TURNING RISING COSTS INTO INCREASED PROFITS:
A STRATEGIC RESPONSE TO TARIFFS, SHIPPING CHALLENGES, AND RISING AMAZON FEES
PURAWOOD'S AMAZON
SUCCESS STORY WITH ZONLABS
INTRODUCTION
Over the past five years, Purawood—a kitchen organization brand—has carved out a strong foothold in one of Amazon’s most competitive niches. By consistently delivering high-quality products at competitive prices, the brand has not only sustained healthy margins but also fueled steady growth in a challenging marketplace.
INTRODUCTION
Over the past five years, Purawood—a kitchen organization brand—has carved out a strong foothold in one of Amazon’s most competitive niches. By consistently delivering high-quality products at competitive prices, the brand has not only sustained healthy margins but also fueled steady growth in a challenging marketplace.
Over the past five years, Purawood—a kitchen organization brand—has carved out a strong foothold in one of Amazon’s most competitive niches. By consistently delivering high-quality products at competitive prices, the brand has not only sustained healthy margins but also fueled steady growth in a challenging marketplace.
THE CHALLENGE
In its early years, the brand benefited from a relatively simple and predictable supply chain. However, as the business grew, it began facing a new wave of challenges—ranging from rising shipping costs and frequent delays to evolving Amazon fees, programs, and regulatory changes. Without a clear grasp of these shifting dynamics and a strategic plan to adapt, the brand risked escalating COGS and shrinking profit margins.
OUR
SOLUTION
ZonLabs partnered closely with Purawood to develop and execute a comprehensive strategy tailored to address the evolving challenges in supply chain, cost management, and market competitiveness. The plan included the following key initiatives:
INVENTORY
PLANNING
ZonLabs conducted an in-depth analysis of Purawood’s inventory levels, annual sales patterns, and shipping lead times. From this, a hybrid inventory strategy was developed—leveraging traditional Fulfillment Center (FC) shipments, Amazon Warehousing & Distribution (AWD), Amazon Global Logistics (AGL), and Amazon Freight. This approach minimized shipping costs while virtually eliminating stockouts.
SUPPLIER NEGOTIATIONS
& TARIFF STRATEGY
Working closely with Purawood’s existing supplier network, ZonLabs facilitated negotiations that resulted in lower wholesale unit costs and more favorable payment terms. Additionally, they redesigned product carton packaging to reduce shipping dimensions and inbound fees, helping to offset costs.
STRATEGIC SALES
ACCELERATION
As industry-wide COGS climbed and competitors raised their prices, ZonLabs helped Purawood implement a pricing strategy that capitalized on the market shift. The result: higher price points, increased sales volume, and improved profit margins—thanks to cost increases rising at a slower rate than the new revenue.
INVENTORY
PLANNING
ZonLabs conducted an in-depth analysis of Purawood’s inventory levels, annual sales patterns, and shipping lead times. From this, a hybrid inventory strategy was developed—leveraging traditional Fulfillment Center (FC) shipments, Amazon Warehousing & Distribution (AWD), Amazon Global Logistics (AGL), and Amazon Freight. This approach minimized shipping costs while virtually eliminating stockouts.
SUPPLIER NEGOTIATIONS
& TARIFF STRATEGY
Working closely with Purawood’s existing supplier network, ZonLabs facilitated negotiations that resulted in lower wholesale unit costs and more favorable payment terms. Additionally, they redesigned product carton packaging to reduce shipping dimensions and inbound fees, helping to offset costs.
STRATEGIC SALES
ACCELERATION
As industry-wide COGS climbed and competitors raised their prices, ZonLabs helped Purawood implement a pricing strategy that capitalized on the market shift. The result: higher price points, increased sales volume, and improved profit margins—thanks to cost increases rising at a slower rate than the new revenue.
THE RESULTS
Controlled COGS Amid Rising Costs:
Without intervention, Purawood’s inbound shipping costs were projected to increase by over $5 per unit (a 90% spike) due to rising tariffs and Amazon fees. Thanks to the strategic inventory planning developed with ZonLabs, that increase was held to under $1 per unit—an increase of less than 20%.
Improved Supplier Terms & Cost Efficiency:
With ZonLabs' guidance, Purawood secured a $0.20 reduction in wholesale unit costs (approximately 5%) and negotiated more favorable payment terms. These changes significantly improved cash flow and supply chain flexibility.
Higher Margins Without Sacrificing Market Share:
While the broader niche experienced an average price increase of 22% due to rising costs, Purawood successfully raised prices by approximately 20%. Because COGS increased at a slower rate, the brand not only protected its market position but also increased profit margins.
THE RESULTS
Controlled COGS Amid Rising Costs:
Without intervention, Purawood’s inbound shipping costs were projected to increase by over $5 per unit (a 90% spike) due to rising tariffs and Amazon fees. Thanks to the strategic inventory planning developed with ZonLabs, that increase was held to under $1 per unit—an increase of less than 20%.
Improved Supplier Terms & Cost Efficiency:
With ZonLabs' guidance, Purawood secured a $0.20 reduction in wholesale unit costs (approximately 5%) and negotiated more favorable payment terms. These changes significantly improved cash flow and supply chain flexibility.
Improved Supplier Terms & Cost Efficiency:
While the broader niche experienced an average price increase of 22% due to rising costs, Purawood successfully raised prices by approximately 20%. Because COGS increased at a slower rate, the brand not only protected its market position but also increased profit margins.
CONCLUSION
Through its partnership with ZonLabs, Purawood successfully navigated one of the most challenging periods for Amazon sellers—marked by rising tariffs, increased fulfillment fees, and mounting supply chain complexity. By taking a proactive, data-driven approach to inventory planning, cost control, and pricing strategy, Purawood not only avoided major disruptions but also strengthened its profitability and market position. This case highlights the power of strategic collaboration and the importance of adapting quickly in a fast-moving e-commerce landscape. With a scalable foundation now in place, Purawood is well-positioned for continued growth, even in the face of future marketplace changes.