Zachary Nickerson
Apr 2, 2025
When selling on Amazon, choosing between FBM (Fulfilled by Merchant) or FBA (Fulfilled by Amazon) is critical. Each has distinct benefits and drawbacks, and below we’ll take a look at the pros, the cons and the benefits of using Multiply to help you supercharge your Amazon selling and help you fulfil the potential of your business.
Fulfilled by Merchant (FBM)
With FBM, sellers handle every aspect of the fulfilment process themselves or through a 3PL (third-party logistics) provider. This model gives sellers complete control over their operations but demands more resources and expertise.
Pros:
- Lower Costs: Avoids FBA fees, especially for large or slow-moving items.
- Inventory Control: Full oversight and flexibility in logistics and stock.
- Branding: Custom packaging and personal touches are possible.
- Great for Niche Products: Ideal for unique or bulky items.
Cons:
- No Prime Badge: Fewer sales from Amazon Prime members unless you’re using SFP (Seller Fulfilled Prime).
- Logistics Burden: Packing and shipping require significant resources.
- Customer Expectations: Errors can hurt reviews and performance metrics.
- Scalability Limits: Growth may demand costly infrastructure investments.
Fulfilled by Amazon (FBA)
With FBA, sellers ship their products to Amazon’s fulfilment centres. Amazon handles the storage, packaging, shipping, customer service, and returns. This model is especially popular for businesses looking to leverage Amazon’s logistics expertise.
Pros:
- Prime Eligibility: Boosts sales with access to Prime customers.
- Scalability: Amazon handles logistics, freeing sellers to grow.
- Customer Experience: Reliable delivery and returns enhance satisfaction.
- Time-Saving: No need to manage shipping or returns.
- Global Reach: Simplifies international selling.
Cons:
- High Fees: Storage, fulfilment, and long-term fees can add up.
- Inventory Control: Sellers lose direct oversight of their stock.
- Returns Policies: Amazon’s tolerance may increase return rates.
- Limited Branding: Sellers can’t personalize packaging.
Which is Best?
Choosing between FBA and FBM depends on your business goals, resources, and the type of products you sell.
FBA is ideal for scaling quickly and boosting sales with Prime, while FBM suits sellers with strong logistics or niche products. A hybrid approach can balance costs and efficiency, allowing you to optimize fulfilment based on your products and goals. Many successful sellers use a hybrid approach, leveraging FBA for fast-moving products and FBM for niche or oversized items. By analyzing your inventory, margins, and operational strengths, you can decide the best fulfilment strategy to meet your needs and grow your business.
Should You Reprice Products Differently Depending on Fulfilment Method?
You should reprice your Amazon products differently based on whether you use FBA or FBM, as each fulfillment method affects costs, competition, and the Buy Box algorithm. FBA sellers benefit from Amazon’s Prime badge, faster shipping, and stronger Buy Box eligibility, often allowing for higher prices. In contrast, FBM sellers must compete on shipping speed, reliability, and customer service, often requiring more competitive pricing to win sales. By strategically adjusting prices based on fulfillment method, you can maximize profitability while staying competitive in Amazon’s dynamic marketplace. By using a repricing software, such as Multiply, you can input your minimum and maximum pricing bounds and allow the repricer to do the work for you, allowing you to use your time to focus further on your customer service and shipping speeds. Reach out today to start analyzing your catalog with our free BuyBox Scan tool. We can find hidden growth opportunities and you can gain a competitive edge using our powerful insights!
