Amazon FBA refers to the term Fulfillment By Amazon.com, which is a service that promotes the sellers’ options for utilizing different selling practices in their business. This flexibility of the sellers is automatically enhanced due to this service by Amazon which provides support in terms of storage, shipping and packaging. These tasks are the crux of shipping for which FBA makes it easier for the seller. This service allows sellers to ship their merchandise and keep it stored in the warehouses of Amazon center.
Understanding the Working of FBA
FBA might seem confusing to some at first, but it is not that complicated to work with at all. In FBA, when a customer has placed an order, Amazon picks the order from your storage at the warehouse and ships the order on your behalf. Just like regular shipping, the customer receives a tracking ID and information regarding their order. A perk of Amazon FBA is that it just takes two business days to deliver your shipping because of Prime Shipping Feature. With the assistance of FBA and an FBA calculator, you will be able to deliver your products to an Amazon warehouse to store your products in the fulfillment center from which your orders will directly be shipped by Amazon FBA.
Storing your products in the Amazon Fulfillment Center comes with a storage fee that depend on the season and time of the year your products are in the warehouse as well as the storage they will take up. For instance, the fee can start from 48 cents per cubic foot and can go up according to the product. Other than this, busy and snowy seasons are also charged extra such as Christmas and Thanksgiving. Other than this, you might also have to pay fee for packing and shipping. Even if your products are being sold, Amazon is shipping them out on their responsibility so in case there are any queries, refunds or problems, Amazon will handle these. For more information, you can check this infographic:
Costs of Fulfillment by Amazon
Amazon FBA has costs just like any other service provider, and these costs include a monthly fee for storage, cost of shipping and packaging, and sometimes third-party tools as well. Estimating the total cost of using the FBA service is a smart idea especially considering the tools as they cost a lot. These tools are basically designed to make selling your products on FBA simpler and easier. Third-party tools fee can actually start free for a trial and can cost you about $100 a month. These tools can be like Jungle Scout, Sellics etc. If you are planning to start with FBA, research more about the costs involved with Two Hour Blogger.
Fulfillment by Amazon Features
Prime shipping is one of the most exciting and useful features of FBA which add the wow factor to this service. Prime shipping is also available for Prime subscribers of Amazon who aren’t using FBA, so this is a great feature. This basically means that the shipping of your product will reach to you in only two business days. FBA product listings mention the Amazon Prime logo which boosts the potential of customer shopping.
Higher Search Ranking
FBA products are known to always gain an edge over the non-FBA items on Amazon’s algorithm for products search results. By getting high rankings, the products appear in top search results resulting in more and more sales. When a product listing occurs in the top items, it gains a lot of add to cart clicks. Usually, it is thought that FBA prime-eligible products gain preference over products with equal prices, which is a plus point for FBA sellers.
Small and Light
Small and Light is a reduction on specific costs on items. This feature allows the seller to gain good profit margins; and all the eligible products are considered on the criteria of 10 ounces or less with quick selling number. By using FBA service, the Small and Light feature provides you with a great opportunity to expand your sales in the international market. Besides this, the customers will get free prime shipping.
Subscribe & Save
The subscribe and save feature is a huge convenience for the customers which leads them to getting big discounts and special deals on subscribing to a product or just by signing up for it. This enables the repetition of customers which is also a boost in sales for the seller. This is one of the best ways to generate recurring revenue with assistance of Amazon and increasing your profit in business in a smart and easy way.
Advantages of FBA Services
Amazon FBA has a lot of advantages that benefit the sellers in multiple ways. When you sign up with FBA, it might seem a bit costly but when you run your business with it, you’ll know that it is a great deal after all, especially considering the scope that Amazon provides to your products globally. Some advantages are as follows:
Association of Amazon Brand Name
Amazon has developed and gained customer trust overtime, so association with an international brand like Amazon makes the customers more prone to the idea of buying the products and also helps sellers in increasing sales because of the consumer trust as developed by Amazon.
Discounted Shipping Fee
Amazon has contracts with shipping companies worldwide, so when you sell your products through Amazon FBA, the service will actually cost you less than if you ship them yourself. If you ship the products yourself, you will be charged full fee for all products separately which will cost you a lot.
FBA orders are always handling with exact care as of Amazon’s own orders, because they have agreed to take responsibility over it. Amazon FBA is a professional service in terms of their conditions, and if someone purchases your item, Amazon will pack and ship the product with care. Sellers can just feature their products on the website, the rest of the work Amazon FBA will do for them.