Whether you’re just starting out or looking to scale your business, FBA offers an unbeatable platform to grow your brand, boost your sales, and streamline your operations.

This beginner’s guide will walk you through everything you need to know to get started with FBA, helping you unlock your full potential and make your mark in the world of e-commerce. Let’s dive in and discover how FBA can take your business to the next level!

Ready to turn your entrepreneurial dreams into reality? Let’s dive!

What is Fulfillment by Amazon (FBA)?

Fulfillment by Amazon (FBA) is a service that allows you to outsource the entire order fulfillment process to Amazon. By enrolling your products in FBA, you can:

• Store your inventory in Amazon’s extensive global fulfillment network.
  
  

• Offer customers the benefit of free, two-day shipping through Amazon Prime.
  
  

• Let Amazon take care of packing, shipping, returns, and customer service, so you don’t have to.
  
  

• Reduce your operational costs, boost your sales, and free up more time to focus on growing your business.
  
  

• Leverage Amazon’s fully automated services under the Supply Chain by Amazon.
  
  

Moreover, Supply Chain Amazon includes Multi-Channel Fulfillment (MCF), which lets you extend FBA’s benefits to orders placed on your own website or other sales channels.

Advantages of FBA

Fulfillment by Amazon (FBA) not only simplifies your fulfillment but also provides a host of advantages to enhance your business. Here’s what you gain:

• Lower Costs: Save up to 70% per unit on shipping compared to other premium US fulfillment services.
  
  

• Increase Sales: Boost visibility and sales with reliable two-day shipping through FBA. Programs like Subscribe & Save also help secure repeat sales with regular deliveries of everyday items.
  
  

• Save Time: Offload order processing, customer inquiries, and returns to FBA, allowing you to focus on product development and business expansion.
  
  

• Optimize Operations: Streamline your logistics with services like Amazon Global Logistics, offering cost-effective shipping from China to US and European fulfillment centers. Use Buy with Prime to integrate Amazon’s checkout and Prime delivery on your own site.
  
  

• Expand Your Reach: Grow your market with remote fulfillment, selling in Canada, Mexico, and Brazil with your US inventory, or Amazon Export, reaching global customers.
  
  

Interested? FBA is flexible and allows you to enroll in as many or as few products as you want. New sellers also benefit from discounts and incentives. Next, we’ll explore the costs to help you determine if FBA is the right fit for your business.

Next, we’ll cover costs to help you determine if it’s right for you.

What Does FBA Cost?

Fulfillment by Amazon (FBA) operates on a pay-as-you-go model, with costs based on the products you sell and the services you use. Here’s a breakdown of the key costs:

• Fulfillment Cost: This covers the picking, packing, shipping, handling, customer service, and returns for your orders. Fees depend on the product type, size, and weight (both shipping and dimensional weight).
  
  

• Storage Fees: Amazon charges monthly storage fees for holding your inventory in their fulfillment centers. Fees are based on the amount of space your products occupy and are typically lower for items stored during the first half of the year.
  
  

• Long-Term Storage Fees: To manage inventory turnover, Amazon imposes additional fees for items that remain in their warehouses for more than 365 days. This encourages efficient inventory management.
  
  

• Removal Fees: If you need to remove inventory from Amazon’s fulfillment centers, either for returns or to avoid long-term storage fees, a removal fee per unit is applied.
  
  

• Optional Services: Additional services, such as labeling and prep services, come with extra charges. These can be useful if you prefer to have Amazon handle specific tasks related to your inventory.
  
  

While these fees can add up, FBA’s benefits—like lower shipping costs, increased sales potential, and reduced time spent on fulfillment—often outweigh the expenses. For detailed information on Amazon selling costs, visit Seller Central.

FBA Revenue Calculator

Understanding your costs and their impact on profits is crucial for choosing the right fulfillment method. The FBA Revenue Calculator is a useful tool to help you estimate the potential costs and profits of using Fulfillment by Amazon.

By inputting details about your products, such as size, weight, and selling price, you can:

• Estimate Fees: Calculate fulfillment and storage costs to understand your expenses.
  
  

• Assess Profitability: Determine your net profit by factoring in Amazon’s fees alongside your product’s selling price.
  
  

• Compare Options: Evaluate different pricing scenarios and shipping options to optimize your margins.
  
  

How to Become an Amazon FBA Seller

Now you may be curious about how to be an FBA seller. To start using FBA, follow these steps:

• Sign Up: Create an Amazon selling account by selecting a selling plan.
  
  

• Enroll in FBA: In Seller Central, hover over the Gear icon and click “Account Info.” Then, click “Manage” on the Seller Account Information page and select “Register for FBA.”
  
  

• Create or Convert Listings: You can either create new listings for FBA or convert existing ones.
  
  

Requirements to Be an Amazon FBA Seller

To become an Amazon FBA seller, you need to meet certain requirements:

• Amazon Selling Account: You must have an active Amazon selling account with a valid payment method and business information.
  
  

• Product Listings: Ensure your products comply with Amazon’s guidelines and are eligible for FBA.
  
  

• Inventory: You need to have inventory ready to be shipped to Amazon’s fulfillment centers, following their packaging and labeling requirements.
  
  

Additionally, review Amazon’s terms and conditions for sellers and familiarize yourself with the specific requirements for adding inventory to FBA.

What Are the FBA Inventory Requirements?

Wondering if your products meet the FBA inventory requirements? Here’s what you need to know:

Many products eligible for sale on Amazon can also be enrolled in FBA. However, some items have specific restrictions. For example, alcoholic beverages and tires are not eligible for FBA, and dangerous goods (hazmat) generally cannot be sold through this service. Additionally, products with expiration dates require you to review specific shelf life requirements before enrolling them in FBA.

For detailed information on product restrictions and FBA inventory requirements, check out Amazon’s guidelines.

How Amazon FBA Works

Ready to streamline your business with Fulfillment by Amazon (FBA)? Here’s a step-by-step guide to getting started and achieving your business goals:

• Decide on Your Fulfillment Strategy: Choose whether to use FBA for all or some of your products. You can also fulfill orders from other sales channels through multi-channel fulfillment and integrate with pre-built applications or APIs. For cross-border selling, use Remote Fulfillment with FBA to offer your US inventory to customers in Canada, Mexico, and Brazil.
  
  

• Add Products to FBA: Enroll your products in FBA via Seller Central. For new products, select “Amazon will ship and provide customer service (FBA)” in the Offer tab. To convert existing products, go to Inventory, click “Manage All Inventory,” and choose “Change to Fulfilled by Amazon.” Ensure product dimensions are accurate to avoid issues.
  
  

• Prep, Label, and Pack Products: Prepare your inventory by following FBA’s packaging, prep, and labeling guidelines. Gather necessary items like shipping labels, poly bags, and bubble wrap. If you need help with labels, Amazon’s FBA label service is available for a per-item fee.
  
  

• Ship Products to Amazon: Use the “Send to Amazon” workflow in Seller Central to efficiently send your inventory to Amazon’s fulfillment centers. This tool helps you create shipments, select shipping options, and access discounted rates through Amazon’s partnered carriers.
  
  

• Track Inventory and Manage Stock: Keep track of your inventory levels to avoid stockouts and long-term storage fees. Use the FBA Dashboard in Seller Central to monitor sales, shipments, and inventory. The FBA Restock Inventory tool can help you plan shipments and manage stock based on sales data and demand forecasts.
  
  

• Grow Your Sales: Leverage FBA’s fast shipping to attract more customers. Utilize programs like Subscribe & Save for repeat business or Buy with Prime to enhance your sales channels. Explore additional tools and advertising options, like Amazon Brand Registry and sponsored ads, to further boost your sales.

By following these steps, you’ll be well on your way to optimizing your fulfillment process and growing your business with Amazon FBA. Would love to learn more? Connect us.