Selling through Amazon FBM in 2025 means more than just fulfilling ordersโitโs about building control, boosting profits, and owning your brand experience.
Whether you're a seasoned seller or just switching from FBA, understanding the latest strategies can set you apart.
This guide breaks down whatโs working right now in FBM, so you can streamline operations, cut costs, and deliver customer satisfaction on your own terms.
So, letโs dive in.
What is Fulfillment by Merchant (FBM)?
Amazon Fulfillment by Merchant (FBM) is a fulfillment model that puts you, the seller, in the driver's seat.
This means youโre responsible for warehousing your products, packaging them, and shipping them directly to your customers.
Here are some benefits of FBM:
- FBM gives you complete control over your inventory and shipping processes, allowing for more personalized customer service and potential cost savings.
- Approximately 30% of Amazon Marketplace sellers use FBM, finding it particularly advantageous for products with lower sales velocity or those that are oversized.
- FBM avoids the hefty storage fees associated with FBA.
- Plus, FBM lets you choose your shipping methods, offering flexibility that can lead to faster delivery times and improved customer satisfaction.
- Some Amazon sellers use Fulfillment by Merchant (FBM) for products that are bulky, heavy, or don't sell quickly.
This approach helps them avoid paying for storage in Amazon warehouses, as long-term storage fees can add up.
How to set up FBM for your products?
1. List your products on Amazon: After creating an Amazon Seller Central account, start listing your products in the catalog with apt images and descriptions to improve your conversion rates. Make sure to structure your PPC Campaign the right way to increase sales.
2. Choose where to store your inventory: When choosing your warehouse location, choose it strategically to avoid redundant shipping costs. For a small business, you could rent a room or use your house for warehousing temporarily.
3. Ship out orders on time: Once you receive the order, you must ship the item based on the chosen delivery date by the buyer.
Amazon provides an estimated delivery time to customers on the product detail page so that customers know when to expect the product they ordered.
This includes handling and transit times. You can set your shipping, handling, and transit time to meet your customersโ expectations.
You must also provide order tracking for the customer. Make sure to update your Amazon seller account with valid instructions for all your Fulfilled by Merchant orders.
When you approve a customerโs return request for a product, Amazon sends the customer a return label along with your default return address, which must be valid.
How much does Amazon FBM cost?
The fee structure of Amazon FBM includes three types of fees: Referral Fee, Monthly Subscription Fee, and Per Item Selling Fee.
- Referral Fee: Your products are being sold on Amazon and not your own site. Hence, each sale you make will be considered a referral. The total referral fee to be paid depends on the type of product you sell. It can range anywhere between 6% to 45%. You can check the referral fee table out on the Amazon website
- Monthly subscription fee: Amazon offers a subscription fee for the Pro FBM service that costs $39.99 per month. By subscribing to this plan, you can waive additional fees when a product is sold.
- Per-item selling fee: The per-item selling fee is $0.99 for each item you sell. This fee can be waived if you sign up for the Pro FBM plan.
What are the Pros and Cons of FBM?
Letโs look at the merits and demerits of Amazon FBM to help you decide if you should consider choosing FBM for your business.
When deciding between Fulfilled by Amazon (FBA) and Fulfilled by Merchant (FBM), it's crucial to understand the unique benefits and drawbacks of each model.
FBM allows you to take charge of your entire fulfillment process, offering a different set of advantages compared to FBA's streamlined approach.
To make the best choice for your business, consider the following pros and cons of FBM, which highlight how it can impact your operational control, costs, and overall customer experience.
Advantages of FBM:
- Evade Amazonโs strict FBA product requirements: Amazon often changes its requirements for FBA products without giving sellers enough time to get used to the changes. With FBM, there are fewer rules. The penalties for failing to meet their strict standards for each Amazon Prime order are also lower than FBA.
- Branding: With FBA, the packaging box contains Amazonโs brand logo and not yours. Choosing FBM gives you the freedom to show off your brand to the buyers.
- Take control: All the customer feedback and reviews will not reach you as they will be handled by Amazon Customer Support. By choosing FBM, you can directly handle customer feedback and do a better job of giving them a better experience.
- Access customers with relatively fewer fees: Amazonโs FBA fees are higher than FBM. With FBM, sellers can choose a suitable service that has a monthly subscription and lower fees.
- Your choice of Marketing material: Through FBM, you can include whatever marketing material suits to promote your brand, and Amazon will have no say in this. This is not possible through FBA as Amazon has very strict rules pertaining to marketing and customer communication.
Disadvantages of FBM:
- No Amazon Prime badge: One of the main drawbacks of using Amazon FBM over FBA is not having access to Prime-eligible products. Amazon sellers who want to switch from FBA to FBM must be prepared to drive organic traffic without the Prime designation to help them succeed on the Amazon marketplace.
Amazon Prime intends to deliver orders in at most two days. Customers would prefer to choose the products that get delivered to them as soon as possible. Therefore, the sellers who are planning to choose FBM as their fulfillment option must arrange it so that they can be on par with the delivery speed of Prime-designated products.
- Most of the time goes into fulfillment: In the case of self-fulfilling sellers, most of the time is spent packing, shipping, and tracking the orders. You might not have enough time to pay attention to other crucial things related to business, such as optimizing PPC Campaigns, Advertising, bidding, etc.
- Delivery Speed: Amazon FBA offers Prime customers one-day delivery, which is why they prefer orders fulfilled by Amazon over FBM. To be on par with the products through FBA, you must keep up with the speed of the delivery process. You can do this by strategically splitting the warehouse locations for faster deliveries. This strategy also saves delivery costs.
- Customer Feedback: With FBM, you will have to make sure that you respond to every negative feedback and review. On the other hand, with FBA, Amazon takes care of everything, like customer feedback and handles negative reviews.
Amazon is undeniably the best at fulfilling Amazon orders, so giving up their perfected process might be quite a tough choice. Moreover, Amazon FBA sales are not always equivalent to FBM sales.
- Less likely to win the buy box: Fulfillment by Amazon and Seller Fulfilled Prime Sellers will be prioritized over Fulfilled by Merchant Sellers because of the faster and cheaper delivery process.
Can Amazon sellers use more than one fulfillment method?
With a few conditions, yes. You can use both FBA and FBM for your products under certain conditions.
1. An Amazon Seller can sell products through both FBA and FBM, but not for the same product in the same country at the same time.
2. In case your FBA stock runs out in the Amazon warehouse, then you can switch to FBM and fulfill orders.
3. You can sell through FBA in one country and FBM in the other.
Best Practices for FBM sales:
- Use the โBuy Shippingโ feature: One of the simplest ways to make sure that your orders are delivered on time and have tracking numbers is to purchase your shipping using Amazonโs โBuy Shipping Featureโ. When one of your products is ordered, you have the option to purchase shipping directly through Amazon. Once you buy from Amazon, it automatically confirms the order and sends the tracking number to the customer.
- Provide Tracking Numbers: All Amazon orders necessarily require tracking numbers. Make sure to provide one once the order is confirmed. If you purchase Amazonโs shipping, you will automatically get a tracking number.
- Manage Delivery Timeframes: It is important to confirm, pack, ship, and deliver your products on time. It needs to arrive on or before the promised date.
- Return Policy: Make sure you have clearly specified return instructions included in your packaging, as well as a return address that is valid. As an FBM seller, you will have to process and handle your own return requests. If a customer requests a return, you have to accept it as it is not optional.
What is Seller-Fulfilled Prime?
The Seller Fulfilled Prime (SFP) option is an Amazon fulfillment option that allows you to store, pack, and ship your own products while allowing your products to be listed as โPrimeโ.
For those who want access to new prime customers and want to exercise control over the shipping process, customer feedback, etc., Seller-Fulfilled Prime is the best option to go for.
Basically, you get to use the Amazon Prime label and have to follow shipping guidelines, but you get to do all of the picking, packing, and shipping of your products.
You also have to manage all of the returns and cover all of the shipping costs. Since the customers see the prime label, they expect Prime treatment. So you have to meet their standards, no matter how you fulfill the item. So basically, SFP is a lot of work.
However, if you are selling low-cost items, large and oversized products that would cost you high storage fees with Amazon, SFP is a great way to get the โPrimeโ label while keeping your costs down.
In short, depending on the products, SFP can either be the best of both worlds or too much work done.
Fulfillment by Merchant (FBM) vs Seller-Fulfilled Prime (SFP)
Both FBM and SFP are fulfilled by the seller, and both of them are similar yet different in their own ways. Here is a comparison chart -
1. Using Seller Fulfilled Prime, you can get access to new Prime customers, and your products will have a Prime label. Since prime customers shop twice as much as regular customers, you are definitely hitting the bullโs eye here.
2. If you choose FBM, you will not have to comply with the strict regulations set up by Amazon. Meanwhile, since you will have a prime label for SFP, the customers expect prime treatment, and you must abide by the strict instructions given by Amazon for your products.
3. Using Seller Fulfilled Prime, you have total control of the inventory. You can also respond to customer reviews and improve your product accordingly. Despite this, you will still have the โPrimeโ label for your products.
Features:
Amazon FBM includes many features that improve shipping, product listings, customer service, and more. Here are some of the most essential features:
- Multi-location inventory. Sync your inventory across multiple warehouse locations in real-time.
- Amazon buys shipping. Purchase and print shipping labels in one place.
- Shipping settings automation. Have more accurate shipping arrivals and calculations based on past deliveries, the warehouse location, and your customerโs location.
- Seller Fulfilled Prime (SFP). A program that allows sellers to qualify for Amazon Prime.
Tools:
Handling your fulfillment can be a hassle. Fortunately, FBM includes many tools that can automate many aspects of the fulfillment process.
All FBM sellers access the Amazon Seller App. This is an all-in-one platform to fulfill orders, analyze sales, manage offers, source products, handle returns, track inventory, and handle customer service.
Another tool is Veeqo. This multi-channel shipping tool finds the lowest shipping rates and integrates with other eCommerce platforms like eBay, Shopify, Etsy, and Walmart.
Summing Up
Every Amazon seller is unique โ and so is every sale. Thereโs no one-size-fits-all formula for success on the platform.
From choosing the right fulfillment method to optimizing listings and scaling ad performance, the decisions you make play a big role in shaping your growth.
Choosing FBM can be a smart move depending on your business model, inventory control, and long-term goals.
If youโre looking for expert guidance to navigate that journey, SalesDuo is here to help.
As a full-service Amazon agency with 85% ex-Amazon insiders, we bring unmatched insider knowledge and experience to the table.
From fulfillment strategy to catalog management, advertising, inventory, and performance analytics, our team handles it all.
Plus, our proprietary BI dashboard gives you clear, real-time insights to drive smarter decisions and better results.
Letโs build your success story together! Book a free strategy call with SalesDuo today and see how we can help take your Amazon business to the next level.
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About the Author
A dynamic customer success professional, Rahul Gowda helps businesses grow smarter at Amazon by building strong relationships, solving tricky operational challenges with data-driven strategies. Beyond work, Rahul loves exploring new tech trends and experimenting with creative cooking.
