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Amazon Reduces Inefficiencies in FBA with Supply Chain Connect

Fulfillment By Amazon

Fulfillment By AmazonAmazon launched a new program for FBA merchants called Supply Chain Connect designed to increase efficiency and boost its control of inbound shipping to its warehouses.

Sellers currently have two ways to get inventory from suppliers to Amazon fulfillment centers. They can have the items delivered to their own address and then prep and ship the items to Amazon FCs. Or, they can have the supplier ship the inventory directly to Amazon FCs, in which case they must coordinate between the supplier and Amazon.

With Amazon Supply Chain Connect, FBA sellers can choose to have suppliers send their inventory to Amazon using a portal to communicate directly with Amazon about shipments while keeping the merchant in the loop.

Ryan Craver tweeted a screenshot of an invitation to the program. It describes the following benefits to FBA sellers:

– Supplier portal – A central supplier portal where selected suppliers can process your FBA shipments.

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– Faster inbound – Suppliers can enter box content information and immediately download FBA shipment and item labels eliminating the need for back and forth communication resulting in reduced lead time.

– Better performance – Suppliers have the tools they need to fulfill shipments with greater accuracy, and gain a better understanding of the Amazon shipping processes.

The video describing the program shows that sellers can choose the shipping method. If the shipper has selected “Small parcel delivery (SPD) / I’m shipping individual boxes,” they can then select:

– An “Amazon Partnered Carrier” with “Deeply-discounted shipping with easy tracking”; UPS and FedEx are options;

– Or, they can choose “I’d like to use my own.”

When a merchant selects an Amazon Partnered Carrier, it means lower costs for the merchant, and greater insight (and shipping volume) for Amazon.

During the fall months leading up to Christmas, FBA sellers frequently report problems of shipments to Amazon FCs ending up in limbo. It’s possible sellers who use Supply Chain Connect could see an improvement.

We haven’t read any discussion from sellers about the program as of yet, but they could have concerns that bringing their suppliers closer to Amazon could ultimately lead the marketplace to cut merchants out as unnecessary middlemen.

Some merchants also prefer to inspect inventory from their suppliers before it’s shipped to Amazon warehouses, for a variety of reasons.

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Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

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