Amazon Is Doubling Down On FBA Usage For Sellers

Supply Chain
Written By Rick Watson

Seller Fulfilled Prime is going the way of the dodo on Amazon. Here are a few reports from friends of mine who ship using both SFP and FBA.

Since February, reports are that there is only a 0.5% late shipment allowance for Seller Fulfilled Prime - that is far below what most sellers can produce. If you are not shipping virtually overnight, and shipping on Saturday, you aren't going to qualify for very long. It's extremely difficult to keep up with.

Amazon is telling sellers that 90% who tried to ship Prime on their own have failed. The experiment and leniency are over.

Many top sellers use at least some FBA. Switching to 100% FBA is difficult due to higher fees for slow-moving items. If you can't ship SFP using your own facility, it means that you need to divide your inventory between your own facility (likely where your goods land), FBA (which you are already using) and even another 3PL.

That divides your inventory even further. Yes, it can be managed. But it's expensive to juggle and get wrong.

Even 5 years ago, supply chain on Amazon was easier. Logistics is everything, folks.

Rick Watson

Rick Watson founded RMW Commerce Consulting after spending 20+ years as a technology entrepreneur and operator exclusively in the eCommerce industry with companies like ChannelAdvisor, BarnesandNoble.com, Merchantry, and Pitney Bowes.

Watson’s work today is centered on supporting investors and management teams incubating and growing direct-to-consumer businesses. Most recently, in partnership with WHP Global, Rick was a critical resource in architecting the WHP+ platform, a new turnkey direct to consumer digital e-commerce platform that powers AnneKlein.com and JosephAbboud.com.

Watson also hosts a weekly podcast, Watson Weekly, where he shares an unbiased, unfiltered expert take on the retail sector’s biggest players.

In the past year alone, Rick has spoken at many in-person and virtual events as well as podcasts on topics ranging from retail/ecom to supply chain/logistics and even digital grocery including CommerceNext IRL, ASCM Connect, and Retail Innovation Conference.

https://www.rmwcommerce.com/
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