Want to sell on Amazon with that coveted Prime symbol on your product listings? Amazon has a program called Seller-Fulfilled Prime, which allows third-party sellers to offer two-day Prime shipping without using Amazon’s warehouses for fulfillment.
We’ll cover everything you need to know about Amazon Seller-Fulfilled Prime, including:
While Seller-Fulfilled Prime (SFP) can help small-medium sized businesses increase their sales on Amazon, sellers must meet Amazon’s strict performance standards in order to be eligible for SFP as well as to maintain SFP status.
Seller-Fulfilled Prime is a program that allows Amazon sellers to offer 2-day Prime shipping to Amazon customers while fulfilling orders from their own warehouse or by using a third-party fulfillment center.
This is different from Amazon’s Fulfillment by Amazon (FBA) program, in which Amazon handles the packing, shipping, and other fulfillment operations for a seller’s Amazon products from their warehouses. (Since they control the shipping, all FBA products automatically sell as Prime.)
If you want to fulfill your own products (ie. Fulfillment by Merchant or FBM) — whether to maintain full control over the fulfillment and storage of your Amazon inventory or avoid paying Amazon FBA and storage fees — SFP allows you, as an Amazon seller, to experience the sales benefits of having the Prime badge on your listing. By offering this Prime shipping on your listing, you are committing to fulfill all your orders with fast, two-day shipping at no extra charge to the customer.
Not only is this appealing for Amazon shoppers and can help drive sales for your products, it’s also great for Amazon, which can increase its Prime offerings without taking up more warehouse space.
As of September 2020, Amazon is not currently accepting new registrations to join SFP, but if it is a shipping option you would like to offer in the future, you should work on getting your numbers up now.
To be eligible for SFP, Amazon sellers must go through a trial period of anywhere from 5 and 90 days, and fulfill FBM orders with all of Amazon’s strict shipping requirements. (In other words, you have up to 90 days to meet the required trial orders.)
During the trial period, you must offer Premium One-Day to Two-Day delivery options to prove to Amazon that you can meet the fulfillment promises. The Prime badge will not be displayed on your listings during the trial period. You must meet the following criteria for at least 50 Prime trial orders:
Once you complete the trial period, Amazon will automatically enroll you into SFP and your product listing will then display the Prime badge!
To maintain eligibility for SFP, you are required to meet the same Prime trial performance requirements consistently. Even if your feedback rating or your cancellation rate were to drop below Amazon’s criteria for one day, Amazon will remove the Prime badge from those listings, and you may no longer be eligible for SFP.
SFP is great for experienced Amazon sellers who sell high volumes through FBM.
Currently, SFP allows sellers to enable two-day Prime shipping to specific regions where sellers know they can meet that promise.
However, in June 2021 (previously February 2021, see update below), Amazon will require SFP sellers to offer nationwide two-day delivery as well as Saturday delivery and pick-ups.
We’ll go over these changes in greater detail below, and if you are currently enrolled in SFP and think that you may not be able to meet these new requirements, we’ll go over some alternative fulfillment options to keep the Prime badge on all your products.
Prime members are Amazon loyalists. 67% of Amazon Prime members said if they had to shop at only one store, it would be Amazon. By enabling the Prime badge on your listings, your products will have increased discoverability as Prime customers will be able to filter their search by Prime products only.
Amazon’s FBA fees and storage fees can be a huge deciding factor for whether sellers choose to use FBA or SFP. Because of how Amazon’s fee structure is based on weight and dimensions, you may be more profitable using SFP than FBA. Additionally, storage fees vary during different times of the year and Amazon can limit your storage space if your IPI score is low.
Amazon’s FBA fees and storage fees can be a huge deciding factor for whether sellers choose to use FBA or SFP. Because of how Amazon’s fee structure is based on weight and dimensions, you may be more profitable using SFP than FBA. Additionally, storage fees vary during different times of the year and Amazon can limit your storage space if your IPI score is low.
Winning the Buy Box means that when customers click on “Add to Cart,” their default option is to buy the product from you. Products listed with the Prime badge have increased chances to win the Buy Box over an FBM offer. Even if you were selling your product via FBM, your price would have to be considerably lower than an FBA or SFP offer to get the Buy Box.
By utilizing SFP, you will have more control and insight over your Amazon inventory by keeping your operation in one location. You’ll avoid lag time between sending inventory into an Amazon FBA warehouse and worrying about running out of stock. You also have the option of using a third-party fulfillment center to store and ship SFP orders.
If you are not able to meet Amazon’s requirements for SFP, then Amazon will remove your Prime eligibility. Starting February 2021, Amazon’s requirements will become even more stringent and many sellers will not be able to meet Amazon’s standards.
Yes, you’ll save money on FBA fees and Amazon storage fees, but that does not mean you will not have any costs of your own. You need to take into account the cost of a warehouse, employees, shipping supplies such as boxes and labels, as well as expedited shipping costs. And premium shipping costs can really eat into your margins.
When using FBA, any customer’s returns will be handled by Amazon and sent back to Amazon. When using SFP, not only do you need to abide by the same return policies as FBA sellers, but customer returns will be sent back to you. This can be a challenge if you do not have the space or a standard operating procedure on how to handle returns.
In August 2020, Amazon announced that in February 2021, it would require SFP sellers to offer nationwide two-day delivery as well as Saturday delivery and pick-ups. Amazon has since relaxed this policy as of January 5, 2021 (see update below).
Previously, SFP sellers could offer regional Prime shipping only to areas where they knew they could meet the two-day delivery window. And for other regions, sellers needed to offer free premium shipping but orders did not need to be delivered within two days. The new requirements changed that.
The August 2020 announcement Amazon sent SFP sellers:
Dear seller,
We are always listening to our customers, and Prime members consistently tell us they want free and fast shipping. This is why Amazon is making significant investments in our fulfillment and transportation capabilities to make Prime faster, transitioning from a Two-Day to a One-Day delivery program. As we continue to improve the Amazon Prime experience for customers, we want to ensure Seller Fulfilled Prime (SFP) meets customers’ expectations of Prime.
We know that as a seller enrolled in SFP, you work hard to provide customers with a delightful shopping experience. Despite these good intentions, even before COVID-19, fewer than 16% of SFP orders in the US met the Prime Two-Day delivery promise customers expect, in large part because many sellers do not operate on weekends. As a result, we are making the following changes to this program in the US:
We recognize these changes are meaningful. We want to make sure you have plenty of time to determine how these changes affect your business and to make any adjustments you may need, which is why these new requirements will not take effect for more than five months. While the current performance of the program is not meeting customer expectations, these changes will help deliver an experience our Prime customers expect, including fast delivery. We will continue innovating with tools and offerings that help make SFP more compelling to you and our shared customers. You and SFP are important to Amazon and our customers, and to help you navigate these changes, we have launched a guide in Seller Central with details, examples, and answers to your questions. We have also set up a dedicated support team that you can contact at [email protected]
Regards,
The Seller Fulfilled Prime Team
Amazon is temporarily relaxing the delivery speed targets for SFP sellers due to COVID-19-related strains on shipping carriers. If Seller-Fulfilled Prime sellers are not able to meet the one-day to two-day shipping requirements, Amazon will give sellers a break since they cannot control the carriers delivery speeds.
However, the changes Amazon announced in August will still eventually go into effect, just not as soon as initially thought. The nationwide two-day delivery requirement, as well as Saturday delivery and pick-ups, are now set to begin on June 1st, 2021.
Here is Amazon’s new announcement:
In August 2020, we announced changes to Seller Fulfilled Prime (SFP) to provide customers with fast, consistent delivery – regardless of how their Prime order is fulfilled – that go into effect on February 1, 2021. These changes include weekend ship methods, targets for one- and two-day delivery speed, and nationwide delivery coverage for standard-size products.
While we know sellers like you are working to raise the bar for Prime customers, we also understand that the pandemic has introduced constraints on the logistics industry that you depend on to meet customer expectations.
In recognition of these current constraints, we are adjusting the one- and two-day delivery speed targets that will go into effect from February 1, 2021 to May 31, 2021 (see below). Delivery speed targets in line with those previously announced will go into effect on June 1, 2021.
Delivery speed targets from February 1, 2021 through May 31, 2021:
Less than or equal to 1-day product detail page views (%)
Standard-size: 20%
Oversize: 5%
Less than or equal to 2-day product detail page views (%)
Standard-size: 55%
Oversize: 30%
Delivery speed targets as of June 1, 2021:
Less than or equal to 1-day product detail page views (%) Standard size: 30%
Oversize: 15%
Less than or equal to 2-day product detail page views (%) Standard size: 70%
Oversize: 60%
Weekend ship methods and nationwide delivery coverage will take effect February 1, 2021 as planned. Please keep in mind that you are still required to adhere to existing requirements to maintain your SFP eligibility. For more information, see the following Help page:
https://sellercentral.amazon.com/gp/help/201812270
You can see all the requirements that go in to effect on February 1, 2021 on the following Seller Central Help page: https://sellercentral.amazon.com/gp/help/GVB5YNDGLQG4GYGR
For additional assistance, a dedicated support team can help you at [email protected]
Thank you for helping to provide an even better experience to Seller Fulfilled Prime customers.
The Seller Fulfilled Prime team
These new requirements may make it much more difficult for sellers to participate in SFP. Unless sellers have a multi-warehouse operation or utilize a third-party fulfillment partner, their shipping costs may be too high to maintain profitability.
For example, if your warehouse is located on the east coast and you receive a Prime order from the west coast, your expedited shipping costs will likely be very expensive.
So why is Amazon making these changes? According to its letter to sellers, Amazon wants to ensure Prime customers are receiving orders within one or two days because in the past, fewer than 16% of SFP orders in the U.S. met the Prime Two-Day delivery promise.
Amazon continues to invest in its fulfillment capabilities in order to improve Prime customers’ experience, and the company wants all Seller-Fulfilled Prime orders to meet the same exact customer expectations of Prime.
If you are no longer able to meet Amazon’s new strict SFP requirements, what are your options?
Enrollment to Seller-Fulfilled Prime is currently closed but we suggest putting yourself on the waitlist for when it reopens to new sellers.
(Our prediction is that registration for SFP will open after the new fulfillment requirements take effect in February 2021.)
To ensure your business will be ready for SFP, set up some FBM offers and see if you can handle the fulfillment process and maintain Amazon’s requirements. If you find you’re successful, you may be the perfect candidate for SFP!
Do you sell on Amazon using Seller-Fulfilled Prime? Tell us your experience in the comments!
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