FBA (Fulfillment by Amazon)
You send inventory to Amazon's warehouses; Amazon picks, packs, ships and handles customer service and returns.
Why it matters
FBA products get the Prime badge, which is the single biggest conversion lever available on the platform, and FBA offers are strongly favored for the Buy Box. For most brands the fee premium over self-fulfillment is comfortably outweighed by the conversion difference.
In practice
The costs to model are the fulfillment fee (by size tier and weight), monthly storage, and, the one that surprises people, long-term and aged inventory surcharges on stock sitting past six months. Poor sell-through turns FBA from an advantage into a slow bleed, which is why inventory planning matters as much as the fee schedule.
Related terms
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