Amazon has made it easier for sellers to get their products in front of customers. It is an incredible place for reaching out to customers from various parts of the world. It was the most visited e-commerce site in the U.S alone last year, with approximately 2.45 billion visits monthly.
No doubt, it provides excellent services to its buyers and sellers. But should it mean you must completely depend on fulfillment by Amazon services? Then what should be done? Here the alternative to FBA services comes into the picture.
There are many ways that Amazon Fulfillment Services (FBA) can be improved, and an Amazon fulfillment alternative may be a better fit for your business. But why is an amazon fulfillment alternative service needed? It is because there are many problems with Amazon FBA.
Here are some of the most common problems with using FBA and how you can solve them:
Amazon is Not Transparent About How It Works
Amazon does not disclose all the information about its fulfillment services, making it difficult to compare and contrast with your other options. For example, you will not know how many products you can send in a day or week or your sales cut. It is also unclear whether Amazon will accept returns from customers on behalf of your company or not.
An Amazon FBA alternative is responsible for all the order processes just like Amazon does but much more efficiently. It will handle picking, packaging, storage, shipping, and product return services. It will act as a catalyst for the success of your business.
With an Amazon Fulfillment alternative, you can get transparency regarding:
- How many items per day/week can you send to the warehouse?
- What percentage of each sale will go toward your account?
- Are there any restrictions on how many products you can ship through their program?
Fulfillment Costs Go Through the Roof
Once you have set up your Amazon FBA account, you can begin to imagine how this process works. Your seller account will be charged for every item sold. Usually, Amazon FBA charges start from a minimum of $3.07 for a small package of less than 6 oz. At the same time, it can go up to $161.11 plus an extra $0.83/lb above the initial 90 lbs package.
The good news is that there are other options for fulfilling orders on Amazon outside of Amazon FBA. Some fulfillment options may not be as convenient as shipping directly to customers, but they come with lower fees and fewer restrictions.
Fulfillment costs go through the roof once you start selling high volumes or products in certain categories. But if you have just started selling on Amazon and don’t want to deal with these fees right now, Amazon’s fulfillment alternatives are the best option.
Amazon Can Kick You Out of the Marketplace at Any Time
Amazon is extremely easy to get started. All you need to do is sign up, verify your seller account, and start selling. However, this ease of entry can also be a double-edged sword. Under its terms and conditions, Amazon has every right to kick you out without notice. Once it decides that they no longer want to work with you as a seller on its platform, you are out.
They may choose this route if they suspect that your products are counterfeits or if there are complaints about the quality of your products or business. They may also opt for this method if they believe there is no chance of recovery from whatever issue in your business model. Finally, they can decide not to spend more time trying with you.
3PL Companies Are Just as Good as Amazon
So, you’re not buying a 3PL company just because they’re better than Amazon. Well, that makes sense. But it is also true that some Amazon Fulfillment Alternatives are just as good or better than Amazon’s Fulfillment Services.
3PL companies have more insight into their customers and products than any other company. They know what their customers want, how to serve them better, and why they should buy from them instead of someone else.
The way this information is used is different for every seller. Some use it for marketing only; others use predictive analytics to get ahead of trends. Still, others integrate customer data into their internal systems to make more informed decisions on inventory management, product listings, and distribution channels.
There are around 2 million SMB sellers on Amazon’s marketplaces worldwide, and 5,00,000 are from the U.S alone. However, Amazon says that only 50% of the U.S third-party sellers use the FBA services. It means the other 50% are using alternatives. Thus, if you’re looking for an alternative who knows your business and what you do, there are plenty out there waiting for you.
Controlling Your Inventory Is Practically Impossible with Amazon
Controlling your inventory is practically impossible with Amazon. If you try to manage your inventory, you’ll be in a constant state of disorganization and frustration.
With the FBA system, Amazon can store your products within its warehouses and sell them whenever possible. You could lose thousands of dollars worth of sales if Amazon chooses not to ship out items as quickly as you would like them to be sold.
Your Customers Enjoy Better Returns Processing
An Amazon FBA alternative removes much of the stress and anxiety around sending back items that don’t work or fit. When you sell on Amazon, you are responsible for shipping back items that do not fit or perform as expected by buyers. With an Amazon fulfillment service alternative, you have a company that handles this part for you.
You don’t have to worry about being out $5-$10 each time a customer decides not to keep an item, nor should you spend your valuable time doing so. Having an experienced team take care of this aspect allows sellers to focus on their business development and sales.
In addition, you need not worry about routine tasks like packaging and shipping items back because they were returned by customers or didn’t work properly after purchase.
An Amazon fulfillment alternative may seem to have the exact costs as Amazon FBA, but sellers will benefit from having more insight into their customers and products. You may be tempted to use Amazon FBA because of its name recognition, but that’s not the only factor to consider. It’s important to understand each option’s costs and benefits before deciding.
Finally, Amazon’s FBA program is a great way to start the platform. But a third-party fulfillment company might be the answer if you want more control over your products and inventory.