Amazon FBA

Amazon FBA

Definition

Amazon (FBA) is a service that allows you to outsource order fulfillment to Amazon. Amazon FBA is used to send products to Amazon’s global network of fulfillment centers and offer customers free, two-day shipping through Prime. When a customer makes a purchase, Amazon fulfillment specialists can pick, pack, and ship the order. We can also provide customer service and process returns for those orders.

How Amazon FBA works

The process is overly simplified, so you don't need to put in the grueling efforts at all. Here's the upfront breakdown on how the Amazon FBA process works:

1. To get started, you need to send your products to any of Amazon's warehouses. Amazon owns a network of fulfillment and warehousing centers across the US, Canada, Europe, and Asia. In the U.S. territory alone, there are about 100 warehouses within close-range proximities.

2. Amazon's team begins the inventory sorting process, which includes damage assessment to put clear the condition of each product. If there's any damage incident at Amazon's warehouse, rest assured that the retail giant will repay you for any loss.

3. As soon as the shopper places an order, that's where the FBA process begins. This model automates the process, in the sense that Amazon's team packs, sorts, and ships the order to your online customer's doorstep.

4. When an order is in transit, Amazon tracks the shipment on your behalf so you don't need to do any follow-ups, which might throw your schedule off balance.

5. If perhaps there are any refund or return claims, Amazon handles that too.

How much does it cost to start amazon fba

The startup cost for an Amazon FBA business can range from $1000 to $13,000 or more. The minimum budget for a successful FBA business is $1000 to $13,000. The monthly inventory storage fee varies from $0.48 to $2.40 per cubic foot depending on the season and the size of the item.

Is the Amazon FBA model worth it?

We catch this question a gazillion times in our comments section. Selling on Amazon FBA is probably the best choice for any newbie seller with a strapped budget.

Order fulfillment grabs a lofty share of attention while running an online business. Leaving this part to the experts gives you a sizeable scope of time to take care of stuff like product promotion and customer engagement.

Some of the onset benefits to bank from the FBA business model include:

1. Optimized logistics funnel. Amazon bolts up the shipping process- which gives your ecommerce business a competitive edge. For Amazon Prime subscribers, the two-day delivery time-frame bumps up the fulfillment success rate a notch above the typical threshold.

2. The ecommerce seller can leverage on discounted shipping rates. Such an offbeat incentive helps boost the sales projections, by far.

3. Massive capacity to help scale your ecommerce business. Amazon has over 175 fulfillment centers across the globe. And if you sum up the unlimited warehouse space, you'll realize that there's no inventory limit on the part of the seller. Also, there's no minimum number. You can as well send a single product.

4. Amazon offers multi-channel fulfillment to merchants who sell on other platforms. If, say, you sell on Shopify or BigCommerce, you can automate the order processing right from your store's dashboard. Once all integrations are in order, Amazon syncs the inventory and auto-updates the tracking status straight to your ecommerce store.

5 Its shipping speed fits as it should, pretty competently. Not only that. You don't need to process returns together with their shipping labels. The FBA reverse logistics team sort it out.