Another way to trade through Amazon is Amazon FBM, which we want to give a complete guide in this article. Amazon is the largest online store in the world and is entering other global markets every day. You can find almost everything you need on Amazon and determine the type and speed of its delivery.
There are two ways for a seller to work with Amazon:
The first method is called FBA. In this type of method, the seller or merchant sends his product to the Amazon warehouse and it is packed and shipped by Amazon employees.
Read more: Dropshipping in eCommerce
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The steps to be followed by the seller on Amazon
In this method, the seller creates an account on Amazon under the name FBA to operate on Amazon.
In the created account, he puts the details of his manufactured goods on the Amazon site. Amazon employees come to the seller’s warehouse and transfer the goods to the Amazon warehouse.
After the sale of each item, Amazon deducts its commission from the customer’s payment and pays the seller’s fee after the specified time.
Due to the fact that in the FBA method, Amazon is responsible for most of the sales activities of sending the warranty, which means that if the product is returned or sent back again, it is Amazon’s responsibility.
Read more: Amazon FBA: Pros and Cons
Advantages of selling on Amazon
More money will be given to Amazon as a commission, the seller’s activity will be less and his free time will be more.
In this method, there is no need for the seller to worry about choosing the right shipping company or spending money on storing and maintaining the goods.
Amazon does all these things, even the cost of the product is charged by the seller when the seller stops doing it. the problem that can be pointed out in this type of business with Amazon is that in this method, the possibility of creativity is taken away from the seller.
For example, the seller cannot apply his desired packaging on the goods, that is, he may want to choose a special package with the desired design and color for his goods, but he loses the possibility with the FBA method.
Another issue is the cost that is paid to Amazon for transferring the product and sending it to the customer and warehousing. If the seller is the manufacturer of the product, he definitely has a variety for his goods and does not need to pay the storage fee, but by choosing the FBA method, he must pay these fees.
Read more about: How to Enhance Customer Loyalty And Fulfillment Experience
Another way to trade through Amazon is Amazon FBM
In this method, a seller creates an account on Amazon and selects Amazon FBM. This method allows the seller to plan and implement all the steps of selling the goods.
In fact, the seller uses Amazon as an extensive global store to sell his goods, and in exchange for the possibility of selling his goods on Amazon, Amazon receives a certain percentage of the sale of the goods.
The cost of storage and the location of the warehouse is the responsibility of the seller, and Amazon does not provide the warehouse to the seller.
It is also the responsibility of the seller to choose the shipping company and the method of sending the shipment, and the merchant himself must choose a suitable company for the transfer of his goods.
Read more: Fulfilling Online Orders And Meeting Consumer Demand In 3PL Services
Professional packaging by Amazon
Packing the goods for sending is a sensitive and precise task, with the smallest mistake, especially at long distances, there is a possibility of damage to the goods.
The positive points in the product packaging are the possibility of creativity by the seller.
The seller can do the packaging according to his taste and according to the product. choose the color and type of the box, he can select a gift for a series of purchases that different customers have, or can put his product catalog in the packaging so that customers can get to know other products.
Another point in carrying out the packing and shipping process by the seller is that the seller knows his customers and can communicate with them and even give discounts to his regular customers or make them benefit from his special gifts.
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The problem with Amazon FBM
the problem with Amazon’s FBM method is the seller’s workload. Although a lower fee is paid to Amazon than the FBA method, the seller is much busier, in addition to reducing the free hours available to the seller, the customer may be dissatisfied with the quality of the product and send it back.
Or if the shipment is returned in any other way, such as being damaged during delivery to the customer. Such activities increase the possibility of creating dead stock, as a result, a part of the production workshop or types may be allocated to the returned goods on the way of shipping and return given by the customer. But in Amazon FBM, there are no muscles because all the mentioned services are performed by Amazon and it is possible to store goods for one year in Amazon.
Read more: What are the key factors to the successful eCommerce order fulfillment process?
Advantages and disadvantages Amazon FBM & FBA
The truth is that both methods have advantages and disadvantages. And which of the methods to choose depends on what we want from our electronic sales, for example, if we may ask Amazon to sell our dead stock then it is definitely more appropriate to choose Amazon FBM in this context.
Or if we want to have more contact with the customer, in this case, we should use the FBM method.
One of the interesting features of Amazon is to send the shipment code to the seller. In this case, the seller can send the code to the customer and the customer will know the status of his product.
Your products will be sold within a year. You no longer have to pay Amazon for monthly storage. It takes between one and seven days for Amazon to share your product on their site.
Before you enter Amazon, always think about whether you can fulfill your commitments, for example, whether you can provide the number of products and the variety that a global store needs.
