Preparing for Q4 with Amazon FBA
Are you ready for Q4? With COVID-19, Amazon FBA has been anything but reliable. With new inventory limits and ASIN quantity limits, fulfillment already a problem. Now, you’re looking at inbound shipping delays from a few weeks to months, and storage rates that are through the roof. So, what can you do to make sure you're shipping orders for the holidays?
Option 1: In-House Fulfillment
Sure, you can take your operations in-house if you're set up with a label printer and packaging materials. However, not everyone has these materials - and I bet most of you don't want to spend countless hours printing Amazon labels one by one. Now is the time to be focused on marketing!
You're also going to get a pricing shock with your new shipping rates. If you're already set up with someone like Stamps.com or ShipStation you can get some basic discounts, but it will still be be quite different from Amazon's rates. If this doesn't sound like something you're ready to take on at a short notice, consider doing FBM with a 3PL.
The Better Option: Amazon FBM (Fulfilled by Merchant) Using a 3PL
If in-house is not an option, your best option is to utilize a 3PL. A Third-Party Logistics company works much like Amazon. They store, pick, pack, and ship your orders at discounted rates. How does this work with Amazon?
Depending on your situation, it may be best to split your inventory with a 3PL and do FBM alongside FBA. With Amazon, you can create FBM and FBA SKUs for one ASIN. If your FBA inventory sells out or if you opt out of FBA for now, you have your 3PL to do FBM.
The other option is to skip the hassle and go entirely FBM. During the holiday season, your products are going to sell regardless. Not to mention, with current shipping delays the Prime shipping label doesn’t mean you’re going to get your order in 2 days anyways. Customers know this and are taking Prime standards with a grain of salt.
Despite what you may think, there are advantages to using a 3PL for Amazon FBM too:
Save on Storage Costs
Amazon FBA storage fees increase almost 4x during the holidays. Using a 3PL gives you a consistent and much less expensive rate.
OTW Shipping Storage: $0.50/cubic foot (79.17% cheaper than Amazon)
Flexible and Stress-free Inventory
Especially now, slow-moving and excessive inventory will result in hefty Amazon FBA fees. You have to decide how much to ship weeks to months in advance which is an educated guess at best. If you go over your limit or your products aren't selling, that can mean trouble. With a good 3PL, you don’t pay long term storage costs and you won't have storage limits. So, if your product gets hot you'll have the inventory ready to go.
OTW Shipping has no inventory limits and no long term storage fees.
Improved Quality Control
With a 3PL, you are going to get a thorough inspection of your product. Because of this, there is less of a chance of sending out an incorrect or damaged good that would result in bad reviews and hurt your sales.
OTW Shipping has an intense receiving process that ensures the correct quantity and quality of your products, resulting in less shrinkage and product damage.
Better Customer Service
Not surprisingly, Amazon customer support gives you the runaround and support tickets are a lost cause. It’s the worst. Unfortunately, most 3PLs do not provide much better service. A great 3PL will have a dedicated account manager, and be available when you need them.
OTW Shipping has a private dashboard for constant communication with you.
Discounted Shipping Rates
If you try and ship yourself, you’re not going to get the same rates as if you used Amazon or a 3PL. While Amazon has the power to bargain rates down to pennies on the dollar, 3PLs also get a good bargain with the order quantities they ship. This helps you keep your margins and keep your shipping costs down for your customers.
Contact OTW Shipping to see our domestic and international rates! With locations in Utah and Maryland, reach 90% of the US with 2-day ground shipping.
No More Amazon Packaging
No more Amazon advertising all over your package. Now you can use your own custom packaging, or at the very least not look like an Amazon rep. Customers will associate your product with your brand, not with Amazon.
OTW Shipping can use your custom packaging at no extra cost!
If you’ve been looking to expand to other selling platforms, this is the perfect opportunity. Chances are, you’re missing out sales by only selling through Amazon. With multi-channel fulfillment, you can integrate all your selling platforms with the 3PL and provide consistent pricing and shipping times across the board. This is much less of a headache for you. While Amazon does do multi-channel fulfillment, their rates are more expensive for slower speeds, you can't do international shipping or returns, and not all channels can integrate. These are some pretty big drawbacks for most companies.
OTW Shipping utilizes Shipedge software that integrates with countless platforms and processes returns for you.
Are you curious if FBM can work better for you than FBA this year in Q4? Click here for a free and fast quote and consultation from our team!