Everything about FBA
- FBA stands for Fulfilment by Amazon
- How does FBA work?
- Seller send the products to the Amazon warehouse
- Amazon offers its warehouse space for storage
- Amazon picks, packs, labels, ships and tracks every order directly
- Amazon handles returns and refunds
- Benefits of FBA
- More time to focus on the business
- Products under FBA subscription are eligible for Amazon Prime benefits
- FBA subscribers only pay for services they use
- Customers trust FBA
- Sellers do not have to stress about manpower, storage space, packing or delivering orders even as the business expands
- Excellent customer service
- Cash on delivery hassles managed by Amazon
Link to Amazon page
- Why is it NOT RECOMMENDED to send goods directly to the Amazon warehouse?
- Amazon isn’t an importer so the seller will have to higher a freight forwarder to take care of duties and taxes
- Courier companies that multitask as freight forwarders are available
- Sending the whole lot to Amazon warehouse can attract “Long Term Storage Charges”
- The seller will have to get a thorough and detailed pre-shipment QC done to avoid quality issues
- Damage of goods during shipment may be ignored
- It is recommended to check and send small quantities of the product to avoid hassles!
How can a seller send the goods to Amazon warehouse?
- Most viable option if the quantity, size and weight of the parcel is small
- Amazon approved courier is the best way to go
- The seller can place a service request online and Amazon takes care of the rest
Link to Amazon approved courier services
- Option for products which are large and bulky
- Cheaper than courier
- Pallets need to meet Amazon requirements
- Shipping companies need to be Amazon approved
Link to Amazon LTL page
- What are “Long Term Storage Fees”?
- Amazon levies penalty to sellers for products that are stored for more than 6 months
- Audit for the same is done of the 15th of February and 15th of August every year
- It is recommended to dispose of the products if the net value is low
- Amazon offers to courier the products back to the seller for a fee which is not recommended for cheap and everyday products
Link to Amazon Long Term storage fees page
- A seller can easily manage inventory and avoid long-term storage fees or can keep the product always available by checking the inventory dashboard on Amazon’s seller central.
- Amazon also offers a service to fulfill orders outside its environment, but it is not recommended because
- Hampers the brand image as the product is delivered by Amazon in Amazon brand packaging
- Attracts buyers to Amazon providing them with more choices
- The fees charged by Amazon are quite high
Link to Amazon fulfillment page