When looking for channels in which to sell your products, it’s always a great idea to go where the power is, and Amazon definitely has the power. Some of the most recent statistics show that more than 310 million active customers browse and purchase at Amazon, which shows a huge promise for any retailer who wants success for their products.
You can opt to self-fulfill on Amazon, but there are so many reasons why you just shouldn’t go this route. We’ll cover some of that in a bit, but let’s talk about Amazon FBA.
What is Amazon FBA?
Fulfilled By Amazon is a revolutionary system in which Amazon will receive your products in their facilities, manage your inventory, handle customer inquiries, and even package and ship everything. When you use Amazon FBA, you are essentially storing your products in Amazon fulfillment centers, and they handle the rest. Now, this is a pretty great deal, but there are a few drawbacks. For instance, there are costs associated (more into that later), and there is time involved in shipping your items to Amazon.
Still, with statistics showing that 66% of the top 10,000 Amazon sellers are using FBA, we think those drawbacks don’t outweigh the massive selling potential of FBA.
Why Use Amazon FBA?
Now that you know exactly what it is, as well as the major drawbacks of FBA, let’s talk about the major reasons why sellers are turning to this platform.
First of all, sellers using FBA are automatically eligible for Amazon Prime. This is HUGE. Amazon Prime membership belongs to more than 100 million Amazon customers, and these regular shoppers will rarely buy a product without Prime. If you want to be eligible for Prime and reach the biggest audience possible, FBA is crucial. It’s an obvious selling advantage.
The next advantage of FBA: Amazon handles everything. Once your products are received at their facilities, they handle logistics, shipping, and customer care. It’s a winner for you, as a retailer, because you have more time on your side. In fact, this gives you the opportunity to spend more time selling on other channels, thereby maximizing your selling power. That’s right – with FBA, you can sell more, not just on Amazon, but with other channels.
What Does the Process of Shipping to Amazon FBA Look Like?
This is the part that usually scares newbies. If you’re with me up until this part, then you’re still wondering how on earth you get your products to Amazon. The truth is, Amazon is particular about the way they receive products from retailers. The good news, however, is that the process is transparent, and with the use of the FBA portal, you can get a lot done online. With that said, the main thing to remember is that if you follow the steps, you’ll be just fine.
Before we dive into the exact process of shipping to FBA, I want to cover something I said we’d go over later. The time has come to discuss…….the costs! It makes complete sense that a platform as smart as FBA wouldn’t be free, right? There are a couple of fees to be aware of. First of all, there are storage fees, including higher fees on products that aren’t moving so fast. Then, there are either individual seller fees (for non-professional sellers) at $1 per product sold or subscription fees (for professional sellers) at $39.99 per month. When you first place an item with FBA, there’s an initial fee, and there are also closing and referral fees.
Use this estimator to get an idea about the true costs of shipping to FBA:
Now, this sounds like it adds up, and it really does. You are the retailer, so you have to weigh out what makes the most sense to you. Just don’t forget about the massive audience and potential that comes with Amazon.
Now, back to shipping to FBA. This process begins in the dashboard, where you simply choose “Manage FBA Inventory” and then click “Send/Replenish Inventory”. Once you’ve done that, you just choose preferences, like shipping, and then pack all of your items. Each item must be in its own poly bag, and you’ll need to print labels for each bag. Going back to the dashboard, you’ll click “Approve Shipment”, print the shipping label, weigh and measure your box, and print box labels.
If you are importing, please note that customs is a whole different ball game. You’ve got to adhere to all of those rules carefully and ensure no duties are owed, or Amazon won’t accept your items.
I’d like to recommend this guide – The Complete Amazon FBA Shipment Strategy Guide – to learn more about the ins and outs of Amazon FBA shipment.
What About Selling on FBA?
We all know about the importance of marketing, but selling on Amazon has its own promotional perks. For instance, its built-in SEO lets you create a product description that can be searched for within the system. The Amazon Buy Box is a coveted position for Amazon sellers. This box appears on product detail pages when customers add items to their carts. The only way to get there is by having a long track record of being an amazing seller – it’s something to work towards!
Other ways to promote directly within Amazon are with deals, coupons, and promotions. You can even use Lightning Deals as a way to drum up traffic. Giveaways are also another way to get the attention of Amazon shoppers from right within the platform.
If you want to try PPC ads, don’t forget about Amazon PPC. With this system, you can put your product in front of the perfect audience!
In Closing…
Is FBA worth it? I’d say most definitely, but only if you are committed to the process.
Your next step would be talking with the Amazon sellers you know and learn the craft from them. You should also look for ways to compare freight services for delivering to FBA centers, so that you can better manage your costs. And last but not least, make sure you’re always in the know when it comes to Amazon FBA costs, so that you can manage your margins.