What is Amazon FBA?
Updated Tuesday, February 22, 2022 — Tags: #amazon fba #what is it #how to sell — Prepared by Beren Bayraktar
Understanding Amazon FBA (Fulfilled by Amazon)
Amazon FBA, whose full name is “Fulfilled by Amazon,” is a service introduced in 2006 that aims to assist marketplace sellers with storage and logistics. Under this program, once you send your products to Amazon’s warehouses, Amazon takes over all remaining operations including storage, packaging, shipping, and returns. Not only sellers operating exclusively on Amazon, but all sellers engaged in e-commerce can benefit from this service.
FBA offers numerous advantages such as discounted shipping rates, high-quality third-party customer service, and unlimited storage space at affordable prices. However, you should keep in mind that separate fees will be charged for storage and logistics for your products, and additional fees will apply if you keep the same product in the warehouse for more than six months.
🛠 Steps to Benefit from Amazon FBA
To benefit from the Amazon FBA service, there are certain steps you need to follow. First, you must log in to Seller Central to create an Amazon account and set up Amazon Logistics. To use the FBA system, you must have a VAT (Value Added Tax) registration in the country where you will be selling.
To prepare your products in accordance with Amazon packaging conditions, you should review the questions on the “Manage Inventory” page. The information requested from you will include: the number of products, total number of boxes, barcode labeling for each product to be shipped, and the dispatch address. After printing the product identity labels, they are shipped to the warehouses designated by Amazon. Products arriving at the warehouse are classified according to their characteristics and placed in an orderly manner. When an order is received, packaging and shipping to the customer are handled by Amazon.
Three Business Models for Selling on Amazon FBA
There are 3 different methods you can choose from to sell on FBA:
🛒 Dropshipping
Purchase products at low prices and sell them at higher prices on Amazon without holding inventory.
🎨 Private Label
Create your own brand and sell on Amazon by carrying out marketing, logo design, and market research.
📦 Wholesale
Purchase products in bulk at low prices and sell them at retail prices through Amazon.
How to Sell on Amazon?
To sell on Amazon, you must first open a business account through Seller Central. All companies, including sole proprietorships, can sell on Amazon. The important thing is to have a legally registered company.
Required Documents
The documents the system will require from you are as follows:
- A current and active credit card
- Company phone number and business type information
- Company registration number and tax number
- Company address
- Identity information of the authorized person for transactions
- Phone number of the authorized person for transactions
- Date and place of birth of the authorized person for transactions
- Bank account information where sales revenue will be deposited
After that, you must add the product you will sell to Amazon’s inventory. However, remember that selling second-hand products on Amazon is prohibited.
Required Product Information
The information required for the product is as follows:
- Product EAN code
- UPC or ISBN code
- Full name and detailed description
- Related images
- Price
- Stock status
Additional information may be requested depending on the product type.
✓ After completing all these steps, you can start selling.
📄 You can also check out our article: What is Micro Export?
