If you’re using or thinking about using Amazon’s FBA to fulfill your orders then you’ll probably be aware of some of the advantages for orders you receive if you’re selling products through their 3rd party merchant program..
Here’s to mention a few (take into consideration this is only for orders placed through the 3rd party merchant program)..
- You relinquish customer service responsibility. Amazon considers the consumers who buy your product through their platform to be ‘their’ customers not ‘your customers.’ This is great if you’re main objective is to get your product out there, but not so great if you plan on building a customer database.
- Amazon give FBA users priority with the ‘Buy Box’. Thats right, Amazon say that you’re listing should receive more exposure in the buy box if you’re shipping through FBA.
- Shipping costs are low. One of the main benefits to using Amazon’s FBA program are the low shipping costs to ship your orders out to Amazon’s customers. Obviously their volume is immense and they pass some of this saving onto you. Although again, these ‘savings’ are only applied to orders placed through Amazon’s 3rd party merchant platform and not for any other orders you might need them to ship. So be aware these shipping discounts do not apply to ‘non-amazon orders’ placed through other sales channels, including Amazon AVC orders.
SO, those are the main three reasons I believe you might look at using Amazon’s FBA, fulfillment by Amazon.
But what about orders you receive from other online platforms, like eBay, your own shopping cart or from other trade and retail customers, even Amazon Vendor Central orders?
The Reason’s Why You Should Consider Other
3rd Party Fulfillment Options..
To help you weigh up your options, let’s take a look at what FBA won’t do for your other ‘non Amazon‘ orders..
- You pay full price shipping
- Tracking information is not (or was not until recently) readily available
- You won’t receive picking and packing discounts for stock transfers, ‘bulk’ or wholesale orders
- If you sell packages or sets as multiple SKU packaged items, you’re charges individual picking rates
- You’re just ‘another’ small fish merchant seller
In my experience and wherever possible I believe its preferable to hold stock in multiple locations with different fulfillment houses. For example, if you were to advertise your products on the Amazon.co.uk website as a 3rd party merchant (i.e. you dropship to Amazon’s customers directly using the ‘sell on Amazon’ link) then FBA would be an ideal solution for these orders. Amazon would handle the customer support and shipping for orders placed through their platform and you benefit from reduced shipping costs.
(NOTE: you do not receive access to customer email information so you wont be able to maintain a customer database for ‘Amazon’s’ customers – there are ways around this although Amazon might consider this as trying to gain their system and you might be frowned upon and ousted from their platform).
In addition, if you plan on expanding your online and ‘offline’ presence in the future by advertising on other online sales channels, (i.e. more competitor sites to Amazon) it would be preferable to hold stock elsewhere to fulfill these orders.
It might just be me although in my experience Amazon ‘seem’ to give priority to their own orders before fulfilling orders for ‘non Amazon’ sales channels. In sure Amazon would argue this although that’s just my personal opinion and from my own interactions with FBA.
If you do use other fulfillment solutions you’ll also be able to keep total control over your own customer database and ensure your orders are being given the priority they deserve and are shipped promptly.
Diversification is always recommended in my opinion rather than handing over total control to one large company like Amazon who may or may not view your non-Amazon orders as shipments placed through sales channels who are ‘serious competitors’. You could also possibly be perceived simply ‘another small merchant’ with hardly any leverage.
Below you’ll find a diagram to show the preferred distribution and order management model to incorporate Amazon FBA with other sales channels. You’ll notice on this diagram there’s also an order management system you should consider implementing as your supply network expands over time (this central software is essential for managing multiple sales channels, orders, customer data and inventory locations) .
In addition to global fulfillment, 1StockLocation can also manage your order management systems in house OR install your own software for you.
1StockLcoation can certainly take care of your ‘non Amazon FBA’ orders for all channels, both online and offline.
Click the PDF image Below to Download the
‘Multi-Channel Fulfillment Blueprint’ Chart..
