Amazon FBA A 2020 Guide |
Posted: July 4, 2020 |
Over 5 million sellers are present on Amazon, and if you are one of them, you should be aware of Amazon FBA by now. As the number of sellers increases day by day, Amazon FBA is coming with new features and services. For example, direct shipping from China to Amazon FBA lets many resellers save time and money. A large number of sellers are asking if Amazon FBA is still good enough in 2020. We will cover all topics in this article! What is Amazon FBA?Fulfillment by Amazon or FBA is a service provided by the marketplace to its sellers. This service allows sellers to send their products to Amazon’s warehouses. And whenever their products are ordered on Amazon, FBA packs and then forwards it to the location of the buyer. Amazon FBA also manages refunds. All of these are done in exchange for a fee taken from the buyer. Amazon FBA ProcessBefore we go any further, let’s discuss how Amazon FBA works. The process is very simple. After you get your FBA program started, the first step is sending your products. You have to let Amazon know the products you are shipping, whether you are shipping it from your own warehouse or shipping from China to Amazon FBA. There are nearly a hundred warehouses of Amazon spread across the US. You have to send your products to the exact location that Amazon tells you. After you have successfully submitted your items by meeting the packaging requirements, Amazon sorts them and keeps them in the warehouses for future orders. The safety of the warehouse is ensured by Amazon, and even if anyhow your products get damaged, Amazon will take the liability and pay for the damage. After the products are stored in the warehouses, it’s time for getting orders. Whenever a customer orders an item, your products get packed and shipped without you having to worry about it. But after sending the items to customers, the process isn’t finished. They take care of the customer support service, accepting refunds, or helping out the customers. And every two weeks, Amazon deposits your earnings into your account, but they do deduce their fees from that. That’s it! The Pros of Amazon FBAThe FBA program of Amazon brings a lot of new opportunities to sellers, and there are many advantages to this service. Let’s look at some of the pros of using Amazon FBA 1. Safe storage and easy shippingAmazon FBA allows a lot of newbie sellers or startups to easily outsource storage and shipping. For example, you may not have your own warehouse, or as your sales go up, it may be harder for you to ship the products. When you are working with Amazon FBA, you can easily store your items in their inventory, and they can take care of the shipping, no matter how many times your products get ordered. 2. Fast and cheap for resellersIf you are a reseller who brings products from China and lists it up on Amazon, there is an excellent advantage that you can find by using Amazon FBA. Direct shipping from China to Amazon FBA is available. This means you can easily buy your goods from China, import them to the US, and send them directly to Amazon warehouses. It is fast and cheap and great for resellers! 3. Low shipping ratesIf you are not using Amazon FBA, you usually have to spend more on shipping the items. Since Amazon has contracts with major carriers across the country, the shipping cost is lower. It is great for bringing new customers and saving from your spending. Some prime members get free shipping, and you should know that prime members spend more and are highly likely to buy your products when you are using Amazon FBA. 4. Better customer serviceAmazon FBA provides excellent customer service, which brings in more buyers and generates profits. The services are usually returns, refunds, and inquiries. Now, you do not have to worry about getting yourself involved with unhappy customers as refund inquiries will be made to Amazon. However, you have to deal with the reviews and questions on your products page on Amazon. Also, Amazon offers 24/7 customer service for your products when you are using Amazon FBA. It is super effective and brings more prime users’ attention to your products. 5. Unlimited storageWell, once you start selling on Amazon and your products get good feedback, it is inevitable that more buyers will be interested, meaning more products need to be on stock. You can easily perform direct shipping from China to Amazon FBA and store as many items you want without any worries. Forget about having a personal warehouse. Also, if you have a high inventory performance score, meaning if your products are sold quickly, you get a lot of advantage from Amazon FBA to store more items. 6. Fast deliveryOnce you have chosen Amazon FBA, you can stop worrying about the delivery process. Another great thing about it is fast delivery. Amazon has warehouses in numerous locations across the country and the world. It usually takes a couple of days for the items to get delivered. If you are handling the delivery process yourself without the assistance of Amazon FBA, it might not be the same! The Cons of Amazon FBAIn 2020, many sellers are focused on the downsides of Amazon FBA. You have to calculate and make good strategies in order to decide whether or not you should use the service. Let’s have a look at some of the cons of Amazon FBA. We will also discuss how to avoid the cons and increase profit. 1. FBA comes with a costThere is a fee for storage and fulfillment when you use Amazon FBA. It can be lower than the cost of doing it yourself, but if your products stay there for a long time, the cost may go up, and you will start to lose money. So, before you use Amazon FBA, understand if you are going to make a profit or not, and have the right strategy. You should also focus on how long your products are staying in the inventory. 2. Returns may increaseSince you have chosen Amazon FBA, customers can easily return a product if it meets the return policy. One downside is that having such an easy return method increases the number of returns. There is nothing to do about it except making sure your product is top-notch. 3. Complicated packaging requirementsSo, before you send Amazon the items or start shipping from China to Amazon FBA, there is a strict guideline to follow. You have to maintain the packaging requirements so that your products are eligible for Amazon to receive. You will find this packaging requirement easily on the web or once you join the FBA program. Make sure to follow it or take assistance from experienced people so that your time and effort do not get wasted. 4. Cannot quality check for Chinese importsSo, direct shipping from China to Amazon FBA is available, and it saves your time and money by importing the goods and sending them to Amazon. However, it comes with one downside. You cannot see your goods and do a quality check. If you have to check the items, you need to import them by yourself then send it to Amazon, which increases the spending. 5. Sales taxes are slightly complicatedSince different states in the US have different sales tax rules, it can be hard to keep up with them. You need help from Tax partners so that you can understand better and make decisions. How to Be Successful on Amazon FBAAs we have seen many good and bad sides of Amazon FBA, you need the right knowledge to be successful on Amazon FBA. And with a little effort, your products will be sold in large numbers to Prime users across the world, and you will be able to get a considerable profit. So, let’s look at the ways you can be successful on Amazon FBA: 1. Research competitorsIf you are just starting out, it is essential for you to research your competitors and find out what products are popular amongst people. Many would suggest that you should not compete with the most popular sellers if you are a new seller. Research the market carefully and choose products that have low competition yet higher sales. 2. SEO is importantThere is a lot of competition on Amazon, and that is why SEO is essential. It lets your products be found by users as Amazon works as a search engine. You should use the right keywords, optimize your product’s page with good visuals and videos. 3. Optimize titlesWe often see Amazon products having really big titles. Why do sellers do that? Because they want to fit in as many keywords as possible to bring the SEO score higher. You can use this strategy to get more sales, but it isn’t wise to abuse the usage of titles. The title shouldn’t be too long, or else it may have the opposite effect. 4. Bring engagementWhen customers are on your page and see your products, some of them might ask questions. You should try to answer every question to increase the engagement and get a positive outlook from the buyers. And answering questions increases your chance of selling the product. You can also ask your friends to post questions on your products’ pages as it can help to increase the engagement. 5. Better pictures and product descriptionThe pictures you provide on the page should be of excellent quality. If you are providing a low-tier picture, the chances are that buyers won’t be that interested. Then, along with optimizing the product description, you should also make sure that the descriptions answer buyers’ questions. A lot of sellers put high-quality infographics to increase their sales. You can try that method, too. 6. Market your productsSEO can take a long time, and you can’t always ask your friends and families to buy your own products. So, you need to start marketing. One of the best ways for this is by using AMS, which is Amazon’s own marketing tool. It allows your product to be shown in the related products’ section and increases the clicks you get and eventually bringing high ROI. Shipping from China to Amazon FBAIf you are a reseller and import your items from China, you can directly import the goods, and without having a middleman, the products can be received by Amazon FBA. This process is excellent since you do not have to worry about getting a warehouse or need any space for receiving the goods then sending them back to Amazon. As we have discussed before, direct shipping to Amazon FBA has its benefits and downsides. It increases efficiency, reduces your cost, and reduces the time. However, you cannot quality check the items once they are in the US. So, only use this method when you are getting goods from a trusted seller, and you have the essential experience. Is FBA Worth it in 2020?A lot of sellers are frowning and fearing to use Amazon’s FBA. Yes, it can be challenging to be successful amidst many competitors. But if you have the right strategy, and know how to deal with the downsides, it can result in immense success, bringing excellent profits. So, yes, FBA is still worth it in 2020 if you know how to be successful using the right strategy. As a seller on Amazon, your primary goal is to sell your products and bring profits. And Amazon FBA can help you with that. Make sure to gather essential knowledge about all the technical details from Amazon before proceeding. You can contact Amazon to provide you with all the details, and as you get the FBA membership, you will be provided with all the things you need in order to be the next big seller!
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