By now, any shop worth their salt would have learned how important it is to sell on Amazon, especially on Amazon Prime. You can access luc...
By now, any
shop worth their salt would have learned how important it is to sell on Amazon,
especially on Amazon Prime. You can access lucrative Prime shelves through two
different programs: Fulfillment by Amazon (FBA) and Seller Fulfilled Prime
(SFP).
Even though
the goals of both systems are to assist you in selling on Prime, that is the
only similarity. Both SFP and FBA are unique, and depending on a company's
size, goals, and profitability, some of its advantages will undoubtedly appeal
to it.
Reach
clients without jeopardizing your reputation, earnings, or business by adhering
to Amazon's rapid and stringent shipping criteria while still meeting your
continuous sales targets. Herein lies the critical role of SFP.
Let's
examine closely it.
Table of content
Seller Fulfilled Prime (SFP): What is it?
SFP Overview:
Amazon SFP prerequisites
Why Was SFP Launched by Amazon?
Important Distinctions Between SFP & FBA
Cons and Benefits of SFP
Conclusion
Seller
Fulfilled Prime (SFP): What is it?
One of
Amazon's greatest order fulfillment options, Seller Fulfilled Prime, enables
high-volume sellers to sell under their Prime Label and send Prime orders
straight to customers in two days.
In 2015,
this program was introduced. However, you must meet the SFP requirements in
order to enroll. By emphasizing the Prime Badge upon enrollment, it can assist
sellers in making their product listings more discoverable.
Sellers that
fulfilled product listings that were Prime-eligible for the first time via SFP
saw an average sales boost of more than 50%, according to Amazon.
SFP
Overview:
· A retailer who has been handling
their own shipping already stands to gain the most from SFP.
· SFP was established to relieve the
strain caused by Amazon's fully stocked warehouses while maintaining excellent
shipping standards.
· Following the conclusion of their
trial period, a seller may be eligible for the SFP program.
· FBA and SFP are not to be confused.
They are two entirely different schemes.
· Using Amazon's delivery services,
following their return guidelines, fulfilling 99% of orders on schedule, and
other standards are among the fundamental SFP requirements.
· A vendor using SFP ought to offer
free standard shipping. Still, choosing to enroll in this program shouldn't be
solely determined by price.
Amazon
SFP prerequisites
SFP isn't
available to every merchant. SFP isn't available to all vendors because Amazon
wants to protect the prestige of Prime. Rather, they have established Seller
Fulfilled Prime stringent eligibility requirements for SFP sales.
As a result,
only the best sales are eligible. Even so, they will need to fulfill two
requirements:
· Complete the SFP trial period.
· Become Eligible for Priority Shipping
It should be
noted that products do not display the Prime logo during the trial period, and
sellers are expected to ship SFP-enrolled items the same day (subject to
cut-off time). A seller can only join Amazon's SFP program after successfully
completing their trial term, and only then will the Prime badge appear on their
products.
Therefore,
confirm that the following Amazon Seller Fulfilled Prime conditions are
satisfied before considering enrollment:
· Possess a 99% timely shipment rate.
· Possess a 99% valid tracking rate.
· Provide clients with Premium Shipping
· Keep your collection rate at 0.5% or
below as appropriate.
· Utilize Amazon's Buy Shipping for a
minimum of 98.5% of the orders.
· Observe Amazon's return guidelines.
· Use a carrier that has been approved
by Amazon to deliver orders.
· Let Amazon take care of all consumer
questions.
Amazon isn't
currently taking new SFP applications from Americans. When it becomes
accessible, though, the entire registration procedure will resemble this:
1.Premium Shipping
A vendor
needs to demonstrate that they can reliably provide Premium Shipping services.
The seller cannot, however, do this immediately prior to beginning the SFP
trial. Until a seller meets the requirements for Premium Shipping, they will
not be able to go live.
2. Sign
up for SFP
A seller can
sign up for the SFP program through Seller Central, after which they must
assign products to the "Prime trial" shipping template. When
comparing the performance to the trial's requirements, only goods that are
assigned to this template will be included.
3. The
trial phase
There is a
minimum of 200 orders and a trial term of 5 to 90 days for the SFP. During this
time, a vendor should keep the total performance % high.
4. Maintain the SFP status.
After the
trial period has over, the supplier must comply with the requirements and offer
the clients dependable service.
The
Distinction Between SFP and Premium Shipping
The topics
of premium shipping and SFP (Seller Fulfilled Prime) are frequently discussed,
but for some reason, they are also misinterpreted. Recognize that premium
Shipping is a completely other concept that effectively allows sellers to
provide clients with expedited shipping choices using their own shipment. A
vendor must complete these in their orders over a period of 30 days in order to
be eligible:
· A valid tracking rate of 99%
· An on-time delivery rate of 97%
· Seller cancellation rate of 0.5% and
less
After being
approved, the vendor can begin providing clients with Premium Shipping
alternatives, although at an additional cost. These delivery options are
available in the US and include:
· 1-day Delivery
· 2-day Shipping
A seller
must continue to meet the previously listed standards in order to be eligible.
SFP as well as
It is not
appropriate to truly compare Premium Shipping to one another. While Seller
Fulfilled Prime makes it possible for products without FBA to receive a Prime
badge, Premium Shipping enables you to provide faster shipping choices.
Why Was
SFP Launched by Amazon?
We all know
that Amazon is simply obsessed with their customers. They have enduring
relationships with their clients, especially those who are devoted to them as
Prime members. So, the main objectives of Amazon's SFP launch are:
· Assist clients in receiving their
goods promptly and dependable
· Provide as many options for products
as you can
· Not tack on additional shipping costs
to customers
Important
Distinctions Between SFP & FBA
Shipping is
one of the primary distinctions between SFP and FBA. A seller participating in
the SFP program fulfills orders and covers shipping costs, even though both can
help you earn the privilege of winning the Buy Box and earning Amazon's Prime
badge. However, a significant disadvantage of SFP is that it requires a seller
to pay for shipping in order for buyers to receive their goods promptly and at
no additional expense.
However, for
an FBA seller, Amazon handles all aspects of delivery. There is a charge,
though. It's possible that the FBA fees will come to virtually equal the cost
of shipping the orders yourself.
FBA could be
a little pricey for bulky, huge, slowly selling, or oddly sized products. On
the other hand, it might be costly to maintain and invest in your personnel,
warehouse, systems, and software.
If your
seller fulfilled prime is suspended, what should you do?
Your SFP may
occasionally have been suspended; in such case, the Amazon team will notify you
via the email address you registered with.
Have you
ever wondered why it was suspended?
These
could be the potential causes:
A decline
in your rate of on-time shipments. Your Prime Badge will be disabled and the SFP deactivated if
it drops below 99%.
A
decrease in your rate of valid tracking. even if it proceeds somewhat less. Consequently, keep your
minimum at 94%.
increased
rate of cancellations. An additional warning indicator is present if the
cancellation rate is higher.
To ensure
that neither your SFP nor your Premium Badge are suspended, keep an eye on
these numbers.
The most
recent premium figures include of:
· For orders using Premium Shipping,
the timely delivery rate is 97.0% or higher.
· For orders using Premium Shipping,
100% of the tracking rate should be valid.
· If you select Premium Shipping, you
should have cancellation rates of no more than 0.5 percent.
Among the
most recent SFP numbers are:
· It is important to keep the timely
shipment rate at 99%.
· 97.0 percent of deliveries should be
made on time.
· 98% should be the buy-shipping ratio.
· The percentage of cancellations
should be 0.5%
Cons and
Benefits of SFP
As all
things have two sides, it should come as no surprise that SFP has a set of
advantages and disadvantages of its own. Let's examine them in greater detail.
Benefits
of use SFP
Despite the
fact that SFP requires a seller to handle a lot more labor than FBA (a program
in which Amazon handles inventory storage and shipment), SFP offers a number of
advantages. Among them are:
1. Boosts
revenue and sales with the reliable Prime badge
On their
product listings, sellers can get Amazon's Prime badge highlighted as soon as
they pass their trial term or finish it. This now increases visibility by
displaying the products for both normal and Amazon Prime customers. The symbol
also indicates a seller's credibility and dependability when it comes to
offering high-quality goods.
2. Less
costly in comparison to FBA
SFP is able
to waive FBA handling, shipping, and storage costs—all of which are usually
thought to be superfluous. Previously, businesses had to fulfill orders through
FBA in order to receive "Prime status," which resulted in significant
economic losses.
Additionally,
FBA sellers were required to pay an additional cost for "Inventory
Placement Service" each time and divide their shipments among three
fulfillment centers. SFP vendors, however, can just distribute the goods from
their own stock and take advantage of Amazon Prime without paying additional
costs.
3. Make
use of Amazon's customer service
Customers of
the SFP program and Amazon get round-the-clock access to after-sale customer
service. That's one advantage. Therefore, the group of knowledgeable customer
service agents at Amazon is available to provide fantastic support on your
behalf. Additionally, clients can easily track their item orders, return items,
and get refunds.
4. Better
control and more options compared to FBA
SFP provides
more avenues for brand development. Why? Essentially, because you have the
power and not Amazon. This implies that you will have more control over your
items, less Amazon trademarks on your product packaging, and direct inventory
visibility from your warehouse—all of which you may imagine while still being a
Prime member.
Cons of
utilizing SFP
There are
several drawbacks to taking the SFP path as well, especially when it comes to
"scalability." Thus, there are a few things you cannot ignore as a
third-party merchant.
1. SFP
eligibility and upkeep standards are stringent.
SFP has a
highly exclusive membership. Amazon has strict procedures in place to guarantee
that their customers are completely happy. Even though they are intriguing,
they also hold great promise for a seller to follow because they have gotten
harder and harder with time. Amazon will promptly withdraw your Prime Badge if
you continually fail to meet its SFP requirements.
2.
Expensive shipping costs
Without a
doubt, there is a fee to use a fantastic service. Amazon's SFP is therefore not
an anomaly. Benefits for customers, such as next-day delivery, are generally
more expensive for sellers. Additionally, the price of shipping SFPs may
increase. As a result, a seller should control those expenses by limiting and
determining how far they can ship with Prime deliveries.
3. There
comes a point at which fulfilling more requests can become challenging.
You will
undoubtedly have total control over your fulfillment process when you use SFP.
Yes, without a doubt, this is a wonderful benefit that should be appreciated.
However, issues arise when operations scale and you have to cope with a bigger
order volume, particularly if a well-designed procedure isn't put into place.
Investing in
your fulfillment infrastructure is necessary to both efficiently execute the
orders and keep the SFP eligible. Aside from this, you will need to use
appropriate strategies for everything, from product packaging to figuring out
when an order must be placed in order to qualify for 2-day shipping.
Conclusion
Without a
doubt, Amazon has transformed the e-commerce industry. They genuinely go above
and beyond to satisfy the needs of their clients. Meeting consumer expectations
can help retailers like you stand out, which is why services like FBA and SFP
are available to make things simpler.
Selecting
between FBA and SFP might be challenging because each has advantages and
disadvantages of its own. Nevertheless, the things you sell and how you want to
run your company will ultimately determine which option is best for you.
Read More:
10 Strategies to Lower Your Amazon Pick and Pack Fees
Choosing the Right Marketplace for Wholesale Business on Amazon
How to Obtain Amazon Approval for Topical Products - Seller Guide
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