Running a business on Amazon is not easy. If you manage to set up a business, you then have to worry about order fulfillment. Here, Amazon gives you two options: Fulfillment by Merchant (FBM) or Fulfillment by Amazon. Check the new IO Scout product finder for Amazon and find the best products to sell.
Since this article is an Amazon FBA guide for absolute beginners, we will stick to FBA.
What is Amazon FBA?
The Amazon FBA program is what simplifies order fulfillment for Amazon sellers. Instead of the seller doing his or her own shipping and delivery of items when a customer buys them, Amazon handles it on their behalf. All the FBA seller needs to do is ship the products to one of Amazon’s many fulfillment centers. From there, Amazon will go pick up the items, package them and ship them once an order is received.
FBA is contrasted to FBM, which is where you, the seller, is responsible for your own shipping. While others prefer this method, it can end being expensive for the seller, which automatically means it is also expensive for the customers.
You also need to know that you must be a member of Amazon Seller Central before joining Amazon FBA. That means picking what to sell on Amazon FBA is up to you, as well as marketing it and keeping the stock levels updated.
Why You Should Join Amazon FBA?
When you run an Amazon FBA business, there are a number of benefits that come with it. Here are the biggest.
No Need to Worry About Order Fulfillment
Since Amazon is taking care of order fulfillment for you, you have more free time on your hands. This means you can channel that free time into other activities that can grow your profits and your business. In short, FBA selling allows you to focus more on selling and tending to your customers’ needs, which can help you increase sales.
No Need to Worry About Returns and Refunds
On top of handling order fulfillment for you, Amazon FBA also takes care of the returns and refunds for you as well. This should greatly increase your customer service delivery and help you minimize a lot of complaints. However, keep in mind that Amazon is not responsible for handling customer complaints – that is up to you.
Access to Amazon Prime
When you start selling on Amazon FBA, it means that your items are eligible for Amazon Prime. This opens you up to an ever wider audience of shoppers who prefer to shop through Amazon Prime. This means more sales for you.
No More Inventory Storage Concerns
By sending your products to fulfillment centers, it means you don’t have to worry about inventory space. Amazon can store all your inventory, and dispatch orders much faster than if you had to do it yourself. And when you are running low on inventory, you can expect Amazon to notify you. You will then have to send more stock to replenish your inventory.
How Can I Join Amazon FBA?
Starting an Amazon FBA business requires you to register for the FBA program. All you have to do is go to the FBA homepage and click on “Get Started.” Then it is just a matter of following the steps outlined by Amazon to be a member of the program.
Are There Any FBA Fees that I Need to Be Aware Of?
Before you jump into becoming a member of Amazon FBA, you need to know there are fees involved. Here are the fees you need to be most aware of:
- Seller Central Fees : Since a Seller Central account is required, you can choose between Individual and Business account types. For the Individual account, you will pay $0.99 per item sold. On the other hand, you just pay a monthly fee of $39.99 for the Business plan.
- Fulfillment Fees : You will also be expected to pay fulfillment fees for the picking, packing and shipping of items by Amazon. These fees are dependent on the size and weight of the items.
- Monthly Inventory Fees : Another fee you should be concerned with is the fee for storing the items at Amazon’s fulfillment centers. These fees are calculated per cubic feet of each item.
So there you have it – an FBA guide for absolute beginners. With what you know now, it should be easier for you to join FBA and enjoy the benefits. Just keep in mind that FBA takes away the worry of order fulfillment, leaving you with a more worthwhile concern – selling your products to maximize profits.