Amazon Seller Fulfilled Prime: comprehensive guide [2024]

Amazon Seller Fulfilled Prime (SFP) is a program that allows third-party sellers to offer Prime shipping directly from their own warehouses. This comprehensive guide will cover everything you need to know about SFP, its importance for Amazon sellers, and how to successfully enroll and maintain your status in the program.

What is Seller-Fulfilled Prime?

Seller-Fulfilled Prime enables sellers to fulfill orders from their own warehouses while offering the same fast, reliable shipping that Amazon Prime customers expect. This program sits between Fulfillment by Merchant (FBM) and Fulfillment by Amazon (FBA) by combining the control and flexibility of FBM with the customer trust and shipping standards of FBA.

Fulfillment by Merchant (FBM)

Fulfillment by Merchant (FBM) allows sellers to handle their own inventory storage, packaging, and shipping. However, FBM listings do not automatically get the Prime badge, which is a significant advantage of SFP as many customers prioritize Prime-eligible products for their fast and free shipping benefits.

Comparison with Fulfillment by Amazon (FBA)

• Control: SFP offers more control over inventory compared to FBA, allowing sellers to manage their fulfillment process directly
• Fees: SFP can save costs on FBA fees, but sellers must manage their own storage and shipping expenses.  FBA fees cover storage, packing, and shipping, which can be higher for large or heavy items.
• Prime Badge: Both FBA and SFP listings can display the Prime badge, enhancing their appeal to customers.

Benefits of Seller-Fulfilled Prime

Seller-Fulfilled Prime (SFP) offers numerous advantages that can significantly enhance your selling experience on Amazon. By participating in SFP, sellers can enjoy several key benefits that help streamline operations and boost sales.

Access to Amazon Prime Members

Having the Prime badge makes your products visible to Amazon's 200 million Prime members, significantly boosting potential sales.

Avoiding FBA Fees and Storage Costs

SFP allows sellers to avoid the often high FBA fees and storage costs, especially beneficial for large or heavy items.

Enhanced Control Over Inventory

Sellers maintain full control over their inventory, managing storage, packing, and shipping from their own facilities.

Increased Chances of Winning the Buy Box

Products with the Prime badge are more likely to win the Buy Box, increasing sales opportunities.

No Storage Restrictions

SFP does not impose storage limits, unlike FBA which can restrict storage based on Inventory Performance Index (IPI) scores.

Flexibility in Fulfillment

Sellers can tailor their fulfillment processes, potentially offering faster or more customized shipping options.

Enhanced Customer Trust

The Prime badge increases customer trust and can lead to higher conversion rates due to the perceived reliability and faster shipping times.

Challenges and Considerations of Seller-Fulfilled Prime

While Seller-Fulfilled Prime (SFP) offers significant benefits, it also comes with certain challenges and considerations that sellers need to be aware of. Understanding these can help you prepare better and maintain your Prime status effectively.

High Performance Standards

Sellers must meet stringent performance metrics, including a 99% on-time shipment rate and maintaining a low order cancellation rate.

Costs of Storage, Shipping, and Handling Returns

While avoiding FBA fees, sellers incur their own storage, shipping, and return handling costs, which can be significant.

Enrollment and Maintenance

The initial trial period requires strict adherence to Amazon's requirements, and ongoing performance must be maintained to keep the Prime badge.

Customer Service Management

Sellers must manage customer service, adhering to Amazon's policies, which can increase workload.

Eligibility and Requirements for SFP

To participate in Seller-Fulfilled Prime (SFP), sellers must meet specific eligibility criteria and maintain high performance standards. Adhering to these requirements ensures that sellers can provide a reliable and high-quality shipping experience for Amazon Prime members.

Criteria to Qualify:

• Offer premium shipping options (one-day and two-day delivery).
• Ship over 99% of orders on time.
• Maintain an order cancellation rate below 0.5%.
• Use Amazon Buy Shipping Services for at least 99% of orders.
• Ensure on-time delivery of 93.5% or higher.
• Maintain a valid tracking rate of 99% or higher.
• Provide nationwide delivery coverage for all standard-size products.
• Use shipping methods that support weekend delivery and pickup.
• Comply with Amazon's Returns Policy and allow Amazon to handle customer service inquiries.

How to Enroll in Seller-Fulfilled Prime

Enrolling in Seller-Fulfilled Prime (SFP) involves a series of steps to ensure that your business can meet Amazon's high standards for Prime shipping. Following these steps will help you successfully join the program and maintain your Prime status.

Step-by-Step Enrollment Process

1. Evaluate Your Business Capability: Ensure you can meet Amazon's stringent requirements.
2. Set Up Fulfillment by Merchant (FBM): Practice handling your own fulfillment.
3. Register for the SFP Trial: Visit Seller Central and register for the trial.
4. Prepare for the Trial Period: Offer one-day and two-day shipping, and use Amazon's Buy Shipping Services.
5. Complete the Trial Period: Fulfill at least 100 Prime orders and meet all performance metrics.
6. Achieve and Maintain Eligibility: Consistently meet performance standards to retain the Prime badge.

Tips for Preparing Your Business for SFP

• Optimize warehouse operations for quick turnaround.
• Partner with reliable shipping services.
• Implement robust inventory management.
• Train your team on packing, shipping, and handling returns.
• Monitor performance metrics regularly.
• Enhance customer service capabilities.
  

Recent Updates to SFP

Amazon continually refines the Seller-Fulfilled Prime (SFP) program to enhance the experience for both sellers and customers. Staying informed about these updates ensures that you can adapt your operations to meet the latest requirements and take full advantage of the program's benefits.

Latest Changes and Updates from Amazon

• Reopening of Enrollment: Amazon reopened enrollment for SFP in 2023 after pausing it to ensure better support and standards. This allows new sellers to join the program and benefit from Prime's extensive customer base.
• New Performance Metrics: Updated performance metrics have been introduced, including stricter requirements for on-time shipment rates, valid tracking rates, and order cancellation rates. These metrics are designed to ensure a high level of service and reliability for Prime customers.
• Enhanced Customer Experience Standards: To further improve the Prime customer experience, Amazon has implemented new standards for delivery speed and accuracy, including mandatory use of Amazon's Buy Shipping Services for at least 99% of orders.
• Additional Support and Resources: Amazon has increased its support for SFP sellers by providing more comprehensive resources and guidance to help sellers meet the updated performance standards and maintain their Prime badge status.

Conclusion

Seller-Fulfilled Prime (SFP) allows Amazon sellers to offer Prime shipping directly from their warehouses, providing access to Prime members, cost savings, and greater control over inventory.

However, SFP comes with challenges like strict performance standards and independent logistics management. Understanding the requirements and preparing your business is key to leveraging SFP for boosting sales and improving customer experience.

Integrating ShipWise can help. Our shipping software streamlines operations, ensures compliance with Amazon's standards, and helps maintain high performance. With ShipWise, you can manage SFP operations efficiently, reduce costs, and enhance customer satisfaction.

Frequently Asked Questions

What is Seller-Fulfilled Prime (SFP)?

SFP allows sellers to fulfill orders directly from their own warehouses while offering Prime shipping benefits.

How do I qualify for SFP?

Meet Amazon’s performance standards, including on-time shipping, low cancellation rates, and high tracking accuracy.

What are the benefits of SFP?

The benefits of SFP include access to Prime members, control over inventory, and savings on FBA fees.

What are the challenges of SFP?

High performance standards, handling shipping costs, and managing returns.

How do I enroll in SFP?

Register for the trial on Amazon Seller Central, meet the trial period requirements, and maintain performance metrics.

Can I use third-party fulfillment centers for SFP?

Yes, you can use third-party centers as long as they meet Amazon’s shipping and performance standards.

What happens if I fail to meet SFP standards?

Your Prime badge can be removed, and you may lose SFP status.

Is SFP suitable for all sellers?

SFP is ideal for experienced sellers who can meet stringent requirements and handle fast shipping.

How does SFP compare to Fulfillment by Amazon (FBA)?

SFP provides more control and avoids FBA fees but requires handling your own logistics and meeting strict standards.