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1. Confidential Information. As used in this Agreement, “Confidential Information” means all nonpublic information relating to Amazon or disclosed by Amazon to the above-referenced company, its affiliates or the agents of any of the foregoing (collectively, “Supplier”) that is designated as confidential or that, given the nature of the information or the circumstances surrounding its disclosure, reasonably should be considered as confidential. Confidential Information includes, without limitation (i) all nonpublic information relating to Amazon’s technology, customers, business plans, promotional and marketing activities, finances and other business affairs, and (ii) all third-party information that Amazon is obligated to keep confidential. Confidential Information may be contained in tangible materials, such as drawings, data, specifications, reports and computer programs, or may be in the nature of unwritten knowledge.2. Exclusions. Confidential Information does not include any information that (i) is or becomes publicly available without breach of this Agreement, (ii) can be shown by documentation to have been known to Supplier at the time of its receipt from Amazon, (iii) is received from a third party who did not acquire or disclose such information by a wrongful or tortious act, or (iv) can be shown by documentation to have been independently developed by Supplier without reference to any Confidential Information.3. Use of Confidential Information. Supplier may use Confidential Information only in pursuance of its business relationship with Amazon. Except as expressly provided in this Agreement, Supplier will not disclose Confidential Information to any person or entity without Amazon’s prior written consent. Supplier will take all reasonable measures to avoid disclosure, dissemination or unauthorized use of Confidential Information, including, at a minimum, those measures it takes to protect its own confidential information of a similar nature. Supplier will segregate Confidential Information from the confidential materials of third parties to prevent commingling. Supplier will not export any Confidential Information in any manner contrary to the export regulations of the United States.
Confidentiality: The Short Version
• Information we are sharing with you is confidential
• We want you to learn more about our business & our plans
• We ask that this presentation and its contents be shared only with persons inside your company, who have a need to know
Amazon Services Confidential 1
An invitation to
2Amazon Services Confidential
Agenda Slide
• An Introduction to Amazon.com
• Online Retailing Challenges & our proposal
• Amazon Seller Services – How we can help you grow your business
• Selling on Amazon & Fulfillment by Amazon
• The Value Proposition
• Commercials (Pricing of Amazon services)
• Amazon.in Seller Policies
• Next Steps
3Amazon Services Confidential
An introduction to
4Amazon Services Confidential
Amazon’s Strategy…
“Start with the customer and work backwards.”
- Jeff Bezos, Founder and CEO
We strive to be Earth’s most Customer-Centric Company
Build a place where people can find and discover anything they want to buy online
Relentless focus and innovation based on a core set of customer needs:
•Selection•Value •Convenience
5Amazon Services Confidential
Service How we help you Available in India
Sell your products on Amazon.in
Amazon stores, packs, ships and provides customer service for your products
Increase traffic to your site using ads that take consumers to your product pages
Amazon customers pay on your website using their Amazon profiles
Build and operate your online store using our all-in-one e-commerce platform
: How we seek to help grow your business
5Amazon Services Confidential
Third Party Sellers contributed to 45% of Amazon’s units sold Worldwide in 2012
With SOA, List & Sell your products on Amazon.in
7Amazon Services Confidential
You sell it, we ship it. With FBA,
store your products in
Amazon fulfillment
centers, while we pack, ship &
provide customer service
Amazon’s current offerings in India
Reach millions of online
shoppers with ads on
Junglee.com that link to
product pages on your website
Businesses Nearby
Advertise your offline store on Junglee.com; reach buyers who research products &
compare prices online
6Amazon Services Confidential
OFFLINE & ONLINE RETAILING CHALLENGES & OUR PROPOSAL
6Amazon Services Confidential
Limitations of offline retail
10Amazon Services Confidential
Reach limited to local customer base near the store Large marketing budgets required to expand reach to
new customers in other localities
Range of products on display limited to physical shelf space in store(s)
Reach
Product display space
Inventory management
Significant incremental costs of setting up new stores – real estate, manpower, overheads, etc.Cost of operations
Challenges & costs of managing inventory across multiple stores
Payment Options Managing multiple banks & debit/credit card
transactions High cost of credit card transactions
Internet Growing Rapidly in India
11
• Growing trend of Indian offline retailers going
online with their own sites, eg. JJ Mehta, Nalli
Silks, Mom & Me.
• Traditional multi-brand offline sellers also going
online with Amazon.in, eg. Shoppers Stop,
Croma, Vijay Sales, Univercell, Kamdar &
Kamdar.
Offline retailers growing online
Challenges faced by an Indian online retailer
12Amazon Services Confidential
High Capital expenditure in technology, delivery infrastructure
High Operational expenses in marketing, retaining employees with technical expertise, scaling infrastructure with demand Customers are hesitant to adopt online platforms as they are unsure about experiences like returns, warranty, on time delivery etc…
High customer acquisition costs
Customer Service brings customer retention & repeat purchases
High employee costs in hiring & training personnel
High Fulfillment costs & High cost of customer returns Cash on Delivery inefficiencies Lowers buying
commitment, increases returns & Adds collection charges
High costs in going and staying online
Customer Acquisition & Conversion
Customer Service – Expertise & Costs
Last mile delivery issues
Inferior payment options lead to order cancellations, customer dropouts and overall Suboptimal customer experience
Payment Gateway Challenges
SELLING ON AMAZON (SOA) & FULFILLMENT BY AMAZON (FBA)
13Amazon Services Confidential
Demo of amazon.in & Benefits
14Amazon Services Confidential
Product Listings on Amazon Platform
Transaction on Amazon Platform
Credit/Debit Card, Net banking & COD payment options
Inventory Stocking in Amazon Warehouse
Amazon’s Guaranteed 1-Day Delivery* for any seller using FBA
Amazon Delivery Network + Capabilities like Fast-track* shipping
Customer Service & Support
Click the Image for a demo of the amazon.in website
* Guaranteed 1-Day delivery and Fast Track shipping available in select cities
SOA & FBA: The Value Proposition
15Amazon Services Confidential
No upfront costs
Additional Sales Channel
Variable Cost
Structure
Robust Paymen
t System
sEase of
use
- Enhanced visibility to a new range of predisposed consumers
- Opportunities to Cross Sell & Up Sell
- No customer acquisition costs or capex towards warehousing
- Reduced opex towards delivery network, human capital and customer service
- Credit/Debit Card, Net banking & COD payment options available on robust payment gateway
- Use of Amazon catalog; user-friendly panel to manage orders, inventory & payments
- Dedicated seller support team & Analytics support
- Pay as you go – we make money only when you sell or use storage space
16Amazon Services Confidential
COMMERCIALS
With Amazon you can focus on growing your business
17Amazon Services Confidential
FUNCTION DESCRIPTION YOUR WEBSITE
PARTNERING WITH
AMAZON
SOA+FBA
Product Sourcing Selection plan and procurement
Pricing Product and shipping pricing
Technology Hardware, software, ongoing development and maintenance √
Catalogue E-catalogue with rich product data, images and reviews √
Customer Acquisition/ Marketing
SEO, SEM, Affiliate Marketing √Payments E-payment integration, card and net banking
fees, payments fraud √Storage Inventory storage and warehouse management √Delivery Order handling, Pick and pack, Shipping, COD
Fees and Returns, Octroi √Customer Service Phone, email and chat based customer service √Returns Inbound customer returns and returns
processing √
Seller does the work √ Amazon does the work
How Amazon’s tools & services will help you succeed
18Amazon Services Confidential
Business Reports
Inventory Management
Seller Support
Customer Contacts
Order Management
Performance monitoring
Reports on high demand products category -wise Market information on price competitiveness Seller specific insights to promote sales in the listed & related
category
Add offers to Amazon catalogue using feeds, spreadsheets, web APIs & other tools
Options to configure various means of promotion
Dedicated seller support team on e-mail and phone correspondence available 24X7
Opportunity to view & respond to customer feedback Email sent whenever customer responds to a query
E-mail/periodic alerts on orders & shipping deadlines Order/payment reports for accounting needs
Periodic notifications on performance metrics along multiple dimensions
Monitor & promote your business by leveraging the features of Amazon Seller Central portal
Cost Comparison on Amazon promo rates
19Amazon Services Confidential
LINE ITEMSCOSTS -YOUR SITE (INR) LINE ITEMS
COSTS -SOA (INR) LINE ITEMS
COSTS - SOA+ FBA (INR)
Item Sale Price 5300 Item Sale Price 5300 Item Sale Price 5300Traffic 393 Ref. Fee@5% 265 Ref. Fee@5% 265Payments 122 Closing Fee 10 Closing Fee 10Packing and Labor 35 Packing and Labor 35 Per Unit Handling Fee 0Shipping 70 Shipping 70 P.U. Ship Fee 20Storage Fees 4 Storage Fees 4 Storage Fees 7.1Customer Service 1 Customer Service 1 COD + Octroi Service 53Cost of Returns 7 Cost of Returns 7 Returns + CS 0Service Tax 0 Service Tax 34 Service Tax 44TOTAL* 632 TOTAL* 426 TOTAL* 355Additional Charges Seller Paid Octroi Additional Charges Seller Paid Octroi Additional Charges None
Bid Amount ($) 0.55 Weight of product (kgs) 0.5Bid Amount (INR) 27.5 Multiples of .5kg in prod 1Conversion Rate (%) 7 Space occupied (cu.feet) 0.5% of prepaid txns 40%% of COD txns 60%Prepaid txn charge (%) 2.75%COD txn charge (More than 30) 2%COD txn charge (Less than 30) 30Packing and Labor 35Shipping 70Storage fees 4Customer Service 1
Legend:Cost of selling on your channel:
Cost of selling via Amazon:
Pricing for Selling on Amazon
20Amazon Services Confidential
And Get:
Achieve National Presence
Sell in 15+ categories Zero Cost of Traffic Zero Cost of Payments Amazon’s E-commerce
Technology & Catalog Fraud Protection Benefit of Zero
Subscription Fee & Reduced Referral Shares*
* Zero Subscription Fee applicable till June 5, 2014** Reduced Referral Shares applicable to different categories are as follows: Books & Movies till June 5, 2014; Consumer Electronics, PC, Tablets, Mobiles & Accessories till June 25, 2014; Health & Personal Care till September 12, 2014; Jewelry & Watches till September 19, 2014 & Home & Kitchen till September 26, 2014*** Charges are exclusive of Service Tax @ 12.36%
SOA Referral Fees (per Unit Sold)***
Promotional Rate (First Year)**
Standard Rate
Books, Music & Movies 5% 12%
Consumer Electronics (includes Camera)
5% 8%
Accessories (includes PC Accessories, Electronic Accessories & Mobile Accessories)
5% 12%
Mobile Phones 4% 5%
Personal Computers, Laptops & Tablets
4% 5%
Toys & Baby Products 5% 15%
Personal Care Appliances
5% 15%
Jewellery 8% 15%
Watches 8% 15%Home & Kitchen 5% 15%Beauty 5% 15%Video Games - Console 5% 8%
Video Games - Games 5% 12%
Luggage 8% 15%
FEE COST (INR)
Subscription
Rs. 499/- per month (applicable after June 5, 2014)
SOA Referral Share
By Category (see adjoining table)
Closing Fee
Rs. 10/- per unit
Pricing for Fulfillment by Amazon
15Amazon Services Confidential
Increased Order Conversion through FBA branding*
Fast Track shipping to select cities
Amazon’s Guaranteed 1-day Delivery to select cities
No additional COD or Octroi charges
Guaranteed delivery & trackable courier**
Trusted customer service and returns
Insured shipment
High quality packing material
You Pay:Promotional Rate (First Year)
Standard Rate (Media^)
Standard Rate (Non-Media^^)
Standard Rate (Oversize)
Pick & Pack Fee (per Unit)
Free Rs.10 Rs. 25 Rs. 50
Weight Handling Shipping Fee (per Unit)
First 500 gms
Rs.20Rs. 35 (for oversize only)
Rs.40 Rs. 45 Rs. 100
Every additional500 gms
Rs.20Rs. 50 (for oversize only)
Rs.40 Rs. 45 Rs. 70
Delivery Service Fee (per Unit)
1% of Item Value
1% of Item Value
1% of Item Value
1% of Item Value
Storage Fee (per Cubic Ft/Month)
Free for the first 3 months
Rs.14.20 Rs.14.20 Rs.14.20 Free storage for 3 months after your first shipment to the Amazon FC Free FBA shipping for units > Rs. 20,000 (not for Oversize products) Packing material weight – Media: 75 gms; Non-media: 100 gms & oversize: 500 gms Oversize Defined as: Greater than Any Of the following – 12 kgs in mass OR 45cm on longest side OR
34 cm on median side OR 26 cm on shortest side. Per unit Removal charges: Media: INR 10; Non Media: INR 25 & Oversize: INR 50 All Charges are exclusive of Service Tax @ 12.36%
* As observed on amazon.in as well as in other geographies** In pin codes serviced by our couriers with trackable service
And Get:
^Media Categories: Books, Movies, Music, Videogames & Software^^Non Media: all other categories
AMAZON SELLER POLICIES
22Amazon Services Confidential
MANDATORY POLICIES for sellers on Amazon.in All customer queries are to be responded to
within 24 hours
Pre-fulfillment Cancelation rate* (seller-canceled orders) to be less than 2.5%
Late Shipment rate on all orders to be less than 4%
For damaged/defective products, return pick-up is to be arranged/paid for by the seller.
Only products with India-specific manufacturer warranty can be sold on Amazon.in
Pricing of products on amazon.in is expected to be equal to or lower than the price on your site
Seller is expected to deliver pan India & bear Octroi charges wherever applicable
Requirement of UPC/EAN and bar codes to list your products
Manufacturers who wish to sell their own products on Amazon.in are expected to have trademark registered for their brand
23Amazon Services Confidential
Product Category
“Change of Mind”/Unopened
Damaged/Defective Products
Books, Movies & TV Shows, Music, Beauty & Health
7 days 30 days
Electronics, Video Games, Toys, Baby, Home & Kitchen
10 days 10 days
Watches, Fashion Jewellery, Luggage
30 days 30 days
Amazon’s Return Policy for different categories
Next steps
Confirm interestDesignate business and tech points of contactRegistration and account creation
Tax registration (only for FBA)Onboarding and integration Launch on the Amazon platform
24Amazon Services Confidential
THANK YOU
25Amazon Services Confidential
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