One of the most important processes that you should watch out for in Amazon FBA is shipping. And Amazon have been rather low-key in the split shipments that surprises many new sellers.
Whether it’s shipping from your suppliers to Amazon or from Amazon to your customers, you have to know every step of the process because this is a part of your product cost.
When you are shipping from suppliers to Amazon, there’s a tendency that Amazon will split your shipment since they have to put your products in different warehouses around the country. Amazon has warehouses in almost every state to make the shipping more convenient.
Split shipments are actually there to help your business although these will cost you a little higher in shipping fees.
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What is Split Shipment?
Amazon has this policy to spread out your inventories to make shipping to your customers easier. This is the standard policy and you have to bear the costs of shipping to multiple warehouses. While every seller on Amazon settles on this kind of arrangement, you can actually avoid split shipments. This is how you can do it.
When split shipment happens, you will be asked to deliver a portion of your inventory to two or more Amazon warehouses. Needless to say, that also usually means higher shipping cost.
How to Avoid Split Shipments with Amazon FBA?
To prevent split shipments, go to Inbound Setting in your Amazon FBA account and select Inventory Placement Service.
Amazon FBA has 2 types of placement options: distributed inventory placement and inventory placement service. The solution you are looking for is the latter.
According to Amazon, the Inventory Placement Service is done so that all the inventories of a single seller will be put to a single fulfillment center. Then Amazon will help the seller distribute it to the many centers scattered all around the country. By using this service, you will be saved from paying higher shipping fees.
Is Inventory Placement Service free?
Unfortunately, the Inventory Placement Service is not free.
There is a unit service fee that applies. The standard-size per unit can range from $0.30 to $0.50.
If the size of your product is 1 lb. or less, the price per unit is $0.30. If it’s 1 to 2 lb., the price per unit is $0.40. If it’s over 2 lb., the fee is $0.40 plus $0.10.
On the other hand, over-sized products cost higher. For 5 lb. or less, you will have to pay for $1.30 per unit. If it’s over 5lb., the cost is $1.30 + $0.20.
So, What Option is better?
Since both of the options will cost you money, you have to weigh what’s better depending on the amount of the shipping expenses you have to pay.
The best way to know which is better is by asking a free quote from the forwarded.
You can ask for the estimated fees when you choose inventory placement service and distributed inventory placement.
When choosing the right shipping option, make sure you consider all the options available. Even if the difference is only $100-$200, this is still savings.
You can adjust the prices of your products with the money you save from Amazon shipments, which will give you an edge among your competitors.
Just don’t forget to consider this cost when you are pricing your product so you won’t have to bear the loss in the future. Sell smartly and explore all the selections you have as an Amazon seller.
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