That eBay purchase might arrive in an Amazon box?
The River continues to get a ton of publicity for its Fulfillment by Amazon program, including today's writeup in the New York Times.Since last fall, the program, Fulfillment by Amazon, has allowed independent sellers who list their goods on Amazon.com to use its network of more than 20 distribution centers around the world to fill orders. Now Amazon, which is based in Seattle, is opening the program to vendors who list their items elsewhere on the Web — on their own site, through Google, or even on Amazon’s e-commerce rival, eBay.I think this program could work for a lot of businesses, but I see a lot of problems with used books. There profit margin is low enough, without the FBA fees.
But the Times article does quote one enthusiastic bookseller:
Barry Mark, who runs Treebeard Books from his home in Palm Beach County, Fla., buys surplus books and sells them on Amazon and other sites. Since he signed up for Fulfillment by Amazon last September, he says that his sales have jumped more than 30 percent, and a third of the orders that come in are from members of Amazon Prime, the company’s premium discount shipping program.The article also quotes another Amazon bookseller, John Brown, who estimates FBA could save him $2,000 monthly in storage and labor. But Brown hasn't switched because he sees two show-stoppers with FBA: no international shipping, and no expedited shipping.
Call me a control freak, but there's no way I would trust my fulfillment to anyone else -- even if I could watch over their shoulder.
posted by Steve Weber at 4/27/2007
3 Comments:
When you sign up for FBA, does the seller still pay the $1.20 closing fee even though no shipping credit is granted?
As well, does it really cost 45 or 60 cents storage a month per book? Or is it for as many books that can fit into a cubic foot this fee is applied to?
I read the fee table on FBA but wasn't completely clear on it.
It seems like a seller would give up an awful lot of profit to have orders fulfilled and handle shipping inquiries.
And it seems like packaging, shipping and SKUing books in preparation for shipment to Amazon takes away from that time saved.
Any FBA sellers care to chime in?
Steve,
You state that the margin on used books is fairly low. I would disagree with that statement - in cases where you can buy a book inexpensively and sell it for 3-10x its cost, you are in some of the highest retail margin area generally available. I think the issue is really the lack of assured customers.
With many books, you are not sure that it will *ever* sell, let alone sell in a reasonable amount of time. During this period, your purchasing capital is tied into this stock. As a result, you may buy sales stock that will have a return of zero - and heaping cost (FBA charges) on top of that can be devestating.
My two cents, anyway.
Anonymous: Yes, you're right the profit margin on used books is very high, it's the labor that is the real cost.
With FBA, I think the shipping and storage fees are the killer. I know they would kill a good bit of my profit margin. And how much do you want to bet that once you're committed to FBA the fees will get jacked up?
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