What is Amazon FBA and Amazon FBM?

While Shopee and Lazada dominate the online retail scene in the Philippines, Amazon serves as the largest online retailer in the world with Amazon Marketplace service as their e-commerce platform. For their sellers, Amazon has provided two programs in terms of order fulfillment: Fulfilled by Amazon (FBA) and Fulfilled by Merchant (FBM). Based on the name, the program is dependent on who is in charge of order fulfillment.

Amazon FBA is Amazon’s program for their sellers to use their order fulfillment service for ease of transaction. The FBA program will handle the storage, preparation and delivery of the products to the customer, giving the seller less tasks to worry about. The responsibility of a seller now becomes focused on making sure that their products are of the best quality, creating a product listing, marketing their products on Amazon, and preparing the items to be shipped to an assigned Amazon warehouse. Most Amazon sellers that we cater to prefer this model since there is less for them to worry about and there is more visibility on the Amazon website, however, there is an initial expense even before an item is sold.

Amazon FBM is Amazon’s program where the order fulfillment is at the responsibility of the merchant or the seller. Although there is more responsibility for the seller, this does not entail the seller to keep stocks in the United States and there is no expense on their side before an item is sold. The seller now has the freedom to send the item in whichever way they prefer but they would need to communicate directly with the client. It is recommended that niche products are listed in FBM since compared to FBA, visibility for FBM items are much less in search results in the Amazon website.