If you want to know about an online income stream that still has very little competition and can earn good amount of money if you learn it right, then you can read this article about Amazon FBA.
Those who have ideas about online shopping or e-commerce, must know Amazon. Amazon is an e-commerce company, which is currently operating successfully in many countries around the world. Amazon’s journey began in July 1994 as a small online bookstore. But now it has transformed into one of the largest and most popular e-commerce companies in the world. Amazon FBA is a special service of Amazon, through which business owners get the benefit of selling their business products on Amazon. In today’s article, I will tell you the details about Amazon FBA (What is Amazon FBA in English). So let’s get started without delay.
What is Amazon FBA?
The full form of Amazon FBA is Fulfillment by Amazon. Amazon FBA in simple terms is a service provided by Amazon targeting those who want to do e-commerce business, by taking this service online sellers can do business more easily with the help of Amazon.
That is, you can sell various products of your business on Amazon by taking Amazon FBA service. In this case, the most convenient thing about taking this service is that Amazon handles the entire logistics here. That is, picking your product, packing and shipping your product to customers from Amazon’s own fulfillment center is done by Amazon. So Amazon FBA can be said to be quite different compared to other e-commerce models.
Amazon FBA has created quite a response among everyone since its launch. Do you know why? Guys! Logistics is one of the most important part of any online business. Since you don’t have to do any logistics related work by taking Amazon’s FBA service, the hassle of your business will also reduce a lot. As a result, you can devote both time and effort to growing your business.
How does Amazon FBA work?
Let’s try to understand a little more easily how Amazon FBA works.
In this case, sellers initially send their inventory or collection of products to the Amazon fulfillment center. Amazon’s fulfillment centers then receive, sort, and store that inventory.
Then when a customer orders the seller’s product from Amazon’s marketplace, the product is shipped to the customer’s address after packing it properly from the fulfillment center. In this case, if a customer service or product return issue is created, it is also resolved from Amazon.
Now you may ask, if these important tasks are done by Amazon, how much control do the sellers or business owners have? Now come to that matter.
You can decide which products to sell through Amazon’s FBA service. Since almost all types of products are sold on Amazon, no matter what type of product you want to work with, there is an opportunity to do so.
But yes, if you want to keep the profit margin high, then it will be advisable to choose the products which are in high demand for sale. You can also decide the quantity of products you will stock in the Amazon Fulfillment Center.
Apart from this, there are no restrictions from Amazon FBA on how you market your products. If you want, you can influence potential customers to purchase products from you through Facebook marketing, Instagram marketing or affiliate marketing. If you want, you can also promote your product with the help of Amazon’s own advertising program.
How to use Amazon FBA service?
There are a few steps to follow to avail Amazon FBA service. But before taking this service, the first thing you need to do is decide which niche product you will sell. This decision should be taken after sufficient research. Because whether or not you can be successful depends a lot on the type of product you will sell.
- So first select a niche. Then start researching the product. In this case, try to find out which products are best selling. Especially the products that are priced between 10 to 50 dollars and the popularity is very high, choosing to sell those products is a safe option. You can also search for products and select products by reading their ratings or reviews.
- After selecting the product, the next step is to find an authentic supplier. Remember, the better the quality of your product, the more likely it is to generate sales. So when looking for a supplier, find the best one.
- Then go to the Amazon.com website and click on the Sell On Amazon option to create an account by providing your information. Then after adding FBA service to the account you can start selling products.
- When your account is ready, the next step is to create product listings. To do this, click on the Add Product option from the inventory menu of the Amazon Seller Central account. Then click on Create a Product Listing and select the product category you want to sell. Finally, click on Save and Finish and the product listing will be ready.
- Now, the products that you want to stock in Amazon’s fulfillment center, properly pack and label the products so that they reach the fulfillment center properly. Then create an Amazon shipping plan and ship your products to the fulfillment center by printing the shipment ID label.
Matter! Then continue marketing your product well and patiently. If you can do marketing properly, you will see your product selling very quickly. Basically this is how Amazon FBA service can be used.
Advantages of Amazon FBA
Let’s now find out what benefits Amazon FBA offers you. The biggest advantage of this service is that Amazon takes full responsibility for order fulfillment. Order fulfillment is the work done after a customer orders a product to deliver it to him. For example: picking the product from the warehouse, sorting, packing the product and shipping it to the customer’s address, tracking the parcel, providing customer support, solving problems like returns or refunds, etc.
If a business owner wants to do these things himself, then his expenses will be much higher, but also more time and effort will have to be paid.
Taking Amazon FBA service offers many benefits. Because first all logistics related work, even customer product refund and return related work is handled from Amazon. Also, Amazon’s customer care service is available 24 hours a day. So you don’t have to do any work of answering customers’ questions, solving any of their problems or responding to any of their complaints.
So if you take this service, you will get extra time, during which you can develop business marketing strategy, sourcing high quality products or focus on how to improve product quality.
Moreover, you must know that if you want to do online business, you need to have a warehouse for stocking. If you want to take this warehouse, you have to pay a good amount of rent every month, and you have to hire employees to take care of them, who have to pay their salaries every month.
Since Amazon’s FBA service allows you to stock all your inventory at Amazon’s fulfillment center, there is no need to spend extra money on warehouses. So you can understand, you can save a lot of money with the service.
Not only that, if you want to deliver your products with the help of a shipping company, then customers will have to pay more shipping charges. By doing this, there is a possibility of losing the customer. If Amazon takes FBA service, customers can order products from you with much lower shipping charges, which will increase their satisfaction.
Also, if you are a part of Amazon’s FBA program, chances are your product will rank faster in search results. So the chances of cell generation will also be high.
Another great advantage of Amazon’s FBA service is that you can sell your business products not only in one country, but internationally through the service. You must know that if you want to grow your business outside the country, in addition to increasing both investment and resources, you also need to work hard. And there is a risk of not being successful.
Currently Amazon fulfillment centers are set up in different countries, so if you want, you can try to grow your business globally through this service, because the chance of loss here is relatively less.
Disadvantages of Amazon FBA
Now let’s talk about some disadvantages of Amazon FBA service. One of the disadvantages of this service is that you have to pay various fees to provide this service. Such as picking and packing fee, monthly storage fee, long term fee, order fulfillment fee etc., which may cause inconvenience to many. Especially those who are new to the business, suffer a lot in paying the fees.
Also, since there is no free trial option for this service, everyone has to pay a fee to open an account. So if for some reason no sales are generated after taking the service, then the entire money that he has subscribed to the service will be lost. Hope you understand the disadvantages of Amazon FBA.
How do you know if Amazon FBA is perfect for you?
Now let’s talk about who Amazon FBA is perfect for.
If your online business is brand new, then this service of Amazon is not at all useful for you. Because the new business does not receive many orders. So even if you register for Amazon FBA service, there is no chance of getting many orders. Rather, if your business has more than 50 orders per month, you can take Amazon FBA service to increase sales.
Whether Amazon FBA might be perfect for you depends on the type of products your business sells. For example: If your product size is small but its price is high, then you can generate profit by taking this service. However, if your product is large in size but low in price, then you will not be able to benefit much from this service. Because Amazon’s FBA service fee is determined by the size of your product. So, if the price of your product is low and the size is high, it will be advised not to take this service.
If it is the case that your business products are in high demand among customers, but you are struggling to deliver the products to them because you do not have enough manpower to provide logistics support, then FBA on Amazon can be a good choice for you. Because I said earlier, you don’t have to think about logistics if you take this service.
That was our discussion today. To be honest, Amazon FBA is not discussed in Bangladesh that way. So I have tried to explain everything to you in simple language. If you want to read more such informative articles, then stay with us.