How does Amazon Seller Fulfilled Prime work?
Amazon Seller Fulfilled Prime is a programme that allows Sellers to use the Prime element of the site directly from their own warehouse.
Sellers must commit to a number of regulations in order to qualify for the scheme, but Amazon claims that Seller Fulfilled Prime users can immediately experience a significant spike in sales once they sign up.
So how does Amazon Seller Fulfilled Prime work? Thompson and Holt managing partner Craig Gedey, who has vast experience in using the site’s various platforms, outlines the key points to understand.
Gedey explained: “Amazon outlines five main criteria in order to qualify for Amazon Seller Fulfilled Prime. Prior to that there are two basic requirements that you must have - you must have a warehouse in the country you are selling from, and you must have an Amazon Professional Seller account.
Amazon Fulfilled Prime Criteria
“The five criteria you then have to fulfil are as follows:
1. Qualify for Seller Fulfilled Prime and complete the trial period
2. Store inventory in your own warehouse
3. Process your orders and buy shipping labels from approved carriers.
4. Pick, pack and ship your orders same day.
5. Seller Fulfilled Prime carriers collect and deliver orders in one day to customers.
“It’s important to understand first of all what the trial period involves. This is done to show you are going to be able to meet the stringent requirements for Seller Fulfilled Prime and ultimately keep their customers happy. Also, it’s worth noting that the Prime badge will not be displayed on items enrolled in Seller Fulfilled Prime during the trial period.
“According Amazon’s own guidelines, to finish the trial, you need to ‘complete your onboarding with the SFP supported carrier and ship a minimum of one Prime order with 100% on time shipping’.
“After completing the Seller Fulfilled Prime trial period, your enrolled ASINs will be shown with a Prime badge, increasing their visibility to the most loyal Amazon customers, which is a major benefit for Sellers.
“Amazon does have strict requirements for Seller Fulfilled Prime if you want to continue using it, which keeps standards and customer satisfaction levels high. They are:
1. Ship over 99% of your orders on time
2. Have an order cancellation rate of less than 1%
3. Buy shipping labels through the Buy Delivery Services or the Amazon Shipping website
4. Deliver orders with our supported Seller Fulfilled Prime carriers
5. Seller must agree to the Amazon Returns Policy
6. Allow for all customer service enquiries to be dealt with by Amazon.
How much does Amazon Seller Fulfilled Prime Cost?
“The final issue to understand is how much Seller Fulfilled Prime costs. It varies for different products, but is basically the cost of the transportation fee of approved carriers (such as Amazon Shipping, DPD and Royal Mail) and the marketplace fees of Amazon.
"You should also note that as a Prime-eligible Amazon seller, you will need to offer free standard shipping on all of your Prime orders to non-Prime customers and will need to take this cost into consideration when setting your prices.
“Amazon has understandably trumpeted the benefits of its Seller Fulfilled Prime programme on its own site, with two specific examples quoting increases in sales of around 50 percent (Bells Shoes) and almost doubling (No1BrandsForYou). These have obviously been handpicked examples, but the general feedback from Sellers that has signed up for scheme has been positive.
“What the programme does do is allows you to access Amazon’s most loyal customers, benefit from Amazon’s 24/7 after-sale customer service and compete more effectively for the Buy Box feature. Winning the Buy Box means that when customers click on ‘Add to Basket’, their default option is to buy the product from you.
“Ultimately you need to decide if you can make it work for your company, but it’s certainly something worth seriously investigating if you have your own warehouse.”
Benefits of Amazon Seller Fulfilled Prime
If you are eligible to self-fulfil your Prime products, then you can save on the shipping and handling fees incurred by using the alternative FBA (Fulfilled By Amazon).
You should also consider if fulfilling Prime orders in-house is a cost effective and how much additional resources and warehouse space is needed. It’s also important to consider the added pressure of meeting Amazon’s strict requirements.
Avoid FBA inventory storage costs
In addition to Amazon Seller Fulfilled Prime eliminating Fulfillment by Amazon’s shipping and handling fees, it also eliminates any basic FBA inventory storage costs and additionally any long-term storage fees which can certainly be costly.
You should also note that the standard costs of selling on Amazon still apply.
Access millions of active Amazon customers
There are over 100 million Worldwide Amazon Prime customers, that’s a lot of money being spent on Prime-eligible products.
Disadvantages of using Amazon Seller Fulfilled Prime
Self-fulfilling your own Prime orders doesn’t come without its limitations though.The biggest challenge of using Seller Fulfilled Prime is that you will need to maintain your eligibility.
Amazon Logistics doesn’t currently cover all UK postal codes, which means that sometimes you will be required to use another Amazon approved carrier.
You can register for Amazon Fulfilled Prime here: https://services.amazon.co.uk/services/seller-fulfilled-prime/how-it-works.html
What to do if you lose your Amazon Seller Fulfilled Prime - Suspension
It can be an Amazon Sellers nightmare if they lose their Seller Fulfilled Prime eligibility. The process of the suspension usually starts with and email from Amazon
Your eligibility for Seller Fulfilled Prime has been suspended because one or more of your performance metrics dropped below the required threshold.
To regain your eligibility, please submit a Plan of Action that explains:
Why your Seller Fulfilled Prime performance dropped below the required threshold? What actions are you taking to remedy the situation? What measures are you putting in place to avoid the reoccurrence of these problems? You can submit your Plan of Action by replying to this email.
You may review the performance requirements of the Seller Fulfilled Prime program here.
If you lose your Seller Fulfilled Prime eligibility you should write a measured and thorough appeal and plan of action that addresses Amazons concerns, remember you are selling to Amazons most important customers.
Once you have submitted your appeal and Amazon are happy with the plan of action your Seller Fulfilled eligibility should be restored within a few days.
If you have found yourself suspended while using Amazon Seller Fulfilled Prime, contact Thompson and Holt for a free LiveChat to get your Amazon Seller Fulfilled Prime eligibility back as quickly as possible.