What is Amazon Seller Fulfilled Prime?

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Amazon Seller Fulfilled Prime

As Amazon puts it, “Seller Fulfilled Prime is the Prime program that allows you to deliver directly to domestic Prime customers from your own warehouse.”  Seller Fulfilled Prime was launched in 2015 as a program that allowed high-volume sellers to get under the Prime label while still fulfilling orders themselves. Anyone who wants Seller Fulfilled Prime must meet Amazon’s strict requirements, of course. The program is an extension of Fulfilled By Amazon, allowing select sellers to fulfill Prime orders from their own warehouses or through their own third-party logistics partners.

Why Use Amazon Seller Fulfilled Prime

Amazon Prime members spend about $1,300 each every year, which is almost half the amount that non-Prime members spend. Since this number increases every year, the end of 2018 is likely to show even greater spending. Prime members enjoy perks like event offers, media content, and discounts at Whole Foods – and of course, Amazon’s free two-day delivery.

As Amazon puts it, “Seller Fulfilled Prime is the Prime program that allows you to deliver directly to domestic Prime customers from your own warehouse.”  Seller Fulfilled Prime was launched in 2015 as a program that allowed high-volume sellers to get under the Prime label while still fulfilling orders themselves. Anyone who wants Seller Fulfilled Prime must meet Amazon’s strict requirements, of course. The program is an extension of Fulfilled By Amazon, allowing select sellers to fulfill Prime orders from their own warehouses or through their own third-party logistics partners.

Why Use Amazon Seller Fulfilled Prime

Amazon Prime members spend about $1,300 each every year, which is almost half the amount that non-Prime members spend. Since this number increases every year, the end of 2018 is likely to show even greater spending. Prime members enjoy perks like event offers, media content, and discounts at Whole Foods – and of course, Amazon’s free two-day delivery.

The Amazon Prime program has over 100 million members. That’s almost half of all US households. Seller Fulfilled Prime is how merchants can gain access to this huge customer base. Amazon Prime Certified sellers stand to make a significantly higher number of sales simply because their products qualify for free two-day free shipping. The boost in sales is worth the effort to get certified for Seller Fulfilled Prime. And the best part is, they can have is as of their multichannel strategy.

And don’t forget about Amazon Prime Day. So many people shop online on Prime Day that traffic even overflows to other sites. Seller Fulfilled Prime is a golden ticket to gain as much as a 30 to 40 percent increase in sales. All that while having access to couriers that are 60 percent cheaper because of Amazon’s partnerships, plus the regionalization of Prime-eligible product for buyers who are near seller warehouses. In addition, Seller Fulfilled Prime offers a variety of return options on top of Amazon customer service to back them up.

What to Know about Seller Fulfilled Prime

Seller Fulfilled Prime is encouraged by Amazon because it lifts some of the burden that FBA has put on the retail giant. By pre-qualifying professional sellers to get the Prime badge, they can both guarantee the same Amazon fulfillment promise and unburden themselves at the same time.

Seller Fulfilled Prime fulfill inventory

Shipping

The program allows sellers who qualify to add the Prime label to their product. You must, however, meet Amazon’s strict requirements for shipping speed on top of offering free shipping and returns.

With Seller Fulfilled Prime, you will have to absorb shipping and return costs, which can be considerable. Even with Amazon’s discounted rates, you still need to maintain warehouses all around the US to be able to deliver on the two-say shipping promise and still make a profit. Seller Fulfilled Prime only works if you can work the cost of shipping into your pricing and still be competitive.

To meet the demands of free two-day shipping, you need to hand over ready-to-ship product to the shipping company no later than 4:00 PM on the day the order comes in. For same-day shipping, prepared orders need to be in the shippers hands by 1:00 PM. Not every eCommerce store can handle this level of processing. Moreover, the more inventory you have, the greater the burden. Plus, if you aren’t automated and don’t have strong infrastructure, it will be very difficult to maintain.

An Alternative to FBA

FBA gives you access to Prime, but it can get too expensive if you either sell large or heavy items or very small items that Amazon can choose to make Add-Ons, reducing sales. Seller Fulfilled Prime also allows you to sell items that you can’t do FBA for.

Split inventory – shipping to Amazon from your own warehouse – is a problem for many sellers. You have to constantly juggle inventory in two places, and you lose money when you sell out in one even if you still have stock in another. Seller Fulfilled Prime allows you to customize your system so you can control inventory.

Customer Service

Seller Fulfilled Prime customer service

Other than shipping, customer service can end up costing a lot. Manpower isn’t cheap, and you can’t just pick up talented customer service off the street. There are outsourced customer service options, however, that can prove feasible.

With Seller Fulfilled Prime, however, you do maintain control over your customer service and returns. You can set up how you want product returned, and when. Amazon guidelines for issuing returns still apply, but you get product back immediately so you retain control over your brand and processes.

Getting Ready for Seller Fulfilled Prime

Seller Fulfilled Prime brings a lot of advantages for sellers. To hold the privilege, however, you must be able to develop and sustain an infrastructure that is capable of supporting all of Amazon’s requirements while taking in an increased order volume.

Order Processing

To comply with two-day and same-day shipping, you need to automate your inventory and order processing system. There are a lot of tools that can help you with this, but you need time to find the right one for your needs.

    The tools to make you an eCommerce mastermind, free.

    Drop your email to be in the know.


    You also need a flexible and reliable pick and pack system and workforce to meet increased sales volumes that fluctuate throughout the year so you can remain profitable.

    Shipping

    Seller Fulfilled Prime means offering free shipping on every item you sell. You need to have product as close to the buyer as possible to reduce costs. This can greatly reduce shipping costs, but also means calculating the costs of maintaining more than one warehouse and managing order processing at different locations.

    Most small sellers can’t create this level of warehouse infrastructure, however. Partnering with a third-party logistics provider is probably the best solution in this case. You can arrange for same day shipping, and get automatic return postage forms that are billed only when used. Do some research to find out who can provide the level of service that Prime requires.

    Customer Service

    Seller Fulfilled Prime requires that you issue refunds within two business days of a return request. You are also responsible for either paying the return shipping or making sure that the buyer pays, depending on the return category. Your system need to have shipping and inventory management integrated so that everything can be easily tracked and there are no mistakes.

    Getting Started with Seller Fulfilled Prime

    You need to have a few other things as well before the actual application to Seller Fulfilled Prime:

    1.  Get a Professional Seller Account

    2.  Qualify for Amazon Premium Shipping

    • sell on Amazon for at least 90 days
    • fulfill at least 30 Premium Shipping orders in the previous 30 calendar days, whether same-day or two-day shipping
    • feedback of 4.5 or higher for the preceding 30 calendar days
    • provide tracking IDs for at least 94% of orders (UPS, US Postal Service, FedEx, or OnTrac)
    • have an on-time delivery rate of at least 96%
    • have a seller-initiated cancellation rate of less than 1%.
    • work with approved Buy Shipping Service carriers who are available to pick up orders by 4 PM in the seller’s time zone.

    3.  Complete the Prime Fulfillment Trial

    • offer Prime shipping benefits
    • fulfill 200+ orders in 90 days
    • maintain a 99% on-time shipping rate regardless of shipping speed
    • maintain a 99% same-day shipping rate
    • maintain a cancellation rate of 1% or less
    • use Buy Shipping Services for at least 95% of orders
    • adhere to Amazon’s returns policy
    • automatically direct all post-order customer service inquiries to Amazon

    Seller Fulfilled Prime

    Once the above is completed, you can register for Seller Fulfilled Prime, enable Prime Shipping, and enroll product in the program so you can start fulfilling orders.

    Note that you will have to provide Amazon with tracking information for all Prime orders since they will be monitoring your account to make sure that you maintain a rating of at least 98.5% for on-time shipping and a rating of no more than 1.5% for order cancellations. If you fail to maintain these standards, you could lose your Prime eligibility and have to go through the trial for another 30 days or more.

    Final Thoughts

    Seller Fulfilled Prime offers a boost in sales as well as more control over your brand and processes. It can also lower shipping costs if it’s right for you. Be sure to calculate your costs to determine which of your products to get into Seller Fulfilled Prime and which ones should be in FBA. Once you have it, you can also easily move product to FBA when order volumes threaten your metrics. Make sure to prepare for this early, too, so you don’t lose your eligibility.

    Share on facebook
    Share on Facebook
    Share on twitter
    Twitter
    Share on linkedin
    LinkedIn

    Get Updates & Our Best Tips to Increase Your Amazon Sales

    Julia Valdez

    Julia Valdez

    Julia is a professional teacher and long-time lover of the art of words on paper and the stage. She has an entrepreneurial heart and spends most of her time doing marketing and management, freelance content writing, volunteer work, and sharing lots of laughs over little crazy things.

    More Posts

    en English
    X