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Is owning a warehouse an advantage for FBA selling?

by theguy111
10 replies
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Hey,
I have a question and I need advice from experienced FBA sellers.
If I have a logistic infrastructure (warehouse, trucks, inventory management software etc), do you see it as a big advantage for me as a FBA seller or not so much?
Please explain....

Thanks!!
#advantage #fba #owning #selling #warehouse
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  • Profile picture of the author Michael J Anthony
    If you are making a lot of money and if your infrastructure/warehouse costs are lower than what amazon would normally charge you, then yes, its an advantage. If not, then no.
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    • Profile picture of the author theguy111
      Thanks Michael,
      What I want to understand is if I store my products in a warehouse before sending it to Amazon's warehouse, will it be a smart move?
      If I send the products from China (for example) to Amazon it might cost more than to send it to my warehouse. That way I can manage the inventory at Amazon more carefully... or am I wrong?
      Thanks
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  • Profile picture of the author Michael J Anthony
    You need to figure out what those costs would be and you'll have your answer.
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  • Profile picture of the author smartprofitmoney
    Originally Posted by theguy111 View Post

    Hey,
    I have a question and I need advice from experienced FBA sellers.
    If I have a logistic infrastructure (warehouse, trucks, inventory management software etc), do you see it as a big advantage for me as a FBA seller or not so much?
    Please explain....

    Thanks!!
    Hello,
    Most people just order from vendor, China , etc and ship it straight to amazon, FBA means they do all the stocking and shipping, so why stock it twice, makes no sense.

    Thanks
    Rob.
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  • Profile picture of the author Bella Lopez
    It can be an overhead cost. You can get the products from supplier and directly ship to Amazon. After all Amazon is charging you with the per sale fee (10% if I remember). Having your own warehouse doesn't make sense here.

    However, if you want to have multiple point of sale and wish to keep stock, then you can invest in a warehouse. Otherwise it'd be wasted money for you.
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  • Profile picture of the author Fred Kimberly
    Hi,

    If your warehouse is located near Amazon's warehouse and you can send your inventory within a day to Amazon's fulfillment center then you can keep inventory at strategic low level to decrease your storage costs with Amazon by keeping most of the inventory at your facility. In this case yes it is an advantage to lower your cost.

    Again, f you already have the storage facility and it wont incur any extra cost to store most of the Amazon products inventory with you then go ahead do it!
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  • Profile picture of the author dave_hermansen
    I can't imagine paying for shipping three times instead of twice ever makes a whole lot of sense (China to you - you to Amazon - Amazon to customer). The only scenario I can conceive of where it might work out better keeping things in your warehouse before sending to Amazon is if you are so grossly over-ordering in order to get a better deal, that the shelf fees of Amazon for unsold inventory are more than what it costs to ship products to them from your location.

    Of course, I am wondering why you would ever fulfill by Amazon if you have the warehouse and logistics already in place to handle shipping things yourself.
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  • Profile picture of the author theguy111
    Hey all and thanks for your answers.
    Let me share my thoughts, your comments will be appreciated.
    I think that if I can manage my own stock then I can be very efficient and sent is to Amazon Just In Time and not be depended on the supplier.
    Also, I cant be the one that put the labels, make sure the packaging is OK, etc and this might also reduce my costs a little bit..
    What do you think...? from your experience, is it worth it?
    Thanks!!
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    • Profile picture of the author dave_hermansen
      I'm just not sure if the time spent labeling, packing and shipping individual orders isn't less than the money spent paying Amazon for space and for doing the same.

      More than anything, this is going to come down to the number of daily orders. If it isn't many, Amazon probably works out. If there are a lot of orders each day, hiring someone to process, pack and ship them seems like it would cost far less (on a per order basis) than the Amazon fees.

      And, of course, it depends on whether you have another use for the warehouse space that you have and what kind of money you would be losing to use it for your eCommerce venture, instead.
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  • Profile picture of the author zeus136
    Fulfilled by Amazon means Amazon handles the logistics.

    Your warehouse would be totally redundant.
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