Demystifying the Mystery of Fulfillment by Amazon
What is Fulfillment by Amazon?
It’s pretty straightforward, you (or your business) has a product to sell and use Amazon’s special shipping rates to ship your product in bulk to one of their warehouses. Then, when a customers orders your product on Amazon, it gets picked, packed and shipped to the customer.
Fulfillment by Amazon Means your Business can work Quickly and Efficiently while you Sleep, Vacation, or Work on your Salsa Dancing
Fulfillment by Amazon, aka FBA, means that orders can ship to your customers from the the closest fulfillment center to the customer, and right after their order is complete. It takes the full strength of Amazon’s shipping and processing network and puts it behind your business so you can focus on the important stuff like product development, marketing, or your salsa dance moves.
What’s inside an Amazon Fulfillment Center? How does it work?
Like the video shows above, it’s an incredible system of product storage, processing, and shipping like nothing else in the world, and that system can make things more efficient for your business.
Not sure, you can take a tour of an Amazon fulfillment center to check it out.
What are the Drawbacks to using Fulfillment by Amazon?
Fulfillment by Amazon does have a few downsides.
1. Fulfillment by Amazon isn’t Free
Sorry, no free lunch, but the costs for Fulfillment by Amazon aren’t unreasonable for what you get. Costs depend on product size, storage, and weight, and you can check the Fulfillment by Amazon cost schedule. For many products, the cost could be around a few dollars, but if you were to ship that same product to a customer, you might be paying $3.50-$18.50 (or more) to ship just one order.
Fulfillment by Amazon does have a cost, but it can be less costly than fulfilling the orders by yourself, not to mention the time you save.
Now Amazon does have other fees for selling, it takes a commission for selling on the site (15% in the home category for example) whether or not you fulfill by Amazon or if you fulfill orders by yourself, but from what we’ve seen, the jump in sales for the few dollars for Fulfillment by Amazon, the gain is well worth it.
2. Long-Term Storage Fees for Products that Don’t Sell
Amazon issues a long-term storage fee for products that don’t sell. The good thing is that you can send a little bit of inventory and grow your stock at Amazon as you see demand increase. If you have product that stays in a fulfillment center for more than 6 months to a year to over a year, you might want to increase your marketing or run some sales.
3. Problems with Inbound Shipments to Amazon
There can be problems with inbound shipments to Amazon. One can be if you have your products incorrectly labeled (you’ve sent in the wrong stuff), it can cause headaches. The other thing that can happen is that the fulfillment center gets busy and it’s a couple weeks (or more) for your product to be received and marked as in stock.
So What Should You Do?
You’ll never know unless you try.
Seriously. There’s a powerful engine that is waiting for you to get your products there to be made available to millions of people. Will you let that opportunity pass you by?
But what if you don’t get it right?
None of us “get it right” all the way. We make mistakes. It takes a little bit of time. You can do it all on your own, or seek help from those who’ve gone before and are offering support.
Either way, it can be done.
You can succeed.