Multichannel Listing Platform 

Designed for Growth

Table of Contents 

1. What is FBA? How is it different from regular selling?

2. How FBA works?
3. Advantages and Disadvantages of FBA
4. How to start with FBA. Step-by-step manual
5. PRO Tip
 
Multichannel Listing Platform 
  Designed for Growth
 

What is FBA? 
How is it different from regular selling? 

 
 
FBA  stands  for  Fulfillment  by  Amazon.  This  service  was  launched  by  the  eCommerce  behemoth 
back in 2006 as a way for attracting small businesses to the platform. 
 
The  original  mission  of  FBA  (that  did  not  change  to  this  day)  is  to  improve  customer  experience 
and give SMB companies access to Amazon’s enormous resources.  
 
Of  course, using FBA is not mandatory for sellers. They can choose to use Fulfillment by Merchant 
(FBM)  instead.  Which  means  that  every  step  of  order  processing  is  the  sole  responsibility  of  the 
seller.  

 
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Both,  FBA  and  FBM,  undoubtedly, have their pros and cons. And experienced Amazon sellers have 
very  strong  opinions  regarding  which one is better for different types of businesses, products, etc. 
But  it  is  generally  accepted  that  absolute  beginners  to  Amazon  selling,  like  the  ones  this  guide  is 
intended  for,  are better off using Fulfillment by Amazon as the starting point, since it has, possibly, 
the easiest model. 
 

How FBA works? 

 
1. As you can see from the picture above, the FBA process is quite clear and easy. 
After  you  sign  up  for  your  Amazon  account  and  list  some  products  for  sale,  you  need  to 
send,  label,  pack,  and  set  up  a  shipping  plan  in  your  Seller  Central  dashboard.  And then go 
to  your  local  post  office  and  send  the  packages  to  an  Amazon  processing  facility.  And, 
basically, your work here is done. 
 
2. Now Amazon will hold up its part of the deal. After receiving your package, Amazon will  
store it until somebody purchases. 
 
3. A customer will look through Amazon, find your listing, and buy your product (often 
because FBA aids you in winning the Buy Box and offer better shipping options, more on 
that below).  
 
4. Amazon will take care of shipping the ordered product to the customer.  
 
5. Amazon will also handle all customer communication and support (including refunds and  
returns) until the order is finished. Then you will receive the payouts.   

 
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Advantages and Disadvantages of FBA 

As  you  can  see,  only  one  out  of  the  five  steps  above  is  your  responsibility.  Seems  like  a  perfect 
deal,  why  would  anybody  use  anything  but  FBA.  Well,  the  answer  is  simple  —  everything  has  its 
pitfalls. 
 
Fulfillment  by  Amazon  is,  unquestionably,  a  great  option  for  a  one-man  operation  business. If the 
team  is  small  and  the  resources  are  limited,  following  through  with  all  the  steps  of  getting  your 
product  to  the  customer  can  be  very  time-consuming.  And  potentially  quite  costly  as  well,  since 
you  will  have  to  resort  to  third-party  services  for  shipping  at  least,  and  those  rates  might  not  be 
cheap.  
 
That’s  when  the  FBA  team  steps  in  and  deals  with  the  unavoidable  warehousing,  shipping, 
customer  service,  and  refunds.  So,  you  do  not  need  to  spend  money  on  storage or hire additional 
team members. FBA also has some less obvious advantages, like: 
 
+  Amazon  Prime  and  the  Buy  Box.  All  FBA  products  are  eligible  for  free  two-day  Prime 
shipping.  And,  according  to  most  surveys,  faster  shipping  is  the  second  most  important 
dealbreaker for customers (after the price, of course).  
FBA  products  are  also  more  likely to win Amazon’s Buy Box, so, your listing is displayed to
customers more often 
   
+  Winning  the  competition.  FBA  sellers  are displayed higher in Amazon search results. That 
means  that  you  will  successfully  set  yourself  apart  from  hundreds  of  competitors  in  your
category.  Additionally,  there  is  a  special  search  filter that customers can use to show FBA 
listings first. 
   
+  More  sales.  Quicker  shipping  and  Amazon’s  superb  customer  service  subsequently  lead 
to  improving  your  reputation  as  a  seller  and  a  higher  consumer  trust  rate.  According  to 
Amazon,  the  overwhelming  majority  of  the  Prime  subscription  customers  will  not  buy  a
non-FBA  product.  And the sheer volume of sales from winning that Buy Box might surprise
you. 
 
   

 
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—  Fees.  The  obvious  con  of  FBA  is  cost.  It  is  not  free,  Amazon  essentially  charges  you  for
every  step  of  order  processing.  There  are  monthly  storage  fees,  additional  long-term
storage fees, fulfillment fees. With so many fees you might wonder if it is really worth it. 
The answer is yes, it is worth it, but not for every product.  
Before  listing  your  items,  you  can  use  ​Amazon’s  profitability  calculator  to  see  how  well 
they will do. 
You  might  also  want  to  also use a tool that helps avoid building-up long-term storage fees 
— ​Inventory Health Report​.  
Another  potential  problem  is  Amazon’s  “​distributed  inventory  placement​”. This essentially
means  that  Amazon  can  split  and  assign  your  products  to  different  warehouses  —  you
don’t  just  send  your  inventory  to  the  closest  one.  So,  the  initial  shipping  costs  might  eat 
away  at  your  margin.  There  is  a  workaround  for  this  but,  not  surprisingly,  it  also  incurs
fees. 
 
   
—  Delays.  Despite  Amazon’s  best  effort,  some  delays  can  still  occur  around  the  busiest 
times of the year, like, Christmas, New Year, etc. And you cannot do anything about it.   
   
—  Lack  of  control.  When  handling  your  products,  Amazon  holds  all  the  cards. It can ship via 
not  the  most  cost-effective  routes  or  improperly  package  the  items,  causing  them  to 
damage  during  transportation.  Amazon  can  also mingle your products with other identical
ones  that  are  closer  to  the  buyer.  So,  while  purchasing  from  you,  the  customer  will  be 
getting the item that was sent to an FBA warehouse by another seller.  
   
—  No  customers  email  list.  This  might  not  be  an  issue  for  you  as  a  beginner,  but,  as  your 
business  grows,  you  might  find  this  problematic.  Amazon  will  not  share  customers’ 
information with you and building a quality marketing email list can be hard without it. 
   

 
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Fulfillment and Monthly Storage Fees 

Fulfillment Fees  Standard-Size  Oversize 

/ unit 
  $8.13 
Includes picking and  Small (1 lb or less)  $2.41  Small oversize  + $0.38/lb. 
packing your orders,  above first 2 lb 
shipping and 
handling, customer 
service, and product  $9.44 
returns  Large (1 lb or less)  $3.19  Medium oversize  + $0.38/lb. 
above first 2 lb 

$73.18 
Large (1 lb to 2 lb)  $4.71  Large oversize  + $0.79/lb. 
above first 90 lb 

$4.71  $137.32 
Large (over 2 lb)  + $0.38/lb  Special oversize  + $0.91/lb 
above first 2 lb  above first 90 lb 

Add $0.40/unit for clothing items 

Monthly Inventory  Standard-Size  Oversize 

Storage 
/ per cubic foot  $0.69  January-September  $0.48 
  January-September 
/ per cubic foot    / per cubic foot 
Charged for all units 
stored in an Amazon 
fulfillment center 
based on calendar 
month and your daily 
average volume  $2.40  $1.20 
  October-December  October-December 
/ per cubic foot  / per cubic foot 
Learn more about 
inventory storage 
fees › 
 

 
Picture: a
​ mazon.com  
 
Even  though  we  have  outlined  more  cons  than  pros  to  FBA,  it  still  remains  a  better  option  for  a 
beginner if you follow the ground rules below.   

 
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When is FBA good for you? 

• When you are a beginner. 
• When you only sell through Amazon. 
• When you have some sales on other platforms that can be fulfilled through Amazon  
(Multi-Channel Fulfillment), e.g. eBay and Etsy. 
 

When is FBA bad for you? 

• When you want to sell slow-selling, bulky or heavy items. 
• When your profit is too small — less than 200-250% markup. 
 

PRO Tip 
  
When your Amazon business takes on, you might want to test out Fulfillment by Merchant on a 
limited number of your inventory to see which fulfillment option suits your business better.  

   

 
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How to start with FBA. Step-by-step manual 
 
1. Register for an account (if you haven’t got one yet).  
A.  Go  to  the  ​Amazon  selling  page  and  make  sure  to  read  all  the  information  before  registering,  including 
the  current  pricing.  Then  click  the  “Start  selling”  button.  As  you  probably  noticed,  there  are  two  types  of 
accounts:  “Individual”  and  “Professional”.  Their  conditions  and  pricing  are  different.  As  an  absolute 
beginner,  you  can  start  with  an  “Individual”  account  (right  now  it  charges  $0.99  for  every  sold  product,  40 
sold  items  per  month  are  allowed)  just  to  give  yourself  enough  time  to  get  acquainted  with  the  account 
navigation.  Because  with  a  “Professional”  account you will have to pay the seller fees ($39.99) upfront. But 
you can upgrade to “Professional” at any time. 
 
   

 
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B.  Make  sure  that  you  have  everything  ready  for  registration.  Amazon  will  ask  you  for  the  following 
information: 
 
1.​ Your business name (Individual sellers can use their full name) and Address. 
2.​ Read the document first and then check the box “Agree to Seller agreement”. 
3.​ Your phone number. You need to have it with you for SMS verification.  
4.  Billing  Method  (e.g.  a  valid  debit  card)  and  Deposit.  For  a  “Professional” account you will need a 
chargeable Credit Card. 
5.​ Your tax information. Only for “Professional” accounts 
6.​ After filling in all the information, you will be redirected to your newly created account.   

 
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2. List your items  

A.  ​Assuming  that  you  have  already  chosen  which  products  to  sell,  now  you  will  need  to  list  them  in  the 
account. 
 
B.​ Go to “INVENTORY” tab and click “Add a product”. 
 
C.  A  pop-up  window  will  prompt  you  to  search for the product that you want to sell by barcode or by name. 
If you do not sell anything unique or, maybe, handmade, just search for the item to save time.  
 
D.​ Then fill out the information fields: 
 
1.  The  price  of  your  product.  How  much  do  you  want  to  sell  it  for?  Make  sure  to  count  in all of the 
Amazon fees.  
 
2.  The  condition  of  the  product.  Never  lie  about  the  condition.  You  cannot  hide  the  truth  forever. 
When  the  customer  receives  your  “Used-Good”  product  with  a  whole  lot  of  wear  and  tear,  you  are 
getting a 1-star review for sure. Consult this Amazon Condition Guide when in doubt. 
 

 
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3.  Shipping  method.  This  essentially  is  the  step  where  you  choose  between  FBA  and  FBM.  For 
Fulfilment  by  Amazon  make  sure  to  choose  “I  want  Amazon  to  ship  and  provide  customer  service 
for my items if they sell.” 
 
E.​ The last screen just asks you to agree with the Terms and Conditions. 
 

 
 

3. Convert items for FBA selling 

A.  This  might  be  a  bit  confusing,  but  even  though  we  just  chose  the  FBA  option,  you  need  to  take  some 
additional  steps  to  sell  through  FBA.  This  is  due  to  the  fact  that  not  every  item  can be fulfilled by Amazon 
or  you  might  not  want  to  sell  all  of  them  via  FBA.  So,  on  this  step, you need to choose which ones to send 
to Amazon exactly. 
 
B.  Go  to  INVENTORY  →  Manage  inventory  →  Actions.  In  the  drop-down  menu choose “Change to Fulfilled 
by  Amazon”.  From  that  moment  on  your  item  will  not  be  visible  until  you  follow  through  with  the  process 
and actually send it to an Amazon warehouse. 
 
C.  At  this  point,  you  will  be  asked  to  choose  between  two  options:  “FBA  Label  Service”  or  “Stickerless, 
Commingled  Inventory”.  “FBA  Label  Service”  means  that  Amazon  will  put  a  label  on  the  product for you. It 
does  come  with  a  small  fee  of  $0.20.  “Stickerless,  Commingled  Inventory”  is  free.  It  means  that  there  will 
not  be  a  seller  sticker  on  this  item.  It  is  good  for  when  you  sell  a  brand  new  and  not  unique  product  that 
 
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many  other  merchants  also  sell  through  FBA.  Amazon might use your item to fulfill other seller’s order and 

vice  versa.  There  is  a  catch  to  that,  however:  if the other seller’s item is bad quality, you will get blamed for 
it and might even receive a bad review. 
 
D.  ​On  the  next  step,  you  need  to  choose  whether  to  “Convert  only”  or  “Convert  &  Send  Inventory”.  If  you 
want  to  add  some  more  items  to  FBA,  choose  the  former.  If  you  want  to  finish  the  process  and  go  to  the 
next step, choose “Convert & Send Inventory”.  
 

4. Create an Amazon FBA Shipping Plan 

A.  Now  you  come  to  the  last  stage  of  the  setup  —  creating  a  shipping  plan.  Here  you  will  need  to  provide 
your "Ship from" address and choose a Packing type: 
 
1.​ Individual products. 
 
2.​ Case packed products — choose only if you, for example, send a box full of identical items. 
 
B.​ Add your items to the shipping plan. 
 
 

5.  Now  that  your  shipping  plan  is  created,  go  to  INVENTORY  →  Manage 

FBA shipments → Continue with shipping plan. 

A. Here add the quantity of each item and whether your item needs prep, (note that, only a minority of items 
require  it,  e.g.  inseparable  sets,  which  need  “Do  not  separate”  sticker  as  prep).  Also, choose who will label 
the products, you or Amazon.   
 
B.​ Next, weigh your items. You can use any available scale. 
 
C.​ Purchase shipping from Amazon 
 
D.​ Print labels and put them onto the package.  
 
E.​ And, finally, go to your local post office and ship your items to Amazon.   

 
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PRO Tips 
Some additional tips from Amazon experts to get your business to another level. 
 
1. Find good items for sale.  
Your  Amazon  experts  will  tell  you  that  this  is  the  most  important  step.  And  they  are  not  wrong. 
Choosing  a  product  that  will  sell  well  and  will  be  highly  profitable  is  the  most  important  step.  As a 
beginner,  you  can  just  have  a  look  around  your  own house and find items for sale: maybe some old 
video  games  or  board  games,  that  you  do  not  use  anymore.  Later  on,  when  you  get  enough 
experience  with  Amazon,  try  looking  into  Private  Labelling.  This  means  that  you find a product that 
is  already  selling  well  and  put  your  own  label  on  it.  To  find  the  well-sold  products  try  visiting  the 
Bestsellers section​ on Amazon. 
 
2. Create top-notch listings. 
Invest in some professional photos and copywriting for your products. If you can do all of that 
yourself,  that’s  fine.  But  if  not,  nowadays  it  is  easy  to  find  a  person  on  the internet who will do that 
for you. 
 
3. Do your research. Check your orders daily. 
If  your  products  are  selling  well  and  you  make  a  good  profit,  look  for  the  next  product  that  will  do 
the  same.  If  not,  analyze  why  and  try  to  minimize  the  damage.  There are tons of information about 
selling on Amazon out there. Take your time to find the most reсent and relevant one.   
 
4.  Read Amazon Policies. 
Never  just  skip  agreements  and  rules  without  reading  them.  You  do  not  want  to  lose  all  your  hard 
work  or  business  because  of  some  small  rule  that  you  never  thought  was  that relevant. Amazon is 
very  strict  about  their  policies.  And  losing  seller  accounts  due  to banning is not unheard of. Review 
the most important policies from time to time to see if there are any changes.   
 
5. Get reviews. 
Building  your  seller  reputation  starts  with  getting  some  positive  reviews.  Try  looking  through  the 
Amazon’s top reviewers list​ to see if there are potential reviewers for your products there. 
 
6.  Go multichannel.  
When  you finally reach your target revenue and your business becomes stable, it is the time to scale 
it up. The current eCommerce trend tells sellers to expand into multichannel sales.   
   

 
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Some advantages of it include: 

• You know the products well and have all the necessary descriptions.  
 
• There will be no costs for new product establishment, i.e. research, logos, design, advertising.   
 
• A new audience will get awareness of your brand and it will increase the loyalty of the existing  
customers. 
 
• Nowadays it is possible to manage all new channels yourself, especially with the help of  
multichannel  sales  tools.  A  tool  like  ​Sellbery​,  for  instance,  allows  Amazon  to  be  a  source 
marketplace.  That  means  that  you  can  automatically  download  products  from  Amazon  to  other 
platforms  in  bulk  with  all  necessary  information  included  in  the  product  description.  Sellbery  also 
helps  count  FBA  fees  into  the  total  price of your products. With this tool you can also automatically 
synchronize orders between various channels, to manage all of them in one platform of your choice. 
 
 

 
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