Amazon Prime is a term that stands for fast and free shipping among online shoppers. Until recently, this service was exclusively available for products sold directly by Amazon. But with the "Seller Fulfilled Prime" program, Amazon has opened the door for third-party sellers who want to label their products with the Prime badge as well. In this blog post, we'll examine what the program means for sellers, what benefits it offers, and what requirements must be met.
What is Seller Fulfilled Prime?
Seller Fulfilled Prime is a program that enables third-party sellers to mark their products as Prime offers, as long as they meet certain shipping criteria. The aim is to offer customers the same quality of service and fast delivery that they are accustomed to from Amazon's own products. Sellers participating in this program handle the storage and shipping of their products themselves or use an external fulfillment center that meets Amazon's shipping requirements. For a long time in Germany, it was exclusively possible to use FBM Prime in conjunction with shipping via DPD. It was necessary to purchase DPD Express shipping labels through Amazon (buy shipping credit). Since 2023, fundamental changes have been made, so that sellers can now choose the shipping service provider themselves and no longer have to obtain shipping labels through Amazon. This makes the program significantly more attractive for many sellers.
Benefits for Sellers
Increased Visibility
An obvious advantage is the increased product placement and visibility. Products with the Prime label are generally ranked higher in search results and attract more customers who are specifically looking for Prime offers. The Prime badge also typically results in a higher conversion rate, which in turn positively affects ranking.
Increased Sales
Studies show that Prime products are more likely to be added to cart and purchased than non-Prime products. Free and fast shipping is a decisive purchase factor for many customers.
Building Trust
The Prime label is a sign of quality and reliability for many customers. By participating in the program, you signal that your business meets Amazon's high requirements regarding shipping and customer service.
Access to Prime Customers
Amazon Prime has millions of members worldwide who spend more and shop more frequently than non-Prime members. With "Seller Fulfilled Prime," you reach this affluent customer base directly.
Control Over Inventory
Since you have the option to handle shipping yourself or use an external fulfillment center, you maintain more control over your inventory compared to Fulfillment by Amazon (FBA). Additionally, you don't tie up your capital in the form of goods in an Amazon warehouse and can sell the goods on other sales channels. This plays a particularly important role for very expensive items that don't turn over as quickly.
Enrollment Requirements
Participation in the "Seller Fulfilled Prime" program is not open to everyone. There are some specific requirements that must be met:
Shipping Requirements
To qualify for the Prime program, sellers must consistently meet certain criteria at the product category level. More information about specific product categories and associated minimum requirements can be found in the "Seller Fulfilled Prime Program" section.
- Regarding delivery promise: Depending on the type of product category and warehouse location, Prime offers must meet specific delivery criteria. You can view the set targets for delivery promise in the "Seller Performance Statistics for Seller Fulfilled Prime" section.
- Regarding on-time delivery: Prime orders must arrive at the customer's location by the promised delivery date at the latest. A quota of at least 90% on-time deliveries is required.
- Regarding shipment tracking: When confirming the shipment of Prime orders, you must provide valid tracking information. It is important to maintain a quota of at least 99% valid tracking numbers.
- Regarding cancellation rate: When it comes to canceling Prime orders before shipment, the cancellation rate must not exceed 0.5%.
Eligible Product Range
The target requirements for Prime program eligibility can vary and depend on factors such as the dimensions and price of the respective item. These different product groups, also known as product categories, help us optimally align shipping resources with customer expectations. It is possible to qualify for one, two, three, or all four product categories within Prime. For sellers who were already Prime-qualified before the cutoff date of June 21, 2023, Prime eligibility is extended to currently offered product categories for both "Fulfillment by Amazon" and "Seller Fulfilled Prime."
Make sure to correctly specify both the weight and dimensions of your items so that the ASINs can be precisely assigned to the appropriate product category. This assignment directly influences your performance metrics regarding delivery promise.
Fees
Amazon does not charge additional fees for using Seller Fulfilled Prime. You must offer Prime customers free and fast shipping with your Prime offers. While there are no additional monthly fees for participating in "Seller Fulfilled Prime," you bear the express shipping costs, which can be considerably higher compared to regular shipping costs.
Trial Period
Registration consists of three steps: Registration, trial period, and Prime approval. After you have registered for the trial period, you are required to demonstrate that you meet the program's criteria. For Prime qualification, an offer must
(1) be available nationwide,
(2) offer the option for free shipping, and
(3) enable free returns for Prime members, with some exceptions regarding product weight and international deliveries.
Additionally, the seller must demonstrate and fulfill the already mentioned requirements (delivery promise, on-time delivery, shipment tracking, and cancellation rate) during the trial period.
Conclusion
"Seller Fulfilled Prime" offers an excellent opportunity for third-party sellers to present their products to a broader and more affluent customer base. The benefits in the form of increased visibility, increased sales, and building trust are compelling arguments for participating in the program. However, as with all business opportunities, there are also challenges and requirements that should be taken seriously. Those who successfully overcome these hurdles can benefit from the numerous advantages and take their business to the next level.