The benefits of outsourcing a job to someone else are undeniable: you gain an extra helping of time — which can’t have a monetary amount fixed on it — and you’re left free to focus on building the important aspects of your business. Amazon does a fantastic job of this with Fulfilled By Amazon (FBA), as they take care of shipping your inventory for you.
But not every seller goes this route, choosing Merchant Fulfilled Network (MFN or FBM) instead. Why? What would prompt a seller to willingly take on extra work that a huge business can do quickly and efficiently? And what are the pros and cons of travelling down such a path?
Difference Between FBA and MFN: What You Need to Know
Regardless of whether they sell on Amazon or through their own site, merchants can use Amazon to ship for them. All they have to do is send their merchandise to a central Amazon office, whip off instructions about what goes where, and sit back and relax. It’s an incredibly hassle-free process that takes a huge weight off your shoulders, but there are ways to make the most of it.
MFN, on the other hand, leaves the reins in the merchant’s hands. Sellers are responsible for every aspect of shipping, from finding the exact item and packing it to arranging the details and actually sending it out.
Pros and Cons of Each Shipping Method
As we alluded to before, FBA frees up your time so you can focus on continuing to expand your business. Time is an invaluable resource, and Amazon gives you that in spades. FBA products are eligible for Prime and in many cases FREE Super Saver Delivery options so you can access millions more loyal and active Amazon customers. As well, they’re flexible about being used by both Amazon and non-Amazon sellers, leaving the market wide open for all ecommerce merchants. Shipping products yourself, though, does leave you with extra work and responsibility, which can leave disorganized merchants fumbling to re-establish their perch.
However, not all is good with FBA and not all is bad with MFN. The biggest drawback to the former is the price: merchants, because they ship to a central facility, have to pay “rent” each month for the space their merchandise uses, as well as fees to Amazon for doing the shipping (plus handling, picking and packing). With MFN, this isn’t the case at all, and you also get complete control over the condition of the packaging and when it goes out.
Shipping Your Products Internationally
As stated before, control over the shipping process is entirely in your hands with MFN: you choose the carrier that can ship internationally, you choose how it’s packaged and when it goes out, and you can tell buyers firsthand how long it will take and cost based on customs regulations and costs associated with international shipping (for example, once the buyer receives your product, they’ll have to pay the carrier, which acts as a broker). Depending on how you look at it, becoming deeply acquainted with the knowledge of other countries’ shipping processes can either be a blessing or a curse, as you’ll pretty quickly get to know exactly how the process in each country you ship to works.
How Much Everything Will Cost You
Regardless of whether you choose FBA or MFN, there will always be a cost for shipping and it will be calculated by dimension and weight. Other factors come into play, too, when arriving at the final price:
- How long it will take the item to get from Point A to Point B (delivery time)
- The rules and regulations in your country (shipping source)
- The rules and regulations in the country the product will be arriving in (shipping destination)
- Any customs, duties, taxes, tariffs or other costs that may be necessary
It should go without saying, but some sellers forget a couple of key things about shipping:
- Shipping internationally takes longer than shipping domestically
- Shipping via ground mail takes longer than shipping via airmail
- Buyers aren’t always aware of the aforementioned two points, and they don’t necessarily care, either: it’s up to you to name a shipping date based on your knowledge, and not worry them with details or excuses.
How you decide to ship to your buyers — either by using FBA or MFN — is up to you, but you should familiarise yourself with the details as fully as possible. Not only do laws change from country to country, but shipping times do, too. Your buyers are only concerned with one thing, and one thing only: receiving their purchase quickly. And it’s up to you, the ecommerce merchant, to do that.