Q5

 Although not an official fiscal quarter, Q5 is informally recognised by Amazon retail, operations, and finance teams as a unique transitional window between Q4 (holiday peak) and Q1 (new fiscal start).

During this time, Amazon shifts from record-breaking sales volumes to handling reverse logistics, clearing excess stock, and evaluating year-end metrics. Vendors and internal teams focus on stabilising operations after the intense Q4 surge.

Key Activities in Q5:

• Returns & Reverse Logistics:
  • Managing high volumes of customer returns and refunds post-holidays.
  • Repackaging, refurbishing, or liquidating returned goods via Warehouse Deals or Amazon Outlet.
• Inventory Normalisation:
  • Processing overstocks from Q4 and updating replenishment forecasts.
  • Adjusting safety stock and procurement models for Q1.
• Financial Reconciliation:
  • Closing out trade terms (VIR, PPA, PCOGS).
  • Resolving invoice disputes such as PPV (Price Variation) and PQV (Quantity Variation).
  • Finalising vendor chargebacks and accruals.
• Performance Analysis:
  • Reviewing Q4 sales performance and advertising ROI.
  • Preparing Year-to-Date (YTD) summaries and business plans for the next cycle.

Benefits for Amazon:

• Operational recovery: Balances systems after the Q4 surge.
• Data-driven insights: Analyses holiday trends for upcoming forecasting models.
• Vendor accountability: Closes the financial year cleanly with accurate reconciliations.

Benefits for Vendors:

• Post-peak stabilisation: Time to resolve shortages, overstock, and financial disputes.
• Strategic preparation: Review assortment and pricing ahead of Q1 negotiations.
• Relationship reset: Re-engage Vendor Managers (VMs) after the peak season rush.

Challenges:

• High operational load: Returns and claims management can overwhelm logistics systems.
• Financial reconciliation pressure: Requires close coordination between finance and supply chain teams.
• Slow sales period: Consumer demand typically dips after the holidays.

Why It Matters:
Q5 symbolises the cooldown and recalibration period of Amazon’s retail cycle - a time for clean-up, analysis, and preparation for the new fiscal year.
Though unofficial, it’s widely recognised internally as a critical stabilisation phase bridging two business years.

Example:
In Q5 2025 (Jan–Feb), Amazon processes a record number of electronics returns, clears unsold Q4 inventory through Warehouse Deals, and prepares vendor performance reports for Q1 joint planning.

In short:
Q5 (Fifth Quarter) is an informal term for the post-holiday period (January–February) when Amazon focuses on returns, stock clearance, and financial reconciliation after Q4’s peak - effectively serving as a bridge between the old and new fiscal years.