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Why Startup Businesses Should Use Amazon FBA

Estimated reading time: 6 mins

A startup is a company that is started by people who are looking for business models that can be scaled up. Instead of being onboard a big company, the startup culture encourages founders to start small then slowly build up the brand or business. Some startup entrepreneurs think that they need to do everything by themselves, but this is not necessarily the case.

Being in a startup, would mean you need all the help and support that you can get that will be more beneficial for your business. You shouldn’t hesitate to use professional services to deal with certain things because this can save you money in the long run. Several platforms have developed numerous tools and programs to be able to help out startups or give budding entrepreneurs opportunities to start an online business.

One of the tools used by startups is called Fulfilment by Amazon or FBA program. The FBA is a system where Amazon sellers can rely on Amazon to pack and ship out items to their buyers.

Here are some more reasons to use Amazon FBA for your startup business:

  1. Gives you more time to focus on your business

Building and establishing a startup is a lot of work, and you need as much time as you can get for the business to kick-off. You need continuous product research, study trends, network, build marketing strategies, evaluate the current performance, and so on, to ensure your business can gain traction.

Since Amazon handles the orders fulfillment, you have more time and the convenience to focus on growing your business. When the burden of the logistics complications are removed from you, you can focus on developing your products, researching other profitable goods, marketing, sales, and customer service.

If you have international suppliers, an FBA forwarding and prep center service like fbabee.com/ can even make your logistics a lot easier, so you don’t need to worry about getting your stocks to the Amazon warehouse.

  1. Possibilities of increased sales

There are definitely many ways that you can make more sales as an Amazon seller. However, using FBA can increase those possibilities much more than just being able to reach a global audience. Amazon will treat you as a partner, and that alone can be beneficial compared to your competitors who don’t use FBA.

Here’s how FBA can help increase sales:

  • Qualification for Amazon Prime

Amazon Prime is a paid subscription where members get free two-day delivery, among other benefits. When you use FBA, Prime members immediately qualify for free two-day shipping for your items. That’s already an edge against other competitors.

  • Shipped by Amazon

Your listings will have that phrase when shoppers browse through the site. Because consumers trust Amazon, there is a higher possibility that they will also have the confidence to purchase your goods. That phrase can mean a particular level of service for buyers who may not have heard of your business before.

  • Amazon A9 algorithm

Amazon’s search algorithm considers FBA as one factor in ranking search results. This means that products will have higher visibility compared to those that aren’t FBA.

  1. Cost-effective and hassle-free logistics

Shipping rates always fluctuate depending on the area, courier, and dimensions of the items, among other things. At the same time, selling goods online will mean time spent on packing and running back and forth to the post office or between different couriers. That doesn’t even count your expense for packing supplies, gas, employees, and others. By using FBA, you can leave the hassle for all the manual labor with logistics and be able to cut some expenses.

Here’s how FBA can help you in this area:

  • Online shoppers hate paying for shipping costs and will find means to avoid them. By using FBA, you can have more stable shipping rates compared to when you add up your expenses from shipping from suppliers to your warehouse, and then to the buyers.
  • You won’t need to rent out storage space. We all know that commercial warehouses can be expensive, but it’s not always ideal to use your garage or your living room to store boxes of your goods. With FBA, the Amazon warehouse will have a place for your items, and you will never run out of space.
  • You don’t need a lot of workforce. If you’re doing everything by yourself, then you are saved a lot of time from packing and shipping alone. If you do have some help, you can concentrate on administrative tasks like listing products and coming up with other business strategies. Amazon’s employees will take care of picking, packing, and shipping your items on your behalf.
  • You won’t need to worry about customs regulations and fees, as well as other sipping protocols. As a leading platform, Amazon is continuously working with these agencies and are up-to-date with regulations and fee structures. While this can mean fees for you too, and carefully following their selling policies, you won’t have headaches of dealing with these complications yourself.
  1. Increased chances of winning the Buy Box

The Buy Box is the box or space on the product detail page where customers can begin purchasing items by adding products to their carts. Sellers selling similar items will compete for this coveted space for increased sales. When you use FBA, you have a higher chance of winning the Buy Box spot compared to self-fulfillment sellers, increasing opportunities for buyers to purchase from you instead of another seller.

When you have around 20 to 30 sellers selling the same goods, the Buy Box spot can really matter for the business.

  1. Quality customer service

 As an e-commerce business, your responsibilities don’t stop when the buyer gets the item. There are still after-sales processes that you need to think of like further queries, complaints, returns, or refunds. You will need customer service, which can influence a buyer’s decision to purchase from you again or never return. Items that are sold using FBA allows you to take advantage of Amazon’s customer service to manage these.

There are no fees involved except for the Returns Processing Fee for particular product categories, and you can stress less when Amazon’s excellent customer service team does the best that they can to help your buyers.

  1. Access to last-minute shoppers

Last-minute shoppers can be more than a handful during the holiday season, cramming to buy gifts for their family and friends. With so little time, these buyers will look for options to ensure that their purchases arrive on time, and Amazon’s Fulfillment Centers are equipped to cater to these needs. By using FBA, you can still make last-minute holiday promotions without worrying about shipping items.

  1. Multi-channel Fulfilment

You need an Amazon seller account to be able to take advantage of FBA. However, FBA will not be limited to shipping items from your Amazon store. Instead, the FBA offers multi-channel fulfillment, where Amazon can still fulfill sales from your other platforms. For example, if you have your own e-commerce platform besides the Amazon store, you can streamline your process wherein your website’s sales can be forwarded to FBA, and they fulfill it for you too.

This can be a huge advantage if you’re trying out different e-commerce platforms without being limited to shipping options.

Conclusion

If you’re interested in learning more about FBA, it’s best that you read through ways on how to gain traction with the program, and look into FBA courses you might want to invest in. Your startup shouldn’t be limited just because you’re a small business. There are many possibilities open for you like the Amazon FBA. We’ve provided some benefits of the FBA for your business, and we hope that this helps you decide if you want to use the service.

 

About the author /


Simon is a creative and passionate business leader dedicated to having fun in the pursuit of high performance and personal development. He is co-founder of Applied Change, a Business Change consultancy based in the UK. Simon is also an Ambassador for Gloucestershire business. Simon is an Associate Member of the Chartered Institute of Professional Development.

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