I'm considering of using Fulfillment by Amazon just to target Prime members for our Amazon listings. Not surprisingly, Prime members spend more.
Was anyone in the same boat?
Was there any significant improvements in your profits over selling as a regular seller on Amazon?
In our case, FBA (Fulfillment by Amazon) was useful for a few things, but increased profit was not one of them.
On the contrary, we used FBA to sell 'hot' items quickly, which in turn led to boosts of higher customer feedback for our merchant account.
Ultimately though, the increased traffic you might get with your FBA items is seriously offset by the increased competition you will get from other merchants and even Amazon itself. And After Amazon takes the cut for doing the fulfillment, you are left with pennies per sale in profit if you are lucky enough to get the volume sales.
Another unexpected negative aspect of using FBA is that occasionally Amazon fulfillment centers claim that there is "something wrong" with your goods or they are "damaged in shipment" and they refuse to store them or ship them. You have to eat the cost in these cases.
I think FBA can be useful if you are a merchant with a specific product line that won't experience direct competition, or if you are a small merchant trying to build some traction.
On a side note, I think FBA is a brilliant win-win strategy for Amazon: they get paid for storing stuff whether it sells or not, and they get merchants to test out product lines at ZERO cost to themselves.
100% of the time, I'd rather buy a product sold and fulfilled by Amazon (BIG bonus if it's prime) then some random third party seller who will charge $40 for shipping via the USPS in 10-20 days.
Amazon Prime is certainly best for consumers-- but for merchants it is very difficult to turn a profit.
Thanks guys!