Sunday, February 24, 2008

My FBA (Fulfillment by Amazon) Series for Media Sellers!

I've written several posts on Amazon's FBA program and how I am using it, but they are kind of scattered throughout the blog. So I thought I would create an index to each of the posts so that you could reference them in the future. I may add additional posts at some point but they will all be included in this index, so you might want to bookmark it.

This information is geared towards Media Sellers, but if you sell in other categories, it will serve as a starting point for your research.

Small media sellers will get the most benefit from FBA, at this time, because they don't have the large commitments to facilities, employees etc. Larger media sellers can benefit by segmenting their inventory and using FBA for their Amazon orders.

A new resources for eBay sellers, looking to sell on Amazon, is called "Selling on the River". It's an e-book written by a former eBay employee and seller who began selling on Amazon. He found it wasn't the easiest of transitions. His tips and information will save you hours-upon-hours getting listed on Amazon.

Just my 12%

27 comments:

BookingAlong said...

HI -
I had to stop by here after seeing a comment by Steve Weber which recommened your site. So glad I did!

Randy Smythe said...

Thanks for stopping by!

dan said...

Randy, utopia is a term for an ideal society...are you suggesting Amazon FBA is the "utopia" media sales platform? $2.99 to sell a $9CD is not insignificant. 33% of sales price?

But if you're saying its utopia in nature because you don't have to deal with shipping product, then that is different. Where is the line drawn between working for Amazon and working for yourself? After all, Amazon is sending you payment as opposed to your customers. Several years ago didn't half.com almost shut its doors? Any idea why there is a resurgence in this model?

Now that Amazon has possession of your goods, does anything stop them from competing with those they deem successful?

Amazon already has their own private label Pinzon and is using its sellers to push its own products.

Any idea why the guy who sold his 3 million dollar CD collection on eBay didn't hand it over to Amazon's FBA?

There are plenty of arguments on both sides...I'm just being devils advocate...is building Amazon's FBA program enough of an independent opportunistic "untapped market" to classify it as mindful entrepreneurship in 2008?

I know, a loaded comment, but the FBA concept is intriguing and I haven't seen very much written about it.

Randy Smythe said...

Dan,

FBA, is a service that works well for me, not Utopia by any means.

You have a lot of questions that would take lengthy answers. So I won't answer all of them.

FBA, IMO is best used as a tool for Amazon sellers to reach out to a completely different customer base (Prime Customers and Super Saver Shipping Customers)without adding to their overhead. In my case it saves me money and hassle over shipping the product myself. Instead I can concentrate on other things, like sourcing product, blogging and making money.

Maybe my experience with Glacier Bay makes FBA intriguing to me because I don't want to recreate that business.

I had to spend a great deal of money building my own internal systems to make Glacier Bay work; I had to use CA to manage my eBay listings; I had two Customer service reps just to handle the eMail coming from eBay orders. I paid $4500 a month for a warehouse and office. Insurance, Workmans Comp, Payroll taxes and the list goes on. The funny thing was, all I really did was list on eBay and ship product to my customers.

The same thing I am doing now except now I list on Amazon and ship to Amazon and I'm done with it.

dan said...

Randy-- you make some great valid points. There are many positives...just have to test it. Amazon is simply going after the "consignment" market (ebay drop off centers are suffering) by calling it "Fulfullment".

http://www.post-gazette.com/pg/07123/782951-28.stm

Parris said...

Amazon is in a great position to pull it off.

Trying to make an Ebay Consignment center work has to be tough. Most are pretty small scale so they don't qualify for shipping discounts etc, Cant buy packing material at the huge discounts that AMA can etc. etc. etc. etc.

Randy Smythe said...

Dan, it doesn't make any sense not to test it.

As far as a comparison to the drop off model, regular consumers can cut out the middleman and just use Amazon's Easysell to sell their product online. The problem with consumers selling their stuff online: They don't have a clue how to price things.

In a way, I'm a middleman with my BuyBack site but the difference is I actually buy their product not just handle it based on a consignment agreement. They ship a box to me and make $100 and them I turn around and send it to FBA and sell their stuff for $200 or more and I don't have to pay for a storefront or staff for walk-in business.

That is the comparison to a Drop-off model. Amazon just is the warehouse and marketplace that allow me to move my product.

Cliff said...

Hey Randy,

Thought I'd post here about my progress with signing up for FBA, as perhaps it'd help others. (Hopefully you check these old posts!)

Anyway, I'm still waiting for them to update my Seller Central area to include the FBA option. For those reading this, I wasn't listed as a seller on Amazon, so I had to list a product and then to enroll in FBA I had to register with their Seller Central. I'm okay with Seller Central, but there isn't any option for FBA there at this time (despite a confirmation screen saying I was enrolled).

I did talk to someone at Amazon and they told me to try calling back again tomorrow if the FBA option isn't active by then. As of late tonight it's not, but they did say it didn't always immediately take.

A question, I noticed as I was going through some of their info about both item labels and shipping labels, that this was one of the "Don'ts" under their "Dos" and "Don'ts":

"Do not print product or package labels using an inkjet printer."

Is that a strict rule? If so, I'm out again before I really get started. I was just about to purchase both types of labels and then stopped myself when I saw this.

Thanks,
Cliff

Randy Smythe said...

Cliff, it isn't a hard and fast rule. I use an inkjet printer for my FBA labels.

They are trying to avoid labels where the ink smudges or runs because if that happens they can't scan the labels.

I've been using an inkjet since Oct. without a problem.

Cliff said...

Thanks, Randy, the fact that you do it does make me feel much better. I use the inkjet for my PayPal shipping labels and they print fine, so I figured it'd be okay...it just it worried me to see it as a big Don't!

In other news, my Seller Account is still the same as yesterday (no FBA option, no surprise!), so I'll have to call them again this afternoon.

Cliff said...

It took about a week from sign-up, including 5-6 days with a request in to the technical department, but the FBA part of my Seller Central Account is now active.

Next up, will purchase the appropriate labels tomorrow and list the first batch of stock to be shipped off to FBA.

Hopefully it's smooth sailing from here. Thanks for the help, Randy!

--Cliff

Randy Smythe said...

Cliff, Glad to hear it, let me know how FBA works for you.

R

NewChapterBooks said...

For the "other" side of the story (nightmare stories of how poor FBA service actually shut down some booksellers), look on DIGG (link below) or read the Amazon discussion boards...
http://digg.com/business_finance/Problems_book_sellers_have_with_Fulfilled_by_Amazon_FBA

Randy Smythe said...

NewChapterBooks,

I'm sure there are issues with the FBA service. This blog is an account of my experience nothing else.

I personally have not had any issues or I would have mentioned them.

Bobalitos said...

Are you sure you're not posting these stories just to sell your e-book?

Something smells a bit fishy here. I read about FBA on DIGG ...doesn't look good.

Randy Smythe said...

Bobalitos,

That's not my book and it has little to do with FBA.

I'm guessing a positive viewpoint of FBA can't be honest?

Look at my stats, its' all info from my FBA account.

I'm sure that there are sellers unhappy with FBA but I am also not the only seller who thinks its great.

I would love to hear what problems people are having with FBA, so help me out and post some.

brad said...

Are there any third party listing/pricing/re-pricing software packages that support FBA?

Randy Smythe said...

Yes, I use Seller Engine. $49.95 per month. It has some limitations but works for me.

I am not aware of any others that work with FBA

Nate said...

I have been selling books via Amazon FBA since the summer of 2007. This has been one of the best decisions I have made.

Here are some benefits:

-I make around $2 more per book.

-Books sell faster.

-I have been able to grow an inventory of 20,000+ books by myself.

-I have tons of time to pursue other interests/revenue streams.

-I am able to purchase inventory that would NOT be suitable for regular merchant fulfilled, but is profitable for FBA (ie. lower priced books).

-I could go on and on...

Nathan Holmquist
http://www.booktothefuture.com/

Fred said...

After two years as a casual seller on Amazon I converted to FBA and started getting serious. I went live with inventory on January 13th and as of today have 47 sales. The process with Amazon was seamless and we are very pleased with results to date. We will have over 2000 listings by early next week and are excited by the possibilities.

Kirc said...

We have recently started the FBA program and are seeing some amazing results! We also sell some across other venues...Merchant sales with Amazon & Half.com for example. I have read other booksellers info and researched on my own, but haven't arrived at a good answer for managing my inventory here. Are there any info sites or tips you have come across that might help? FBA makes it simple, but what I am left with here definitely needs some order.

Anonymous said...

Here's the problem that we are facing with Amazon.com FBA program. Amazon.com is taking our the products that are being returned to us, and selling them under their own Amazon Warehouse Deals Program. They say they are paying us for these, but they have yet to be able to point out a payment that they've made us for these products. Not only does this cause a problem with us, but also our manufacturers. Some manufacturers will absolutely not deal with Amazon with a 10 foot stick due to their total disregard for MAP pricing policies. As a seller of many products that have MAP pricing, I can tell you Amazon is a nightmare, and our below MAP pricing on close to 100% products they sell that have this policy. So the manufacturers don't want to deal with Amazon, and are getting furious that Amazon is now selling their products under Warehouse Deals, below MAP price. We have seen this now on 3 different brands, and 2 of those brands have now banned their vendors from participating in Amazon FBA program because of this. Thanks Amazon, appreciate it. Selling through FBA is not all it's cracked out to be. I was shocked to see our products (I know these were our products because we import these directly from Italy, and are the only seller of this particular product on Amazon) being sold for profit by Amazon.com. I was furious, and immediately called Amazon to find out how they can just steal my product like that. They assured me that they had indeed paid for it, but as of today 2/28 they can't show me the transaction that they did, it's still an open case in seller central. I was very impressed with this service until this point, and I will be much more vigilant in what I send them from now on. Their inventory controls have never been impressive either, it's difficult to track sales of FBA products through SC, as they outbound and inbound tabs are almost always never up to date. Beware of Amazon FBA guys, seriously.

Harry said...

Hi Randy,
Nathan Holmquist referred me to you, after I purchased his book and he invited my questions. Have you taken up answering his emails or have you just out-performed him? lol
As a Senior guy who truly wants to generate the extra income that FBA can provide, I am just having trouble getting out of the gate. First, I have a few hundred books and cds here at the house and the entire shipping process ... barcodes, labels etc looks like a mountain to climb. Then, Nathan and Steve (book authors) are all about this SCANNER thing, which is quite an investment? Any advice you can provide is greatly appreciated. I can provide my address if you want to email separately.
Thanks,
Harry

Anonymous said...

Hi Harry,
Has anybody in America ever heard of the Clayton and Sherman act. Please look these anti-trust laws up and you will know why entrepreneurship is coming to an end in the States. The day they allowed distributors to retail and manufacturers to distribute, etc. the distribution chain was broken. The small business man was put out of business by giant corporations that have an unfair trade advantage. Amazon.com is a retailer, distributor (FBA), and a publisher (Kindle) and now the fourth dimension in the chain...they are the market, mall and place we sell. We cannot win. As inept as Ebay may be it is still for now a true free, independent market (albeit and expensive one).
This is why I will not support FBA

Cygan Saber said...

Nếu bạn đang định mua hàng ở amazon và có thắc mắc mua hàng trên amazon có tính thuế không hay cần tư vấn hướng dẫn cách mua thì hãy liên hệ chúng tôi. Chúng tôi nhận ship hàng từ amazon, nếu bạn sử dụng dịch vụ của chúng tôi bạn sẽ không cần lo lắng hay tìm hiểu nhiều nữa.
Ngoài ra chúng tôi còn nhận vận chuyển hàng đi campuchia, chuyển hàng từ Pháp về Việt Nam, ship hàng từ đức về việt nam, chuyển hàng sang lào hay chuyển hàng từ anh về việt nam. Hãy để chúng tôi lo cho bạn nỗi lo về vận chuyển ship hàng.

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