What Is The Difference Between FBA and FBM?

The Difference Between FBA and FBM

Many sellers have questions about Amazon FBA and Amazon FBM, and do not know whether to choose Amazon FBA or FBM, in this article will be an in-depth introduction to the difference between the two, only to understand the difference between the two models, you will able to choose the most suitable for your Amazon model.

What Is Amazon FBA?

FBA is Amazon’s self-built logistics warehouse, the official logistics service of Amazon. Sellers need to take the products they want to sell and ship them to the Amazon warehouse in the place of sale, usually, the warehouse will be established in the airport and dock.

Advantages of FBA

Amazon platform gives traffic support to improve rankings and help sellers become featured sellers.

Efficient and fast delivery time. Overseas warehouses worldwide and intelligent standard management provide strong backing support for the efficient delivery of Amazon FBA.

Amazon’s professional customer service provides you with various services around the clock

All FBA logistics fees are waived for products with unit prices over 300USD.

Disadvantages of FBA

There is a certain amount of financial pressure, and small sellers who are just starting may not be able to afford it. Sellers need to prepare a certain amount of goods for the FBA warehouse, product procurement costs + headway shipping costs, plus storage fees, tail delivery fees, etc. This is a lot of money.

Amazon’s warehousing costs and processing costs are increasing, the compression of profit margins.

If the seller does not select the right products, it may produce stalled products. Send back to the domestic may not scratch, destroyed locally, not only the loss of products but also need to pay a certain amount of destruction costs.

Sellers will have certain restrictions on the selection of products, FBA has special restrictions on the products entering the warehouse, and not all products can enter the FBA warehouse.

What Is Amazon FBM?

With the Merchant Fulfillment model (formerly MFN or Merchant Fulfillment Network), you can store and ship items or outsource fulfillment to a third party (not Amazon). Either way, sellers are required to meet Amazon’s service levels related to shipping and orders. In addition, sellers must provide customer service and return processing for FBM orders.

Advantages of FBM

Flexible input cost, no need to stock up

Lower upfront investment, simpler and more flexible operation, more suitable for newbies

Disadvantages of FBM

Slower logistics speed compared to FBA

No dedicated customer service, poor customer service experience

What Is The Difference Between FBA and FBM?

Different Costs

The cost of FBA is higher and requires Amazon to provide a warehouse to store the goods, while the cost of FBM is lower and does not require Amazon to provide a warehouse to store the goods and ship directly.

Different Logistics Methods

FBA is to send the goods to Amazon’s foreign warehouse first, after the order by Amazon’s official distribution and delivery. That FBM does not need to stock up in the early stage, but the store after the order, by domestic courier to the international courier, delivery to the buyer.

Different Customer Unit Prices

Because the logistics costs and operating costs of the two models are different, so the customer unit price is also different

The Way to Get to Traffic Is Different

The primary way to get traffic for FBA is to attract traffic through advertising on and off the site, and the traffic from Amazon is not enough. FBM’s traffic is mainly from the traffic given by the Amazon platform.

Different Logistics Time Limit

When the store orders, FBA’s delivery cycle is three days, and the buyer can receive the goods. The FBM’s delivery to the buyer to receive the goods time is a month.

Receiving Time Is Different

Amazon’s current platform rule is to receive the goods after the payment to your Amazon seller account, logistics time also determines your collection time.

Different Responsibilities

FBA is responsible for customs clearance and China delivery to Amazon warehouse services, FBM is not responsible for customs clearance and China delivery to Amazon warehouse services, the seller needs to solve their delivery from China to the foreign Amazon warehouse customs clearance, customs clearance, and tax payment problems.

FBA and FBM: Which Is Better?

FBA and FBM which is better

After reading about the advantages and disadvantages of the two shipping models, I believe some friends already have a number in mind. Then I’ll make a small summary: FBM mode is suitable for new sellers, the cost and profit are controllable, and the requirements for the ability to select products are low. According to the policies introduced by Amazon, they pay a lot of attention to customer experience, which requires us to provide better quality service.

Conclusion

After reading this article I believe you already know what the difference between the two is, and which model you choose will need to be considered based on your actual situation.

Honest FulPhilment gives you every eCommerce Fulfilment Service you can think of, If you want to do 3rd party order fulfillment for your store on Amazon, look for Honest FulPhilment and build the right relationship. Then you can find a way to fulfill your customer’s needs at a lower cost than Amazon.

we’ll be happy to answer in detail

Any Questions about Dropshipping Fulfillment

Need a Quick Quote?

– Competitive price
– Quote within 24 hours
– 30+ Shipping methods
– Dedicated account manager
– Shopify/Woo integrations
– Autofulfil
– Auto tracking
– Plus much, much more

 
Recent Post
Share article: