Key Takeaways
- Amazon FBM (Fulfilled By Merchant) is the method of selling on Amazon where a seller lists their products on Amazon but handles storage, shipping, and customer support themselves.
- Amazon FBM is an alternative and often an additional shipping method to Amazon FBA (Fulfilled by Amazon).
- With this Amazon FBM Guide, Amazon sellers can save time and money shipping products to their Amazon customers.
In over 10 years as an eCommerce Fractional CMO, Amazon Consultant, and eCommerce Marketing Consultant, not to mention CEO, I’ve seen just about every mistake and the lessons from them. That means you get all the learnings without the scars.
Amazon FBM (Fulfilled by Merchant) can be intimidating for Amazon sellers, especially sellers who are not used to selling and fulfilling orders via their own eCommerce website.
From shipping templates to entering tracking numbers in a timely manner, there is a lot that can go wrong costing Amazon sellers time and money.
I can tell you firsthand that shipping and logistics can be challenging for sellers of any size.
That’s why I put together this in-depth Amazon FBM guide that you can use TODAY to save money, save time, and boost sales whether you’re an Amazon Seller Central seller, using Seller Fulfilled Prime, or selling Amazon B2B.
What is Amazon FBM?
Amazon Fulfilled by Merchant (FBM) is the fulfillment method where sellers fulfill orders from sales on the Amazon marketplace directly to customers.
Amazon FBM is the primary alternative to Amazon FBA (Fulfilled by Amazon) where sellers send in inventory to Amazon fulfillment centers and Amazon fulfills orders and handles customer service.
Sellers can manage Amazon FBM independently or by collaborating with a third-party logistics service provider.
Using Amazon FBM, sellers forego the Prime badge but can still choose to offer free shipping to customers as pictured here:
That said, Amazon sellers who meet strict shipping & handling time criteria, can still offer the Prime Badge through Amazon Seller Fulfilled Prime.
Amazon sellers using Amazon FBM are responsible for their own inventory storage, order fulfillment, returns, and customer service.
So, how does Amazon FBA work?
How Does Amazon FBM Work?
Amazon FBM works as the fulfillment method where Amazon sellers list their items for sale on the Amazon Marketplace and when an item is sold, their warehouse or logistics partner picks, packs, and ships the product to the customer.
This involves acknowledging the order and entering tracking information into Amazon Seller Central in a timely manner.
How To Get Started with Amazon FBM:
- Sign up for an Amazon Seller Central Account
- List your products on Amazon
- Enter your warehouse or logistic partners’ warehouse locations.
- Set up your shipping templates
- Add your return policy to Seller Central
- Acknowledge & ship orders
- Provide tracking information
If you’re shipping products yourself, you can buy shipping labels directly from Amazon Seller Central or use your own account with UPS, FedEx, UPS, or another 3rd party.
One of the benefits of using Amazon’s buy shipping services platform is the pre-negotiated industry-low rates with UPS.
If this is beginning to sound like a lot of work, we should weigh the Pros and Cons of Amazon FBM.
Pros & Cons of Amazon FBM
Amazon FBM can be a great choice for a number of scenarios:
- Amazon sellers who also sell on other channels like their own website who already use 3rd party logistics partners.
- Amazon sellers who are just starting out, haven’t sold on their own eCommerce website and want to get comfortable selling direct to consumer without a 3rd party logistics partner.
- Established Amazon sellers, comfortable with shipping and logistics who want to make sure they don’t miss out on orders when their Amazon FBA inventory has lapses in stock.
With that in mind, let’s take a look at the pros and cons of Amazon FBM from the perspective of a consultant for Amazon.
| Pros (Why You Should) | Cons (Why You Shouldn’t) |
|---|---|
| You can ship products in your own branded packaging. | More difficult to win the Amazon Buy Box. |
| Lower costs on storage. | You have to pick, pack, and ship products to customers yourself. |
| Lower costs on picking and packing. | You have to handle customer service. |
| Easier inventory tracking. | When products are lost in transit or damaged, it is your responsibility. |
Pro’s and Con’s are just part of the Amazon Fulfilled By Merchant story, you also want to consider Amazon FBM fees.
Amazon FBM Fees
Fulfillment by Merchant, Amazon FBM only charges Amazon sellers the monthly Seller Central subscription fee, a small fee per each order, and a referral fee every time a sale is made.
This is one of the reasons brands decide to switch from FBA to FBM.
Amazon Seller Central Pro Seller Account Fee:
$39.99 / mo.
Per Item Selling Fee:
$0.99 per item sold but WAIVED if you have a Pro account.
Amazon Referral Fees:
| Fee Category | Referral fee percentages | Minimum referral fee |
|---|---|---|
| Amazon Device Accessories | 45% | $0.30 |
| Amazon Explore | 30% for Experiences | $2.00 |
| Automotive and Powersports | 12% | $0.30 |
| Baby Products | 8% for products with a total sales price of $10.00 or less, and 15% for products with a total sales price greater than $10.00 | $0.30 |
| Backpacks, Handbags, and Luggage | 15% | $0.30 |
| Base Equipment Power Tools | 12% | $0.30 |
| Beauty, Health and Personal Care | 8% for products with a total sales price of $10.00 or less, and 15% for items with a total sales price greater than $10.00 | $0.30 |
| Business, Industrial, and Scientific Supplies | 12% | $0.30 |
| Clothing and Accessories | 17% | $0.30 |
| Compact Appliances | 15% for the portion of the total sales price up to $300.00, and 8% for any portion of the total sales price greater than $300.00 | $0.30 |
| Computers | 8% | $0.30 |
| Consumer Electronics2 | 8% | $0.30 |
| Electronics Accessories1 | 15% for the portion of the total sales price up to $100.00, and 8% for any portion of the total sales price greater than $100.00 | $0.30 |
| Everything Else3 | 15% | $0.30 |
| Eyewear | 15% | $0.30 |
| Fine Art | 20% for the portion of the total sales price up to $100.00, 15% for the portion of the total sales price greater than $100.00 up to $1,000.00, 10% for the portion of the total sales price greater than $1,000.00 up to $5,000.00, and 5% for the portion of the total sales price greater than $5,000.00 | — |
| Footwear | 15% | $0.30 |
| Full-Size Appliances | 8% | $0.30 |
| Furniture | 15% for the portion of the total sales price up to $200.00, and 10% for any portion of the total sales price greater than $200.00 | $0.30 |
| Gift Cards | 20% | — |
| Grocery and Gourmet | 8% for products with a total sales price of $15.00 or less, and 15% for products with a total sales price greater than $15.00 | — |
| Home and Kitchen | 15% | $0.30 |
| Jewelry | 20% for the portion of the total sales price up to $250.00, and 5% for any portion of the total sales price greater than $250.00 | $0.30 |
| Lawn and Garden | 15% | $0.30 |
| Lawn Mowers and Snow Throwers | 15% for products with a total sales price of up to $500.00 8% for products with a total sales price greater than $500.00 | $0.30 |
| Mattresses | 15% | $0.30 |
| Media – Books, DVD, Music, Software, Video | 15% | — |
| Musical Instruments and AV Production | 15% | $0.30 |
| Office Products | 15% | $0.30 |
| Pet Products | 15%, except 22% for veterinary diets | $0.30 |
| Sports and Outdoors | 15% | $0.30 |
| Tires | 10% | $0.30 |
| Tools and Home Improvement | 15% | $0.30 |
| Toys and Games | 15% | $0.30 |
| Video Game Consoles | 8% | — |
| Video Games and Gaming Accessories | 15% | — |
| Watches | 16% for the portion of the total sales price up to $1,500.00, and 3% for any portion of the total sales price greater than $1,500.00 | $0.30 |
Frequently Asked Questions
What is FBM on Amazon?
Amazon Fulfilled by Merchant (FBM) is the fulfillment method where sellers fulfill orders from sales on the Amazon marketplace directly to customers.
Which is Better Amazon FBA or FBM?
Amazon FBM is better if:
- You desire increased control over your customer interactions.
- Your business already excels in customer service practices.
- The items you offer are oversized or heavy.
- You have an established logistics system in operation.
- You can effectively manage the costs associated with fulfilling your own products.
- Your inventory tends to have a slow turnover rate.
Amazon FBA is better if:
- The products you are selling are small and lightweight.
- You are comfortable relinquishing control to Amazon in terms of customer interactions.
- You prefer Amazon to handle your customer service.
- Your inventory experiences rapid turnover.
- You lack an existing logistics infrastructure.
- The expenses associated with fulfilling your own products would be higher.
Does Amazon FBM Cost Money?
Yes, Amazon FBM costs money in the following ways:
- Amazon Pro Seller Account Fee
- Per Sale Fee (waived if using a pro Seller Central account)
- Referral fees
Who Pays For FBM Shipping?
The Amazon seller pays for FBM shipping in most cases as charging the customer shipping on Amazon can lead to lower rankings and Buy Box issues.
Can I Switch From FBM To FBA?
Yes, you can switch from FBM to FBA at any time and even offer both simultaneously where you have one ASIN, but one SKU is FBM and one SKU is FBA.
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