five to ten minutes until they can unload the truck and give the goods to Amazon. But as mentioned, this is just for bigger vendors as you need the demand behind it.
Then Amazon Freight is also quite interesting as an alternative for waypay vendors. Amazon Freight is like DAX or DHL or anyone else you use currently to ship products to Amazon. So in that case, you decide PO-related if you want to choose Amazon Freight as an additional external carrier, or for sure you can also use Amazon Freight in total for all the POs. But most of the vendors use it temporarily if the current vendor has a loading situation, or if there is an issue in terms of capacity or if it's just too expensive. Amazon Freight is quite interesting in terms of full truck load deliveries. So in that case, they just book the truck, Amazon will come to you, but that's single PO and bring the goods to Amazon.
Then if we move to the next program, which is Vendor Flex. Vendor Flex means that Amazon opens a virtual FC directly within your warehouse. What is now the advantage? The advantage for Amazon is they don't need to store the product, so they just use your warehouse. The advantage for you is, that you at the end don't need to bring the products to Amazon. You can directly bring them from the one side of the building to the other side of the building, and Amazon can directly pack it and bring it to the customer. So you save a lot of time, and it's quite good as an addition to vendors who already use the traditional PO ordering method. So you just can extend the capacities of the Amazon quantities which can be sold based on your warehouse quantities. But in that case, Amazon will come to you and it's a virtual FC. And yeah, Amazon just opens it within your warehouse.
The opposite to it is direct fulfillment. So within direct fulfillment, Amazon will transfer to you the orders of the Amazon platform. They will also give you a prepaid label, and with that label, you just put it on the carton that your employees are doing it, and then you ship it to the end consumer. The customer, they don't see on the label that it's shipped from your FC, so it's also quite interesting to just have stock in addition if the Amazon warehouses are empty, for example, during Prime Day, Black Friday, or something like this, then you just support Amazon directly from your warehouse, shipping additional goods to the end consumer.
And then to the coming to the last program which is direct import or global direct sourcing. I will deep dive this later on because therefore i have a special slide to explain it better and yeah this is also a program which is quite new and interesting for many some of yeah of the people here in the audience. Then coming to the next category. So in the first category, we saw which programs can be used to optimise the inbound and the outbound process.
Now in a second step, we want to try to consolidate PO. So every PO should be bigger. And in the best way, we don't deliver to a lot of FCs, but we also consolidate this to a small amount of FCs. So first program that we can use here is PICS, which stands for perfect inbound consolidation service so normally approximately you would deliver in Germany to ten fifteen twenty different FCs and with PICS you can consolidate this. So, at the end it depends if you have sortable unsortable passionate or heavy bulky products.
But let's put it on an easy level so you just have sortable products and for sortable products you would define two FCs and instead of fifty different FCs you just deliver to two FCs on a country level. So for germany for france for italy in every country just two FCs. SuperPICS would be the next level. So there you just deliver to one single country and Amazon will then take the products from this Crosstalk FC and ship it to the other country. So Amazon will manage the shipping process to all of these FCs. So, this already helps you to increase the minimum order values minimum order quantities based on every product for every single PO.
Then the next is Acapulco or also called pellet ordering pallet ordering means that Amazon that you give Amazon a small discount and Amazon then can decide if they order for example still five units within the normal PO process for. For example, ten euro or if they are they purchase it through the pellet ordering vendor code and then you give for example ten percent this is sorry one percent two percent discount and yeah Amazon will then purchase it a little bit cheaper but you have to guarantee that Amazon is ordering a full pilot and everyone can use both ways. So it's not that you have to move completely in as into the pellet ordering vendor code. You can set it up in both ways.
And then next level to it is then full truck load. So within full truck load, as the name already says, you can deliver a full truck directly to Amazon. For sure, it's just for very big vendors available. Then next step is order optimisation. So once we know how to inbound the products in the right way, also we have the outbound process optimised and we consolidated the POs to a bigger level or bigger volume, we now want to optimise the order. So first of all, you can use the EAN gold list or gdsn so the gold list is an excel file that you can share with a special team at Amazon where you explain Amazon how your EAN structure works.
So, to give you an example there is one football and this football has EAN code a there is a case pack where three footballs are in it this is EAN code b and there is a third one which is a bigger box where multiple of these case specs are inside of it. So, once you transfer these information to Amazon, they don't need to open every single carton within their logistic processes or within the FCs. They just scan the barcode which is on the box and they know okay this barcode stands for three footballs which is EAN code a, this really helps a lot to optimise the inbound process. I would recommend to do at least once a quarter or once you have new products in place to inform Amazon about the structure.
Secondly, maybe you already have to, maybe you also have the problem that Amazon is ordering products that are not available. So in that case, you can use within the Vendor Central, the product availability tool. So within the tool, just let Amazon know if you are available or not. If you are not available, you can inform Amazon that you are temporarily not available or that it's end of life and Amazon don't need to order. I know always this question is coming, why does Amazon order products that are end-of-life, maybe after six, nine, twelve months? The reason is quite easy. If there are customers who want to purchase the product and there is demand, Amazon will try to order the products because maybe meanwhile you receive from any of your customers a return, so you now have stock and Amazon wants to purchase this stock.
This is the easy explanation. You can't avoid this. But please work on the product availability, because otherwise if you reject three times or three weeks afterwards, or three weeks every week, then the product will be moved into a so-called hard reject status, and this could cause that the product will be ordered now from from an external partner, so not directly from you as a brand, so from a distributor, so that Amazon is just trying to order all of these products and to make the customer happy in terms of availability. And then the last topic would be the operational data quality. I will also deep dive to it later on as there are two ways. First is the inbound process, the EAN goals list that I already explained. And the second one is how Amazon can order the products from you, which is the operational data quality topic.
And then we're coming already to the last section, which is the receipt and dispatch of goods. So the first one is LPR, so license plate receipt, EDI, and carton level information. So within this area, we're talking more about process of topics or technical products and how you can optimise this. I will also deep dive it later on. And then in the second area, this is about packaging. Most of you will know SIOC, which stands for shipping on container. A crazy fact about it, if you deliver as a vendor and you don't deliver within a SIOC carton, you have to pay a SIOC fee to compensate that Amazon needs to put the product into a new box and label it and ship it to the customer. And if you are a seller, you get a bonus if you ship your products as SIOC compliant.
Last but not least, the analyse of shortages and chargebacks. This is also part of the next slides. So as mentioned before, I will deep dive on some of them more in detail so that you have there a better overview. Let's start with direct import and global direct sourcing. Direct import is the, yes, the alternative, sorry, global direct sourcing is the alternative for direct import vendors. So it's a quite new program where Amazon combines the demand from multiple countries. So normally you would receive within the direct import program, different POs for each of this country within this program, Amazon will create a single PO. So it will be a new vendor code, like a global vendor code for all the countries you're working with.
Amazon will transfer this single PO, then on to you, you prepare the shipment, and then from this step on, Amazon will receive the products from the origin, so Amazon is owning the whole process, and they will build the containers and they will deliver to each country. So again, it's part of optimisation, of consolidation. It's currently just an invitation-only program, but if you have amounts that could justify to use this global direct sourcing program, please just ask within the AVN or contact us. We can share more information with you and help you also to understand if this is a relevant program for you. Just request it at the end. And this is allowable for the destinations North America, MENA, Europe and APAC. But you need to know this is currently only available for the original destinations in China and Thailand is also on board by end of 2025.
So quite interesting program as the next level to consolidate POs and make the POs even bigger. Then coming to the next point with which i would like to deep dive a little bit more this is the operational data quality. This helps you really to structure your ASINs and your ASINs based on unit k spec master back as mentioned already before. We had the example with the football or the baseball, which is now here in one single ASIN. Then we have the inner pack with three balls inside. Then we have the master packs of two of these inner packs are inside and dependent.
What I bring now to the table is an example also for Coca-Cola. So we have the unit can, which can be used by the customer and which also can be purchased and within the excel file that you upload to Amazon it would look like this. So first of all we have the unit SKU with the unit barcode and this is quite interesting or important here is package double audible in that case you would say yes so the customer can order also the single unit can. Then in a second step we have the case pack where six cans are inside of it. So this would be this one. This is also orderable by the customer. And then the third one, which is the master pack, there are twenty four cans inside, which is this one. This can also be ordered.
And now what is interesting, you can control how Amazon will order these products from you. So in that case we just let Amazon know case pack ordering id and there we inform Amazon please order always a master pack barcode. So if Amazon wants to have the cans inside of their um FC they have to order the master pack bucket and barcode and this can be repeated for all of the other products too so in that way you can try to control doesn't always work, but in most of the cases it works. Amazon will then order the correct quantity or the correct package, which also helps you to optimise your internal processes and the outbound process.
Talking about processes leads me to the next topic, which is the LPR. LPR stands for license plate receipt. And this can really help you to solve ninety percent of your shortage claims in an average when we take a look to the vendors. So managing LPR, CLI, ASN and EDI. This is really the most in most of the cases, the solution for shortage claims. So, how does it work normally? If you don't use LPR, Amazon needs to open every carton. So they receive it, and they count it and there can happen some problems or they just count it in the wrong way. And then we have the license plate receipt. In the license plate receipt, they just scan the barcode, so the so-called SSCC code. And on the SSCC code, they directly know what is in the box.
How does it work? so there we coming to the next topic which is CLI carton level information Amazon is scanning the barcode the sscc code and before you already transferred through the ASN which is part of the edi protocol advanced shipment notification you will Amazon you let Amazon know which cartoon level information on the ASN is packed on the palette so Amazon directly know what is in the cartoon they don't need to open it the whole inbound process will be easier they just for sure measure they check the weight and so on. If everything is right, great.
And the last one is analyze of shortages and chargebacks I would really, really ask all of you, if you never have done it before, to get a professional analyze, so audit of shortage claims, chargeback, and co-ops, please, please do it now. You can contact us afterwards. We do the audit completely for free. What are we doing within the audit? We are checking up to the last two years if it is possible to reimburse some money from Amazon. And in average, we were able to reclaim per vendor, €37,000 for our customers for the last two years.
To give you an example, how does it work, or where can something happen in the wrong way? First of all, if Amazon is ordering within the PO, one hundred units and you confirm ninety and you deliver ninety. Amazon could, for example, due to any reason, tell you you just delivered eighty. So first off, you have a shortage claim of ten units. Due to the fact that you delivered an 80 or Amazon thinking that you delivered 80 instead of an 90, you mostly pay a chargeback. And in some cases, this is the third one, it can also happen that Amazon will count the co-op.
So for example, the five percent MDF market development fund agreement to the one hundred units they try to order. Most of the vendors I would say no one hundred percent one hundred percent of the vendors, they don't check if the backup reports which are delivered with the co-op invoice if they really fit to the shortage claims. This is what we are doing with the software so we put everything into our bi system everything is measured against each other and we can then identify if there are some wrong data or discrepancies between us. As mentioned, please just get in contact afterwards. We can do the audit completely for free for you. So there's no risk for you, you can just win if there's some money you can get back. This will help you, and the base of the data at the end is also quite interesting because there we see which issues we have, and all of the programs that we talked before can then help to reduce also these topics. And we just know where the processes are not going into the right direction.
Great. So this is already the end of my presentation hopefully it was not too fast. I hope we have still some minutes for questions. Otherwise, I'm also later in the panel discussion so yeah please just feel free to ask your questions and also if you have afterwards questions please just get in contact with the domain is here at dicommerce.de/meeting. So please feel free to book a free consulting session with us.
Paul Sonneveld
Thank you so much, Oliver. We do have approximately just over five minutes for questions. We have a couple here. If you do have a question for Oliver as well, put it into the chat, or the LinkedIn or YouTube comment section, and we will try and ask them. Let me pick one up here. I'm going to start here with a question from Peter. Peter, thank you for participating. It's what makes this summit a fantastic interaction. So his question is about PICS, right? He's using picks. In your opinion, what is a good condition for SUPERPICS to talk about during AVN? You know, when does super pick start to make sense, and how do you go about that conversation as part of the AVN process?
Oliver Tomaschewski
Me, it always it always depends i know you don't, maybe you don't like this answer, Peter. But it depends on different factors first of all um please try to calculate what are your real shipping costs so that you have a base to evaluate at the end. It should be a business case decision either on the fact that it's cheaper to pay Amazon approximately mostly you pay something between one to two two and a half percent more if you use SUPERPICS instead of PICS so first of all it could be a economical decision to do it or not.
And on the other side, what is not mentioned on any official paper, if you use SUPERPICS, it's harder for Amazon to say to you that there are shortage claims because the volumes per pellet are bigger, everything is just bigger. So also your shortage claims should reduce a little bit and your internal process will be just easier instead of packing a half pallet you can now pack three pallets in total and this is just saving internal costs. So beside of the carrier savings please also calculate always the cost for the internal stuff with which you don't need to pay anymore in so detailed level.
Paul Sonneveld
Excellent, very insightful. We see this actually a lot with our vendor customers on MerchantSpring, running multiple vendor codes, often direct import vendor code, as well as local fulfillment. What's your advice? I mean, how do you balance the direct import with local fulfillment really to optimise profitability and margins?
Oliver Tomaschewski
Yeah for me it's part of the planning process so if you use also direct import, try always to order these or to to get orders for the direct import orders in the beginning of the year and at least you should have half a year of planning period before so you already know in the best case six seven eight months before what they will order so you have enough time to prepare everything maybe you can manufacture them if you have bigger capacities within your production. So try to separate it. The local fulfillment should be always to cover spontaneous demands and the direct import is to optimize the processes and to plan in a better way.
Paul Sonneveld
I think you've done a great job laying out all these logistics options in fact i think someone commented before it's it's everyone's favorite slide the slide that you've got together every time i look at it it's it's enhanced. But from a maybe from an AVN point of view, where are the wins and the gains in 2026? I know, you know, I will say for you, it depends. Right. So we'll get that out of the way. But where do you think there are some good moves for vendors to consider, particularly in Europe, maybe to reduce some of the freight costs or improve their margins by optimizing the different logistics options in front of them?
Oliver Tomaschewski
To make it very short two topics the first one is either use we pay or PICS or SUPERPICS. So this is more to consolidate orders, and the second one is master data as you saw on on the topic gdsn gtn gold is also operational data quality there's a lot of potential most of the vendors even didn't know that there's a way to optimise or influence how Amazon's ordering the products. So at the end, work on two topics. Optimise your master data, and on the other side, work on consolidation of quantities per order.
Paul Sonneveld
Very succinct, to-the-point answer. That is great. At this rate, we could do another forty questions before we hand over to Toni. Actually, I've got a question here from Yuri. He's talking about the fact that he scheduled a deal to run for the whole month. But for whatever reason, Amazon only ran the deal for five days. But of course, they charged the whole deal funding fee per unit sold during the whole month. So there's a bit of a mismatch between what Amazon's charging versus their execution, right? The activation doesn't quite match the invoice. Is that something you can rectify with Amazon? And how would you go about that?
Oliver Tomaschewski
Yes. So, we yeah we can help on this basically if you have an AVS that I currently don't know, I would suggest in the first step try to just claim it through the AVS could be the easiest way because if the AVS or the Vendor Manager created the deal sorry the the agreement behind it It should be quite easily solved within the backend of the Vendor Central. If you don't have it and you create it by your own, create a case, request for support, but if it doesn't work, just get in contact with us and we can help you on that to push Amazon to the right decision.
Paul Sonneveld
Thank you. That's great. Probably the last question today is just from me. I've been thinking a lot about direct fulfillment, and we covered it on day one from a North American perspective as well. But obviously, you also put on the table this vendor flex, which maybe from the outside, if you're just looking at someone's warehouse, products leaving the warehouse, it kind of creates the same results but be great if you can just maybe re-emphasise some of the key differences between the two models particularly how it may play out in terms of my um you know rebate structures or you know overall ASIN or SKU profitability.
Oliver Tomaschewski
Yeah. So for VendorFlex, normally Amazon is coming to you. So they bring their cartons, they bring their labels, they bring their printers, the IT, so everything what is necessary to pick and pack the products at the end, and they manage the whole process. More or less easier for you as a vendor because it's not your responsibility. Amazon will manage it. With direct fulfillment at the end, you are responsible for all of these. It could happen that on the one day you don't receive any order for direct fulfillment, and on the other one, if it's Black Friday, you receive five hundred orders.
You can also limit it at the end, but generally, it's you it's not really you cannot plan it. This is the biggest issue of direct fulfillment. In terms of the the cost behind it you can agree with Amazon for direct fulfillment this is what most of our vendors do what what we also recommend during the AVN if you onboard direct fulfillment, agree with Amazon that they don't pay the same price they have to pay in addition for example five percent a price increase based on a normal cost price for direct fulfillment orders. Because you have to cause you have to labor you have to stuff you you need to pay for everything. The only thing that Amazon will deliver you is a prepaid label. But to be fair, this is what they also do in the PO process that you also don't pay for the shipping costs. So this is the minimum that Amazon should do.
Paul Sonneveld
Yeah, this must be Amazon's dream, right? Convincing vendors to shift to direct fulfillment and keep all terms the same. There's definitely some benefits to be had from the vendor side. All right, fantastic. Oliver, thank you so much for this wonderful explanatory session around all the moving parts in terms of vendor logistics in Europe. It was a great session, and I look forward to having you on our panel next very, very soon to go a bit deeper in some of these questions.
Oliver Tomaschewski
For sure, thank you very much, Paul, for the invitation. Thanks, see you later.
