Amazon, the world’s largest internet site and marketplace, introduced a new innovation to the world of e-commerce with its FBA (fulfillment by Amazon) system.

FBA is a significant initiative that makes e-commerce management, already quite practical, even more convenient.

Developed by the world’s largest e-commerce site Amazon, this system provides great conveniences for both sellers and buyers.

FBA not only relieves Amazon sellers from the hassle of product storage but also offers advantages such as Amazon handling the shipping processes.

1. What is Amazon FBA?
2. How does the Amazon FBA process work?
3. What are the fees for Amazon FBA?
4. What are the advantages of Amazon FBA?
5. What is Amazon FBM? What is the difference between FBA and FBM?
6. Another System That Will Be as Useful for Your Business as Amazon FBA!

1.What is Amazon FBA?

Amazon FBA is a warehouse system where Amazon sellers can store and list their products in multiple countries.

Through the FBA system, Amazon sellers can send their products to Amazon’s warehouses anywhere in the world, and the products will be directly delivered to customers from FBA warehouses by Amazon.

This system relieves sellers of a significant burden, as when an order is placed through the seller’s platform, the same order is also received by Amazon FBA warehouses.

As a result, without the need for any action from the seller, the products in stock are packaged and delivered to the customer by Amazon FBA. Additionally, the inventory of the sold product is automatically updated by Amazon FBA after each sale.

With this system, sellers can easily send their products as if they had stores in the countries where they make sales, while buyers will experience a quality shopping experience thanks to fast and reliable product delivery.

2.How does the Amazon FBA process work?

1st Step:

Firstly, if you don’t have a seller account, you need to go to Amazon Seller Central and create a seller account. There’s no additional application process required for Amazon FBA. If you already have a seller account and want to use the Amazon FBA system, you simply need to register for VAT in the country where you want to sell.

It’s necessary to register for VAT in the country where you’ll be using the warehouse if you are going to enroll to FBA program in Amazon Europe, you can skip this process alltogether for all other marketplaces, for example; if you’ll be doing FBA in Amazon Germany, you need to register for VAT in Germany.

You can register for VAT either through an solution provider company or by following Amazon’s instructions on your own.

For detailed information on the new VAT rules of the European Union, you can click on the link and take a look at our article. (bizim yazımıza backlink). 

All this taxation process seems quite complex and cumbersome to sellers. How about handing over the process to a professionals?

Let me introduce you to TBA accountants!

TBA accountants platform allows sellers engaged in e-export to track and manage VAT registration procedures. TBA accountant’s software system offers real-time and automatic data validation to ensure that all data related to VAT is accurate and complete. 

Click here to register with TBA accountants!

2nd Step:

After listing your products on your Amazon account, you should select the shipping method for your products as FBA.

3rd Step:

In the FBA program, your products need to be prepared according to Amazon’s packaging requirements and sent to FBA warehouses. You’ll do this from the “Manage Inventory” page.

You’ll need to answer the following questions for the products you’re going to send:

• Number of products
• Total number of boxes/dimensions/weights
• Are the items in the box packaged?

If the items are not packaged, Amazon will ask you to package them before sending. This packaging is not for the shipment to the customer (this process will already be done by Amazon).

Your products need to be in a certain standard to avoid damage while going to the depot and while being stored on the shelves.

-Product Hazard info:

If the products to be sent are in certain category (i.e. electronics, flammable etc.) Amazon will require the hazard info of the products that you are going to send.

-Product ID Barcode: 

Each product to be sent must have a identifier barcode attached. Amazon can do this for you on your behalf for small fee.

-Is the address of the point of departure (your customer’s address) written in the system?

4th Step:

After answering the questions above for your products, your products are sent to the designated Amazon warehouse addresses. These warehouses are called ‘Fulfillment Centers’ at Amazon.

The incoming products to the warehouse are sorted according to specifications and placed in the warehouses according to the specified order.

If your products are damaged after passing to Amazon’s responsibility, Amazon will cover the full cost of the damage.

5th Step:

After the order comes in, your products are sent to your customers by Amazon FBA authorities.

6th Step:

Your products reach your customer on your behalf. The labeling, barcode number, and invoice process on the product are managed by Amazon.

7th Step:

Amazon provides customer service in case of product returns or other issues your customer may face, providing complete confidence to the customer, and return processes are professionally managed by Amazon.

Having logistic processes selected as FBA is also crucial for obtaining Prime Badge.

3.What are the fees for Amazon FBA?

Packaging/Shipping: When an order comes in for your product in the warehouses, Amazon charges a fee of $3.62 per item for packaging and shipping.

Return/Disposal: If you want to retrieve the products you sent to Amazon’s warehouse, you need to pay $0.50 per item. If you prefer disposal instead of retrieval, you should pay $0.10 per item.

Important Note: Disposal of products means that the product will no longer be available for sale on Amazon and will not be present in the FBA warehouse.

Customer Returns: If a customer who purchased your product from your Amazon FBA warehouse returns the product, as a seller, you need to pay Amazon a fee of $3.62.

Storage: Amazon charges monthly fees for storing products in their warehouses, depending on the size and weight of the products. The standard fee they apply here is $2.40 per cubic foot per month.

Amazon categorizes storage fees into diffrent size tiers with diffrent rate tables. You can click here for more detailed information about the fees.

4.What are the adventages of Amazon FBA?

Prime

Sellers using the FBA program automatically list their products in the Prime section. So, what are the advantages of this?

Firstly, Prime products always rank at the top. This is crucial for reaching a larger customer base and increasing sales.

Additionally, Amazon doesn’t charge shipping fees for Prime members, which encourages people to consider becoming Prime members when shopping on Amazon.

Considering these and more advantages, a significant portion of products purchased from Amazon are Prime products. As a result, demand for your products increases, and Amazon offers you the opportunity to make more sales.

For more detailed information about Amazon Prime, you can check out our article “Amazon Prime Day: Tips for Sellers.” 

Storage and Shipping

With Amazon FBA, all your storage and shipping processes are handled by a professional team without hefty costs from your pocket.

You only need to enter the information of the product you want to sell and send it to the Amazon FBA warehouse. All remaining processes are carried out by Amazon FBA team on your behalf, saving you a significant amount of money and time as you don’t have to deal with shipping or return processes.

The same product can be listed for sale by different sellers on Amazon.

BUY BOX

Buyers prefer not to browse through long lists of stores when searching for a product. Instead, they prefer to click on the “Add to Cart” option and purchase their products much faster.

Buyers with the Buy Box option automatically purchase your product when they click on the “Add to Cart” button. Thus, having the Buy Box provides you with a significant advantage.

5.What are the adventages of Amazon FBA?5. What is Amazon FBM?What is the difference between FBA

Amazon FBM (Fulfillment by Merchant)” is the most traditional way we are all familiar with for selling on Amazon.

You upload your products to Amazon’s site, manage order placements through the site, and fulfill your sales. The process of shipping, storage, packaging, etc., is handled using your own methods.

In contrast, with Amazon FBA (Fulfillment by Amazon), Amazon stores your products in its massive warehouses on your behalf and handles packaging. When you receive an order, Amazon directly manages the shipping process of your product and ensures it reaches the buyer.

Furthermore, not stopping there, Amazon also ensures to monitor the post-delivery process, prioritizing customer satisfaction.

6.Another System That Will Be Beneficial for Your Business as Much as Amazon FBA!

With Propars, you can quickly open an Amazon account for any country you desire and list your products for sale worldwide. 

Thanks to Propars’ automatic language translation system, the descriptions of your products uploaded to the Propars panel are translated into the language of the country where they will be listed for sale. This leaves you with only one task: listing your products for sale across all countries with just one click from a single screen.