Amazon offers round-the-clock customer support for FBA sellers.
Costly fee: Storage fees and fulfillment fees are costs that can pile up quickly with slow-moving products and oversized products. The sellers are also charged for the removal fees for products that are damaged and unsellable.
Product handling: Inventory can get lost and damaged while handling. Although, this error can be Amazon’s and not the sellers, it can cause you your inventory. Amazing, however, does reimburse the seller but when smaller issues are encountered they may go unnoticed and cause the seller a loss.
Accurate product guidelines: Certain products have specific guidelines to be followed as per Amazon’s rules. These are in place to ensure that the products arrive in optimal condition. Hence, it will cost the seller a per-item fee.
Stickerless commingling: Products that come from the same manufacturer are often commingled on Amazon. So if two sellers are selling the same products, they are mingled.
Greater returns rate: Amazon has an open return policy. This has, in return, resulted netherlands phone number list in a higher number of returns for most of the sellers.
Product comingling: Amazon often comingles products with the same manufacturer ID even if they are from different third-party merchants. In simple terms, it pools similar products together to increase fulfillment efficiency. For merchants, it may have a negative impact when their products are mixed with low-quality products.
How Much Does it Cost to Use Amazon FBA?
The cost to sell on Amazon will depend on the type of business model you have selected.
Standard seller fee: Amazon charges around 15% to 18% of the product’s price as the fee for the seller. The actual amount varies based on the product being sold. Although Amazon says that they charge only around 15%, there are certain hidden charges like refunds that are not charged back completely.
Fulfillment fee: These are charges levied per unit of the product sold. It varies based on the size of the product and it includes the charges for packing, shipping, packing, and handling. It also includes customer service and product return costs.
Inventory handling and storage fee: Based on the month and the everyday average volume, the sellers are levied a monthly storage fee. These fees also vary based on the product size. Long-term fees are those that are levied on products that are stored for over a year in addition to any monthly inventory fee.
International shipping fee: Global export is now an option with Amazon and they enable their sellers to send their inventory across the world.
Is FBA Right for Your Business?
The ideal fulfillment solution for any e-commerce business will be dependent on many factors including the nature of your business. The type of products sold, the location, and the approach to satisfy consumer demands. A business model like Amazon FBA will be best for your business when:
You want to minimise the burden of fulfillment
Require help in scaling your business
Outsource storage, shipping, returns handling, and consumer service
Need your products to be Prime shipping eligible
Require help for customer service features
Inability to afford warehouse space and employees to handle it
Amazon FBA vs. Seller-Fulfilled Prime
Let’s dive into the key differences between Amazon FBA and Seller-Fulfilled Prime.
The cons include the following:
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