Sales Taxes
American online retailers might allow you to source products (e.g. Online arbitrage might be a reason to be required to pay sales tax when you purchase your products through US-based online retailers. It is possible to reduce costs by using an online prep center that is located in a state where there is no sales tax, or a lower rate. How? by delivering your inventory directly to the pre-center. If the stock is in one of four states that do not have sales tax (Delaware Montana New Hampshire Oregon) The storage costs they charge when waiting for the additional inventory to be delivered will likely lower than the tax you'd have to pay in your the state where you live. Be aware that the US has sales taxes that range from zero to seven percent. Just a two or three percent decrease in sales tax can make a a big difference in the overall cost.
Climate
If you are selling perishable products, such as food or drinks, the first thing you need to inquire of any prep business is whether their receiving/storage premises are climate-controlled. Your products shouldn't be damaged because they were not kept in the correct conditions. This isn't just a matter of perishable goods. The control of temperature is essential when you're shipping stock to a hot state or one that is prone to extreme weather. If the weather conditions aren't handled correctly, your goods could be damaged or get damp.
Storage Facility
FBA prep services are primarily responsible for getting your inventory ready to be placed in FBA. However the prep centers are becoming more and more popular among sellers who wish to store their inventory. The sellers use this method for two primary reasons. The first reason is that it is cheaper than keeping all your inventory in the Fulfillment Center. Sellers keep their inventory in their prep facility, and then send FBA stock according to sales velocity. Let's say that a seller sells 1,000 units per month, and then sends 10,000 units to the prep center. They will send only 1,000 units to FBA every month. The rest of the inventory will be stored at the prep center. Amazon's suspension is the second reason. Your product will be placed within the Fulfillment Center if it is suspended. The customer will be required to pay per piece in order to have the item returned. The item may not arrive for some time. Your Plan of Action will require the prep center to inspect all inventory in FBA. You will then need to get your stock packed, labeled, and shipped back to FBA once you have been reinstated. This is a costly procedure, and sellers attempt to minimize by keeping their inventory in a Prep Center and submitting smaller quantities. If you plan to take this approach be sure that your preparation firm is able to quickly and efficiently change inventory. Inquire about their insurance. Stocks should be protected from fire and theft.
Processing Time
The most important factor to consider when selecting the FBA preparation service is how fast they will make your inventory. There are many factors that can impact your need for speed. For instance, if keeping stock in the prep center and sending it in based on the rate of sales (see above) you'll probably need the center to process your orders within no more than 48 hours. Prep centers typically provide an estimate upfront of their processing times, while some might offer a 24-hour- or 48-hour guarantee. If you can't see this information, make sure you make a request, because you don't want your shipping rate to be harmed because the prep service is waiting for their sweet time to get your goods into FBA. Check out the top rated Door to Door Delivery website for details.
Inspection
It's worth checking whether your FBA prep services also perform inspections. Important to note that FBA prep service cannot replace factory product inspections. However, they may complement them. Manufacturers don't inspect their shipments in detail because it could lead to stock rejections that result in higher costs. Imagine your company is performing an inspection prior to shipment. There are 10,000 units in your facility and they inspect 20%. There's a high chance that the FBA preparation services will find problems in your stock which your manufacturer didn't. Danny McMillan believes that manufacturers tend to not examine their shipments closely because they know that if the stock is rejected by the manufacturer, it's likely to cost them more and reduce their margins. Inspections by the company that prepares your food more vital.
In Summary
You could outsource FBA preparation to help your business become more productive, but it could also slow your business. It is essential to build a relationship and trust with the prep company. If they refuse to respond to your inquiries, it might be a sign that they are not right for you. Speaking with other vendors could be useful as well. You can find out which preparation services they're using and, even more important, if there are any to stay clear of. When you're transferring your inventory to someone else, you'll need to ensure you're sending it in a safe manner.