5 min read If you’ve been exploring how to grow your ecommerce business, you’ve probably come across the term Fulfillment by Amazon (FBA). FBA lets you send your inventory to Amazon’s warehouses so Amazon handles storage, picking, packing, shipping, and even customer service. It allows businesses of any size to tap into Amazon’s massive logistics network and reach Prime customers across the US and around the world.
Many sellers hear that Amazon FBA makes ecommerce simple, and while it absolutely can help a business scale, it isn’t effortless. If you don’t manage fees, storage limits, prep requirements, and your supply chain carefully, the same system that helps you grow can start working against your margins.
This guide walks through what you need to know before you dive into FBA: the benefits, hidden costs, supply chain impact, and how to treat FBA as logistics infrastructure, not a passive shortcut.
Why Amazon FBA Can Be a Game Changer
Prime eligibility: When you use FBA, your products become eligible for Amazon Prime shipping, which gives you access to a massive base of highly engaged customers.
Lean fulfillment model: You don’t have to store, pick, pack, or ship items yourself. Amazon takes care of that for you, freeing up your time to focus on growth.
Scalability potential: By using Amazon’s logistics network, you can scale far beyond what your in-house fulfillment could handle.
Reach and trust: Amazon’s name and customer trust can help boost conversions and visibility for your listings.
FBA offers a path to growth, but it’s important to plan ahead to make it work for your business.
The Reality Check: What You Need to Know
1. Fees and Storage Costs
FBA comes with various fees, including storage, fulfillment, long-term storage, and removal or disposal costs for slow-moving inventory. Storage rates rise during peak seasons, and if you exceed limits or move product slowly, you may see unexpected charges. Careful forecasting and inventory planning are essential.
2. Prep, Labeling, and Compliance
Amazon has strict labeling and packaging requirements for all inbound shipments. Mistakes can lead to rejected units or added fees. Treat compliance and prep work as part of your operational process to avoid costly delays.
3. Loss of Control Over Packaging and Experience
When Amazon fulfills orders, your products are packed and shipped using their processes. This means less control over packaging and the customer experience. If brand presentation is important to you, plan ways to maintain your brand voice outside of packaging.
4. Seasonality and Demand Forecasting
Storage rates increase during high-volume seasons like Q4, and space may become limited. Forecasting demand, planning shipments in advance, and monitoring your sell-through rate can prevent surprises and help you maintain profitability.
5. Supply Chain Complexity
FBA adds a layer between your production and your customer. You’ll need systems in place to track what inventory is in Amazon’s network, what’s being sent, and what’s selling. Without visibility, it’s easy to lose control of your supply chain.
Treat FBA as Logistics Infrastructure, Not a Shortcut
It’s tempting to think that sending products to Amazon means the work is done, but you’re still responsible for inventory management, forecasting, and profit margins. FBA handles fulfillment, but you handle strategy. The key is to view FBA as part of your logistics ecosystem, not a replacement for it.
FBA can help you grow, but only if you actively manage it. Costs rise with scale, so plan accordingly and make sure your pricing reflects that. Successful sellers treat FBA as one tool among many in their overall fulfillment strategy.
How to Make FBA Work for Your Business
Choose the right products
Focus on products with steady demand and good turnover to avoid long-term storage fees.
Forecast inventory and turnover
Track sell-through rates and plan shipments carefully so your inventory levels match demand.
Integrate your systems
If you sell on Amazon and other channels like Shopify or eBay, you need software that keeps inventory synced in real time. This prevents overselling and stockouts.
Monitor performance
Slow-moving products tie up cash and storage space. Use reports to identify and remove or reallocate them before they become a burden.
Use a multi-channel strategy
Don’t rely on Amazon alone. Balance your fulfillment between FBA, your own warehouse, and other sales channels for flexibility.
Optimize for cost and margin
Look beyond sales volume. Understand your true profit after Amazon’s fees, inbound shipping, prep costs, and returns.
Why SKULabs Helps You Manage FBA and Multi Channel Fulfillment
When you’re selling on Amazon FBA and other platforms, visibility and control over your inventory are critical. That’s where SKULabs helps.
SKULabs gives you real time syncing across all your connected channels so you never lose track of inventory whether it’s in Amazon’s warehouses or your own. You can manage orders, fulfillment, and inventory all in one dashboard. The platform also helps with forecasting, tracking slow-moving products, and managing multiple warehouses with ease.
With SKULabs, your FBA operation becomes part of a unified workflow. You can scale confidently knowing your data is accurate and your systems are working together.
Bringing It All Together
Amazon FBA opens up massive opportunities for growth, but it’s not a set-it-and-forget-it system. Success comes from understanding the costs, planning your inventory strategy, and maintaining full visibility across every channel.
If you’re selling through FBA or considering it, SKULabs can help you take control of your inventory, orders, and multi channel fulfillment so you can grow efficiently and sustainably.
Take the next step and book a free walkthrough with our team to see how SKULabs can support your next stage of growth.
