Is Amazon FBA Right for My Business?
As someone who’s worked with countless ecommerce businesses at Medallion Fulfillment, I’ve seen firsthand how the choice of fulfillment services can make or break a company’s growth trajectory. Amazon FBA has become incredibly popular, but is it the right fit for your business? Let me walk you through what you need to know.
Amazon’s Fulfilled by Amazon (FBA) program allows sellers to store their products in Amazon’s fulfillment centers. When customers place orders, Amazon handles the picking, packing, shipping, and customer service. It sounds straightforward, but the reality is more complex.
Understanding Amazon FBA Basics
Amazon FBA works well for businesses selling primarily on Amazon’s marketplace. Your products get the coveted Prime badge, which can significantly boost sales since Prime members prefer fast, free shipping. Amazon handles customer service inquiries, returns, and refunds—removing a major operational burden.
However, FBA comes with strict requirements. Your products must meet specific packaging standards, labeling requirements, and inventory restrictions. Amazon charges storage fees based on cubic footage, which can become expensive for bulky items that don’t sell quickly.
Control and Flexibility: Where FBA Falls Short
Here’s where I see many of my clients struggle with Amazon FBA—the lack of control. You can’t choose your shipping carriers, customize packaging with your branding, or control the customer experience beyond the initial product listing. Everything ships in Amazon-branded boxes, and you have no say in delivery methods.
For businesses that value brand identity and customer relationships, this can be problematic. You’re essentially handing over your customer experience to Amazon, which may not align with your brand values or service standards.
Storage Costs and Hidden Fees
Amazon’s fee structure is notoriously complex. While they advertise a simple per-item fulfillment fee, there are numerous additional charges: long-term storage fees, removal fees, return processing fees, and seasonal storage surcharges. These costs can quickly eat into your profit margins.
I’ve worked with businesses that discovered their Amazon FBA costs were 30-40% higher than expected due to these hidden fees. For companies with seasonal inventory or slower-moving products, storage costs can become particularly burdensome.
Shipping and Branding Limitations
With FBA, you lose control over the unboxing experience—a crucial touchpoint for building customer loyalty. There’s no opportunity for branded packaging, personalized notes, or promotional inserts that could drive repeat purchases.
Additionally, Amazon’s shipping methods may not align with your sustainability goals or customer preferences. You can’t choose eco-friendly packaging options or work with local carriers who might offer better service in specific regions.
Recommendation Based on Business Needs
Amazon FBA makes sense if you’re exclusively selling on Amazon, have small, lightweight products, and prioritize hands-off operations over brand control. It’s particularly effective for high-volume sellers who want to leverage Amazon’s massive logistics network.
However, if you sell across multiple channels, have larger products, want to maintain brand identity, or prefer predictable pricing, consider alternative ecommerce fulfillment solutions. At Medallion Fulfillment, we’ve helped many businesses transition away from FBA to achieve better cost control, enhanced branding opportunities, and improved customer relationships.
Making the Right Choice for Your Growth
The best fulfillment solution depends on your specific business model, growth goals, and priorities. Amazon FBA isn’t inherently good or bad—it’s about finding the right fit for your unique needs.
Before committing to any fulfillment service, carefully evaluate your current and projected order volumes, product characteristics, sales channels, and brand objectives. Consider speaking with fulfillment experts who can provide unbiased guidance based on your specific situation.
Ready to explore your fulfillment options? Contact our team at Medallion Fulfillment to discuss how we can support your business growth with flexible, cost-effective solutions tailored to your needs.