What is Fulfillment By Amazon?
Amazon sellers may find themselves in an overwhelming situation when their business picks up and they are feeling the stress of trying to make sure customers receive the products they have ordered in a timely manner. Amazon offers a service for sellers known as Fulfillment by Amazon that makes it easy for sellers to get their products to customers’ doorsteps.
The way it works is that sellers can store their products within one or some of Amazon’s fulfillment centers throughout the country. When someone orders one of your products, Amazon ships it out to the customer and you don’t have to worry about it. Additionally, if the customer decides to return the product, it will go right back to the fulfillment center with the remainder of your merchandise. Since these products are in Amazon’s fulfillment centers, they will become eligible for Amazon Prime. This is an important feature to consumers and many times will make purchases based on whether or not they have Prime’s free two-day shipping as an option.
In order to utilize Fulfillment by Amazon, you will have to pay for storage space in the fulfillment centers as well as for the orders that are filled for you. These prices vary on the size and weight of the product you are shipping. Amazon has created a table of specific prices per size and weight of both shipping and storage that makes it easy for sellers to calculate their particular costs. Be aware that fulfillment fees are changing on February 22, 2017, so your costs will likely differ.
To see how these fees may impact your business and to determine if it is worth the investment, have an Amazon accountant look at your finances and determine what might be right for you.
If you are an Amazon seller and require the assistance of an experienced Certified Public Accountant, please contact Ebiz Accounting for an initial consultation.