In a recent paper, we asked the question “Is Fulfillment by Amazon Right for Your Business?” We all know that Amazon is a great sales channel, and for many eCommerce companies it’s also a great order fulfillment service. But it’s not for everyone.
To help you determine if Fulfillment by Amazon (FBA) is right for your business, we’ve compared it to its most common alternative – a third-party logistics provider (3PL).
Comparing Order Fulfillment Service Options
For both FBA and 3PL order fulfillment, the basic concept is similar: you send your inventory to a provider and they house it and handle the orders and shipping. You focus on production and branding, and leave fulfillment to an expert without worrying about staggering overhead costs or being unable to meet demand.
But there are marked differences between the two.
It is important to note that Amazon also allows eCommerce companies to sell through Amazon but handle fulfillment themselves. This is known as “Fulfillment By Merchant” (FBM). And, FBM companies who meet certain criteria are also eligible for the Seller-Fulfilled Prime (SFP) service.
Your Fulfillment Operation
Fulfillment is a crucial part of your business, and a major factor in determining its success or failure. And, whether you entrust your order fulfillment service to FBA or a 3PL, you will be in good hands – these are fulfillment experts, after all. The key difference is you – what do you want for your brand and the experiences of your customers.
If you are happy to plug into Amazon’s existing system, FBA may be a perfect fit for your company. If, however, you would like more control over your operations, 3PL order fulfillment could be the best solution.
