Introduction of Amazon SFP Model and Amazon Inventory Management
The Amazon SFP model is an alternative to Amazon FBA for high-performing sellers who want more control over their fulfillment processes. Unlike FBA, SFP doesn’t require a monthly fee and lets you distribute products from warehouses that you own or manage. It also gives you the Prime badge and allows your products to surface more often to Amazon’s Prime members, which helps increase sales conversions.
The SFP model can work for any type of business, from conventional retailing and private labeling to retail arbitrage, reselling clearance products, trading in used items and more. However, it’s most useful for companies with high margins who can absorb the cost of the program.
SFP requires a few key changes to a seller’s business. First, a business must change its operations to meet new SFP fulfillment requirements. This means retooling inventory levels, arranging for weekend pickups and deliveries with carriers, and dealing with increased expenses.
This is a significant change for third-party sellers, especially smaller ones that don’t operate on weekends. Getting orders to customers on time as part of the SFP program has always been a challenge for some sellers, and these new requirements add another element to the equation.
Shipping Options for SFP
In the past, if you wanted to take advantage of Amazon Prime shipping, your only option was FBA. This was a great way to take advantage of the free two-day delivery on your products, but it came with a number of challenges.
The biggest drawback to FBA was the cost of storage, which can be expensive for small businesses. Additionally, the FBA process involves human error that can result in damaged or lost inventory, and if it’s a common issue, you may face penalties on your account.
One of the biggest benefits of the SFP program is that it allows you to handle returns much better than with FBA. This can be beneficial to sellers who sell perishable goods or items that can’t be shipped via FBA due to size or temperature.
Nevertheless, even with SFP, you will still need to account for return inventory and ensure that it doesn’t deplete your stock. This can be complicated by the fact that returns often need to be handled as separate items from your regular inventory.
It’s a good idea to find a software solution that can closely track your Amazon inventory on all of your sales channels and provide real-time financial reports that you can use to make strategic decisions about your business. This will help you avoid unnecessary costs and ensure that your orders are processed in a timely manner.
The best software solutions will also include a built-in dashboard that can be accessed from any device so you can easily view the status of your orders, inventory and more. This will give you a clear overview of your entire business, making it easy to make informed decisions and stay competitive with your competitors. The most advanced systems will also have a dedicated support team to ensure you’re able to quickly solve any problems that arise.