How to use Amazon to distribute your export products in your target country
Amazon, as the world’s largest e-commerce platform, is a great way to start or grow a business as an exporter. Although not impossible, it has been a notoriously lengthy process to begin selling on Amazon from Africa in the past. However, now that the South African court has given Amazon go-ahead to begin construction on their new African headquarters in Cape Town, it is expected that with Amazon’s expansion into Africa the process of selling on Amazon from Africa will be simplified. Their expansion into South Africa is expected for February 2023.
For SMMEs, selling on Amazon can be an extremely successful method of e-commerce in general, and more so to reach global markets. More than half of units sold on Amazon are from independent sellers, and a large percentage of these are from foreign markets. Although registering as a supplier for some of the global markets on Amazon can involve hoops to jump through, those South Africans that have successfully become registered Amazon Sellers have reaped substantial returns.
Selling on Amazon can be supported through the use of Amazon’s e-commerce fulfillment structure Fulfillment-by-Amazon (FBA). With FBA, sellers send their products directly to Amazon’s warehouses, where inventory is stored. When orders come through, Amazon ships the product to the customer, as well as handling all customer support and returns.
If you’re set up as a seller on Amazon, all you need to do is set up FBA on your seller account to start using their services. Then, when adding products to your Amazon catalog, specify them as FBA inventory. When your products are ready to be sold, you would have to securely transport your goods to an Amazon fulfillment center as per their packing and shipping guidelines. Many people ship their goods directly from the manufacturer to FBA warehouses, so stock never needs to be stored in the seller’s own warehouse.
Before Amazon can receive your inventory, your products must be prepped, which includes having FNSKUs (a unique barcode used on Amazon) and other proper labeling.
Once goods arrive at the fulfillment center, they become available for purchase. When an order is made, Amazon’s employees pick, pack and ship the goods on behalf of the sellers.
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What are the benefits to FBA?
International shipping costs can quickly add up, with Amazon FBA you can ship in bulk to one location and let Amazon manage individual orders. Here are some advantages on letting Amazon FBA manage local shipping in the foreign area you require.
1. Cost Effective
In America, shipping with FBA costs 32%-72% less per unit than the most basic shipping options offered by major American carriers. After the monthly subscription fee, Amazon uses a pay-as-you-go structure; so you are charged storage, order fulfillment, returns and removal fees depending on your stock movements for that month.
There is no minimum or maximum for the number of products you send. As your business grows, your use of FBA can grow accordingly.
3. Inventory Management
FBA offers tools in your seller account to list products, create shipping plans, send in shipments, track and monitor your shipments, and remove inventory from Amazon fulfillment centers. You also have access to an Inventory Performance Dashboard, which displays your Inventory Performance Index (IPI) score, which can help you manage your business.
Amazon’s FBA service can be an effective way to tap into the global market without the traditional logistical issues that come with shipping smaller individual orders to an foreign clientele. It comes with resources that, if taken advantage of, could help you to grow your business internationally with substantial returns.
About the author
Trade consultant, researcher, writer
After receiving her degree, Zoë joined the Trade Logistics team as a trade consultant, researcher and writer, assisting multitudes navigate and grow in the world of international trade. In her free time, you can find her programming, baking, or reading a great book.