FBA 101: How & When To Start Using Fulfillment By Amazon
If you want to stop spending all of your time on inventory picking and shipment…
If you want to stop spending all of your money on warehousing and inventory costs…
If you want to focus your energy on growing your business and profits…
Then it’s time to consider Fulfillment by Amazon (FBA).
FBA is a service offered by Amazon that can take over a majority of your logistics processes. Think of it as an Amazon outsourcing service for your inventory, shipping, logistics, and customer service.
What does FBA do for you and how can you get started with it?
What are the benefits of FBA?
World-class, customer-centric fulfillment
Customer service and fast fulfillment is absolutely crucial to Amazon business success—and you get the best of both with FBA.
Amazon is a world-class leader in service. This means that when you use Amazon’s services, you’re getting one of the highest quality fulfillment on the market.
Amazon cares first and foremost about the customer, so they will do everything to ensure that they please their customers—and in this case, those are your customers as well. All of your customer’s FBA orders are backed by the Amazon promise and service.
Reduced time expenditure
Amazon FBA also frees up your time and resources to focus on core business processes. After you choose and source your product, Amazon FBA will do the rest.
They unpack, store, pick, fill, and ship for you. They’ll even handle your customer service and returns. This means that after you give them the product, you’re basically done with the process. This frees you up to focus on sales, marketing, and the future growth of your business.
This gives you more time to focus on finding products, creating listings, integrating sales, and growing your brand. FBA makes the day-to-day operations smooth and efficient.
Product visibility and customer access
FBA boosts your product visibility and access to customers. When your product is listed with FBA, it will automatically be qualified for super saver shipping and Prime Eligible with two-day shipping. Furthermore, Amazon promotes their Prime (and FBA) products over non-Prime, so having this can help you win the Buy Box.
This also encourages customers to buy from you. Prime customers, who pay $99 per year, will almost always choose a Prime Eligible company over non-Prime. This means that you already have an automatic advantage over the other sellers of the same product. Plus, customers tend to trust Amazon-backed and Prime brands more than those without the stamp of Amazon approval.
Amazon FBA doesn’t just offer logistics and fulfillment. They also have resources to help you grow your business. They provide tools that help you manage your inventory health, forecast customer demand, analyze your business performance, optimize pricing, and even provide personalized business recommendations. Amazon also helps their FBA businesses grow in global marketplaces, even handling customer service in the local language.
Although FBA offers these services, they aren’t necessarily FBA’s primary forte. In fact, many FBA sellers say that Amazon’s FBA is great for fulfillment but lacking in growth services. If you’re looking to grow your business, you need a partner with your best interests in mind. Learn more about our Sellers Choice services here to learn how we can help you grow.
You can condense your inventory into one place and use FBA for all of your e-commerce platforms. This means that if you sell from your own website or other online channels (like Facebook), you can integrate these systems with FBA. This not only centralizes your inventory management; it also allows your entire business to benefit from Amazon’s expansive scale and service.
Mobility and support
Your FBA business can be with you at all times. You can access FBA and manage your inventory from your business, home, or even your mobile device. Amazon also offers tools, video tutorials, resources, and 24/7 support if you’re having issues with any aspect of your Amazon FBA business.
When and how should you use FBA?
We recommend using FBA as soon as you start selling. Although the cost of the service cuts into your margins, you can make that money back in time-savings and access to Amazon’s world-class resources. FBA helps you grow, which is more important than your per-unit margin.
You should determine your goals for FBA’s services. What are you looking to gain from outsourcing certain processes to Amazon?
They will store, pick, pack, and ship the products as well as handle customer service and returns. However, FBA also offers two additional services that can further improve your business operations.
The FBA Label Service saves you from having to label hundreds of items yourself. Without it, you have to label and prep your inventory before sending it to the Amazon warehouse. This service will label it for you, saving a significant amount of time spent on boring busywork. It costs a small fee per unit.
The Stickerless, Commingled Inventory will pool your inventory with the inventory of other sellers’ for new items with scannable UPCs. This allows for Amazon FBA to offer better customer service with faster pick times and shipping rates.
How do you get started with FBA?
- Create a Professional Selling account on Amazon if you don’t have one already. Click to learn more about the benefits of a Professional Selling account.
- If you’re creating a new listing, click the button to opt into FBA. If you’re changing previous listings to utilize FBA, go to “inventory” in your Seller Central. Click on “manage inventory.” Select “actions” and click on those listings you want to be fulfilled by Amazon. You can select as many listings as you want.
- Prep your inventory. It needs to be labeled and packaged in accordance with Amazon guidelines. If you don’t want to prep it yourself, you can use the FBA Label and Prep services for a per unit fee, as discussed above.
- Create a shipping plan that includes the packing type and the items to be sent. You can send as many or as few products as you’d like.
- Ship your products to Amazon. With Amazon’s FBA service, you have access to discounted shipping with their specific carriers. You’ll send your products to designated fulfillment centers or an inventory placement service.
- Amazon will handle the rest!
The Bottom Line
Amazon FBA gives you the time, resources, and service to scale your business locally and globally. You’ll have access to new customers, heightened product visibility, and world-class fulfillment.