How Does Shipping Work on Amazon Sellers?

Individuals and companies that have opted to enter the world of eCommerce usually course their businesses through Amazon. Amazon is a well-known internet-based enterprise that acts as a middleman between businesses and customers all over the world. It is a way for businesses to sell their products online without the need for creating their own online stores. Customers do not often question how the products are shipped to them as long as they receive their orders in good condition. However, for businesses, they may need to know how shipping works with Amazon.

Things To Consider When Shipping Products To Amazon Fulfillment Centers

One of the important things businesses have to consider is how they will be able to safely send their products to Amazon fulfillment centers. Amazon does not actually have its own logistics service to pick up items from the Amazon sellers. It does give sellers the option to choose any of the shipping carriers Amazon has partnered with to handle the pickup of the items from the sellers. However, Amazon sellers still have the option to choose other carriers to handle the logistics and transport of their items to the fulfillment centers. The details listed below show some of the important things that sellers have to consider when shipping products to Amazon fulfillment centers:

  •       The main reason sellers need to ship their items to Amazon fulfillment centers is because they may have opted to course the sale of their products through Amazon. In these cases, these companies use Amazon as their consignment shop, which is usually called fulfillment by Amazon (FBA). There are customers who would rather choose to have their products delivered to them directly from Amazon, which means that the transaction is being done between Amazon and the customer. Amazon FBA is a service provided by Amazon to connect the sellers’ items to the Amazon customers. The service involves storing, packing, delivering, and handling delivery-related customer service issues. For sellers, using FBA lessens the headache of thinking how to safely send out their products to customers. In addition, sellers know that the items will be paid for once there are customers that would purchase their products. For the customers, on the other hand, they feel that shipping from Amazon is the safest way to receive their items. This is due to the fact that Amazon does have quality control measures to ensure that the customers are actually receiving the items that were listed on the Amazon seller’s page.
  •       Most Amazon sellers offer both FBA and fulfillment by merchant (FBM) to their customers. There may be different fees involved between these 2 fulfillment options, but some customers feel that, with FBM, they know that their items are sent directly from the warehouses of the Amazon sellers. This would entail that the items did not have to go through loading and unloading inside Amazon fulfillment centers. Multiple instances of handling the items make it riskier for some of the items to get damaged along the way.
  •       Companies that have contracts with reputable shipping carriers would rather have their partners handle the delivery of their products to the Amazon fulfillment centers. This is a good option for Amazon sellers who may get discounted prices from their chosen carriers.
  •       Before items are sent to the fulfillment centers, Amazon has imposed requirements on how these items should be packed so that they will be accepted at the centers. Amazon uses Fulfillment Network Stock Keeping Unit (FNSKU) as a way to connect products to the company that is selling them. FNSKUs have to be unique per item and are some of the most important things to consider so that sellers avoid running into issues and delays with their deliveries. These FNSKUs have to be placed as barcodes outside the packaging so that it would make it easier for Amazon to scan them. Sellers have to conform to the FBA product barcode requirements.

Amazon Fulfillment Centers

When To Choose Between FBM And FBA

When it comes to shipping with Amazon, sellers have to know when they would need to consider which fulfillment type to prepare for. They must always be prepared to use either of these since the decision on which to pick can be both controllable and uncontrollable for a seller. Below shows the common factors that would decide on the fulfillment type to use:

  •       Companies with excellent reputations have gained the trust of their customers

o   One of the best ways for a company to freely sell products on Amazon and also handle all the shipping and deliveries is to gain an excellent reputation from its customers. Large enterprises are known for selling directly to their customers because they are able to assure their customers that the products will arrive in excellent condition. As a reputable company, you are given the freedom to choose which carrier you will be using to fulfill the orders.

  •       Opportunity to sell on different platforms

o   Companies that sell products on Amazon may also have their own online and offline stores. Including Amazon in their selling platforms is a smart business decision because it gives these companies more coverage all over the world. However, for these sellers, having the chance to sell on various platforms would mean that they must have their own ways to store their products before they are purchased by customers. Sellers may build or rent warehouses to store all of their products before they are shipped to their customers. With FBM, sellers can place more quantities in their storage, which would be more cost-effective than having to pay Amazon to store some of the items that will be shipped via FBA. It would also be easier to handle the inventory of the items that are being sold when they are stored in one location.

  •       No FBA fees means higher profit margins

o   Amazon sellers who wish to gain more profit are better off choosing only FBM on Amazon. Even though some customers may not like this, sellers have better control on their profits and expenses. FBA gives sellers additional fees that may significantly cut their profit margins. These fees may include the storage, handling, packaging, support, and delivery expenses that Amazon has to deal with to effectively complete the transactions. With FBM, these sellers are able to cut out these fees and may avail of any promos and discounts that their preferred shipping carriers offer them.

  •       Smaller businesses need to consign items with Amazon through FBA

o   For individuals and businesses that are still new, it may take some time for customers to be introduced to their products. Since these items need to be marketed, consigning them with Amazon will help introduce their products to customers who are picky with the shipping options available on Amazon. Amazon is known to pay its sellers that opted to go with FBA within 2-3 weeks. This means that the payment for all items sold within the period will be paid to the sellers.

  •       FBA helps sellers with logistics

o   There are individuals and businesses that are not able to sell items in bulk. For these cases, these Amazon sellers cannot handle shipping fees that are meant for full truckload (FTL) shipping. By using less than truckload (LTL) shipping, these sellers are able to reduce their shipping expenses since they only pay for the amount of space their items take up in the trailers that are used to ship them to the Amazon fulfillment centers. Other than the shipping fees, these small-scale sellers may also find it costly to do the packaging and handling of all their products. With FBA, these sellers pass all the work to Amazon. Sellers will have fewer issues selling their items to customers on an international scale.

  •       There are customers who only look for items that are shipped by Amazon

o   This is one of the uncontrollable factors that may force Amazon sellers to include FBA as one of the options for their products. Unless your company is one of the globally recognized brands that customers can trust with direct shipping, there are still businesses that have yet to gain excellent reputations from their customers. Since FBA means that Amazon is accountable for the items being sold, customers feel more secure with this option.

  •       Amazon seller can pass the control of customer experience to Amazon

o   Storing and transporting products can cause them to get damaged along the way. With FBA, sellers do not have to worry about how the items will reach their customers. Since Amazon already does its due diligence to check the products that arrive in its fulfillment centers. After Amazon has deemed that the items from the seller have met all of its standards and requirements, it takes over the accountability and responsibility of the items when they are purchased by Amazon customers. Amazon sellers will just have to wait for the payment when customers buy the products from Amazon.

Ensure That Products Reach Amazon Fulfillment Centers Safely

Selling on Amazon is profitable when done the right way. For those who need to consign with Amazon through FBA, you should ensure that your products pass the quality control measures that are employed by Amazon. One of the most important ways to do this is to ensure that the items do not arrive at the Amazon fulfillment centers with damages, wrong packaging, or missing pieces. You need to trust your products with shipping carriers that are familiar with the Amazon guidelines. Just like with RoadLINX, we can assure you that your items will arrive at the fulfillment centers safely. You may contact us at 905-760-1141.

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