Even if you’ve never been deeply interested in how marketplaces work, you’ve probably heard a recent report that the richest man on the planet, Jeff Bezos, has multiplied his fortune again. And this is happening in an era of global pandemic and economic crisis.
What’s his secret? In the Amazon platform, and its secret is in the FBA program, which we will talk about today by answering a number of popular questions: why does Amazon business not fall out of trends for several years in a row? Why the popularity of Amazon so far no one can get around and who is trying to do it?
What is Fulfillment by Amazon (FBA)?
Fullfillment by Amazon, or FBA for short, is a special program for providing Amazon warehouse space and services to third-party marketplace sellers. Paypal can be used for payment movement with amazon and verify it to extend the paypal sending limit make maximum.
Imagine that you have several products that are popular in the market. You do not want to lose money and plan to take all the cream off the market. In this case, you will need to order a large batch of these goods, find a warehouse where to store them, ensure timely delivery to customers, and service returns.
The goods are scattered like “hot cakes” and you need to replenish the warehouses. And now the most interesting thing: the market we are talking about is not Ukraine, but the United States. How to organize a continuous process of sales, delivery, order service and business scaling in a market with 300 million customers?
This is where the Fulfillment by Amazon program comes in. You list your goods on Amazon, send the goods themselves to the warehouses of the FBA program, and the marketplace takes over most of the labor-intensive processes (we will consider which ones below). Your task remains marketing, ensuring the production of goods and delivering them to the country of sale. And most importantly, you get the opportunity to scale your business.
How does the FBA service work?
So FBA is a marketplace service designed to simplify the lives of sellers who list their products on Amazon. The sequence of the service can be briefly described as follows (consider the US market):
1. You ship your goods to the USA at one of the Amazon warehouses. With today’s level of logistics, you can easily send a container of goods to the United States even from China, even from Ukraine.
2. Amazon accepts your goods and distributes them to warehouses all over the country, for the convenience of internal logistics and ensuring a high speed of delivery.
3. Buyers order your products, along with products from Amazon and other sellers. Amazon FBA accepts and processes orders.
4. At Amazon FBA warehouses, goods are assembled and packed, and then delivered to the customer’s home.
5. Amazon provides almost all work with the order, including its return to the warehouse if for some reason it did not suit the buyer.
6. Every two weeks, the marketplace transfers the profit from sales to your account.
Features of the FBA program in Europe
It should be noted that the FBA program works a little differently on Amazon European platforms, and we will now analyze exactly how. But first, one caveat: under the FBA, your goods can be delivered from the American Amazon to more than 100 countries around the world. Therefore, it is advisable to talk about the FBA program in other countries only if you go out with sales to the markets of these countries.
But, for example, you decided to start selling your goods in Europe. Then you will need to deliver a consignment of goods to one or several European FBA warehouses, depending on which of the program variations you choose. You can aslo sell the games like h game in this fiels.
The fact is that in Europe you can work with FBA Amazon warehouses in two scenarios:
- Pan-European FBA
- Multi-Country Inventory