When selling on Amazon, you can choose to do FBA or FBM. What is the difference?
- FBA = Fulfilled by Amazon – seller stores products in Amazon’s fulfillment centers where Amazon will pick, pack, and ship those products.
- FBM = Fulfilled by Merchant – seller stores products in your own warehouse and wil pick, pack and ship when products are purchased on Amazon.
|What does it look like?|
|Who manages my inventories||Amazon||Sellers|
|Who takes returns||Amazon||Sellers|
|Who ships my orders||Amazon||Sellers|
|What if my products don’t sell||You need to create a removal order for inventories in FBA warehouse – either dispose them or send them back to your local warehouse.||You can try to sell on other website like Ebay or local wholesalers|
|What if some products have wrong bar code||Amazon does NOT have any barcode change service. So seller has to create a removal order and do the barcode change themselves.||You can easily change barcode yourself|
|What if there are a lot of returns and i want to investigate why||Amazon does not do quality check for you. You will have to create a removal order and investigate after you receive the inventories. Amazon will close your listing when return rate is too high.||You can investigate right away when you have 1st return order and make sure same problems won’t happen anymore|
Overall if your product sells well and product turnover ratio is high, you will probably be able to make lots of money from selling on FBA. However, if there are problems about your products, such as labeling the incorrect bar code, quality control problems or they don’t sell fast enough, it will be a painful process to take care. It will all depend on your product quality, how your product is marketed and execution. As a veteran Amazon seller, I always recommend doing FBA only as 99% of amazon customers prefer buying from FBA Prime listings.