You may or may not have heard about Amazon Web Services (AWS for short), but there’s a very good chance that you have used a site hosted on their servers.
Netflix, Reddit, and Pinterest all use AWS services, as do other giants of the digital world, like Dropbox and VMWare. What’s more, The Central Intelligence Agency (CIA) too picked AWS over computer giant IBM to build their private cloud.
AWS rules the world of cloud hosting. No wonder, Amazon made $45.37 billion from its Amazon Web Services (AWS) segment in 2020.
E-commerce is defined as the buying and selling of products or services exclusively through electronic channels. If you’ve made an online purchase through eBay, Shopify, Amazon (through Amazon FBA), and other platforms, then you have made your purchase via an e-commerce site. More and more people spend their time browsing on the internet and the more likely they are to buy stuff online.
Admittedly, the e-commerce industry is booming. Retail e-commerce sales in the United States are projected to grow at a fast pace in the coming years, going from 322.17 billion U.S. dollars in 2016 to just over 485 billion US dollars in 2021.
Why You Need Order Fulfillment Services
If you’re looking for a business that will eventually get you out of your 9-5 job, or looking to expand your existing business, having an online presence and web-based store could fulfill this goal. For beginners in the e-commerce trade, what do you need to do to get more sales, with a lot of online businesses competing for customers’ attention?
Customers want products that will give the best bang for their buck with speedy delivery, and good after-sales support. Here’s where the different companies offering order fulfillment services come in.
What is an Order Fulfillment Service?
Order fulfillment is defined as the steps involved in receiving, processing and delivering orders to end customers. A fulfillment service is defined as a third-party company that provides these order fulfillment steps on behalf of another party, such as an online seller.
FBA, or Fulfillment By Amazon is a business model wherein e-commerce sellers on the Amazon Marketplace, big or small, can have their products stored in any of Amazon’s giant warehouses, pack and deliver them to customers, handle customer support, and returns.
FBA Pros
Expertise and Reach
Amazon has one of the most advanced e-commerce fulfillment service in the world, can help you scale-up or grow your business and as of the last measured period, the source estimated 90 million paying Amazon Prime subscribers in the United States, up from 63 million in June during the previous year.
Amazon Prime customers are eligible for 2-Day Shipping, Free Shipping and other benefits. If you sign up your products for Amazon Prime, your products are eligible for free shipping, too.
Customer Service and Returns
FBA handles customer service and returns. Listings are displayed with the Prime logo, so customers know that Amazon handles packing, delivery, customer service, and returns.
They handle the fulfillment services side of the business and saves your time, so you can focus on the other aspects of your business.
Multi-Channel Fulfillment
With Multi-Channel Fulfillment, you can fulfill orders from other sales channels using your inventory stored in Amazon order fulfillment centers. Single-source your inventory to streamline your fulfillment operations, manage your inventory through an online user interface and can direct Amazon to return your inventory in e-commerce fulfillment centers at any time.
Cons of using FBA
Customization
Little to no order customization. Sellers must comply with existing Amazon .processes.
Branding
Items are shipped in Amazon boxes. Sellers can ship in generic boxes which may cost extra.
Warehouse Pricing
Storage fees are generally higher compared to 3PLs and usually rise during holidays.
Higher order handling fees for non-Amazon orders.
Communication
Solutions are based in standard processes which may pose little opportunity for dialogue.
Conflict of interest
The fact that Amazon may actually be a competitor to the seller. Amazon is in the business of selling, they just happen to offer shipping services. For Amazon, it’s free product and market research, and they’re making money off you.
Third Party Logistics (3PL / TPL)
Third–party logistics in logistics and supply chain management is a company’s use of third party businesses to outsource elements of the company’s order fulfillment services.
Pros of Using 3PL
Customization
Boxes/bags and all internal packaging are customized to a specific brand. Processes are adapted to your business’ operation and specification.
Warehouse Costing
Attractive storage costs that is variable. Customer pays storage space on a given month. Some 3PLs even offer free warehouse storage for a limited time.
Communication
Has onboarding processes, frequent communication before and after product launch. Collaborative approach is encouraged.
B2B (Business to Business)
Certain 3PLs can handle both B2B and B2C (Business to Consumer) fulfillment, resulting in one e-commerce fulfillment partner for all sales channels.
Cons of Using 3PL
Finding a Trustworthy 3PL company takes time.
Not all 3PL providers are created equal. It takes time to find a good company to work with from the beginning. Once you find someone you can trust, you can rest assured that your goods are being properly cared for. The initial search could be stressful but it will all be worth it once you find a reliable 3PL company.
Bad Service Reflects on Your Company
An inefficient 3PL provider could make your company look bad. Your customers do not care who is in charge of getting the product to them. All they care about is the end result. It is very important to look for a good distribution center early on to avoid customer-satisfaction issues in the future.
Amazon FBA or 3PL in Conclusion
Order Fulfillment Services are a crucial part of your business and a major factor in determining its success or failure. Whether you entrust your fulfillment services to FBA or a 3PL, there is a greater chance that you will be in good hands – these are fulfillment experts, after all. The key difference is you as the owner, – what do you want for your brand and what kind of customer experience you want to give to your consumers.
If you are happy to use Amazon’s existing system and tap into their wide customer reach, FBA may be a perfect fit for your company. If, however, you would like more control over your order fulfillment services, partnering with a 3PL could be the best solution. Make sure your order fulfillment service provider is experienced with the type of operations you need before you entrust them with your reputation.
Amazon FBA article and permission to publish here provided by Dona Dimaculangan at 3p-logistics.co.uk. Originally written for Supply Chain Game Changer and published on March 8, 2018.
There are a few factors that can make your product stand out to the customers. One of them is if your product offers standard quality at a relatively low price.
While price is still the main factor for customers to notice your product, when it comes to online shopping, keywords somewhat play the same role.
Fulfillment by Amazon is referred to as FBA. Both novice and seasoned online business owners can offer their products to clients via Amazon FBA. Simply ship your goods to the Amazon warehouse to store them there. Amazon handles the shipping of your products to your clients when you make a sale. In addition, they handle client service.
So here we have covered how to start selling on Amazon with the help of Amazon FBA.
When you have a product you sell on Amazon, the whole package is important including Amazon reviews, quite literally.
Customers have thousands of options at their fingertips in any given product category, and that means they can be discerning. Customers can also leave their reviews of your product, and those reviews are an integral part of boosting your sales if they’re positive.
From having beautifully designed packaging to sending follow-up emails after someone receives your product, you want a streamlined experience that compels your Amazon customers to jump on the site and leave you a great review.
The following are some tips to get those coveted online reviews.
When it comes to e-commerce, Amazon is the top-ranking company in the world. They have a market cap of over $1 trillion. Between the app and website, they receive over 2.45 billion visits each month, practically controlling the online market.
Additionally, roughly 7,400 items are sold by Amazon sellers every minute. Over time, many have become interested in the Amazon FBA model, leading to an influx of participants and an increase in competition.
To stay competitive, it is crucial to know how to optimize your FBA business.
Big news out of the grocery retail world as Amazon has announced its acquisition of major organic foods retailer Whole Foods Market – for an eye-popping $13.7 billion sale price that doesn’t look so massive given Amazon’s $136 billion sales volume in 2016.
Analysts across the retail industry are talking about the huge implications of this sale for a retail industry that many say is in the middle of a major meltdown, in part owing to Amazon’s massive growth in the eCommerce space. This foray into the grocery business is a big challenge to companies like Target, Wal-Mart, and others, and also a sign that reports of brick and mortar retail’s demise might be greatly exaggerated.
Amazon is an online marketplace used by millions of people globally. From clothing to electronics to toiletries, you can find almost anything on Amazon.Wondering how you can get in on the action and how to sell on Amazon? All you need is a small monetary investment to get started and the knowledge of how to run a successful listing.
Anyone can sell on Amazon if they can choose a product, set up a profile and find a fulfillment provider. The benefits of selling on Amazon range from access to millions of customers to the ease of their platform.
Here we’ll walk you through each step of the selling process from setting up your account to expanding globally. Learn how to sell on Amazon.
Whether you love, hate or remain neutral on Amazon, one can only marvel and admire Amazon by the numbers which only appear to be accelerating.
The infographic from Fortna in this post from Jeff Ashcroft provides a startling picture of where Amazon is at currently and how they’re expected to handle over half of online e-commerce transactions with Walmart now only at 5% and growing!
Amazon by the numbers article and permission to publish here provided by Jeff Ashcroft. Originally published on Supply Chain Game Changer on August 24, 2017.
Amazon has reigned supreme in e-commerce for years, but Walmart is well on its way to making the e-commerce giant a little nervous. Amazon acquired Whole Foods and dropped the price of Prime Pantry through Prime Perks. Amazon began looking into brick-and-mortar storefronts, hoping to capture a new slice of the omnichannel pie.
Walmart has a different approach, and in several ways, Walmart is positioning itself to best Amazon in e-commerce through an innovative, omnichannel return strategy. To understand the true scope of this accomplishment, supply chain leaders need to understand the precursor steps Walmart has taken.
Are you looking to sell on Amazon? It can seem overwhelming in the beginning, dipping your toes into the vast ocean that is Amazon. But that doesn’t mean you shouldn’t dive on in.
Amazon has made it possible for thousands upon thousands of sellers to reach customers in the digital, modern-day marketplace. Ranging from books, clothes, home goods, to even brand-new cars, customers love to shop on Amazon for countless reasons.
Not only does Amazon offer the most extensive selection of products, but they also keep customers coming back for several reasons, like their two-day shipping for Prime members and easy returns.
In February, 2018 it was reported that Amazon was going to launch its own delivery service: Shipping With Amazon!
Effectively Amazon has declared that they are officially entering the logistics business. The “Shipping With Amazon” service, albeit currently on a much smaller scale, competes with the logistics service and delivery capabilities offered by UPS, FedEx, and UPS.
But these are incredibly large, well established logistics companies. And they are also the major delivery service suppliers to Amazon.
Fulfillment by Amazon or Amazon FBA lets sellers in the Amazon marketplace take advantage of Amazon’s giant logistics operation to ship their orders.
FBA items are eligible for Amazon Prime shipping and Amazon handles your angry customers (which Amazon considers its customers, not yours). Amazon has dozens of warehouses all over the country, and more around the world, so your products may be in your customers’ hands quickly.
If you pull back the Amazon curtain, however, you find the picture isn’t always rosy.
We have seen many people taking a new leap in crypto circles in the past few years, particularly in Bitcoin. Thanks to the meteoric rise of the coin, many people experimented a lot with the coin.
Several teenagers and college students have invested in this domain and won big in Bitcoin. Several families seemed to have mortgaged their homes. Also, many more billionaires seemed to have suggested around 10 percent of the assets all over the digital currency.
There are loads of money when it comes to playing and the people’s livelihood and saving the same on the line.
Amazon is far and away the leader in the E-C0mmerce space. Their growth continues at an exceptional pace. And they continue to expand their products, services, and capabilities. In short they continue to press their advantage and make it difficult for anyone else to compete with them. You need a Blue Ocean strategy!
But if you are in the E-Commerce space that is your reality. Amazon is the biggest shark in the room. So how do you compete in the face of such an overwhelming adversary?
One technique is to consider creating your own Blue Ocean Strategy to create competitive advantage! If you can define dramatically different space in which to do business you may be able to keep this shark, and others, at bay (at least for a period of time).