Alternatives to FBA: Third-Party Storage and Fulfillment

Amazon’s website itself is, of course, just the marketplace, but the underlying network of warehouses that provide packing, storage and shipping services to the final customer is the backbone of the logistics system that actually gets the product from seller to customer, and is one of the best features of selling through FBA. 

While it handles most sellers’ needs, it is not always a one-size-fits-all, and under certain circumstances sellers and vendors are better off looking for third-party logistics providers (3PL). 

Alternatives can be broadly categorized as Fulfillment by Merchant (FBM), in which you store inventory at a separate location and ship them out yourself independently of FBA. 

When Would FBA Not Be the Best Option?

Let’s face it, in most cases FBA is the simplest and best way to go, but in some cases it may be more beneficial for you to look elsewhere. These include: 

• If you want a higher level of customization - such as bespoke packaging and product inserts - to give customers an additional layer of experience and brand awareness that is not just Amazon’s signature brown box. 
• Sometimes, Amazon’s inventory storage fees can get quite pricey, particularly towards holiday time and during high seasonal demand, when storage fees can balloon as much as four times their usual rate in the period between October and December. By contrast, 3PL’s fees are usually more simple and fixed.
• Additionally, Amazon recently put in storage limits for the holiday season, putting a cap on how much inventory you can have ready to go at, though it did expand these allowances, but at the same time raised the Inventory Performance Index threshold meaning more sellers may fall under it and trigger caps. 3PLs don’t typically use an IPI-type mechanism and allow you to store as much inventory as you want, or as little as you need, without imposing excess or long-term storage fees. 
• 3PLs may also have lower shipping rates than on FBA. The majority of alternative providers also offer shipping options within one or two days, making them competitive even for Prime customers. 
• A downside many sellers have noted from FBA is getting support when things go wrong or when you need a particular need. Amazon doesn’t have dedicated account managers for sellers. If you have the need for one, you may find 3PLs are a better fit. 
• If you ship through other channels that are not Amazon, a third-party player could simplify your overall logistics burden, meaning you can ship things to Amazon customers and other customers from the same place, rather than having to add an extra step to get it to your Amazon buyers.  
  

What Other Providers Are There?

Below is a list of several option for third-party logistics providers, with some of the services they offer: 

• A2b Fulfillment: Good for small and medium-sized businesses, mostly in the US. will ship 94% of households in the US within two days and can handle Prime orders. Also provides for other e-commerce platforms.
• ShipBob: Provides services to any e-commerce seller as well as businesses selling directly to consumers and wholesale vendors. It has full software integration with Amazon. 
• FedEx Fulfillment: Hardly needs an introduction, this is one of the most recognizable name in global logistics. Will only work if you are a big business, however, as FedEx requires a minimum order volume of 1.13 million per year. 
• eFulfillment Service: This is a good service if you want to save costs, as it has no minimum order volumes, setup fees or long-term storage fees. Offers a 30-day free trial and does not limist space at busy times.
• Red Stag Fulfillment: Good for direct to consumer fulfillment, especially if you are a small or medium-sized business. 
• Shipmonk:  It is also good for small businesses as there is no minimum number of orders, though there is a small fee on the first item per order if you have fewer than 500 orders per month. Shipmonk does not impose storage restrictions during high seasons and offers express shipments within two days. Also offers customer success representatives.‍
• Shipwire: Lets you save on shipping costs depending on packaging, couriers and routes. It also lets you choose the storage locations you want and calculate fees ahead of time.
• Fulfillment.com: You need a minimum of just under 22,000 orders per year to use this service, but it is popular among Amazon Sellers as it integrates into just about any major e-commerce software. Not for businesses just starting out, but if you have a decent amount of sales building, it is a good option. ‍
• Rakuten Super Logistics: Rakuten actually guarantees accuracy, with free fulfillment service if errors are made. It also delivers just about anywhere in the US within one day and has good customer support. ‍
• Ships-a-lot: Like Rakuten, Ships-a-lot also guarantees inventory accuracy, but will actually pay you if it makes a mistake. For a monthly fee you get unlimited storage space and services, and they are integrated with all major e-commerce players. 

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