Amazon FBA Multi-Channel Fulfillment: 4 factors to consider
Amazon has come a long way from its roots as an online bookseller operating out of founder Jeff Bezos’ garage. Today it’s the fourth most valuable company in the world, estimated to be worth more than $700 billion.
Third-party sellers have a big part to play in Amazon’s success: more than half of all sales on the site last year came from marketplace merchants, of which there are 2 million-plus worldwide—and the numbers continue to climb.
Consumers love it, too. According to a SimilarWeb study, it’s the most popular online retailer in the U.S. Why? It’s simple: online shoppers expect nothing less than fast, convenient shipping—something that Amazon prides itself on offering through its fulfillment service.
For many online sellers, Amazon is just one of many marketplaces where they sell. If that sounds like you, you may want to consider Amazon’s Multi-Channel Fulfillment (MCF) service as a way to score more sales and easily manage stock and shipping demands.
What is Amazon Multi-Channel Fulfillment and how does it work?
In the long term, working with a fulfillment center should result in greater efficiency when it comes to shipping, lowering costs and your ability to deliver a better quality of customer service.
Since Fulfillment by Amazon (FBA) is a prerequisite to Amazon’s Multi-Channel Fulfillment (MCF) service, we’ll first clarify what FBA is and how it works.
FBA allows its merchants to ship inventory to one of Amazon’s 140-plus warehouse locations in the U.S., where it will be stored until an order comes in, at which point the company will pick, package and ship the item to the customer.
MCF, an extension of FBA, offers the same service but integrates with other platforms you’re selling on. So whether you’re selling via your own Shopify website, eBay, or another e-commerce platform, Amazon will still store, pick, pack and ship your inventory, without getting a cut of the sale.
In addition to providing fulfillment in the U.S., Amazon also offers MCF in Canada, Mexico, the UK, Germany, France, Italy, Spain and Japan.
Amazon’s MCF may be a good option if you’re selling on multiple e-commerce platforms already for the following reasons:
- Amazon’s one- and two-day shipping options could increase customer satisfaction and retention.
- When fulfillment is taken out of the equation, your business will become more efficient, organized and less stressful.
- You can spend more time tending to other aspects of your business such as marketing, product sourcing, growing and defining your brand and other activities that translate into more sales.
- Business growth won’t be limited by a lack of storage space for your inventory.
- You can save time and money with fewer trips to the warehouse.
If you already use FBA, your existing stock will serve customers on both Amazon and your other sales channels. That said, MCF is available with or without FBA and if you have a professional selling account, you can list your multichannel inventory without making it available for sale on Amazon.
In addition to a $39.99 monthly subscription, MCF merchants are charged fulfillment fees for orders placed on their own website or other marketplaces. That said, Amazon’s usual referral fees don’t apply since the products weren’t sold on its platform.
Related post: What it costs to sell on Amazon in 2018
Factors for Multi-Channel Fulfillment success
#1. Consider the shipping location
To make fulfillment time- and cost-effective, you’ll want to ensure the address you’re shipping to is actually closer to Amazon’s fulfillment center as opposed to the location where you’d be shipping the product out of yourself.
Also, depending on the items you’re selling, it’s best to get an idea of which products make more sense for you to ship yourself instead of using Amazon’s MCF service. Each item’s size, weight and measurement should be factored in before deciding if it makes sense to outsource fulfillment.
If the cost of shipping with Amazon’s MCF exceeds the fees to take care of shipping in-house, then, by all means, don’t spend more if you don’t have to.
#2. Deliver exceptional customer service
Amazon handles the physical demands of the shipping process for you, but while FBA takes care of the merchant’s customer service needs, MCF does not. Sellers are expected to update their customers with tracking and shipment information as well as address any questions or concerns.
Whether you’re using MCF or fulfilling orders yourself, Amazon tracks each seller’s response time to every one of their buyers. Merchants are expected to respond to customers within a 24-hour period after the message has been received through their Buyer-Seller Messaging system.
Given that Amazon has stringent rules when it comes to customer service it’s worth investing in a third-party software to make sure your performance metrics are up to speed.
xSellco Helpdesk provides a simple way to manage customer queries from all your sales channels in one place. With all your support tickets in an organized dashboard, you can easily assign specific queries to the appropriate team members.
When juggling several channels, you need to keep tabs on the response times of each team member. This will decrease the chance of buyers leaving negative feedback.
Keep in mind that the quality or service your customers receive directly reflects their impression of your brand.
#3. Order modifications
Processing multiple orders quickly can mean it’s harder to catch little mistakes. But dropping the ball might make all the difference in whether or not a customer returns to do business with you.
Here is the information you’ll need to enter for each order:
- On the “Manage Inventory” page, select the items you would like fulfilled.
- In the drop-down menu at the top of the same page, select “Create Fulfillment Order.”
- On the next page, enter the customer’s details in the “Ship-to Address” box.
- In the “Set Order ID” field, enter the order ID number.
- Under “Print on Packing Slip,” enter a new ID number (optional), as well as the order date and any comments you would like to send the customer.
- Next, choose the desired fulfillment action (hold for two weeks or ship immediately) and shipping speed.
- The last and final step is to review your order before submitting.
Once you submit an order to Amazon, the destination address cannot be changed. You do, however, have a 15-minute window of time in which you may cancel an order, though there is no guarantee it will be successful.
#4. Use special messaging
Amazon has the same standard of visual appearance in regards to shipping all merchant products. This means you’re slightly limited when it comes to branding and personalization. Therefore, it’s extremely important that you do everything in your power to add a personal touch to each shipment.
MCF doesn’t offer a lot of options: you can either ship products in a plain brown box or in an Amazon-branded one.
Keep in mind, it may be a bit confusing to your customers who have ordered products through a non-Amazon channel. For instance, receiving an Amazon-branded box when they ordered from your website may be frustrating and not what the customer would prefer.
It’s best to make your decisions with the goal of enhancing the customer experience rather than what seems convenient to you. You can also choose a customized packing slip that will have a special message from you to the customer.
Despite the lack of options given to make your packages more personal, it’s important to choose to send a special message to each and every customer regardless of what they’ve purchased.
Amazon’s Multi-Channel Fulfillment service is a great way to grow your business on multiple sales platforms while meeting your customers’ delivery expectations. But while fast shipping can work wonders for your reputation, it’s no substitute for great customer service. It’s important to stay on top of your support queries—even more so as you expand to more sales channels.
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