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Do you know that Amazon accounts for 40.5% of US e-commerce sales and 4% of total US retail sales? If you are an e-commerce seller, you must be aware of the various fulfilment options available to sellers, such as FBA, SFP, and MFN. But which one’s the best for your business? Scroll down to know the pros and cons.
To begin with, each has its own set of advantages and disadvantages. Understanding these possibilities can have a huge impact on your platform performance. Let’s discover which one is best for your business.
FBA – Fulfillment by Amazon:
With FBA, sellers store their products in Amazon’s fulfilment centres. FBA takes care of customer service and returns, providing a hassle-free experience for both sellers and buyers.
Pros:
- Access to Amazon Prime, boosting visibility and sales.
- Amazon handles storage, packing, shipping, and customer service.
- Hassle-free returns and customer satisfaction.
Cons:
- Storage fees and fulfilment costs can add up.
- Limited control over shipping and packaging.
- Potential long-term storage fees for slow-moving inventory.
SFP – Seller Fulfilled Prime:
Seller Fulfilled Prime allows experienced sellers to handle their own fulfilment while still enjoying the benefits of the Prime badge. With SFP, you control your inventory and shipping processes while tapping into the lucrative Prime customer base.
Pros:
- Maintain control over inventory and shipping processes.
- Access to Prime customers, enhancing sales potential.
- Greater flexibility in handling unique or oversized items.
Cons:
- Stringent performance metrics and delivery standards.
- Requires efficient logistics to meet Prime shipping expectations.
- Potential challenges in scaling for high demand.
MFN – Merchant Fulfillment Network:
Merchant Fulfillment Network is the traditional method where sellers handle every aspect of order fulfilment, from storage to shipping. MFN is suitable for sellers with their own efficient fulfilment operations.
Pros:
- Full control over inventory, shipping, and customer service.
- Potential cost savings for experienced sellers.
- Ideal for sellers with existing efficient fulfilment operations.
Cons:
- The absence of the Prime badge can affect visibility and sales.
- Increased responsibility for logistics, customer service, and returns.
- Limited access to Prime customers.
In conclusion, choosing between FBA, SFP, or MFN depends on your business model, scale, and capabilities. Each option has its own advantages, and understanding how they work can help you make informed decisions to thrive in the Amazon marketplace.
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