Amazon Seller Fulfilled Prime (SFP): What is it, advantages, requirements and guide for 2022
Before you’re ready for Amazon fulfillment you need to figure out if you’re selling on Amazon FBA, Amazon FBM, or Amazon SFP. As you scroll through Amazon have you ever noticed the Amazon Seller Fulfilled Prime badge on listings? Unlike Amazon FBA or Amazon FBM, Amazon SFP grants sellers access to the millions of customers who shop on Amazon Prime. Amazon SFP is very similar to Amazon FBM in theory, but elevates your listings with a coveted Prime badge (learn more about Amazon FBA vs Amazon FBM here) Learn more about Amazon fulfillment for Amazon SFP in our guide below!
The opportunity to sell to Amazon’s most engaged prime customers sounds like a dream, but before you’re ready for Amazon fulfillment as an SFP seller, there are a few advantages and disadvantages to understand. Before committing your products to an Amazon warehouse, read on for our guide on Amazon SFP to find out if it is the right solution for your company.
How to Qualify for Seller Fulfilled Prime
Anyone can sell through Amazon FBA or Amazon FBA Canada, but Amazon SFP tends to be a bit trickier to crack into. Amazon Prime customers expect immediacy with their orders, so ensuring a reliable and fast shipping record nearly 100% of the time is crucial.
From the moment the shipment is placed, sellers only have 48 hours to deliver the product regardless of the length of the destination. Seattle to New York? 48 hours. Florida to South Dakota? 48 hours. California to Niagra Falls? 48 hours, at a near-perfect success rate.
Amazon Prime customers count on Amazon purchases to be pretty much perfect so you’ll have a hard time making it past the trial if your return rate bubbles up over 1%. You’ll need to cover the cost of shipping as well as returns for Prime members.
Currently, Amazon isn’t accepting new sellers on Amazon SFP, but you can figure out how to get on their waiting list by visiting their Program Terms for Seller Fulfilled Prime page here.
If you’re already managing Amazon fulfilments, it’s worth a read to figure out if this is right for you!
If you get accepted, be sure to read all of the details on how to maintain enrolment in Seller Fulfilled Prime as it is a higher maintenance program for sellers and requires more engagement than Amazon FBA or Amazon FBA Canada.
Having a bullet-proof Amazon fulfillment process is important to maintain your credibility within the program.
Advantages of Seller Fulfilled Prime (SFP)
The most obvious advantage of Amazon SFP is that with every Amazon order, you are gaining access to Amazon Prime customers. You can fulfill the orders yourself, while still having the Amazon Prime Badge on your listing but there is a range of benefits that make this program appealing for sellers who want to amp up their Amazon fullfilments.
Increased exposure to Prime Members
Shopping can be stressful and time-consuming, so the second you make a customer’s life easier by offering them two-day shipping, access to deals and savings, and a variety of other benefits they’re going to be incentivized to shop more often.
Amazon Prime members are some of the most engaged customers on Amazon and the opportunity to sell your merchandise directly to these customers using Amazon SFP is incredible. More Amazon fulfillments coming right up!
There are millions of Prime members who have strong purchasing power so it’s a great opportunity to have a steady stream of sales. In 2021, Amazon Prime Members broke records placing $11.9 billion worth of orders, multiply that by the whole year and it’s pretty obvious these customers spend BIG.
Dive deeper to understand more about how customers shop all the time and on Amazon prime day here.
Seller gains more control over their inventory
You don’t need to manage an Amazon warehouse if you sell on Amazon SFP. You take full control over shipping and don’t have to pay Amazon fulfillment fees.
The one thing to remember is that because Amazon Prime members require two-day shipping, you still need to be mindful of stock to ensure you always have enough merchandise to expedite orders. Ensure you can expedite Amazon fulfillment to meet the fast shipping times.
Do not cut corners with Amazon fulfilments, speed is the name of the game.
The other advantages that come when you’re doing your own Amazon fulfillment:
- You can control the customer experience by offering premium service throughout the Amazon fulfillment process including providing assistance on questions and creating opportunities to upsell similar merchandise
- You can create custom branding/packaging that you can customize in the Amazon warehouse when shipping to excite and engage customers
- You are empowered to have more contact with the customer than the standard Amazon fulfillment
- If you partner with a trusted Amazon SFP 3PL like AMZ Prep, then you have a competitive advantage especially in Q4 when Amazon bottlenecks and shipments are at risk of being delayed on time. Don’t let your Amazon fulfillment be at risk, take control and take charge!
Better control of long-term storage fees
If you can maintain Amazon SFP, you can control your storage fees in the long run. For context, Amazon will allow you to save money depending on the cost of what Amazon’s warehouses charge you to store items. For larger items (couches, playsets, bikes, beds, or chairs) this is usually a HUGE consideration.
Taking control over your storage fees is a great way to scale your Amazon fulfillments.
FBA long-term storage fees can add up quickly (inventory that is left for over 365 days incurs additional fees) read more by visiting Amazon’s FBA long-term storage fees page. It is a stress reliever to reduce the storage fees associated with Amazon FBA so don’t underestimate how this has the power to make or break your business.
Don’t sleep on chances to save money when every cent counts!
More Control Over Amazon fulfillment and shipping fees & more flexibility
Amazon SFP sellers are responsible for covering their fulfillment and shipping instead of Amazon charging FBA fees per unit. This is a cost-effective way to get products out of your Amazon warehouse.
Do your research and compare selling fees for Amazon USA and Amazon Canada as well as using fulfillment centers in both countries.
If you need support with discussing the best options for your business, the AMZ Prep team is here to help. Drop us a line here and we’ll connect the dots for your Amazon fullfilment.
Selling on Amazon SFP allows for more product flexibility which can make Amazon fulfillment easier. The best products for Amazon Seller Fulfilled Prime according to Amazon are:
- High-value items
- Products with seasonal or unpredictable demand
- Items with variations
- Slow-moving goods
- Inventory that requires special handling or preparation
All of these products also make Amazon fulfillment easier. They are NOT suited to store in an Amazon fulfillment center, but are great for Amazon SFP 3PL warehouses like AMZ Prep!
Brand Recognition
Customized packaging for Amazon Prime, as well as the Amazon SFP Badge on listings, adds credibility to your business. Amazon Prime members are more likely to trust and stay loyal to Amazon SFP sellers. This is such a unique benefit that you only get when either fulfilling through Amazon’s FBA warehouses or using Seller fulfilled Prime.
You’ll be busy with Amazon fulfillments due to the legitimacy of SFP recognition.
Things to Consider Before Going to SFP
Shipping: Amazon SFP shipping needs to be done with immaculate precision and efficiency. The upside is that you are responsible for all touchpoints in the shipping process meaning you can use your carrier to reduce costs. With Amazon FBA, there are additional charges that can jack up the price of being a seller.
Do your research to determine the best techniques for shipping based on your region and where your customers are located.
Use an Amazon SFP 3PL to do your orders to help streamline fulfillment/operations. Amazon SFP 3PLs such as AMZ Prep can also fulfill Shopify, Walmart, and eBay orders. Finding the right Amazon SFP 3PL is important, let AMZ Prep take all the stress off your shoulders.
Fees: It’s important to understand the fees that come along with Amazon fulfillment and being an Amazon SFP seller using an Amazon SFP 3PL. Get a thorough understanding of the taxes on items sold by Amazon sellers here.
The volume of Merchandise: Ask yourself if you are ready for the pressure of managing the level of volume required to sell on Seller Fulfilled Prime, as well as the insane precision required to ensure all deliveries are always, always received within 48 hours.
Customer Service: If Amazon isn’t handling incoming questions from the customer, you are going to be responsible for whatever queries they may have. This part of SFP goes beyond just giving answers and also includes treating your customers in such a way that will inspire confidence and encourage them to build a relationship with your brand.
This takes time, skill, and even training to master. Good customer service can influence reviews and reputation.
Amazon SFP changes 2021
Amazon recently announced a few pivots to their SFP program for 2021 and beyond. The most important changes in shipping and delivery will impact Amazon fulfillment.
Prime members want instant shipping at no cost so Amazon is requiring SFP sellers to meet even shorter delivery targets going forward.
Amazon will be launching new backend functionalities to help sellers meet one-day and two-day shipping goals, but the expedited shipping expectations require sellers to be more on their game than ever before.
Read more about the new Amazon SFP rules coming in 2021 here.
If Amazon SFP is in your future, please get in touch with AMZ Prep to find out how we can seamlessly transition your business as a premiere Amazon SFP 3PL.