Orders Fulfilled by Amazon: 5 things Must Know about Orders Fulfilled by Amazon
Due to the pandemic, people are becoming creative about earning a living, which mainly results in online selling, and the primary platform they run into is Amazon. While some people do the work hands-on, there are still sellers who prefer orders fulfilled by Amazon. And there are multiple reasons for that.
Being hands-on means, they get the orders, pack them, and ship them themselves. Some people use online market platforms, which helps them gather customers easier and let the couriers pick up the item and ship it to the receiver. But orders Fulfilled by Amazon take all this work away from the sellers and makes their life easier.
What do Orders Fulfilled by Amazon (FBA) mean?
Orders Fulfilled by Amazon or FBA is a program by Amazon that allows the seller to focus on his selling strategies and leave the order fulfillment routine to Amazon. With this, Amazon handles the storage of the merchant’s products, packaging when someone orders, and shipping it to the customer.
All you have to do is deliver your products, find customers, and promote your product, so you can boost sales. This program is beneficial if you have many customers and work alone or are too busy with other things in your life. And for every two weeks, Amazon will directly deposit your profit to your bank.
What happens when you switch to the Orders Fulfilled by Amazon?
When you join FBA, your product will be associated with them. For those not yet known businesses, being associated with Amazon means that the customers will likely find your products trustworthy and credible. They might even not tell the difference if it is from Amazon or a third party.
What are the 5 things you must know about orders Fulfilled by Amazon?
Orders Fulfilled by Amazon seems like a beneficial program for the online sellers on Amazon. However, the benefits you may attain from this also come with fair consequences.
1. Orders Fulfilled by Amazon can be costly
Because Amazon almost does everything for you, all of it comes with a price. The storage fee is calculated based on the size and weight of the product and an additional fee for long-term storage. The fulfillment fee consists of their packaging, packing, and shipping fee out of the warehouse.
However, not into the warehouse. Items not sold will be carried over to the next month. And so, if your business is going slow and you want to pull out your items, you will have to cover the removal fee of each item. If you have broken or unusable products, you will also pay the disposal fee.
2. Start small and slow
If you are starting to be known, it is best to start orders Fulfilled by Amazon small and slow with the cost in mind. If you put all your products in their storage, but they do not get sold instantly, you will suffer from the long-term storage fee. And so, only put products on the storage in high demand, and you know they will be sold.
Know your market and assess what products you have usually get sold faster. You may send stocks of products little by little to Amazon and send more during holidays or seasons that you know will skyrocket your business. Make sure to evaluate your income and cost to know if FBA is worth it for you.
3. Benefits of joining orders Fulfilled by Amazon
There are also benefits to being a member of FBA. Instead of handling the customers yourself, Amazon takes customer service via phone or email 24/7, free of charge. There is no minimum quantity of products you may store in their warehouse.
Although you have to pay for the shipping fee of your items to the Amazon warehouse, they have partnerships with some shipping companies that give discounted rates. And because they store your products, you don’t have to worry about having a neat and spacious warehouse even when selling many products.
4. The customers cover import fees
Aside from the shipping fees from the warehouse, the import fees are also covered by who buys the item. If someone overseas buys the item, you do not have to worry about how much it will cost you to transport it to another country. This benefit will be extra helpful if you join the FBA export program.
5. The FIFO method
It might worry some of the sellers that the older stocks of products will not be noticed when a new batch comes in. It is not to worry about the FIFO method or the First Come, First Out. Amazon keeps the dates of your products so that when a new batch comes in, they will still send out the older stocks.
There is also no sales quota to join orders Fulfilled by Amazon, which means that even if your stock is in storage for a long time and is not being sold, they will not terminate your membership and continue to fulfill orders.
With all that, you should definitely check out this blog: Your FBA Shipment Checklist: What Is It About and How to Use It?.
Frequently Asked Questions
What is FBA?
FBA or Fulfillment by Amazon is a program that an online seller on Amazon may join to cover the storage of his items, the packaging, and the shipping. All you have to do is focus on gathering customers.
How to join FBA?
The easy 4 steps are to create an Amazon Seller account, add your products to the product listing and specify which products you will send Amazon for FBA, prepare your products by following the packing guidelines by Amazon, and lastly, ship them to an Amazon warehouse.
Is it worth investing in FBA?
If you are a growing business with lots of customers that you can’t handle alone, FBA will benefit you greatly. However, if you are still starting and the business is slow, investing in FBA might only do more harm than good to your profit.
Now that you know the orders Fulfilled by Amazon and how it works, you may decide if it is worth investing in FBA. If you receive many orders that your house can carry, it is time to store them outside your home rather than live in a jungle of products. Remember to be careful on how much you send Amazon to avoid extra fees.