Fulfilled by Amazon – known as FBA – has become a hugely popular way for companies to get more exposure for their products. The Amazon marketplace is visited by 197 million people every month. With so much traffic, using Amazon as a fulfillment option makes sense for a lot of small businesses looking to streamline their operations and increase their visibility.
Enrolling in FBA gives vendors the opportunity to have their products added to the carts of consumers who are ordering their other gifts, goods, and household items.
The Way it Works
FBA is a paid service that businesses use to help get their brand more exposure and simplify the fulfillment and logistics part of the sales equation. This investment makes the process easy for vendors and brands to benefit in big ways.
- You send your products to Amazon: Amazon has over 100 warehouses in the US, which means that your customers can get fast shipping no matter where they live.
- Amazon stores your products in their warehouses: Small businesses don’t always have access to huge amounts of storage and that can limit their ability to create and ship items. FBA gives vendors an option for safe, organized storage for their products.
- Amazon picks, packs, ships and tracks orders for you: After a customer orders your product, Amazon packs and ships the order using their advanced fulfillment and logistics network.
- They also handle returns and refunds: If a customer has a problem with the product, Amazon customer service teams can handle taking care of any returns and issuing refunds.
- Amazon pays the 3rd-party FBA vendors: Amazon takes payment from the customer for each of your orders, deducts their FBA seller fees, and deposits the revenue from your Amazon shop into your bank account.
Ultimately, the price that sellers are paying for the FBA service gives them access to storage, fulfillment, shipping, and customer service fees.
What Vendors Are Responsible For
For vendors using FBA, Amazon is a service provider and following their requirements will get you the highest chance of successfully selling your products and growing your brand.
- Setting up a product page: The first step is to set up an account for your brand and begin listing the individual products to sell. Each listing page will need, at minimum, a product name and title, description of the product (including any sizes, specifications, and other details), and photographs of the items.
- Choosing which products to sell: You’ll want to avoid any of Amazon’s restricted categories. You’ll also want to keep in mind that there’s a balance between having enough inventory to fulfill orders while also not incurring over the top storage fees.
- Keeping inventory in stock and up-to-date: Sellers are responsible for monitoring their inventory on Amazon regularly to make sure your products stay in stock. Vendors also need to be aware of products with expiration dates
- Marketing and advertising your products: Amazon serves as your product page and ecommerce shop, but you still need to invest in marketing, advertising, and outreach and engagement efforts so that consumers will be familiar with your brand. The search element of Amazon does allow for greater visibility in general, but some product categories can be very competitive and brands will need to do more than just have a product listing to get noticed.
Amazon offers sellers a lot of flexibility, but they do have requirements and restrictions about what sellers can list and how inventory and returns have to be managed. Some of these include:
- Vendors cannot sell prohibited products, including alcohol, vehicle tires, gift cards, loose packaged batteries, and more.
- Certain product categories require approval for a product to be listed. Products that are in the categories of collectible coins, streaming media players, certain household and safety products, video and DVD products, and several others will require Amazon approval before the listing is approved.
- Amazon has a list of FBA inventory requirements include specifications about how to prepare and send inventory fulfillment centers, including certain barcode requirements and product categories that require specialized prep before sending.
The effort and work it takes to successfully list inventory with Amazon FBA can be a significant investment of time on the front end, but it can be a worthwhile initial push to make to simplify the entire process for fulfilling your customer orders, and Amazon makes it easy to find and follow their vendor requirements. You can find the full list of FBA policies and requirements on their site to help guide your journey as an Amazon seller.
There are millions of products listed with and sold through Amazon, so it’s important to make sure your listing stands out. Elemerce can help you build and optimize your Amazon presence, making it easier for your brand to be found. You can get in touch with us today for a complimentary evaluation of your Amazon account to help you get started.