If you've ever purchased anything on Amazon, you probably opted for same-day or one-day delivery at some point, even if the item wasn't sold by Amazon. After all, as the world's largest retailer, Amazon prides itself not only on the variety of products on its site, but also on its fast delivery.
But have you ever wondered what happens behind the scenes when shopping on Amazon? According to Statista, Amazon's main source of revenue is the online sales of its electronics and other products. The second is third-party seller revenue.
Third-party sellers on Amazon
The world's largest retailer has more than 2 million third-party sellers registered on its online platform. In fact, it is estimated that more than 47% of items shipped by Amazon are sold by third-party sellers.
More and more businesses are building and growing their wealth on Amazon. In trade and commerce, like it or not, there is always a very important aspect to deal with: logistics.
Fulfilled by Amazon or Dropshipped
Given these advantages, it's no surprise that most third-party sellers on Amazon use its Fulfillment by Amazon (FBA) service. With FBA, sellers' products are eligible for Amazon's Prime and Super Saver Shipping. They can also take advantage of Amazon's customer service experience, which all translates to more sales when competing with non-FBA sellers.
However, not everything that glows is gold. Amazon's FBA also has its disadvantages, and many sellers often choose to handle this part of the logistics themselves. In other words, direct fulfillment.
If you are a third-party seller who chooses direct fulfillment, you may need to hire an outside service to help you manage the logistics part. As the demand has increased over the past decade, direct or other implementations have become more popular and advanced. Technology is obviously a big help when it comes to managing the entire process, tracking individual shipments, and inventory in warehouses. For most people, the dream right now is to reach Amazon Prime levels, where, for example, when you preorder, you know the shipment will arrive at your door on a given date. And it actually delivered on that date.
