Definition, meaning, and explanation of

Amazon FBM (Fulfillment by Merchant)

What does Amazon FBM stand for?

Amazon FBM stands for Amazon Fulfillment by Merchant. 

What is FBM on Amazon?

Amazon Fulfilled By Merchant (FBM) allows sellers to list their products on Amazon and choose to ship products to each buyer themselves. They are responsible for fulfilling their orders and do not rely on Amazon for the same. 

Is FBM better than FBA?

While it's advantageous for products with lower margins, Amazon FBM is rather overlooked owing to easy shipping, handling, and other benefits that come with Amazon FBA.

FBM is better for small scale businesses with small margins and less inventory that can be managed internally where FBA is better for large scale or medium sized businesses who have high amounts of inventory that they ship to different locations and have high amounts of orders. 

Read More: Explore the Diverse FBA Prep Center Directory

How FBM (Fulfillment by Merchant) Works:

FBM, or Fulfillment by Merchant, is an e-commerce fulfillment method where sellers take full responsibility for storing, packaging, and shipping their products directly to customers. Unlike FBA (Fulfillment by Amazon) or other third-party fulfillment services, FBM sellers handle all aspects of order fulfillment, from inventory management to customer service.

Here's a breakdown of how FBM works:

1. Inventory Management

FBM sellers maintain their inventory in their own facilities or storage locations. They are responsible for keeping track of stock levels, replenishing products as needed, and ensuring accurate product listings on their chosen e-commerce platform.

2. Product Listing

Sellers create product listings on their chosen e-commerce marketplace or their own website. These listings include product descriptions, images, prices, and shipping information. Sellers also set their own shipping rates.

3. Order Placement

When a customer places an order for a product, the order details are transmitted to the FBM seller. Sellers receive order notifications through the e-commerce platform or their own order management system.

4. Order Processing

FBM sellers are responsible for processing customer orders promptly. This includes picking the ordered items from their inventory, packaging them securely, and generating shipping labels.

5. Shipping and Delivery

Sellers arrange for the shipment of the orders through their preferred shipping carriers or methods. They are responsible for choosing carriers, selecting shipping speeds, and managing the shipping process. FBM sellers can offer various shipping options to customers, such as standard shipping, expedited shipping, or international shipping.

6. Customer Service

FBM sellers handle customer inquiries, returns, and any issues related to orders. They are responsible for providing excellent customer service, addressing customer concerns, and resolving any problems that may arise during the order fulfillment process.

7. Returns and Refunds

Sellers establish their own return policies and procedures. When customers initiate returns, FBM sellers must process the returns, inspect returned items, and issue refunds or replacements as necessary.

8. Feedback and Reviews

Maintaining a positive seller reputation is essential in FBM. Sellers encourage customers to leave feedback and reviews based on their purchasing experience

9. Cost Control

FBM allows sellers to have greater control over their fulfillment costs. However, it also means that sellers bear the full cost of storage, packaging materials, and shipping, so effective cost management is crucial.

10. Flexibility

FBM offers sellers flexibility in terms of how they run their e-commerce business. Sellers have control over their branding, packaging, and shipping methods, allowing them to tailor the customer experience to their liking.

11. Sales Channels

FBM sellers can choose to sell on multiple ecommerce platforms, their own website, or a combination of both, expanding their reach to different customer bases.

Is Amazon FBM right for you?

Amazon fulfillment by Merchant or FBM is right for you if you:

  • Have large or heavy items
  • Have a small amount of inventory
  • Have temperature-sensitive products
  • Have highly fragile products 
  • Sell a low volume of products
  • Have enough internal storage space
  • Have an existing logistics system
  • Deal with minimal fulfillment requirements

Related terms in the

FBA/FBM Glossary
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