Fulfillment by Amazon, A Logistical Dream?
Do you have a product that you want to sell, but storage space is limited? Fulfillment by Amazon may be for you. You can let Amazon handle your storage and shipping. Outsourcing at its finest. There are many small companies that take full advantage of having their product listed, sold, and shipped by Amazon to make the most from their product.
What is Fulfillment by Amazon
Fulfillment by Amazon is a fulfillment center that allows companies to ship their product to Amazon warehouses for distribution. But what does that mean? This means if you have a product, you can send boxes of this product to the warehouses and list the product on Amazon. When someone buys your product, Amazon will handle all order fulfillment. In other words, it will pack, label, and ship your product for you. Then, it will invoice you with the revenue.
Products for Fulfillment by Amazon
There are many different ways you can get products to Amazon. If you manufacture the products yourself, you can ship them directly to Amazon. But, one way that many people do is purchase a bulk product for a manufacturer and ship them directly to Amazon, taking your completely out of the equation. I, for one, purchased a product on Alibaba and had it shipped directly from China to the Amazon warehouses. You can do this with any manufacturer of any product. It removes the logistical headache from making you have to move product yourself.
Some Nifty Tricks
Amazon warehouses will store and ship your products, but one thing that isn’t always known is that you do not have to only sell on Amazon. That’s right! You can sell your products on your own website, or other sites, and Amazon will still ship your products. They have a manual order fulfillment center that handles products being shipped.
Another option is you can put the order button on your website to purchase from Amazon. You can have a full shop on your page listing your products. The button links to Amazon, so if the customer wants to purchase the product, they can be linked straight to the product. Or, you can create a shopping cart on your site though 3rd party apps.
A Word of Caution
There are many offers that pop up from Amazon about free shipping, free storage, etc. But after that trial is over, you might be stuck with some bills. For example, if you shipped too much product to the warehouses and/or they aren’t selling as fast as you had hoped, Amazon will charge you a storage fee. Typically, this is triggered if a product has sat on the shelf for longer than a few months, so make sure you have decent turnover rates.
Also, you will be charged a shipping fee and a commission, makes sense, but just make sure that you incorporate all that into the price. There are so many YouTube videos of people saying how they make $10,000 a month by using Fulfillment by Amazon. I raise a flag to that. I had a FBA product for a year, marketed on social media well, but could not get traction against the products that have 10,000 reviews on them. If you are only selling on Amazon, you might have an issue getting product sold.
Is It Worth It?
There are many advantages to using Fulfillment by Amazon. Logistics, payment acceptance, and being listed on the largest online retailer in the US is huge. But, know that you’re not going to get instant traction. Do research, start small, and good luck!
Disclaimer
Once again, I am not a financial advisor. These tips are some things I have validated with my own personal experiences. If you feel you need more personal advice, please consult a professional financial advisor. Dont forget to check out the Book List for published authors on this topic!
