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Fulfillment by Amazon is a program that allows businesses to sell their products with ease. This program allows you to set up your own store while Amazon handles all the logistics such as delivering the product, packaging, and providing customer service for the product. Amazon charges a certain amount to the business owner in return for the services that Amazon provides. This program has gained a plethora of acceptance because businesses are continuously moving towards utilizing this program. Since 2016, Amazon has seen an increase in the utilization of this program by 70 percent. This program allows sellers to just focus on the manufacturing of their product while all the logistics are handled by Amazon.
How does this program work?
Prepare your products to be sent to Amazon centers for storage.
You can now easily track your products through the tracking service provided by Amazon.
Whenever someone orders your product from amazon.com, this program will be responsible for handling all the logistics, from packaging, storing, to delivering products to the customers.
They also provide customers with tracking information and customer service.
Pricing Details of the Amazon FBA Program
The pricing is established according to the weight of the product and time of the year. The entire package includes:
- Customer service
- Returns and reverse logistics.
For example, a standard size notebook will cost a fee of approximately $2.40 from January to September. The price of storage per cubic feet will increase from $0.35 to $2.35 during the holiday season.
Along with the basic packages, Amazon charges a few extra bucks for over-sized items and storage of products for more than six months. The charges increase during the holiday season and other charges may also be applied for preparing and packaging the product. Amazon charges approximately an extra $0.40 per unit for storage and shipping of clothes.
Pros and Cons of the Amazon FBA Program
This program is not limited to the Amazon website but you can also use it to for your own website. There are several benefits of using this program as it allows a discount on shipping and also gets you off the hook because you do not have to worry about providing customer service to the customer.
Discount on Shipping
You might be paying a lot of money to get your items shipped to your customers and providing customer service while also managing the production of your product, but this program gives you the leverage on shipping and you don’t even have to worry about it. The major highlight of this program is the fact that it puts your product on the top because of it’s “free shipping option.” Customers can also choose to have their product shipped within two days if the seller is utilizing this program. This way, your customers will have a big incentive to buy from you.
Business owners will not have to worry about providing customer service because if a seller has subscribed to this program, it eventually becomes the responsibility of Amazon to provide their acclaimed customer service to buyers. This service not only saves your time but also provides customers with an outstanding customer service by Amazon itself.
Support on Return
Customers can easily get their products returned via this program. This will give them convenience during the process of return and you will not have to worry about reverse logistics.
Cons of Using FBA by Amazon:
Along with certain pros, there are several disadvantages of using the Amazon FBA program; however, these cons are ignorable:
Long-term Package Fee:
The long-term storage of products can cause a considerable increase in price for sellers; however, if there is a return on investment then it can be afforded.
Preparing Items for Amazon
Even though Amazon.com handles all the shipping and packaging aspect of your products, it can be considerably hectic to ship the products to Amazon stores.
Other Successful Alternatives
In spite of the entire idea of selling your products via the fulfillment program by Amazon, if you are still not hooked to the idea there are other alternatives that can be used as well. For instance, Shipwire offers similar services. You can do a comparative analysis of both the services and choose the one that suits your product the most.
Choosing the right service for your product can be challenging; therefore, it is imperative to learn about various other options that one can explore as a seller. Before making the decision, it is important to evaluate the worth of your product and the entire experience and then opt for the one that suits your business at best.