Amazon is one of the largest sales platforms in the world. When you register as a seller, you have the option of using a ready-made platform which has been trusted by millions of users and is well-recognized around the world.
Currently there are already over 2.5 million existing active sellers on Amazon, and that number grows by an estimated 3,000 new sellers every day. Is it really a surprise, though? After all, the platform offers sellers countless benefits and opportunities to grow their business.
Why is Amazon a good choice if you want to increase your online sales?
Amazon gives its sellers access to 300 million potential customers around the globe! It is present in over 200 countries.
Flexibility and ease of use – these are the main traits of Amazon as a selling platform. You decide which sales model suits your needs better – you can send goods yourself directly to customers (FBM- Fulfillment by Merchant) or you can go through one of the Amazon logistics centers (FBA- Fulfillment By Amazon).
FBA-Fulfillment By Amazon is the more complex logistics model and we will have a closer look at it in today’s article.
What is FBA?
Fulfillment By Amazon – is a service that takes off some of the responsibility from your shoulders as a seller. This is the model in which your company sells products, and Amazon is responsible for all the logistics.
What do sales look like in the FBA model?
Amazon handles all the logistics from the beginning until the end – storing, packing, shipping, customer service and, what’s very significant, handles returns, too. As most e-commerce sellers know, returns handling takes a lot of time and energy, so you can save yourself a lot of precious time if you go for the FBA model.
What are the costs of FBA?
FBA COST = Storage Fee + Shipping Fee + Additional Service Fees
As the cost of the FBA model depend on the size of the product, its specifics, and its storage time in an Amazon’s warehouse, there is no fixed fee for all products.
What are the main advantages of the FBA model?
- No need for your own warehouse
- Easy international transactions
- After years of being a global leader in enabling online sales, Amazon’s name instills the confidence of customers
- Guarantee of fast shipment and safe delivery
- Fulfillment of orders from different sales channels
- Easy monitoring of inventory of your goods in a warehouse
- 24/7 sales
- Free Shipping to Prime Subscribers
There is no minimum product quantity in this model. Moreover, there is no obligation to use FBA for all your products. Seller has the freedom to choose a strategy that best suits the needs of their e-commerce business.
In which cases should you choose the FBA model?
- When your products are easily and quickly sold
- When your goods are small in size and have a relatively high price
- When you lack the resources to run logistics on your own
How to get started with the FBA model?
Step 1. Set up FBA – Create your Amazon selling account, login to Seller Central and set up FBA.
Step 2. Create your product listing – After you add your products to the Amazon catalog, specify FBA inventory.
Step 3. Prepare your products – Prepare your goods in accordance with Amazon guidelines to ensure their secure transportation to a fulfillment center.
Step 4. Ship your products to Amazon – Prepare your shipping plan, print Amazon shipping ID labels, and ship your goods to Amazon Fulfillment Centers.
Amazon FBA – is it worth it or not?
This sales model is certainly an attractive, innovatory and cost-effective option that will help to optimize your distribution to a large extent. The FBA model allows you to increase online sales both locally and globally, while providing access to Amazon’s world-class logistics resources. However, keep in mind that the selection of the most suitable logistics model largely depends on the specifics of your business, the kind of products you sell, and a number of other factors.
Nevertheless, there is no doubt that the FBA has revolutionized the e-commerce market, so it is worth taking a closer look at it to see if this logistics model will be a more effective option for you. Have you already launched the FBA model and do you’re not sure what to do next? Contact us and start developing your business internationally today
