Defining and explaining the different fulfillment options for Amazon Sellers.
Fulfillment by Amazon (FBA)
Starting on one end of the involvement spectrum, the FBA program leaves (basically) everything up to Amazon, letting the seller take a hands-off approach. In simple terms, you sign up for an account and send your inventory to Amazon’s warehouses, allowing them to handle storage, fulfillment, and FBA order returns. FBA products get the titles of Free Two-day Shipping, and access to Amazon Customer Service. The downsides to this program include not being able to control your inventory, paying for storage across multiple warehouses, being required to use Amazon branding and other restrictions.
Click here to learn more about the Fulfillment by Amazon Program (FBA).
Seller Fulfilled Prime (SFP)
Moving towards more involvement from the seller, this method entails the seller managing all inventory and delivery. The conditions are that the carriers must be Amazon approved and the warehouse must match FBA service levels to qualify. This is the only Amazon fulfillment method that allows stores to wear the Prime badge while still managing their own inventory. Because of that, there are high standards that must be routinely met, meaning it’s not for everyone. They even make you complete a trial period before being fully accepted into the SFP program.
According to Amazon’s website, they are not currently accepting new SFP merchants. Check out this link to learn more about the program and join the waitlist.
Fulfilled by Merchant (FBM)
While self-explanatory, this method refers to the seller handling all logistics for Amazon orders. These sellers do not receive the same benefits as SFP and FBA. FBM is a basic program that allows businesses to sell on Amazon, but without prime badges or free two-day shipping. This is a great option for those wanting to determine if their products would do well on Amazon and to gain a better understanding of how Amazon manages sellers. FBM also provides more control over your inventory, and can potentially cuts costs associated with split inventory and additional fees.
Click here to learn more about selling on Amazon.