How to use Amazon Seller Central FBA Small and Light Program to increase profitability

  

Amazon Seller Central Fulfilled by Amazon (FBA) is a powerful way of selling your products and also increasing profitability, but the effect on profitability is more when your product is priced above $15. However, if the product is a little heavier (1lb to 3lb) and priced under $10, you will not be able to realize the needed margin due to higher FBA fees. With Amazon’s FBA Small and Light program, you’ll find much lower FBA fees for small, light products that are priced under $8 and weighing under 3lb. allowing sellers to be more profitable and to grow their business with Amazon.

The recent update made by Amazon to the FBA Small and Light program was a welcome change for the sellers as Amazon has increased the price from $7 to $8 and the weight has also been increased from 10 oz to 3 lb, which provides sellers room to include more products under this program.

What is FBA Small and Light?

FBA Small and Light is similar to the standard FBA offering where Amazon takes care of Pick, Pack, and Ship to the end customer along with the customer service, but they do it at a much lower price helping the sellers to save on FBA fees. However, the offer may not always be eligible for a 1- or 2-day delivery but states that “the order will be delivered by < Date >”. In categories such as Beauty, Health & Personal Care, Grocery, Baby, Amazon gives an additional 5% discount to the customer if the order is placed for 2 or more units. The basic rule for a product to be eligible is to satisfy all the three conditions below.

· Product price of $8 or less

· Dimensions of 18 x 14 x 8 inches or less

· Weight up to 3 lb or less

Fee Breakdown of FBA small and light program

To give you an idea of the potential cost-savings and improved margins, please review the table below for the fees structured in 2 Size tiers Small Standard and Large Standard. This new change in weight from 10 oz in 2021 to 3 lb in 2022 has created more possibilities for products that weigh significantly as the cost of shipping through merchant fulfilled will be significantly higher.

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What are the Pros and Cons of FBA Small and Light?

The Pros of the FBA Small and Light program are, 

1. List Pirce of $8 or less and weight up to 3lb, opens opportunity for a larger set of items at a lower FBA Fee. 

2. Amazon gives a 5% discount for specific categories Beauty, Health & Personal Care, Grocery, Baby if 2 or more units are ordered. 

3. Standard Amazon shipping and Customer Service.

4. Prime eligibility but with the condition of “Deliver by Date” Delivery.

The Cons of the FBA Small and Light Program are,

1. Items must be eligible or meet the required sell threshold (for old ASINs).

2. Temperature Sensitive Items are not allowed

3. The product must be sold in only “New” condition and the rest are not allowed to be part of the program. 

4. Dangerous goods (HAZMAT) items 

How to enrol my listings on FBA small and light?

The steps for reviewing the eligibility and subscribing can be done from the same place. Once you are sure your products meet the qualification criteria, you can enable the Small and Light for your items through click of a button. 

Step 1: Enroll in FBA

Whether you’ve been selling on Amazon as self-fulfilled or you are a new seller, before you can enroll in FBA Small and Light you need to be enrolled in FBA.

Step 2: Select the items you want to enroll in FBA Small and light

Shortlist the products you want to enroll in the program, or we can download the FBA inventory report to look for products which are priced lower then $8

Step 3: Enroll offers in FBA small and light

Go to the Fba small and light enrolment page and click on Quick enroll and the relevant MSKUs in the provided fields. Make sure you remove extra spaces before and after your MSKUs – this is to ensure that there are no upload errors.  

Final Thoughts

Amazon FBA Small and Light is an easy way to save on fulfilment costs if you are selling small, inexpensive, and fast-moving products. A dollar-per-unit (or even less) savings can translate to significant savings as you sell more units. In addition to this, you can pass the savings to your customers to help establish brand loyalty OR invest back in Advertising to create your own flywheel.