Author: Kenneth Schutter

The juggernaut of online retail, Amazon, has now been around for almost 30 years. There is no doubt that they revolutionized that way we all buy and sell online. In fact, just over half of online sellers use Amazon exclusively to sell their inventory. But what if there was another option? What if sellers could have access not only to the massive Amazon marketplace, but several marketplaces – all while diversifying their online seller portfolio? About one third of sellers are now using a combination of FBA (fulfilled by Amazon) and FBM (fulfilled by merchant) to keep a competitive edge and grow their customer base. Here are some advantages of expanding to an FBA/FBM model.

  • Save on your bottom line
    • There are higher handling costs associated with fulfilling orders through Amazon. Standard fulfillment services done by a 3PL provider can many times be provided at a lower cost, since they take out the middleman. In addition, finding the right 3PL service provider could mean eliminating some of the fees associated with the bigger names, such as a monthly user fee or a minimum inventory fee.
  • Scale your business more quickly
    • By using a 3PL service provider that gives you the option of FBA or FBM, you can increase your brand awareness by selling across several marketplaces. Posting your product to multiple marketplaces and shopping carts will draw a wider customer base, allowing you to scale your business and increase your sales.
  • Keep your product moving
    • Holidays and peak seasons are unavoidable, and every business is different. Finding the right 3PL service provider is important to ensure your product is getting to your customers. Amazon has the ability to restrict inventory into their warehouses when experiencing capacity constraints. Finding a good 3PL partner is crucial to ensuring you have the optimal amount of inventory on hand and can deliver on the promise of expedient order fulfillment.
  • Avoid inventory and storage restrictions
    • An efficient 3PL service provider should be capable of handling your product in the best way to get it to your customers. This could include services such as short- and long-term storage, as well as cross-docking services. Finding the right 3PL can ensure that you avoid any fees for inventory minimums or maximums, as well as provide you with enough space to store what you need on hand at a given time – and not pay an arm and a leg for it.
  • Sell more product types
    • Depending on who you choose to handle your fulfillment, you may see that many 3PL service providers can either have restrictions on the size and weight of products that are stored in their warehouse, or they may charge an additional handling fee for these larger items. Amazon is not an exception – aside from some home goods and furniture, small and light items are what thrive on this platform. If you have large or bulky items, or even just lighter items that require a large box, it is important to find a 3PL partner that is willing and able to handle them for you.

So, the point here is not to discourage anyone from using Amazon for their fulfillment services – in fact, quite the opposite. There is no doubt that Amazon is a great resource for online sellers. But for smaller sellers, or any sellers looking to grow their business, FBM is a great addition. In fact, implementing an FBM option can benefit any online seller. It allows for control over your inventory, flexibility in peak times, and more money in your pocket. Finding a 3PL service partner that is capable of both FBA and FBM is an excellent value add for any online seller. Good luck and happy selling!