Difference Between Amazon FBA and FBM and Seller's Selection Advice

What is the Difference Between Amazon FBA and FBM? Which Shipping Method Should Amazon Sellers Choose?

On the Amazon platform, FBA Fulfillment by Amazon and FBM Fulfillment by Merchant are two main logistics distribution models. For Amazon sellers, choosing an appropriate shipping method not only affects the performance of product sales but also directly impacts customer shopping experiences as well as the overall operational efficiency of the store. This article will analyze the characteristics of FBA and FBM in detail and provide practical recommendations for sellers based on recent news reports.

First, let's look at FBA. FBA is a warehousing and delivery service provided by Amazon, which allows merchants to store inventory in Amazon's warehouses. When customers place orders, Amazon handles the entire process from picking, packing to shipping. The advantages of this model are obvious first, FBA can significantly improve order processing speed, usually achieving next-day or second-day delivery services; second, due to Amazon's strong global logistics network, using FBA helps sellers more easily enter international markets; third, FBA also supports free express delivery for Prime members, which undoubtedly increases the appeal of products to Prime users. However, FBA also has its shortcomings, such as high storage fees and issues with return management. According to recent news reports, many small businesses have reflected that as Amazon gradually raises its storage fee standards, they have to reassess whether to continue relying on FBA.

Compared to FBM, which is entirely handled by the merchant themselves for all logistics processes including inventory management, packaging, and shipping. For budget-limited sellers or those who wish to maintain high flexibility, FBM is a good choice. On one hand, FBM can reduce initial investment costs and avoid being constrained by high storage fees; on the other hand, sellers can flexibly adjust their supply chain strategies according to their own situations, such as collaborating with third-party logistics companies to optimize transportation routes. However, FBM also has obvious shortcomings, such as longer delivery times and lack of a unified brand image. According to statistics from a cross-border e-commerce platform, in non-Prime orders, the average delivery cycle for FBM sellers is nearly two days longer than that of FBA, posing a challenge for sellers pursuing rapid market responsiveness.

Then, how should Amazon sellers choose between these two completely different shipping methods? In fact, the answer depends on the specific business needs and development stages of the seller. If your product belongs to a high-demand category and you want to quickly expand market share through Amazon's traffic advantage, then FBA might be a better choice. But if you are just starting out, facing financial constraints and without a clear plan for international market expansion, you can try the FBM model first, and then consider switching to FBA after accumulating certain experience. It is worth noting that in recent years, more and more sellers have begun to adopt a hybrid model, where some SKUs use FBA while others retain FBM. This approach retains the convenience brought by FBA while reducing overall operational risks.

In summary, both FBA and FBM have their respective advantages and disadvantages. As Amazon sellers, the most important thing is to make reasonable judgments based on their actual circumstances and continuously adjust and optimize their logistics strategies. In the future, with Amazon continuously optimizing its logistics system and technical capabilities, believe that regardless of which mode sellers choose, they can benefit greatly.