Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Thu Oct 5 2017 12:04:42

Amazon Wants Access to Your Warehouse?

By: Ina Steiner

Sponsored Link

Airbnb for Online Sellers? What if Amazon used excess capacity in the warehouse of their merchants to store its own goods or those of other merchants? That's speculation on our part, but it's inspired by a new program from Amazon that Bloomberg reported on today.

The program, currently in stealth mode, is called Seller Flex and is an extension of Amazon's current Seller Fulfilled Prime program that allows merchants to offer "Prime eligible" items without requiring them to be stored in Amazon Fulfillment Centers. 

Amazon spokesperson Tom Cook told EcommerceBytes a year ago that since launching it in 2015, Amazon had seen both large and small sellers join the Seller Fulfilled Prime program. Sellers who are approved must purchase shipping for all Prime items through Amazon's Buy Shipping Services. 

Bloomberg said the new Seller Flex program lets Amazon take over the decision making about how those items will be delivered to customers, whether by UPS, FedEx, or by its own couriers through Amazon Logistics (look for "AMZL" on the Amazon shipping label).

Bloomberg, citing anonymous sources, wrote: "Amazon will oversee pickup of packages from warehouses of third-party merchants selling goods on Amazon.com and their delivery to customers' homes, the people said - work that is now often handled by UPS and FedEx. Amazon could still use these couriers for delivery, but the company will decide how a package is sent instead of leaving it up to the seller."

Seller Flex would help give Amazon more control and help it save money through volume shipping discounts, without clogging up space in its own warehouses, according to Bloomberg.

But here's another significant benefit to Amazon the news outlet identifies:

"Seller Flex would also give Seattle-based Amazon more visibility into the warehousing and delivery operations of its merchant partners, potentially helping it make full use of their product inventory, storage space and proximity to customers while still guaranteeing quick delivery."

Which led us to wonder, what if Amazon could identify merchants' excess warehouse space and "rent" it? 

There's precedent for such a service - uShip did the same thing for the trucking industry. Its marketplace allows movers, carriers, transporters, van lines, freight brokers and independent service providers to identify and fill empty cargo space along their routes and sell them to other shippers at a discount. Why not create a uShip or Airbnb for online merchant warehouse space?




Comments (19) | Leave Comment | Permalink

Readers Comments

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: eBay Shill Buster This user has validated their user name.

Thu Oct 5 12:48:42 2017

This is the first step for Amazon taking everyone's entire inventory for their own and automatically adjusting prices, next they will require that your real time inventory is connected via EDI to their inventory systems, and the small sellers will be left in the dust.

So unless you can invest a few million dollars in a warehouse, IT/MIS systems and a million bucks in inventory you will be left behind.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: mcposty This user has validated their user name.

Thu Oct 5 12:57:38 2017

Would this include hiring workers to show up at your warehouse?

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

This user has validated their user name. by: Ming the Merciless

Thu Oct 5 13:15:55 2017

This dangerous and business killing octopus seems to have an unlimited number of poisonous tentacles.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: TomH This user has validated their user name.

Thu Oct 5 14:04:32 2017

I agree with Ming on this.  More and more pressure on the small sellers. May not sound like that on the surface, but that is exactly what it is.  

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: FeelingFroggy This user has validated their user name.

Thu Oct 5 14:16:33 2017

I would let my worst enemy use my vacant warehouse space before I would even think of letting Amazon or Bayzon even know the address.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

This user has validated their user name. by: Rexford

Thu Oct 5 15:12:07 2017

What Ming said.  They want to be in everyone's home and now everyone's warehouse.

You could not pay me to have Echo or Alexa in my home.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

This user has validated their user name. by: Beanie

Thu Oct 5 16:34:39 2017

@ Ming and Rexford, you are both spot on. Snooping, spying, prying into others business, home and lives. They just don't stop. And that Echo and Alexa technology, well that stuff us downright creepy to me. I will NEVER use it. I don't use Siri on my phone or Cortana on my computer. I will never trust it. Technology "usually" starts out with good intentions, but somewhere it goes wrong and eventually can and will be used against us. We are tracked everywhere we go with credit cards, phone pings from cell towers, cameras everywhere, satellite, google street view and on and on. Its become beyond ridiculous.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: eBay Shill Buster This user has validated their user name.

Thu Oct 5 16:55:17 2017

Submit to the beast if you want to buy and sell, you must be in Sellers Hub too !!!!

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

This user has validated their user name. by: RKTOYS

Fri Oct 6 00:29:23 2017

Love the imagery, Ming.  Don't want anything to do with Scamazon either.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: angryllama This user has validated their user name.

Fri Oct 6 03:10:05 2017

I'll   "do" you one better.   Imagine if you had the wherewithall to BUY / LEASE that Large warehouse AND the $million to buy inventory.
Presume that ALL goes WELL for the first 9 to 15 months.  Money comes in, Product goes out... whoo-hoo !   Then just as you have hired more staff AND bought more $inventory....   POOF.   Amazon shifts gears to DROP the entire program OR embraces another Warehouser and drops you like a HOT ROCK.
Horrifying Scenario Number Two:   (THIS one mirrors what happened to one of my OLD customers in Kansas City back around 1977.)   Amazon doesn't DROP you as a warehouser, BUT they start drip-by-drip messing with YOUR business arrangement like paying LESS per square foot for warehouse space, MANDATING that YOU buy a $25,000 forklift to move around THEIR AMAZON inventory, hire more staff to work 24/7 for THEM no matter if you see 90 orders a day or only 3 a day.... all of them between midnight and 3 am.   In the case of that OLD customer their TORMENTOR was Sears Roebuck.  This company had the contract with SEARS for several years to Private Label Motor Oil and Lubricating Grease with the SEARS labeling on the individual CANS and the BULK PACKAGING BOXES, too.   All went well for first few years then BANG they "informed" this company that the price SEARS would pay for the finished, packed, labeled products would henceforth be PAID at only 93 percent of the previous year's price.  Awful news, but "doable" so they kept on buying the oil / grease doing the filling and packaging.  Very NEXT year SEARS announced that THEY (Sears) would be having the packaging materials ( cans, lube tubes, packing boxes)  PRINTED and "Provided" to Jesco by a THIRD PARTY and JESCO would be paid 20 percent less.   VERY painful, but they stayed the path and kept this up for the entire NEXT year.  Next contract that came out "announced" to Jesco that henceforth would no longer be supplying the OIL or GREASE and would only be paid a FLAT fee per unit as SEARS would be buying the oil, grease, cans, tubes, and boxes elsewhere and JESCO would be paid ONLY for packaging SEARS' own property.   Enough was ENOUGH and rather that telling SEARS to  "get stuffed"  they instead just IGNORED the new contract and NEVER returned a signed copy to SEARS.  They also stopped SHIPPING anything to or FOR SEARS.  Took a few MONTHS for purchasing department at SEARS to figure out that their Purchase Orders were being IGNORED.  They started PHONING Jesco with nobody returning their calls.
The owner at Jesco told me this cost him 20 percent of his annual gross sales, but the GLOWED when he SMILED and said it was TOTALLY WORTH IT to be SHED of this PAINFUL customer.   Now just fill in AMAZON anywhere you READ Sears and move you calendar forward 35 years to 2017.  

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: Geetar This user has validated their user name.

Fri Oct 6 14:17:13 2017

U know this isnt a bad idea. Well, find a similar seller in a different geographic location, partner up with them. Ship each others products. and you have fast delivery times without going to Amazon, or bring limited by Ebay's new guaranteed delivery thing. Has a few risks. But HMMM!

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: eBay Shill Buster This user has validated their user name.

Sat Oct 7 13:42:47 2017

Amazon and eBay have taken this thing too far.

If you want your stuff the same day, do what people have been doing for hundreds of years, get off your arse and phone and go to the store and buy it.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: dander This user has validated their user name.

Sat Oct 7 19:35:22 2017

Knowing first hand how Amazon treats their vendors,and especially the vendor employees, I would be wary of letting them know any part of my operation. Before you know if, they have you by the balls. Amazon is the master of slowly turning up the heat. before you know it good bye independence.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: Barbbie This user has validated their user name.

Mon Oct 9 01:02:14 2017

I own my warehouse. If Amazon wants to use it, I charge storage fees both long and short term for the same item and I also charge by the space each item takes in my warehouse, and they need to label everything very carefully because if I lose it, tough for them.
Seriously though, I think this would be a bad idea unless you want amazon to make your life miserable.
I guess you would need a separate work area or employees or whatever to separate out the amazon packages from your own. Just that alone sounds like a pain, then when is the package pickup? So you put your plans on hold to wait for that? No thanks.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: etailer This user has validated their user name.

Mon Oct 9 01:20:21 2017

We are one of the unfortunate sellers who has been invited to participate in this program.  The subject of the e-mail reads ''Subject: [RSVP required] Amazon PreQualification Webinars'' - which presumably means we do not have any option but are being coerced into signing up for this Seller Fulfilled Prime (SFP) program.

Needless to mention that we are concerned - given Amazon's propensity to get intrusive and steal the business from 3rd party sellers.  
- Any unique item that we add to Amazon that is successful is immediately prostituted to multiple competitors.

- If it observed to be successful, Amazon contacts the manufacturer and gets them to kick off the retailers like us who have worked hard to promote the product - we have lost over 20 manufacturers in the past 6 years!

- If the manufacturer declines, Amazon has the product reverse engineered in China and private labels it.

Seller Fulfilled Prime (SFP) program comes with a lot of caveats that an average retailer may not wish to sign up for (see #4 below if you don't believe it?).  Details available here http://amzn.to/2wGbayY

Some of the most outrageous expectations for Seller Fulfilled Prime program are:

1.  Sellers must purchase all shipping labels for orders containing a Prime item through Buy Shipping Services. By using Buy Shipping Services, sellers agree to Amazon's terms and conditions and the terms and conditions of the applicable carrier or service provider for both outbound delivery and returns shipping.

2.  Buyers requesting to return a Prime item within Amazon's return policy will have their return approved immediately and will receive a pre-paid return mailing label.

3. Sellers will be responsible for the cost of return shipping labels for all Prime items, except as outlined in the ''Charges for return shipping'' section below (buyers never select any of the reasons that prompts them to pay for return shipping)

4.  All returned Prime items must be processed and refunded within two business days of the item arriving in a seller’s warehouse.

5.  If a buyer does not receive a delivery of a Prime item, even if the package tracking information indicates it was ''delivered,'' the seller must grant a full refund for the order. We recommend that sellers consider purchasing delivery insurance for shipments to cover this.

6. To ensure a great customer experience, Amazon may make case-by-case exceptions to the return policies, including accepting returns for Prime items past the stated returns time frame. If Amazon accepts a return within the 15 days following the end of the stated returns window, the return must be processed the same as if the product was received during the returns window.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: Barbbie This user has validated their user name.

Mon Oct 9 02:32:13 2017

#2-4 is going to be every 3P at varying times - that began Oct 2. If you are not already on forced returns, you will be and I thought they only gave 24 hours to refund. I may be wrong about the 24 hours, all will have prepaid labels and you will have to collect on the back end for remorse. Not on it yet and hope they forget me.
#5 sounds worse to me. It's one thing for amazon to do that to themselves but I won't volunteer for that.
#6 Amazon handling your customer service is a big problem as well.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: Chicago48 This user has validated their user name.

Mon Oct 9 07:03:06 2017

Whoever Amz partners with....can you imagine the length and terms of the warehouse contract?  A nightmare requiring a table full of lawyers.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: Whatever This user has validated their user name.

Mon Oct 9 10:13:10 2017

well since Amazon won't let me in (closed category) unless I pay someone off - well I could care less how they run their company. Can't sell there - don't buy there.

Perminate Link for Amazon Wants Access to Your Warehouse?   Amazon Wants Access to Your Warehouse?

by: Captech This user has validated their user name.
Web Site

Thu Oct 12 11:06:47 2017

An AirBnB for warehouses? So companies could help each other out and work together? Sounds like an interesting concept...



Login is required to post comments.
To sign in to leave a comment using your AB Verify User Name, fill in the form below. If you have not yet signed up for AB Verify, or if you'd like more information, go to the Registration Page
.

Login for AB Verify
Be sure and use your email address and password to log in.

 
Email:
Password:
 
 Forgot Your Password?
 Even though you are signed in with the AuctionBytes Blog, you will have to sign in to the EcommerceBytes blog. But you can sign in with your existing AB Verify info.