Why should I fulfill products instead of using FBA?•
Posted on May 12 2020
I hosted a talk with our local Amazon group on this exact topic this week. Why should you do the work to fulfill the items when Amazon will do it for you? How can you protect your Amazon account from late shipping? How do you handle customer service for merchant fulfilled items? Let's take it a step at a time and look at the pros of selling your items and fulfilling the orders yourself.
What is fulfillment by merchant?
Amazon fulfillment by merchant is when the seller fulfills the orders from Amazon and sends the product to the customer. Though FBA (fulfilled by Amazon) is the accepted practice, there are plenty of big brands and small brands that have decided to sell by fulfilling themselves for one reason or another. One of the main reasons for selling fulfilled by merchant is to have more control over quality.
Just because someone decides to fulfill by merchant does not mean they are personally fulfilling the orders themselves. Companies such as Grunt Style have their own warehouses and have their employees fulfill the orders. This is still considered fulfilled by merchant. The same goes for someone who
Often when companies send their inventory into Amazon for FBA, the items are handled by an hourly worker or an automated system. The problem with the automated system is that when one small piece of information is incorrect, it can cause inaccurate labeling, packing, or fulfillment. The problem is very similar to the hourly employees.
The advantage of fulfilling by merchant is that when you are the one fulfilling the orders, or a third party company you hire, there is more attention to detail. This attention to detail ensures the orders and quantities are accurate and that packaging is sufficient to protect the item being sent to the customer.
What is small parcel shipping?
Small parcel shipping is when you are sending an individual item or small order to a customer or client. These shipments are under 70 lbs in weight and merchants will use their own boxes or containers to ship. Generally speaking, for less than 10 lbs, USPS is the best option for shipping. Over 10 lbs, it is really a matter of the best price and packaging options. When shipping to customers via merchant fulfilled, the small parcel is the most common. Small parcel shipping is also used for smaller Amazon sellers sending inventory into Amazon's warehouse for FBA.
Two of the most common struggles when it comes to shipping small parcel is getting the best price and shipping orders without having to deliver the items to the shipping center. Usually, this is a small, part-time seller trying to mail orders without having to go to the post office every day. The good news is, there are several different options of services someone can use to get excellent prices and schedule pickups without having to pay a ton and leave the house for every order.
Several of these services include Stamps.com and PirateShip.com. Stamps.com does charge $15 monthly. Pirate Ship is best if your website is hosted by Shopify. Pirate Ship allows orders to easily be imported and shipping rates are very comparable to Stamps.com. Pirate Ship also does not charge a monthly membership fee.
Whether you choose to use Stamps.com for integration into Shipstation or Pirate Ship for integration into Shopify, both will allow pickups to be scheduled right from the USPS website. For price comparison and knowledge, it is also smart to research the prices on the USPS website you have a better understanding of the zones and different classes of mail.
How does less than truckload freight shipping work?
Less than truckload, or LTL, as it relates to Amazon is when someone ships more than 150 lbs of inventory on a pallet through a trucking company. There are many different ways this can be done. LTL is exactly what it sounds like: Any load that is less than a full truckload. You can always contact freight companies directly to ship LTL, but if you're sending inventory into Amazon for FBA, the partnered carrier option is always going to be cheaper and easier.
In order to ship LTL with Amazon, you follow the same workflow as you do for any other shipment, but choose LTL partnered carrier at the end. There are certain things you need to be aware of when doing it this way with Amazon. As with any other Amazon requirements, if you ship LTL and fail to follow the rules, you will incur a fine from Amazon. Though these rules are many, a few of the ones you should be aware of are as follows:
- No less than 150 lbs total gross weight (including the wood pallet).
- No more than 1500 lbs gross weight per pallet.
- No more than 1 inch stacked over the edge of the wood pallet.
- Must be a proper four-way pallet without any repairs.
- Must be stretch wrapped with all labels on the outside.
Of course, these could change by the time you read this article, but you can find the up-to-date LTL, FTL, & FCL (full container load) rules on Seller Central here.
Shipping LTL the first time will always make someone a little nervous, but it's easy and the drivers that pick up are always helpful. I do have two other resources I use for shipping FTL and regional LTL. Feel free to leave me a comment and I'm happy to share them with you.
What are the advantages of selling merchant fulfilled?
When fulfilling your orders directly to your customers, the biggest advantages are being able to control your packing, being able to fulfill orders when FBA cannot (COVID-19 & pandemic problem) and being able to handle your own customer service. Of course, the advantage of automation still exists for sending in shipments to FBA, but fulfilling orders yourself definitely comes with its own advantages.
One of the most important things when it comes to fulfilling by merchant, especially if you have more than one SKU, is being able to find the item. Granted that is another article entirely, setting up an easy to use and understand system will help tremendously. Overall, the best reason to use fulfilled by merchant is to help cut storage costs. If you own the place where you keep your inventory, then that completely eliminates storage costs. If you don't own it, it is more than likely still significantly cheaper than paying Amazon to store the items for you.
As always, please feel free to leave comments and questions below. I will get to them as quickly as possible. Thank you for reading and I hope this adds a ton of value to your business and helps to solve a problem you may have.
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