Understanding FBA vs FBM

Online sellers have a multitude of opportunities available when it comes to selling on an e-commerce platform like Amazon. But, with a lot of opportunities, comes a lot of concepts and aspects that an online seller is expected to know. Two such significant concepts are Fulfilment by Amazon (FBA) and Fulfilment by Merchant (FBM). While both are uniquely effective in their own ways, opting for either becomes a matter of needs and requirements. 

We shall thus determine when one can use FBA and FBM.

Fulfilment by Amazon

FBA is a service on subscription offered by Amazon to its sellers that covers customer service, storage, shipment and returns for sales on the marketplace. One vital factor about Amazon FBA is that Amazon holds the inventory for you, wherein you can choose between FBA and seller fulfillment on a product-by-product basis. While this makes your work easier, the concept may not be economical for everyone.

Fulfilment by Merchant

FBM, on the other hand, is used by merchants who deliver products directly to their customers. They manage storage, shipment and returns on their own. So, the FBM model basically involves sellers selling on Amazon platform, but managing fulfillments independently. 

You must use the FBA model for the following situations:

1. When you have high volume sales

You must opt for the FBA model when the sales volume is quite high. Not only do you get the benefit of a renewing stock, but an organized and efficient delivery service that doesn’t take a toll on your own organization. In this regard, Clearit USA Amazon fba offers great freight forwarding services to Amazon sellers.

2. Unreliable fulfilment providers

If you haven’t found reliable fulfillment providers or the current ones, you’re working with aren’t showing commendable results, there is always a better option of choosing FBA. 

You must use the FBM model for the following cases:

1. When Amazon fulfillment is expensive

Given the brand’s popularity, some may find the Amazon fulfillment quite expensive. Not only are the FBA fees a bit costly but they add up quickly as the storage charges are high too. So, in such situations, FBM might be the best option for you. You can choose your own fulfilment providers and negotiate a deal.

2. When you’re dealing with delicate goods

FBM is all about having control over your goods till the stage they’re delivered to the customer. So, when you’re handling delicate goods, the FBM model may be right for you as extra care in the FBA model means extra charges.

You may thus examine your own situation and choose what model would suit you the best.