In today’s digital era, Amazon is the marketplace everyone is familiar with. But to become an Amazon FBA seller, there are a few things you should consider beforehand. Read below and find everything you need to know.
Amazon is an eCommerce marketplace that sells third-party products to its customers. More than half of its sales come from third-party sellers, and Amazon itself generates the remaining.
You would have heard about Amazon FBA numerous times and always wanted to know an in-depth detail about how it works and whether or not is it worth the hype. Well, now you are about to find the answer to all your long-awaited questions.
Read: How to Prepare Your Business for the Future: 7 Effective Steps
What is Amazon FBA?
Amazon FBA (fulfillment by amazon) is a service provided by Amazon, through which the sellers can sell their products without any hassle of shipment to the customers. In FBA, amazon stores, packages, and ships the sellers’ products to the customers and handles all the returns, refunds, and exchanges. In short, FBA sets the seller free of any tension that local business owners suffer when shipping the products to all the customers individually.
Amazon FBA: How it works?
The process for starting an Amazon FBA business is simple and based upon a few steps. The seller should have thorough knowledge about the marketplace before starting the business. With the below-mentioned steps, anyone can start an Amazon FBA business:
- Login into Amazon and create an Amazon Selling Account.
- In the Seller Central, set up Amazon FBA.
- Create your product listing and specify that it is for FBA inventory.
- Now get your products ready for shipment to the Amazon fulfilment center.
From this step onwards, the seller is free from any struggle to ship products to its customers. Amazon takes care of storing and shipping the products on time. The seller only needs to make sure that the Amazon inventory stays stocked up at all times.
What are the advantages and disadvantages of using Amazon FBA?
ADVANTAGES
- The topmost advantage of Amazon FBA is Amazon’s name.
- The customer service management of Amazon is available 24/7. So if the buyer has an issue with the seller’s product, the helpline can solve it on time.
- With Amazon, there is no hassle in determining the shipping channels for international deliveries. Amazon handles everything. The seller only ships to the fulfilment center once.
DISADVANTAGES
- The fee of Amazon FBA is very high. The sellers are charged fulfilment and storage fees, and it multiplies quickly if the products are unsellable and remain in the inventory for long.
- Due to high inventory traffic, a specific seller’s inventory might get lost or damaged. Though Amazon compensates the seller for the loss, it does not always happen.
- Amazon’s return policy is very convenient for buyers. Due to this, sellers often face higher return rates for their products.
- Amazon has a detailed guide regarding the preparation of products that come into the inventory. It covers labelling, packaging, and many other specifications. Keeping up with all requirements can become cumbersome.
Read: What is White Label and How Can You Use It in Your Business
What are the alternatives for Amazon FBA?
Due to the drawbacks of Amazon FBA, people are forced to look for its alternatives. We have gathered a list of the five best alternatives to save you from Amazon FBA’s shortcomings.
Wrap up!
Nobody wants their new business to fail. So, before you start your eCommerce business, never forget to consider the important things while choosing the fulfillment company.
You should consider the reputation of the fulfillment company. Besides, never ignore delivery speed, location, features, transparency, and cost associated with the company. Looking up to the packaging and return policy is also a must. So, make sure to check and mark all these important things when you choose your fulfillment company.
