Amazon FBA FBM

Amazon FBA and FBM



Amazon has introduced an auto-cancellation feature for Fulfillment by Merchant (FBM) consumer orders, which may have an impact on your operations if not properly managed.

Here are the key details you need to know about this new feature:

  • Automatic Cancellation: FBM orders will now be automatically canceled if a cancellation request is made within the seller's preset auto-cancellation time period.

  • No Opt-Out Option: Sellers cannot opt-out of this feature.

  • Adjustable Time Period: Sellers have the flexibility to set the auto-cancellation time period window between 30 minutes to 72 hours.

  • Impact on Order Fulfillment: If an order is auto-canceled within the set time period and you have already fulfilled the order, it may lead to complications and impact your seller metrics.

To mitigate any potential issues arising from this feature, we are implementing a proactive approach to support our sellers:

  • Adjustment of Fulfillment Process: Upon learning your auto-cancellation window, we will add a buffer of half an hour to ensure that orders are not auto-cancelled before they can be fulfilled.

  • Orders on Hold: Orders will be kept on hold until the auto-cancellation window is cleared, allowing us to fulfill the order without any risk of cancellation.


To set up or adjust the auto-cancellation feature, please follow these steps:

  1. Navigate to your Amazon Seller Central account.

  2. Go to Settings.

  3. Select Shipping Settings.

  4. Click on General Shipping Settings.

  5. Set your preferred auto-cancellation time period within the provided options (30 minutes to 72 hours).

## FBA and FBM Strategy for Amazon Sellers

### Introduction

The FBA and FBM strategy, employed by the speaker on various brands over the years, is regarded as a smart approach to navigating the Amazon marketplace.

### Acknowledgment

While the strategy may not universally suit every brand, its efficacy in addressing issues associated with Fulfillment by Amazon (FBA) is noteworthy.

### Inventory Issues with FBA

Selling through FBA inevitably leads to inventory challenges. This strategy aims to provide a solution for such situations.

### Failover to FBM

To ensure a continuous sales flow, the speaker advocates for the setup of a failover mechanism to Fulfillment by Merchant (FBM).

### Illustration with Products

The strategy is exemplified using identical products distinguished by different Stock Keeping Units (SKUs), with an emphasis on clear labeling for internal communication.

### Failover Mechanism

In the event of an FBA product running out of stock, an automatic failover to FBM is triggered, leveraging a shipping pallet warehouse.

### Algorithmic and Ranking Benefits

Beyond just addressing inventory issues, the strategy contributes to maintaining algorithmic standing, preventing a loss in sales rank during disruptions.

### Inventory Management

The approach involves keeping inventory at zero for both FBA and FBM products during periods of inactivity.

### Setting Up FBM

Copying the FBA product, adding a prefix, changing it to "fulfilled by the manufacturer" (FBM), and maintaining the same price are key steps in implementing the strategy.

### Shipping Template and Buy Box

Application of a shipping template with a small order fee for the FBM product ensures competition for the buy box only when the FBA product is unavailable.

### A/B Testing and Pricing Strategy

To optimize the order fee, A/B testing is recommended, taking into consideration the product's value to avoid friction during the checkout process.

### Shipping Template Options

The flexibility of the strategy extends to shipping template options, including domestic, regional, expedited, and international (if enabled).

### Buy Box Dynamics

The FBM product secures the buy box exclusively when the FBA product is out of stock, providing a seamless customer experience.

### Dual Benefits and Conclusion

The strategy not only offers algorithmic support but also keeps the brand consistently in stock, ensuring continuity and customer satisfaction.