Selling on Amazon without FBA: Pros and Cons

Selling on Amazon without FBA (Fulfillment By Amazon) is a common question among online retailers. The answer is yes, it is feasible. Amazon offers two product fulfillment methods: Fulfillment by Amazon (FBA) and Fulfilled by Merchant (FBM). As an Amazon merchant, you can choose either option.

For Amazon sellers, it is crucial to comprehend the pros and cons of every potential choice available to them. This knowledge will assist in determining the best approach for their company.

And don’t worry, you’re not alone! FBA can be a great option for some sellers, but it’s not the only way to sell on Amazon. In fact, selling on Amazon without FBA can be a profitable venture if you know what you’re doing. In this step-by-step guide, we’ll take you through the process of selling on Amazon without FBA, from setting up your account to shipping your products. So let’s dive in and get started!

Understand the Basics of Selling on Amazon without FBA

For small businesses aiming to reach a wider audience and boost their online presence, mastering the fundamentals of selling on Amazon without FBA is crucial. It’s the first step in ramping up sales, expanding your customer base, and taking your business to the next level. Without having to rely on fulfillment by Amazon, you can have complete control over your inventory, shipping, and handling, which allows you to provide a more personalized experience to your customers. Being familiar with the ins and outs of Amazon’s platform also gives you an advantage in terms of pricing, product descriptions, and marketing strategies. Whether you’re just starting out or looking to revamp your e-commerce strategy, understanding the basics of Amazon without FBA can make all the difference in your success.

If you are planning to sell on Amazon without opting for FBA, you should be aware that you will need to set up your own fulfillment system. This involves managing inventory, shipping costs, customer service, and returns processing. It may seem daunting, but it can also be an excellent opportunity to connect with your customers and build your brand. To manage your inventory efficiently, you can use inventory management software that tracks sales, restocks products when necessary, and generates reports. When it comes to shipping, you can choose between different carriers and services based on the needs of your business. Remember that customer service is key to building a loyal customer base, so make sure to provide timely and accurate information about orders, delivery, and returns. By establishing your own fulfillment system, you can have more control over your business and create a unique selling proposition that sets you apart from other sellers on Amazon.

If you’re selling products on Amazon without using FBA, it’s crucial to estimate the demand for your products and plan accordingly. One way to do this is by taking a look at your sales history. By analyzing how often each product is purchased, you can get an idea of which products are in high demand and which ones might need a boost. This information can help you plan your inventory and pricing strategy, as well as inform your marketing efforts. Remember to keep an eye on your sales trends and adjust your strategy as needed. Utilizing data from your sales history is just one tool in your arsenal for maximizing sales on Amazon without FBA.

When selling products on Amazon without opting for FBA, it’s essential to exercise inventory management. Amazon is a vast marketplace with countless sellers, and the last thing you want is to lose a potential customer due to stock unavailability. Keeping track of your stock levels and replenishing them promptly can make all the difference. Amazon provides sellers with an inventory dashboard, which displays critical information like inventory levels, product performance, and more. With this dashboard, you can better understand your sales trends and forecast future demand. Maintaining proper inventory levels helps ensure that customers can purchase the products they need at any time, ultimately resulting in satisfied customers and better sales. So, stay vigilant, keep tabs on your inventory, and watch your sales soar on Amazon!

Also, it’s crucial to understand that not using FBA means that you will have to manage the shipping and handling of your items. This responsibility may add up to your expenses and decrease your profit margin. Therefore, it’s essential to factor in these costs when assessing each item you list on Amazon without FBA. You should consider the weight, size, and delivery destination of the product before deciding on the shipping cost. By factoring in these costs, you can make more informed decisions that will benefit your business in the long run. So, always keep the cost structure of FBA in mind and make sure to analyze your profit and losses carefully.

How to sell wıthout FBA: 5 secrets

1. Create a marketing plan for your products

Instructions: Determine your marketing budget and think about launching promotional campaigns on Amazon Advertising. This can enhance your brand recognition and empower you to make more intelligent business choices by leveraging customer data.

2. Optimize all Amazon Entries

Attract potential clients with your product listings through the use of excellent photography and well-written descriptions that include relevant keywords related to your products.

3. Employ the services of a third-party logistics provider that is equipped to manage Amazon’s Fulfilled by Merchant program

To handle excess stock, a 3PL offering FBA Prep services is necessary even if you are utilizing FBA. It is crucial to conduct research and locate a reputable 3PL with knowledge of Amazon’s intricacies. Ecommerce fulfillment Service is an ideal option due to their understanding of the guidelines and successful partnerships with numerous clients selling products through Amazon.

4. Partner only with a true 3pl expert in fulfillment

Collaborate with a proficient 3PL that incorporates reliable fulfillment software to circumvent disastrous Amazon inventory mishandling and harmonize online sales through various shopping carts and platforms. Advertise, reduce prices or eliminate sluggish moving inventory; and administer inventory to avert any out-of-stock situations.

5. Supervise the operations of customer support and strategize for managing returns

As an Amazon seller who does not opt for FBA services, taking control of customer service is of utmost importance, especially when it comes to handling returns. You need to establish a comprehensive strategy and a reliable team to execute it efficiently. Failing to do so can lead to negative feedback from dissatisfied customers, which can hugely impact your IPI score, reputation and hinder your sales.

A few pros of using Amazon FBA:

• Ship your products to an Amazon warehouse
• Save money on shipping fees
• Shipping costs stay the same, regardless of location
• Have access to customer service like returens and refunds
• Never worry about missing a shipment deadline

For merchants, product listings and inventory levels are crucial aspects to be constantly monitored, along with ensuring proper preparation of products before being sent to Amazon Fulfillment Centers for restocking. It is of utmost importance to comprehend the inventory requirements for Amazon FBA and to manage risks linked with carrying out FBA preparation in-house. It is imperative for sellers on Amazon to bear in mind the FBA fees.

Merchants must be cautious or they may face exorbitant penalties and potential troubles that can severely affect their profits.

Disadvantages of using FBA:

1. Inventory tracking

When businesses opt for Amazon’s inventory management system, its various features may seem daunting and perplexing at first. However, disregarding automated systems and relying solely on conventional methods to track their inventory would result in them having to bear substantial charges for surplus stocks. Also, due to inventory inaccuracies, businesses might end up sending their customers the wrong product variants, thereby losing out on repeat customers.

2. Increased returns

When adopting FBA for your order fulfillment, anticipate elevated rates of return due to the fact that customers have the ability to return their purchases straight to Amazon, without your consent. Furthermore, Amazon’s return policy allows customers to return items within a 30-day window, and if fulfilled through FBA, Amazon will handle the return shipping. Regrettably, sellers will incur further expenses and encounter increased incidents of lost or damaged inventory that is no longer viable for resale. Furthermore, FBA sellers are unable to alter their return policies and must adhere to Amazon’s guidelines in order to provide a consistent and uniform experience and assurances for all patrons.

3. No branding

The Amazon emblem is a recognizable symbol that most individuals relate to reliable internet purchases. Consumers feel assured when they encounter items that are fulfilled by Amazon, as they expect speedy delivery and an item in impeccable shape.

Although Amazon FBA sellers are able to sell their products successfully, most shoppers are unaware of the fact that these sellers cannot incorporate their branding on the packaging or advertising material. As a result, sellers trying to establish their brand identity may face obstacles since customers may not be aware of the brand they bought from.

Fulfilling by Merchant

Selling on Amazon without FBA suggests that the merchant is probably using FBM. FBM is best suited for businesses that are already established and have efficient logistics in place.

Generally, such businesses possess adequate funds to handle the expenses linked with packing and delivering orders independently, and they usually have a customer service squad for handling order-related problems and returns.

However, one major disadvantage of selling via FBM is, by default, these products can’t be listed as Amazon Prime. Amazon FBA is a fulfillment service provided by Amazon where you store your products in the Amazon fulfillment centers and ship the products when an order is placed.

Amazon gave priority to essential products such as food, healthcare supplies, and cleaning products over non-priority categories like toys, games, crafts, and sporting goods during the Covid pandemic. This resulted in delayed FBA orders for non-priority merchants, which also led to delayed revenue. As a consequence, some customers opted for alternative options such as curbside delivery or direct-to-consumer sources, abandoning the delayed carts.

Many non-priority Amazon sellers found a solution to fulfill their orders by quickly changing from FBA to FBM. Some of these sellers had a reliable fulfillment partner, enabling them to react promptly to sales and maintain their revenue stream.

When expanding their business through various sales channels, it is crucial for sellers to establish a partnership with a professional fulfillment center. These services not only include FBA Prep for inventory replenishment but also cover fulfilling online orders for other local marketplaces such as Allegro in Poland, and others. To diversify channels and increase profitability, it is recommended for sellers to establish a direct-to-consumer relationship through their website.

More interesting FBM and FBA facts

Seller Fulfilled Prime is a program that merges the features of FBA and FBM. This program empowers merchants to have Prime status, yet autonomously manage their fulfillment process.

In order to participate in the program, merchants are required to satisfy a set of rigorous criteria.

• Deliver more than 99% of items on-time
• Follow Amazon’s return policy
• Have less than a 0.5% cancel rate
• Offer multiple delivery methods

In addition to fulfilling the required criteria, vendors have to undergo a probationary duration to authenticate their credibility. It’s not astonishing, given that we’re referring to Amazon! Besides, at present, Seller Fulfilled Prime is solely compiling a queue of interested merchants as stated in this article.

The current unavailability of new registrations for Seller Fulfilled Prime makes it an unattainable option for FBM sellers aiming to achieve Prime status.

Conclusion

Is it feasible for online vendors to sell on Amazon without FBA? This question often arises. The answer is YES. Merchants on Amazon have two choices for managing product fulfillment: FBA (Fulfillment by Amazon) or FBM (Fulfilled by Merchant).

Amazon sellers must weigh the benefits and drawbacks of each alternative before making a decision. Having a clear comprehension of the distinctions can aid them in selecting the ideal course for their enterprise.

Merchants can entrust their online order fulfillment to Amazon Fulfillment Centers through the FBA service. Sellers who adopt FBA are responsible for keeping their goods stocked at Amazon Fulfillment Centers, where Amazon handles customer orders by preparing and delivering products for the seller. Additionally, Amazon extends support to sellers enrolled in the FBA program.

By opting for FBM, you take on complete responsibility and regulate the entire fulfillment process. This includes warehouse storage, shipping, and providing customer support. Consider FBM as an option in case you are already retailing items on platforms other than Amazon and have logistics-related matters such as storage space, in-house customer service, and returns figured out.

If you don’t sell a large volume of goods, or if you specialize in heavy or temperature-sensitive products, it might be wise to avoid using Amazon’s FBA service and sell directly on the platform instead.

WAPI takes pride in having a team of professional, empathetic, and trustworthy individuals who deliver nothing but the best quality of service to our numerous clients who opt for our services for FBA preparation. Our center for amazon preparation and shipment not only provides extensive assistance but also a plethora of advantages and resources.

Selling on Amazon without FBA is usually not an option for many sellers who lack Prime status. It’s important to have a reliable 3PL partner, regardless of whether you choose FBA or FBM.

When searching for a suitable ally to assist your business in attaining triumph through vending on Amazon, contemplate WAPI. Our expertise involves adhering to top standards, being proficient in Amazon FBA Prep Service, and possessing knowledge in the handling of ecommerce orders for various marketplaces such as Shopify websites, Allegro and others.

Discover what we can do for you by contacting us today!