FBA Onsite on Amazon
Amazon is ahead of the whole planet in everything related to e-commerce. It moves fast and offers more and more features and opportunities for Amazon sellers and vendors. Recently, after launching a new Amazon Transparency Program for brand protection, it has introduced a new shipping solution for the third-party sellers – Amazon FBA Onsite Program. The new program will reconfigure seller’s warehouses and offer shipping services at a much lower rate.
Without a doubt Amazon FBA Onsite can make the life of many retailers more profitable. Amazon itself describes FBA Onsite Program as “groundbreaking.” Let’s take a closer look at this program.
What Is The Amazon FBA Onsite Program?
As Amazon itself explains it, FBA Onsite is:
«Enabling fulfillment to Amazon customers for inventory in seller-owned and operated warehouses»
What Amazon is actually doing is creating many FBA warehouses, which are owned by third-party sellers. So, if a seller has a warehouse, Amazon can use it as a fulfillment center.
In other words, Amazon is recruiting third-party vendors to its logistics program.
A ‘How it works’ infographic:
However, we must admit that Amazon FBA Onsite Program is mutually beneficial to both Amazon and third-party retailers.
For Amazon FBA Onsite is a program that can solve its growing warehouse congestion problem. At the same time, it’s an advantageous 3rd party solution for logistics.
Why Is Amazon Interested In Developing The FBA Onsite Program?
- It is running out of space;
- It doesn’t want to raise shipping fees as it means less profit.
Amazon is a giant market and one of the world’s biggest operators of fulfillment centers. Although we don’t know how many millions of square feet of warehouse space Amazon operates, we know for sure that this is not enough.
The FBA Onsite Program is a wonderful opportunity for this ever-growing eCommerce marketplace to free up warehouse space.
Benefits For Third-party Sellers
- They can use Amazon warehouse management system (WMS) to help them with logistics;
- They can easily manage their FBA inventory within their own warehouses;
- It is a less expensive and an easier way for sellers to be eligible for Prime;
- It ensures that your new inventory will instantly become available on Amazon;
- It means cheaper Amazon fees to sellers (no monthly storage fees, no long-term storage fees, no FBA Inventory Placement Service fees);
- It also means flat nationwide shipping rates;
- While taking part in FBA Onsite, third-party sellers can still use Small and Light and Subscribe and Save programs;
- Hazmat products can be fulfilled through FBA Onsite, which can also be a benefit for some sellers.
Thus, FBA Onsite allows sellers to take advantage of the most efficient inventory management practices.
What About Multi-channel Retail?
Amazon FBA Onsite Program is a huge opportunity for multi-channel retailers. This program makes multi-channel fulfillment much easier, as previously Amazon’s multi-channel fulfillment services could be pretty slow unless you use one-day / two-day options.
If you engage in multi-channel fulfillment and have your inventory in a FBA Onsite warehouse – this option will really help. You can setup fast shipments while using Amazon’s rates, which is likely to be extremely cheap.
How To Become Part Of The FBA Onsite Program?
Right now, the program is invite-only. All the current sellers who have warehouses can try to become part of the program, however participation in the program is subject to Amazon’s approval. It is also important to note that the FBA Onsite program requires new partners to pass a mandatory trial period with certain performance results.
The Amazon Onsite setup team will guide you through the enrollment process and will train your warehouse team on the WMS and order processing.