Amazon Merchant Fulfillment to the Rescue: Two Days and $250 Later, I’m Giving It Another Try…

It is high time I sat down and wrote another post about how things are going on my end. I am still knee-deep in trying to get books and other inventory out of the door, so this post will be short and to the point…I hope. 🙂

Back to My Roots

Almost 8 years ago, I started selling books on Amazon as a merchant fulfilled seller. I sold books (primarily textbooks) as a way to earn some extra money while in college and it worked pretty well for me until I stopped right around 2008. Sure, I’ve merchant fulfilled quite a few low ranking, fast flip items since I started using Amazon FBA, but approximately 99.9% of the merchandise I sell on Amazon is fulfilled by Amazon.

…that was until two weeks ago when I resumed selling as a merchant-fulfilled bookseller

While in the middle of trying to get a large shipment of books out the door, I was having problems using my listing service (Listtee) and to make a complicated issue short, I had to finish the listing process through Amazon’s “Seller Central.” I took the .csv file of books I had already priced and labeled in Listtee and uploaded that to Amazon with every intention of immediately converting those listings to “Fulfilled by Amazon.”

Unfortunately — or fortunately depending on how you look at it, I couldn’t do it soon enough. Someone had purchased one of my textbooks right from under me that was designated for FBA. In fact, my condition notes even had my typical “FBA” lingo in it, yet it still sold! Even better was the fact that this book was ranked well above 2 million (2,700,000 if I remember correctly) and it was a textbook published specifically for a particular private college. Here I was, ready to convert over 80 textbooks to FBA and one sold right from underneath me in a matter of minutes.

…and then it hit me. Why in the world wasn’t I merchant-fulfilling books anymore? I honestly didn’t and still don’t have a legitimate reason not to seeing as though I still sell items on eBay and therefore I’m always storing and packing something.

Here I was about to incur over $360 in shipping costs to ship a ton of books to Amazon and it never dawned on me that I could do something about it instead of waiting 7+ days for those books to arrive and be checked in and hopefully start selling immediately…because that was my plan. I would simply eat the cost of shipping and wait for other items to sell to absorb the cost. The only problem with that plan was that my account was due to be charged for any outstanding balances before that latest shipment of books would be checked in. At this point I could either hope that $360 worth of merchandise would sell before then or I could do something about it.

It was at that moment that I began going through the books I intended to ship to gauge which ones were worth keeping and fulfilling myself.

My Criteria for Merchant-Fulfilled Books

I set pretty strict requirements for the books that I would fulfill myself because I did not want my home to become a warehouse for books too.

A typical book on the shelf in my office meets the following criteria:

  • The merchant-fulfilled selling price is close to the FBA price
  • Book has a low sales rank and low # of competing sellers
  • Absolutely NO penny books; books should sell for a minimum of $10 in USED condition (although most of the books I’m selling are considered “New” or “Very Good” and my textbooks range in condition from “Good” to “New” and the average selling price is over $30)
  • Book must fit into a flat rate envelope or padded flat rate envelope

My criteria sounds pretty simple when I write it out, but after scanning over 400 books, less than 35 made the cut!

Thankfully, this strategy has proven to be very profitable. To put things in perspective, once I boxed and shipped everything to Amazon, the cost to ship those books hit my account on 8/19. It was a little over $360. By 8/22, I sold enough items through FBA and through merchant-fulfillment to cover those costs and actually initiate a deposit to my account.

My merchant fulfilled sales wiped out 70% of my inbound shipping costs!

Sure, I could have sent everything in to Amazon and waited for those items to be checked in 7-10 days later, but there was no guarantee that I would have generated enough sales to cover the negative balance on my account. The last thing I wanted was for my debit card to be charged for outstanding fees — even if I recouped the cost once my shipment was checked in and things began to sell.

So What Books Work Best for Merchant Fulfillment?

There is no right or wrong answer for this, but *my* criteria for any book, whether a textbook, non-fiction or fiction book is summed up above. However, to put things in perspective, lets take a look at one of the books that I chose to merchant fulfill rather than sending it into Amazon.

According to the screenshot on your right, this book sells for $66.73 in new condition and $49.95 in used condition. I purchased this book in used condition for $1.00 and set the price at $43 which is a little below the lowest used FBA price and also takes into account the $3.99 shipping charge that the buyer would have to pay.

The lowest price FBA seller just so happens to be “Amazon Warehouse Deals.” If I were to have shipped this book into Amazon, I would have been competing against Amazon who just so happens to have 211 copies of this particular book in stock:

The only way I would have been able to compete would have been on price and I try to avoid doing that at all costs. Unfortunately, if I sent this into FBA, I most likely would have dropped my price below $49.95 and ultimately would have actually made far less than I did by merchant fulfilling this book myself.

Here’s how things actually played out:

This book sold about 5 hours after listing it for $43.00 plus an additional $6.99 shipping credit for expedited shipping. The total came to $49.99. The cost to ship the item via Priority Mail was $5.12, leaving me with $1.87 left over from the shipping credit.

 

In the image above, you can see that I added $5.12 in the “outbound shipping” box to account for my postage costs and $0.79 in the “inbound shipping” box because this was how much I averaged per book to ship to Amazon.

According to those calculations, I lost $0.98 by not shipping this book to Amazon and that’s assuming I didn’t lower my price to compete against Amazon who was also selling the book used too! I can live with “losing” $0.98. 🙂

…and lest you think that I am only merchant fulfilling textbooks, here is a non-textbook that I sold:

This book was ranked well over 1 million and it took 7 days to sell through merchant-fulfillment even though Amazon is selling the book as well. The rank is now sitting somewhere around 500,000 (as of writing this) and climbing.

I also sold the following DVD via merchant-fulfillment:

This DVD also had a high rank for movies (~ 200k) and only one FBA seller whose price was about $10 higher. This DVD also took about a week to sell.

As you can see from those examples, I didn’t really (and still don’t) pay too much attention to sales rank. Whether I’m selling through FBA or merchant-fulfillment, if there is a demand and the niche is obscure enough to justify the rank, I have no problem waiting for the right buyer to come along. In both cases, it took about a week for the right buyers to come along. I think I can live with that! 🙂

Moving Forward

I plan to continue to list books via merchant fulfillment. I believe that the criteria that I’ve set allows me to keep my home from turning into a used book store. It also allows me to pay down my inbound shipping costs if/when my FBA sales slow down.

Ultimately, if I decide that I no longer want to merchant-fulfill books, I can always convert those listing to FBA and ship them to Amazon.

If you have not already done so, merchant fulfillment is worth a try! You can most certainly merchant fulfill more than just books and media. This can also work for eBay sellers too. It never hurts to have your inventory on two separate platforms to capture a sale from a much larger pool of buyers. You would be surprised at the things you can sell on Amazon. There are many items that most people don’t realize you call sell via FBA and as a consequence, the only sellers are merchant-fulfilled ones who are fulfilling a need. …I’ll leave your mind to ponder on that or you could just run some of your inventory through Amazon to see if it is worth giving it a shot. 🙂

Until next time,

Yolanda