Why you need to sell on Amazon and how to be successful
FullStac LLC – Harrisburg PA, August 2, 2019 by Stephon Guyton - Amazon.com is now the forefront of the eCommerce world. Its growing popularity with consumers is at an all-time high pushing out other marketplaces like eBay, Jet.com, Wayfare and even Walmart.com. Data shows that companies using Dashboard OSM are using more then one marketplace. Within those marketplaces, 52% of all sales imported into Dashboard OSM are Amazon.com orders. So what are the remaining top performing marketplaces companies are using? The remaining 48% of all sales imported into Dashboard OSM in 2019 consists of the following:
- Amazon.com - 52%
- Website (eCommerce) - 33%
- Phone/POS/Retail - 11%
- Ebay.com - 2%
- Walmart.com - 1%
- Jet.com - < 1%
Now, rewind back to 2008-2010, eBay.com was the top contender. This information is critical for online sellers. Why? Online sellers must follow consumer marketplace trends. If you do not, your company cannot stay in business.
So why is everyone buying on Amazon.com? Simple, its easy to use and consumers can find anything and everything on the marketplace. It is also seller friendly with a lot of different options to lower overhead costs and increase sales. Now, you are probably asking yourself, "if everyone is selling on Amazon, how can I stand out as a seller and be successful?". The answer, Prime. Trending data show Amazon.com users are 80% more likely to purchase a product and pay more for it just because it displays the Prime badge; rather then a product without the Prime badge. This is because consumers want their orders delivered fast. We live in a world of instant gratification and therfore consumers are willing to spend more in order to receive their order within 1-2 business days. So how can regular sellers get their listings to be Prime? Simple, Amazon FBA and Amazon SFP.
Amazon FBA (Fulfillment)
Amazon.com rolled out FBA or "Fulfillment By Amazon" a few years ago. The idea is to offer online sellers the ability to get products to the consumer as fast as possible utilizing Amazon.com's distribution centers. How does it work? All you have to do is send inventory to three of Amazon's fulfillment centers. The inventory will show up in your seller central dashboard as a fulfillment listing. When the product sells, Amazon.com automatically fulfills the order and ships it to the consumer. All you have to do is wait for the deposits while your sales are on auto pilot. Using FBA allows sellers the option to purchase inventory they would not necessarily have warehouse space for and or eliminate warehousing all together. Of course there is a cost involved that Amazon charges to store your inventory; but if you weight in the cost of your existing warehousing and employees, you are usually saving money using Amazon FBA. The final FBA perk, your listings automatically receive the Prime badge.
The great thing about Amazon FBA is that Dashboard OSM can import the orders automatically and create invoices or sales receipts in your Quickbooks accounting software. You no longer need to manually enter sales and payments into Quickbooks. With Dashboard OSM and Amazon FBA, you can have a true auto-pilot running online sales company giving you the ability to focus on product purchasing instead of order management.
Another option Amazon.com is offering sellers is Amazon SFP, or "Seller Fulfilled Prime". SFP allows sellers to display the "Prime" badge without the requirement of using FBA. This service is not offered to all sellers. Sellers who demonstrate a consistently high seller ratings and fast order fulfillment are asked to join. The reason? Amazon.com wants to keep up Prime's reputation as being known for fast shipping and the ability to get the product to the consumer within 1-2 business days. For this reason, Amazon.com is very picky who is allowed to join the SFP program.
So how does it work? Amazon.com allows you to warehouse and ship your products at your locations instead of an Amazon.com fulfillment center. Therefore, you no longer need to ship your products to Amazon and incur shipping fees and FBA warehousing fees. The only requirement in the SFP program is sellers are required to purchase shipping from Amazon for the order. And you guessed it, you are forced to purchase 2 Day shipping. Now your probably thinking, "How do I automate this like FBA? I now have to log into Amazon.com seller central and print labels for each order? I'd rather stick with FBA." That is true for the average seller but with Dashboard OSM, you no longer have to do that.
Dashboard OSM integrates with Amazon.com's SFP rates. Your Amazon.com orders are automatically imported into Dashboard OSM. When you create a shipping label for your order, Dashboard OSM will notify you that the order is an Amazon SFP Prime order. Dashboard OSM will then allow you to pick a Amazon.com shipping rate and purchase/print a label directly from your SFP account. Its fast, easy and incorporates your orders directly into the pool of other orders you normally process in Dashboard OSM.
Taking advantage of one or both of these Amazon.com programs will give you a leg up on the competition selling on Amazon. It is a quick and easy way to reduce overhead and streamline selling on Amazon. Of-course, using Dashboard OSM will give you even more automation and is an absolute necessity for all Amazon.com sellers.
About the author: Stephon Guyton is the Director of Sales for FullStac LLC, the parent company of Dashboard OSM.