Sales Taxes
You could be required to pay sales tax if you purchase items online from US sellers (i.e. There may be sales tax due online arbitrage. If you work with a center that is not subject to sales tax or offers a lower rate of tax, you can save cash. How? You can ship your goods directly to the preparation center. If the location is any of the states with no sales tax (Delaware, Montana, New Hampshire, Oregon), the storage costs incurred while they wait for the next shipment to arrive is likely to be less than the tax you'd pay in your home state. Sales tax in the US is between zero and just over seven percentage. It doesn't matter if the sales tax is between two and three percent less in your state, it will be significant in your expenses.
Climate
It is important to inquire with your prep service if the climate control is available for perishable goods such as food. You don't want your goods ruined simply because they weren't stored in the right conditions. This isn't just for perishable products. Controlling the temperature is crucial for those who are shipping goods to a hot climate or one that is prone to extreme weather. If the climate isn't handled appropriately, your products could deteriorate or get affected by damp.
Storage Facility
FBA preparation is the primary responsibility for preparing your inventory for FBA. But more sellers are currently using prep centers to keep their inventory. There are two main reasons why sellers choose prep centers are to understand why. The first is that it's less expensive than having your entire inventory stored in Fulfillment Centers. Sellers keep their inventory at their prep company and then stock up on FBA according to their sales speed. To break this down into a simpler way, if a seller is sending 10,000 units to their prep center and is selling about 1,000 units per month, they'll only be sending 1,000 units into FBA each month. The prep center will keep the remainder of the inventory. The other reason is Amazon's suspension culture. If you get suspended your stock essentially becomes locked in the Fulfillment Center. You will have to pay per piece in order to get the item back. The item might not be delivered for several weeks. You (or your prep centre) will need to inspect the contents of your FBA inventory in the Plan of Action. When you've been reinstated, you will need to get your stock repackaged. This is a very expensive process that sellers wish to cut down on by storing their inventory in the Prep Center and sending smaller quantities. If you choose this route, ensure your prep service can quickly turn inventory around. Ask about their insurance. This is important since you want your inventory to be protected from fire or theft.
Processing Time
When choosing an FBA prep service, how fast they are able to prepare your inventory is key. There are many factors that can affect your need to be fast. If you've got stock in the prep center and you are bringing it in according to sales speed (see above) it is likely that you want them to deliver units in 48 hours. The majority of prep centers will be upfront about their processing times and provide a 24- or 48 hour guarantee. If you do not see this information, you should contact them. Don't want your late shipping rates to be affected by your prep service is taking too long to process your inventory into FBA. Have a look at the most popular Door to Door Delivery blog for details.
Inspection
Alongside labeling and packaging, it's worth asking if the FBA prep service conducts inspections. While this does not replace inspections of your product at the manufacturer's factory, it can be added. Manufacturers do not check their products with a lot of care because it could lead to stock rejections that can cost them more. Imagine your company conducts a an inspection prior to shipment. The manufacturer checks 10,000 units. They also check 20% of the items. There's a good chance your FBA prep team will find problems with your stock after going through it. Danny McMillan believes many manufacturers don’t pay attention to shipments because they know rejections will lead to higher costs and lower margins. Your prep service should be able to inspect your shipment.
In Summary
While outsourcing your FBA preparation can help make your company run more smoothly, it could also create issues for your business. The prep service you choose to use will have to develop a relationship with you. If they don't respond when you ask questions it is a sign they might not be the right fit. Speaking with other vendors could also prove useful. You can learn which prep services they are using and, even more important is if there are any that you should avoid. If you're sending your stock to someone, you want to be sure it's secure.