In the competitive world of eCommerce, Amazon stands tall as one of the leading platforms for both buyers and sellers. Seller Fulfilled Prime (SFP) has been a popular choice for sellers looking to take use of Amazon Prime’s benefits without depending on Amazon’s fulfilment centres. We’ll go into detail about Seller Fulfilled Prime in this blog, covering everything from its description and advantages to joining requirements and how to proceed.
What is Seller Fulfilled Prime?
Before diving into SFP’s specifics, let’s clarify what it is. Through its Seller Fulfilled Prime programme, Amazon enables individuals to sell Prime-eligible goods straight from their own warehouses or fulfilment centres.
This allows sellers to maintain control over important aspects of the fulfilment process while still offering customers the quick and dependable shipping benefits associated with Amazon Prime. This contrasts Fulfilment by Amazon (FBA), where Amazon handles storage, packing, and shipping. We’ll go into more detail on the difference between SFP and FBA in the next section.
Put simply, Seller Fulfilled Prime allows sellers to offer customers the same fast and reliable shipping as Amazon’s own warehouses do from couriers such as DPD, Royail Mail and Evri. This is great for shoppers who love the speed and reliability of Prime shipping. According to Fobes, 67% of people are more likely to use Prime-eligible products compared to non-eligible products.
By meeting Amazon’s requirements and offering speedy delivery options, sellers can get the Prime badge on their products and reach more customers who are Prime members. This is positive because it could mean more sales and happier customers!
What is the Difference Between Seller Fulfilled Prime and Fulfilled by Amazon?
Let’s break down the differences between Seller Fulfilled Prime (SFP) and Fulfilment by Amazon (FBA), two distinct methods offered by Amazon order fulfilment.
Fulfilment by Amazon (FBA) involves sellers sending their inventory to Amazon’s vast network of fulfilment centres. Once received, Amazon takes charge of storage, packing, and shipping. Essentially, sellers hand over the reins to Amazon’s logistics experts, allowing them to focus on other aspects of their business while Amazon manages the fulfilment process.
On the other hand, Seller Fulfilled Prime (SFP) empowers sellers to retain control over the fulfilment process. Sellers manage storage, packing, and shipping from their own facilities or through third-party logistics providers. Despite this, sellers still have the opportunity to offer Prime benefits to customers, such as fast and reliable shipping to couriers such as DPD, Royal Mail and Evri.
In essence, the key difference lies in who manages the operational aspects of fulfilment. With FBA, Amazon handles everything, while SFP allows sellers to maintain control over their fulfilment operations.
Depending on a seller’s preferences, business model, and operational capabilities, they may opt for either FBA or SFP to meet their specific needs and goals.
Who Pays for Shipping in Seller Fulfilled Prime?
One of the fundamental questions that arise when considering SFP is who pays for the shipping. Put simply, when using SFP, shipping is the seller’s responsibility. This implies that to satisfy Amazon’s strict delivery requirements, merchants need to have dependable shipping strategies in place. Even though this might seem like an extra expense, joining the Prime programme can frequently have benefits that offset the shipping charges.
What are the Benefits of Seller Fulfilled Prime?
Seller Fulfilled Prime offers many benefits for sellers such as:
Prime Badge:
By participating in Seller fulfilled prime, sellers can display the Prime badge on their listings. Why is this useful? Customers of Amazon greatly value quick and dependable shipping, which is what the Prime symbol is known for. Customers have more faith and confidence in the seller and the product when they see the Prime symbol. This is because it lets them know that they can count on prompt and efficient delivery of their orders. In the end, having the Prime badge can result in higher conversion rates and more sales since buyers are more inclined to select goods that come with the guarantee and convenience of Prime shipping.
Control Over Fulfilment:
As previously discussed, Seller Fulfilled Prime (SFP) allows merchants to maintain control over the fulfilment process. With this control, vendors can continue to provide consistent consumer experiences and uphold their brand identity. By handling returns directly, customising packaging, and promptly responding to market shifts, merchants may build closer relationships with customers and achieve long-term success with SFP.
Cost Savings:
Seller Fulfilled Prime (SFP) offers cost savings compared to Fulfilment by Amazon (FBA). This is because it allows sellers to manage fulfilment independently, potentially reducing fees for storage, packing, and shipping. This autonomy is especially advantageous for products with low margins or unique storage needs. Additionally, sellers can opt for more cost-effective shipping methods and reinvest savings into business growth. SFP enables sellers to maximise profitability while maintaining excellent service standards for customers.
Expanded Reach:
A significant portion of Amazon’s customer base consists of Prime members, renowned for their loyalty and frequent purchases. Therefore, utilising Seller Fulfilled Prime to offer Prime shipping enables sellers to tap into this market segment. Additionally, by meeting Prime members’ expectations for fast and reliable delivery, sellers have the opportunity to enhance their sales and broaden their customer base on the platform.
What are the Cons of Seller Fulfilled Prime?
While Seller Fulfilled Prime offers numerous benefits, it’s essential to consider the potential drawbacks:
Shipping Challenges:
Keeping up with Amazon’s tough delivery rules can be hard, especially for sellers who don’t have good shipping systems or are far away from big cities. This makes it tricky to get orders to customers on time, which can make it tough for sellers to keep up with Amazon’s standards and stay competitive.
Increased Workload:
Opting to fulfil orders internally rather than externally requires additional time and resources. Managing inventory, packing, labelling, and coordinating shipments in-house adds complexity to operations. This will mean your business will have to invest in staff training, equipment, and infrastructure, unless you outsource to a 3PL companysuch as Packpro Fulfilment. This burden may present challenges for sellers with limited resources or smaller-scale operations as it can impact the efficiency of sellers’ business.
Limited Eligibility:
Seller Fulfilled Prime eligibility on Amazon means meeting high standards, making criteria such as shipping speed, order volume, and performance metrics essential. Sellers must demonstrate consistent capability to fulfil and maintain excellent performance metrics, which can pose challenges for those with limited resources.
Competitive Pressure:
Seller-Fulfilled Prime users face heightened competition as the Prime badge, becomes increasingly important to Amazon customers. To remain competitive, SFP sellers must ensure fast and reliable delivery, matching or surpassing the standards set by Prime-eligible listings from Amazon’s fulfilment centres. This means logistical companies must make delivery and operations better to meet customers demands and stay competitive.
Is it Worth it? Is it Right for Me?
Determining whether Seller Fulfilled Prime is worth it or right for your business depends on various factors, including your shipping capabilities, order volume, and profit margins.
For sellers with efficient logistics operations, SFP can be a great opportunity. It’s a chance to use Prime without relying on FBA. However, sellers need a strong commitment to customer service and the ability to meet Amazon’s strict requirements.
However, as we discussed above, sellers must carefully weigh the benefits against the challenges and assess whether they have the resources and infrastructure to succeed with SFP.
How to Join Seller Fulfilled Prime
Joining Seller Fulfilled Prime involves several steps:
Review Eligibility:
First, review Amazon’s eligibility criteria for SFP, which includes meeting specific performance metrics, offering premium shipping options, and maintaining a reliable track record. We will discuss the requirements of seller fulfilled prime in the next section.
Optimise Operations:
Next, ensure your shipping processes are efficient and capable of meeting Amazon’s strict delivery standards. This may involve investing in reliable shipping carriers, optimising packaging, and streamlining order fulfilment workflows.
Apply for SFP:
Once you’re confident that your business meets Amazon’s requirements, apply for Seller Fulfilled Prime through your Seller Central account. Amazon will review your application and will conduct a trial period to assess your ability to meet their standards. We’ll the specifics of the trial period later.
Maintain Performance:
After being accepted into SFP, it’s crucial to maintain high levels of performance to retain your eligibility. This includes fulfilling orders promptly, providing excellent customer service, and consistently meeting Amazon’s shipping standards.
What are the Requirements of SFP?
Amazon sets specific requirements for sellers participating in Seller Fulfilled Prime.
Here are the UK requirements for SFP according to Amazon:
– Create an account as an Amazon Professional seller.
– Possess a domestic warehouse where you can fulfil orders.
– Ship more than 99% of your shipments on schedule.
– Own a lower than 0.5 per cent order cancellation rate.
– Use Amazon Buy Shipping for a minimum of 98% of your orders.
– Use Amazon’s approved Seller Fulfilled Prime couriers to deliver orders.
– Sellers have to consent to the return policy of Amazon.com.
– Permit Amazon to handle any customer service inquiries.
Not only this, but Amazon also requires users to have a trial period to see if they can keep up with the strict demands of Amazon delivery.
Trial Period
Sellers can test out order fulfilment on their own while still getting the benefits of Prime membership during the Seller Fulfilled Amazon trial period. During this trial period, suppliers can evaluate if they can fulfil the high requirements that Amazon has set for prompt delivery and customer satisfaction.
This trial period gives sellers important information about the demands and practical difficulties of controlling their fulfilment procedures. This involves inventory control, packaging, labelling, and shipping. In addition, sellers can use the trial time as a learning opportunity to streamline their processes and assess whether Seller Fulfilled Amazon is a long-term viable alternative for their company.
Once you’ve finished all the steps to join, confirmed your eligibility for SFP, and completed the trial period, you’re officially a member of Seller Fulfilled Prime!
Seller Fulfilled Prime is a powerful tool for eCommerce sellers looking to leverage Amazon’s vast customer base while maintaining control over their fulfilment process. While it presents unique challenges, the opportunity to reach Prime members and enhance your brand’s reputation can outweigh the drawbacks. By carefully evaluating your business’s capabilities and aligning with Amazon’s requirements, you can navigate the world of Seller Fulfilled Prime and potentially see significant benefits for your eCommerce business. With the right approach, SFP can become a valuable part of your Amazon fulfilment strategy.