Amazon to Introduce Selling Partners Vendors API
Automating the exchange of data with Amazon VendorCentral has long been a particularly difficult challenge for vendors. Creating accurate orders has required intensive workaround methods like manual file import and export procedures and data scraping techniques. Software solutions based on EDI (Electronic Data Interchange) are also common, but as this is an outdated and highly regulated technology that has been around for over 40 years with relatively little change, these tools lack the efficiency that many vendors are looking for.
Using an API (Automated Protocol Interface) is the simplest way to process orders; APIs allow near-instantaneous automatic communication between different pieces of software, allowing users to quickly and easily link their own order processing software to Amazon’s system. However, vendors have never had the option to use API available to them, despite sellers and affiliates having both had access to APIs on Amazon for several years.
As of May 2020, this is now set to change. Amazon is currently in the process of deploying an API for their VendorCentral hub. According to job postings, the company has been recruiting engineers to work on a VendorCentral API. Further, a new API category has appeared on the Case Log in VendorCentral, and AMZ Group has also uncovered several internal documents from April 2020 (including an API reference guide and an implementation roadmap calendar) indicating that this development is on its way.
Key Benefits of Using an API for Retail Procurement
Having an API available for use will greatly improve the efficiency and profitability of many Amazon vendors. APIs provide many benefits to retail procurement businesses, including:
- Reduced costs
Using an API greatly reduces the need for manual data input while managing purchase orders, leading to lower overall labor costs.
- Fewer process errors
While manual input processes are notoriously fallible, an API processes orders based on the exact information provided by Amazon. This allows it to maintain near-perfect order accuracy regarding both product type and quantity.
- Improved vendor performance
An API provides swift feedback that can improve a vendor’s lead times as well as their confirmation and fill rates, allowing them to process more orders and potentially win more business.
- Timely automated billing
Vendors can use an API to quickly submit highly accurate software-generated invoices and get paid on time for each order they process.
- Fewer chargebacks
Amazon’s chargeback fees are charged if a vendor fails to comply with the company’s guidelines regarding shipping and fulfillment. Automated systems like an API follow precise rules and work in real time on a 24/7 basis, so using one will eliminate many of the timing and accuracy issues that incur chargeback fees.
- Excellent scalability
In contrast to labor costs (which grow along with a company), the cost of software like an API remains constant regardless of business size, providing a scalable solution for vendors hoping to quickly expand their reach in Amazon Retail.
Why Use an API Over EDI?
Even once the API has launched, EDI will remain available to vendors and existing EDI processes can be used in conjunction with the new API capabilities.Many of the benefits mentioned above are also available to users of existing EDI systems, but there are several compelling reasons for vendors who are currently experiencing success with that technology to consider using the API as well. These include:
- Easy access
EDI is intentionally multi-layered and complex for the purposes of security, and it can be difficult for the average user to fully grasp its capabilities and requirements as a result. APIs are much simpler in comparison and are therefore easier to implement and use effectively.
- Simple infrastructure
There is no need to host services when using an API as you would if you were relying on EDI transactions; client applications can instead interface with the partner API directly.
- Lower costs and more available talent
Creating specialized tools for complex technology like EDI requires vendors to invest in costly developers who have expert-level knowledge of that system. APIs only require general software development skills, so any developer can produce tools for one. This makes high-efficiency custom solutions more accessible to small vendors with limited budgets and helps them establish the infrastructure they need to grow.
- Lightning-fast connectivity
Because of the many layers of security it employs, EDI operates relatively slowly and can easily cause vendors to fall behind when trying to keep up with sudden market developments. An API is far more responsive and can be used to process changes and requests in near-real time, allowing vendors to keep on top of every shift in demand in Amazon’s ever-changing market.
- Low software costs
Software licenses are generally not required to run APIs, so vendors can keep their ongoing software costs to a minimum and only cover any initial development or purchase costs.
- Extended features
As an older technology, EDI only allows for a limited set of functions – for instance, it cannot produce shipping labels. An API solution has the flexibility to perform the most common features used by a typical vendor.
Initial and Upcoming Features
Amazon has already outlined some of the initial features that will be included in the initial release of this API. Users will be able to manage most aspects of their purchase orders, including accepting orders, confirming shipments, and sending invoices.
Some upcoming features have also been disclosed. In Q4 2020 and 2021, vendors will be able to use Amazon APIs for product listing, item cost updates, and purchase order changes and cancellations. Other features are sure to be added as the API matures, but Amazon has not yet definitively named any others at this time.
Phasing and Next Steps
Amazon vendor API capability has currently only been deployed for select vendors, but the company has laid out a trajectory for rollout to help users understand what features are coming and when they are expected to arrive.
The first functions to be released will focus solely on order data, including purchase order changes, cancellations, and status; users can expect these functions in Q3 of 2020. Packing labels and shipping labels for small shipments will then follow in the same quarter.
Product listings and invoice status reports are currently slated for Q3 or Q4 of 2020 and will therefore be the last functions to arrive. Nevertheless, current plans indicate that Amazon intends to have this new system fully operational by the end of the year, and vital functions will likely be available to vendors before the critical 2020 holiday season.
Amazon has also laid out guidelines regarding the implementation of third-party apps within the coming API system. If a vendor has already integrated a third-party app, they need only authorize it within their account to continue using it as usual. Developers of any new third-party apps will be required to share their service provider details with Amazon before that app can be used by any vendor. Amazon will then review and approve the app and allow vendors to access it through their API platform. Each vendor who chooses to use it must then authorize the third-party app as usual. This set of steps should make it relatively easy for vendors to access the add-ons they require without compromising security standards.
While EDI has served its purpose well over the years and still has the benefit of excellent security, the addition of a new API for Amazon vendors opens up a realm of possibilities in terms of function, customization and responsiveness. Due to the dynamic nature of doing business on Amazon, it is likely that most vendors will enjoy the lower cost and flexibility of an API, making the addition of this option an extremely important consideration for many vendors’ strategies in the upcoming months.