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By Martin Heubel ยท August 18, 2025 ยท Curated by George's Blog
Net PPM is the worst margin metric you can track with hashtag#Amazon. โ๐ฉThat's because it tracks what's not broken:- Cost Prices- Trade Terms- Average Selling PricesAnd still, Vendor Managers only want to discuss Net PPM targets.Why?๐๐ฒ๐ฐ๐ฎ๐๐๐ฒ ๐๐ต๐ฒ๐ ๐ฎ๐ฟ๐ฒ ๐น๐ฎ๐๐ ๐ฎ๐ป๐ฑ ๐๐ฎ๐ป๐ ๐พ๐๐ถ๐ฐ๐ธ ๐ฟ๐ฒ๐๐๐น๐๐ (๐๐ฎ๐ธ๐ฒ ๐ถ๐ ๐ณ๐ฟ๐ผ๐บ ๐ฎ ๐ณ๐ผ๐ฟ๐บ๐ฒ๐ฟ ๐ฉ๐ ). ๐คThink about it: Structural margin improvements take time to materialise in your P&L with Amazon.You need to invest in:- Supply Chain Improvements- E-Channel Packaging (SIPP/FFP)- Free Cash Flow InitiativesAll of these aren't reflected in Amazon's Net PPM.So the next time your Vendor Manager wants to review Net PPM targets?Don't get bullied into improving cost prices or trade terms.Instead, let them know that you need to discuss a more holistic approach to improving profit margins.---How are you working with Vendor Managers on the profitable development of your account? Let me know in the comments!hashtag#amazonvendor hashtag#amazonstrategy