Choosing between Fulfillment by Amazon (FBA) and Fulfilled by Merchant (FBM) is one of the first big decisions I bumped into when I started selling on Amazon. Both options work, but honestly, they suit different products, budgets, and business vibes.
Once you really get how each one works—and where they actually shine—you can dodge some expensive missteps and maybe even get to profits a lot quicker.
With FBA, I send my products to Amazon’s warehouses. They handle storage, packing, shipping, and even the customer service headaches.
With FBM, I keep the reins and ship orders myself or use my own logistics partner. Each path has its perks and pain points—FBA saves me time but eats into profits with fees, while FBM gives me control but asks for more hustle.
I’ll break down how both methods actually work, the trade-offs worth thinking about, and some real-life examples of when one just makes more sense than the other. Selling small, fast-moving stuff? Or maybe bulky products that just sit for weeks? Picking the right fit can totally change your margins and how much you work.
Key Takeaways
- FBA handles storage, shipping, and service for a fee—so it saves time but gives up some control.
- FBM keeps control in your hands, but you’ll be doing more work and wrangling logistics yourself.
- The “best” choice depends on your product size, how fast stuff sells, and what resources you’ve got.
What Is FBA?
Fulfillment by Amazon (FBA) is basically sending my products to Amazon’s warehouses and letting them handle storage, packing, and shipping to customers. They also deal with returns and customer service, which saves me a bunch of time, but yeah, it comes with specific fees and rules.
How It Works
With FBA, I ship my inventory to Amazon’s fulfillment centers. Once it’s there, Amazon marks my stuff as “Prime eligible” and stores it until someone orders.
When a customer buys, Amazon’s team picks the item, packs it up, and ships it out with their delivery network. They also handle tracking, refunds, and those inevitable customer questions.
I still control my product listings, pricing, and marketing. But Amazon’s in charge of the physical handling and delivery.
Key Features
Some of the main features of Amazon FBA include:
- Prime Badge – My products get that shiny Amazon Prime logo, which can attract Prime members who want their stuff yesterday.
- Customer Service – Amazon handles all the customer questions, returns, and refunds for me.
- Multi-Channel Fulfillment – I can use FBA to ship orders from other sales channels too, not just Amazon.
- Global Reach – I can stash products in different Amazon marketplaces to reach buyers overseas.
These perks make it way easier to scale without hiring my own warehouse crew. But I still need to keep an eye on storage limits and those sneaky fees.
Basic Process
The basic steps I follow for FBA are:
- Prepare Products – I have to package and label everything just the way Amazon wants.
- Ship to Amazon – I send my inventory to the fulfillment center they pick.
- Amazon Stores Items – My products chill in their warehouses until someone buys.
- Order Fulfillment – Amazon picks, packs, and ships the orders out.
- Customer Support – Amazon takes care of returns, refunds, and service issues.
For example, if I’m selling phone chargers, I can ship 500 of them to Amazon and let them handle the grind as orders roll in. I don’t touch a single package after that, which frees me up to hunt for new products or just, I dunno, take a breather.
What Is FBM?
With Fulfilled by Merchant (FBM), I’m the one storing, packing, and shipping products to customers. Amazon still takes care of the listing and payment stuff, but I’m handling all the physical fulfillment and customer service—either myself or through someone I hire.
How It Works
With FBM, I list my products on Amazon’s marketplace just like everyone else. The difference? When an order comes in, Amazon shoots me the details, and I handle everything from there.
I store my own inventory wherever works—my garage, a warehouse, or a third-party place. Packing and shipping? All on me. Same goes for returns and customer questions.
This method gives me more control over how stuff’s stored, packaged, and shipped. But it also means I have to hit Amazon’s performance standards—like on-time shipping and keeping defect rates low. Mess up too much, and my seller account could be in hot water.
Key Features
FBM puts me in the driver’s seat for the whole fulfillment process. That means I can:
- Pick my own packaging and really show off my brand.
- Set my own shipping rates if I use Amazon’s shipping templates.
- Store as much inventory as I want—no Amazon storage fees eating into profits.
One thing though: I don’t get the Prime badge by default. Seller-Fulfilled Prime is an option, but it’s got some tough shipping requirements.
FBM is great for stuff that’s heavy, oversized, or just doesn’t sell that fast, since I can dodge those big FBA storage and handling fees. It’s also handy if I’ve already got a solid logistics setup or work with a fulfillment center I trust.
Basic Process
- List products on Amazon with solid descriptions and shipping info.
- Store inventory wherever makes sense—my own space or a partner’s.
- Receive orders from Amazon when someone buys.
- Pick, pack, and ship every order on time—no excuses.
- Handle customer service for questions, returns, and the occasional weird request.
Say I’m selling custom furniture that eats up space. With FBM, I can keep it in my workshop and only ship it when it actually sells. That way, I’m not paying Amazon’s sky-high storage fees for big stuff that moves slow.
Pros And Cons Of FBA
When I use Fulfillment by Amazon, I let them handle storage, packing, shipping, and even customer service. It saves a ton of time and gets my products the Prime badge, but that convenience comes with fees and less control.
The main trade-offs? It’s all about cost, convenience, and how quickly I want to scale up.
Cost
With FBA, I pay fulfillment fees for every unit Amazon ships, plus monthly storage fees based on how much space my stuff takes.
If my products are small, light, and move fast, those costs aren’t too bad. But for bigger or slower sellers, storage fees can pile up—especially if I end up with inventory that sits around and triggers those aged inventory surcharges.
I’ve got to factor in prep costs too, like labeling or packaging everything to Amazon’s specs. Sometimes, FBA fees are higher than what I’d spend shipping stuff myself, even after saving on supplies and labor.
For example, shipping a small kitchen gadget with FBA might cost under $5 in fees, but something huge—like a kayak—could run over $300 in FBA fees. Suddenly, that sale doesn’t look so sweet.
Convenience
One big reason I stick with FBA is that Amazon takes care of picking, packing, and shipping every order. I don’t have to fill my garage with boxes or spend my evenings printing shipping labels.
They also manage customer service and returns. I don’t get those late-night emails about lost packages or broken items—Amazon’s team deals with it.
Another plus: Prime eligibility. My FBA listings get that Prime badge, which helps me reach millions of Prime members who want their stuff fast and free.
The flip side? I give up control. If Amazon messes up a shipment, there’s not much I can do except wait for their process. And forget adding personal touches like custom packaging or little thank-you notes.
Scalability
FBA makes it so much easier to grow without worrying about warehouse space or hiring staff to pack boxes. I can send hundreds or even thousands of units to Amazon’s fulfillment centers and let them do the grunt work.
This is a lifesaver if my sales spike during the holidays or a big promo. Amazon’s network can handle a flood of orders way better than I could solo.
But scaling with FBA means I have to manage inventory carefully to dodge stockouts or getting hammered with storage fees. Send too much, and I’m paying extra to store it. Send too little, and I miss out on sales while I restock.
Honestly, FBA works best for products with steady demand and predictable turnover. That way, I can keep storage costs in check and avoid nasty surprises.
Pros And Cons Of FBM
When I decide to fulfill orders myself instead of using Amazon’s warehouses, I take on more responsibility but also get a lot more control. This choice shapes how I handle customer service, where I stash products, and what I spend on shipping.
Control
With FBM, I manage my own inventory, shipping, and customer service. That means I decide how quickly I respond to buyers, what packaging I use, and how I handle returns.
I like being able to personalize the customer experience. Sometimes I’ll toss in a thank-you note or use branded packaging—stuff Amazon just won’t allow with FBA.
The downside? If I mess up—ship late, pack badly, whatever—my seller rating takes the hit. Amazon’s metrics are strict, and one too many mistakes can tank my account health.
Storage Needs
FBM is a good fit if I already have space for my products. That could be a warehouse, a spare room, or even a rented storage unit nearby.
This setup can save me some cash, especially with big or slow-selling items. Amazon’s storage fees for bulky stuff? They add up fast.
But here’s the catch: I have to track inventory myself. If I run out and can’t ship quickly, I might lose sales or see my listing drop in rank.
Some folks use third-party logistics (3PL) companies to store and ship products. It lightens the load, but adds costs and means I’ve got to pick a partner I trust.
Shipping Costs
With FBM, I’m on the hook for shipping. Sometimes that’s cheaper than FBA, especially for local or lightweight orders if I’ve negotiated decent carrier rates.
Large or heavy items? FBM often saves me money since I dodge Amazon’s oversized-item fees. Shipping a kayak myself, for instance, can cost way less than FBA’s charges.
Downside: I don’t get Amazon’s bulk shipping deals. If I can’t keep shipping fast and affordable, customers might bail for Prime’s two-day delivery. There’s Seller-Fulfilled Prime, but man, those standards are strict if I want to keep that badge.
When To Choose FBA
I use FBA when I want Amazon to handle storage, packing, shipping, and most customer service headaches. If fast delivery and Prime eligibility can boost sales—or just save me time—FBA’s hard to beat.
Best For Beginners
When I was new, I didn’t have a warehouse or staff. FBA made things simple: Amazon stored my stuff and shipped it out for me.
No need to fuss over labels, boxes, or haggling with shipping companies. Amazon even handled returns and customer questions, which kept my stress level low.
FBA also slapped that Prime badge on my listings, opening my products to millions of Prime shoppers. That visibility helped me snag the Buy Box more often and compete with the big guys.
If my items were small and light—say, phone cases or kitchen gadgets—FBA fees felt fair and shipping was quick. But with oversized or slow-moving products, storage costs piled up before I knew it.
High Volume Sellers
When my sales picked up—hundreds or thousands of units a month—FBA became a lifesaver. Amazon’s fulfillment network could process orders way faster than I ever could solo.
With high volume, even tiny mistakes can tank your seller rating. FBA cut that risk because Amazon’s system is, well, pretty reliable.
Prime eligibility matters more the more you sell. Many fast-moving products get found because they show up in Prime search filters, and FBA guarantees that without me sweating Seller-Fulfilled Prime requirements.
I also saved on labor. Instead of hiring help to pick, pack, and ship every day, I’d send bulk shipments to Amazon and let them take over. That freed me up to focus on finding new products or marketing.
When To Choose FBM
I stick with FBM when it just makes more sense to handle storage, packing, and shipping myself. Usually, that’s when product size, shipping costs, or my need for control over the customer experience actually matter for profits and satisfaction.
Best For Certain Product Types
FBM is my go-to for large, heavy, or slow-moving items. Amazon’s FBA fees for oversized stuff? They eat into profits fast.
One time, I sold a kayak. Storing it at Amazon cost more than $27 per unit each month, plus steep shipping fees. Shipping it myself saved me over $100 per order—no joke.
FBM’s also better for fragile products that need special packing. I can pack them just the way I want to cut down on returns and damage claims.
If my product doesn’t sell quickly, FBM helps me avoid Amazon’s long-term storage fees. That gives me more time to find the right buyer without extra costs breathing down my neck.
Experienced Sellers
FBM is easier for me when I already have my own shipping process and warehouse space set up. If I’m already fulfilling orders for eBay or Shopify, adding Amazon orders is no big deal.
With FBM, I can control delivery speed, packaging style, and even how I talk to customers. That matters when I’m building a brand that stands out.
But I have to stay on top of order deadlines. Amazon expects fast shipping and solid tracking. If I slip up, my account health tanks. So I only go with FBM when I know my systems are tight.
Seasonal Products
FBM’s great for stuff that only sells at certain times of year. For example, I sell holiday decorations in November and December. The rest of the year, it’s cheaper to store them myself than pay Amazon’s fees.
I dodge those aged inventory surcharges, too.
When demand spikes, I can prep stock ahead and ship fast—no worrying about FBA restock limits. That kind of flexibility really helps with seasonal trends and keeps my money out of Amazon’s storage fees during slow months.
Case Study: FBA vs FBM in Real Selling Situations
I’ve watched the right fulfillment choice make or break businesses. Product size, how fast things sell, and what customers expect usually decide whether FBA or FBM wins out. Costs, control, and Prime eligibility? All big factors too.
A Bookseller
When I sold used books on Amazon, most orders were single copies shipped in padded envelopes. Books are small, but sometimes they sit for months before someone buys them.
With FBA, Amazon handled storage, packing, and shipping. That got me the Prime badge and faster delivery, but storage fees piled up for slow sellers.
With FBM, I kept books in my own space and shipped as orders came in. Costs stayed low, and I didn’t have to worry about long-term storage fees. Downside? More time spent packing and going to the post office.
For me, FBM made sense for rare or slow-selling books, while FBA worked better for popular titles that moved quickly.
A Wholesale Electronics Seller
When I handled bulk orders of small electronics like phone chargers, turnover was fast and customers wanted quick delivery with the Prime badge.
Using FBA let me send pallets straight to Amazon. They handled everything, which saved me from managing daily shipments and gave my listings a boost.
With FBM, I’d have needed my own warehouse crew and a solid shipping system to keep up. That would’ve meant higher labor costs and probably slower shipping.
In this case, FBA kept things lean and met customer expectations, even if the fees were a bit higher. The speed and reach were worth it.
My Take on Choosing Between FBA and FBM
Comparing FBA and FBM feels like looking at two totally different ways to run an Amazon business.
With FBA, I send my products to Amazon and they handle storage, packing, shipping, and customer service. With FBM, I keep control of those steps myself or use my own third-party warehouse.
Pros of FBA I value:
- Prime badge and fast shipping
- Less time spent on packing and shipping
- Amazon handles customer service
Pros of FBM I notice:
- More control over customer experience
- Lower costs for large or slow-moving items
- Flexibility in packaging and branding
The right choice depends on product size, turnover speed, and my logistics setup.
If I’m selling small phone cases that move quickly, FBA is usually the way to go. If it’s heavy gym equipment that sits for a while, FBM saves me money.
Sometimes, I use both. I’ll send small, fast sellers to FBA and handle bulky or seasonal stuff myself.
Quick cheat sheet:
| If… | I lean toward… |
|---|---|
| Small, light, fast-selling items | FBA |
| Large, heavy, slow-selling items | FBM |
| I lack storage or shipping resources | FBA |
| I want full control over packaging | FBM |
In the end, I pick what fits my products, budget, and how much control I want. There’s no one-size-fits-all.
Frequently Asked Questions: Comparing Amazon FBA and FBM
In my experience, the FBA vs FBM decision usually comes down to product size, shipping speed, control over customer service, and overall costs. Each one has trade-offs that can hit profits, workload, and customer happiness.
What are the basic differences between Amazon FBA and FBM for new sellers?
With FBA, I ship my products to Amazon’s warehouses. Amazon stores them, packs orders, ships them out, and even handles returns.
With FBM, I store my own inventory and take care of packing, shipping, and customer service—sometimes with help from another fulfillment company.
Can you outline the pros and cons of using FBA versus FBM?
FBA pros: Prime eligibility, fast shipping, less hands-on work, Amazon handles customer service.
FBA cons: Storage and fulfillment fees, less control over handling, higher costs for large or slow-moving products.
FBM pros: More control, lower costs for bulky or slow sellers, flexible storage.
FBM cons: No automatic Prime badge, more work, must manage returns and shipping issues.
How does the fulfillment process work for Amazon FBA compared to FBM?
For FBA, I send inventory to Amazon’s fulfillment centers. When a customer orders, Amazon picks, packs, and ships it.
For FBM, I keep products in my own space or a third-party warehouse. When an order comes in, I handle packing and shipping directly.
As a new seller, how do I decide whether to use FBA or FBM for my products?
I look at product size, weight, and how fast it sells. Small, lightweight items that move quickly usually work better with FBA.
If my products are heavy, oversized, or slow to sell, FBM can save money on storage and shipping.
What are some real-world scenarios where FBA might be more beneficial than FBM, and vice versa?
FBA example: I sell phone cases—cheap to store and ship. FBA’s fast Prime delivery helps me win more sales.
FBM example: I sell kayaks. They’re big, expensive to store at Amazon, and don’t sell quickly, so I handle fulfillment myself.
Could you provide examples of when a seller should switch from FBM to FBA?
If my sales start picking up and I just can’t keep up with packing and shipping, moving to FBA can free up a lot of my time. It’s honestly a relief not to have a mountain of boxes staring at me every morning.
Sometimes, I notice I’m losing sales because my listings aren’t Prime-eligible. Switching to FBA can help me compete better since Prime shoppers love that fast shipping badge.
