What is Fulfillment by Amazon (FBA) and Why Should You Use It?

AMZ Seller Financing   •   April 30, 2018

Amazon FBA

Amazon has come a long way, from a place selling only books to a global phenomenon, one of the biggest brands in the world, showing no signs of stopping.

Nowadays, Amazon is the place where almost anything can be sold. But not only that Amazon allows a great deal of freedom for online sellers, it also offers an opportunity for entrepreneurs to partner with Amazon and work closely together.

This type of partnership is called Fulfillment by Amazon or FBA, and it revolutionized the entire concept of online selling.

So, what is FBA, basically?

It is a business model where you only focus on the marketing part, and leave the rest to Amazon. The platform does all the “hard work”, such as keeping stock and shipping the products.

What Is Amazon FBA?

Here is the basic concept of FBA, explained step by step:

  • You send the products you want to sell (your inventory list) to Amazon, directly. This can be anything, from toys and books to accessories, clothing items, etc. – literally anything you want to sell online.
  • Amazon takes care of your products, by storing them in their warehouse (think of it as a kind of safekeeping).
  • When you receive an order for a product you’re selling, Amazon picks the item, packs it and ships it directly to your customer.

The best thing about FBA is that there are practically no restrictions. You can use it if you only want to sell a couple of items, but also if your goal is to sell thousands of them. You can opt for FBA if you’re just starting out on Amazon, but also if you want to change your current account to the new business model.

Furthermore, you can use FBA for products you’re selling on Amazon, but you can also use it for items that you sell on other platforms, with the help of Amazon’s Multi Channel Fulfillment.

Here are the benefits of selling through FBA.

Benefits of Selling through Amazon FBA

1. Using Amazon’s Reputation

Amazon is a brand in itself. When the customers order something they know will be shipped through Amazon, they feel safe and at ease. This can make a major difference when they are making a decision who to buy from.

2. Having a Fast Service and Free Delivery

Amazon’s online order and fulfillment operations are on another level; you can offer your customers fast and accurate delivery, earning their trust along the way. And they will get free delivery on the products they order from you.

3. Ranking Higher on Amazon

By having an item sold through FBA, you will show at the top of the search bar more often, thus attracting more potential buyers.

4. Saving Money

By signing up for FBA, you will save a lot of money down the line, because you won’t have to worry about warehousing and packing costs. This practically means that you are able to lower the price of your products, but earn just as much – or even more!

5. Saving Time

You won’t have to spend time picking the products, warehousing them, and then packing and shipping them. Amazon will take care of it all – including customer service. All you have to do is market and sell.

If you want to learn more, please check out the other articles in the blog section of our website. You will find a lot of useful information about selling on Amazon and other marketplaces, including tips, advice, and the latest news.