Amazon Born to Run Program (BTR)—What Is It and How Can You Join It?
Ecommerce founders are commonly faced with two challenges - managing new product launches and out-of-stock issues. It's not easy to build momentum with new launches and stockouts could be costing sellers over $1 trillion in missed sales. The Born to Run Program by Amazon was created as a solution to these challenges. BTR helps vendors accelerate product launches and boost sales.
Keep reading to learn more about the Amazon Born to Run program, its benefits, limitations, and how you can join it.
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What is Amazon Born to Run?
Amazon Born to Run is an invite-only program accessible through Vendor Central. When participating in this program, vendors tell Amazon they´re confident a particular product ASIN is going to sell well. In turn, Amazon agrees to purchase more units to keep in stock and meet the forecasted demand. If the product sells well, Amazon places additional orders. Otherwise, Amazon returns the unsold inventory or you have to pay additional fees to the company.
Amazon BTR is not only available for new launches. You can use the BTR program in other cases, such as when you estimate that a current ASIN should have a higher product order (PO) quantity due to a planned campaign, seasonal demand spikes, or Prime Day promotions.
How BTR Works?
Once you´re invited, you expect a product to sell well, and your product meets the qualifying requirements for joining BTR (more on that below), you can submit a form for Amazon to review.
The form includes information such as: the number of units you ask Amazon to buy, known as the Launch Buy Quantity (LBQ). The maximum inventory value cannot exceed $50,000. If a vendor is launching a product at $45 per unit, they can secure an order of 1,000 units. In this case, the vendor´s LBQ would be $45,000.
If Amazon accepts the offer, you have 20 days from your BTR ASIN submission date to ship the order quantity to Amazon. After 20 days, the sellthrough period begins. The sellthrough period lasts 10 weeks. If Amazon hasn´t sold your inventory within the sellthrough period, it can either:
- Return the unsold products - you must refund Amazon 100% of the product cost for every unit, plus 10% shipping and handling fees.
- Keep the unsold products - you must pay Amazon a retention fee equal to 25% of the cost of the products.
This is a choice you make during your BTR Amazon submission.
If your product sells as expected and sales continue to grow, Amazon can send more orders with no inventory value limit, even before the sell-through period ends. This is the ideal scenario.
“Amazon Born to Run (BTR) is a great way to introduce new products to customers. In this vendor account, 100 units were sent and sold within the 90-day window. We often suggest running advertising, but it is not always necessary, as in this case.” – Prabhat Shah, is an experienced UK based Marketplace consultant helping established and startup brands.
Which Products Qualify for Amazon Born to Run?
A product qualifies for Born to Run if:
- The ASIN is not considered hazmat, bulky, or heavy and it costs more than $5 per unit
- Amazon considers the product “new”, meaning it can´t be an item that is already being fulfilled by Amazon
- The total inventory value (LBQ) doesn´t exceed $50,000
- You have been using Amazon Marketing Services (AMS) for a minimum of 90 days
Before, it was mandatory that all vendors spend 10% on Amazon Ads in order to qualify for the BTR program. This is no longer a requirement, however, it’s highly recommended, especially for new product launches.
If you´re getting started with ads, read our complete beginner´s guide to Amazon Advertising to learn more. Also, there are a variety of ecommerce tools, such as the PPC optimizer for Amazon that can help you make the most of your advertising budget.
Steps to Join Amazon Born to Run
Born to Run is an invite-only program, so you won´t get access to it when you start selling on Amazon. Amazon utilizes its own undisclosed requirements to choose who gets entry into the program.
Once you´re invited and your ASINs meet the above qualifying requirements, you can fill out an intake form for Amazon to review. The submission form includes your Launch Buy Quantity and what you wish to do with the unsold inventory.
Here's the step-by-step process to join Amazon BTR:
Step #1: Sign in to your Vendor Central Portal
Step #2: Head to the Orders tab
Step #3: Click on Vendor Initiated Orders
Step #4: Select Born to Run
After submitting the form, you can see the status of the review in Vendor Central. Typically a purchase order (PO) is generated within a day, however, it may take up to a few business days.
Then, the only step left is to process the order as soon as possible. Before sending the BTR application make sure you have enough stock to satisfy the LBQ and that your order is ready to be processed.
Benefits of the Amazon Born to Run Program
Here's how the Amazon Born to Run program can benefit your business:
Decrease Out-of-stock Risk
When your product is marked as “out-of-stock”, it will fall down the sales rank and you´ll miss out on sales; the customer will instead purchase from your competitors.
What's worse is that you'll likely not only lose that on-time sale, but there's the risk the customer shifts brand loyalties for future purchases. Therefore, by decreasing the out-of-stock risk, the BTR program boosts customer experience and brand loyalty.
No stockouts mean no lost sales. Your product can continue to grow in its sales rank, reach more customers, and sell more. In other words, BTR helps build momentum. Many vendors even submit their ASINs to BTR in anticipation of high sales such as during peak sales periods like Black Friday and Prime Day and before large campaigns. That added inventory cushion ensures greater sales.
Limitations of Amazon Born to Run
One of the main limitations of the Born to Run Amazon program is that it´s not available to all Amazon sellers. You need an invitation to participate as a vendor.
Forecasting the product quantity you expect to sell within 10 weeks is not an exact science. In fact, 73% of sellers struggle with inventory forecasting. When sales are lower than the forecasted quantity, you either have to refund Amazon or pay retention fees. An online tool such as Product Research for Amazon can help your forecasting efforts by showing you up-to-date demand information for similar products.
Besides poor demand forecasting, there are also logistics challenges you should account for, such as not having enough stock to ship to Amazon on time or shipping delays. Ultimately, participating in the Amazon Born to Run program is not a sure ticket to a successful product launch or campaign and it comes with financial risks.
The Born to Run program helps Amazon vendors mitigate some of the risks associated with new product launches, such as building up sales momentum and decreasing the possibility of stockouts. You have to estimate the number of products you can sell in ten weeks and Amazon will pre-pay for the order. It is a great program to boost sales, increase profits, and decrease ecommerce risks. However, you have to pay penalties for unsold items. You can use Amazon demand estimation tools to make more accurate forecasts. You can also promote your products through Amazon advertising to raise the odds of a successful launch.
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Amazon Born to Run is not the only Vendor Central feature that can benefit you. EDI with Vendor Central is another great program to grow your ecommerce venture!