How We Help Amazon Sellers Do Ecommerce Fulfillment Better

If you have made an online purchase, then you have made a purchase through an e-commerce site. E-commerce is defined as the buying and selling of products or services exclusively through electronic platforms. Consumers are now spending more and more time scrolling through the internet, thus they are more likely to make online purchases. The e-commerce industry is growing rapidly, and U.S. sales projections are set to a fast pace in the coming years. With over 300 million active members worldwide and the leading online retailer in the United States, Amazon has become one of the largest sales channels for most U.S. sellers. In turn, with the number of sales options for sellers significantly increasing on Amazon, so too do the complications. An experienced 3PL can help optimize your sales channels and save your business time and money while you still sell through Amazon.

What is FBA and How Does It Work?

FBA stands for Fulfillment by Amazon. This is a fulfillment method where Amazon handles the entire process, from storage to packaging to shipping, for sellers who store their products in Amazon’s warehouses. Sellers pay Amazon to store and fulfill their products that are being sold on Amazon. The sellers retain ownership of the products and are responsible for marketing them on and off Amazon. While FBA allows sellers to take advantage of Amazon’s vast logistics network, it also comes with certain constraints, fees, and a loss of control over the fulfillment process.

FBA vs. FBM: Why FBM with a 3PL is a Better Choice

For many Amazon sellers, the appeal of Fulfillment by Amazon (FBA) is the convenience of having Amazon handle logistics. However, Fulfillment by Merchant (FBM), especially when managed by a skilled third-party logistics (3PL) provider, offers several compelling advantages:
1. Cost Control and Transparency: FBA involves a variety of fees, including storage fees that can fluctuate throughout the year. These costs can add up quickly, especially for sellers with large or slow-moving inventories. With FBM, particularly when partnered with a 3PL, you have more control over your costs. A 3PL can offer transparent, consistent pricing, allowing you to manage your budget more effectively.
2. Inventory Control: When using FBA, sellers are required to send a large portion, if not all, of their inventory to Amazon fulfillment centers. This means you lose direct control over your stock and are subject to Amazon’s rules and processes. With FBM and a 3PL, you maintain full control over your inventory, allowing you to respond quickly to market changes and consumer demand without being tied down by Amazon’s requirements.
3. Custom Branding and Packaging: One of the significant drawbacks of FBA is the inability to customize packaging, as all orders are shipped in Amazon-branded boxes. With FBM, especially when working with a 3PL, you can use your own branded packaging, enhancing your brand’s presence and creating a unique unboxing experience for your customers.
4. Personalized Customer Service: When issues arise with FBA, sellers often find themselves navigating the same customer service channels as regular consumers, leading to frustration and delays. By choosing FBM and working with a 3PL, you gain access to dedicated support that understands your specific business needs. A 3PL provides a more personalized approach, ensuring smoother operations and quicker resolutions.
5. Flexibility in Fulfillment: FBA requires sellers to adhere to Amazon’s strict guidelines and timelines, which may not always align with your business needs. FBM, with the support of a 3PL, offers greater flexibility in how and when orders are fulfilled. This flexibility allows you to cater to special promotions, last-minute sales, or custom requests without being constrained by Amazon’s processes.

How a 3PL Can Enhance Your FBM Strategy

Amazon has strict requirements when receiving products from sellers, whether through FBA or FBM. For FBM, a 3PL can take your inventory directly from the manufacturer, store it, and manage the entire fulfillment process. By partnering with a 3PL, you can ensure that your products are properly prepared and shipped according to Amazon’s standards, without the additional costs and restrictions associated with FBA.

Avoid or Lessen Financial Penalties

Products that are not prepared according to Amazon requirements are subject to monetary penalties called chargebacks. These include:

• Lack of proper product preparation;
• Missing designated delivery windows;
• Failure to send the proper advanced shipping notification (ASN); and
• Incorrect purchase order information.

While these chargebacks can apply to both FBA and FBM, using a 3PL for FBM can help minimize or eliminate these penalties by ensuring your products meet all necessary requirements before they are shipped.

No Unpredictable Monthly Fees

Amazon’s FBA storage fees can fluctuate, creating uncertainty for sellers. With FBM managed by a 3PL, you avoid these unpredictable fees. Instead, you benefit from more stable, predictable costs that allow you to manage your finances with greater certainty.

Maintain Control Over Your Inventory

With FBA, you lose direct control over your inventory once it’s sent to Amazon’s warehouses. This can make it difficult to manage stock levels and adjust to changes in demand. With FBM and a 3PL, you retain full control over your inventory, giving you the ability to make real-time adjustments and ensuring your products are always available when your customers need them.

Lower Storage Fees, Higher Cost Savings

A 3PL typically offers lower storage fees than Amazon, providing significant cost savings for sellers using FBM. By shipping products to Amazon only when necessary, you can avoid the high storage fees associated with FBA and reduce your overall fulfillment costs.

Custom Branding

Branding is crucial in creating your business’s image, and with FBM through a 3PL, you can offer custom packaging solutions. This allows you to maintain your brand’s identity and deliver a unique experience to your customers, something that’s not possible with FBA.

Personal Customer Care

Dealing with Amazon’s customer service can be challenging, especially when trying to resolve issues quickly. A 3PL, on the other hand, offers dedicated support, providing you with a single point of contact who understands your business. This ensures that any issues are resolved efficiently, allowing you to focus on growing your business.

FBM with a 3PL: The Smart Choice

Order fulfillment services are a crucial part of any business and can determine its success or failure. While FBA offers certain conveniences, FBM with the support of a 3PL provides greater control, flexibility, and cost savings. By choosing FBM and partnering with a 3PL, you can ensure that your fulfillment strategy aligns with your business goals and delivers the best possible experience for your customers.

Contact Westhub Logistics

At Westhub Logistics we practice a client-first approach. We stand out with an unprecedented standard for personalized 3PL services. Our first goal is to listen to your needs and provide you with unique solutions. WHL can work with you to create a customized FBA plan, and you won’t have to pay for unnecessary services. If you are seeking logistics support, we’d love to hear from you, our team is ready to help. Give us a call today 408-585-9346 or send us an email at sales@westhublogistics.com