Prime by Seller:
How Amazon Prime can benefit you and your customers

Amazon is the most popular place for online shoppers in Germany to look for products on the internet. One reason for this is the internet giant’s Prime option: Around 200 million people worldwide use paid Prime membership for fast delivery and access to movies, series and music, among other things.

But the Prime program also has benefits for you as an online retailer. Products offered under the Prime label tend to have a better chance of selling than non-Prime products because Amazon ranks Prime listings higher than those that do not offer fast shipping. In addition, these listings are more likely to be given the benefit of the doubt by customers.

If you want to sell your products on Amazon and take advantage of the Prime program, you have two options:

1. Use Fulfillment by Amazon (FBA) and have the marketplace ship your items from an Amazon warehouse.
2. You can use Seller Fulfilled Prime (SFP) and ship to Prime customers from your warehouse or your fulfillment provider’s fulfillment centers.

This article explains the pros and cons of SFP and how to make the most efficient use of Amazon’s fulfillment option.

Amazon offers sellers several fulfillment options – you can either leave the shipping to Amazon (FBA) and participate in the Prime program, or you can take on the task yourself and do without the Prime logo (Fulfilment by Merchant, FBM).

For some time now, there has been a third option: Seller Fulfilled Prime – often referred to as Prime by Seller – allows you to list items on Amazon with the Prime logo and still handle shipping yourself.

With this shipping program, online retailers don’t have to store their items with Amazon, but use their fulfillment – from their warehouse or that of the fulfillment service provider. SFP is therefore the ideal compromise for online retailers who want to

• use Amazon as a marketplace,
• retain control of inventory, shipping, and the customer experience, and
• want to offer their Amazon customers (and themselves) the convenience of Prime

There are five steps sellers need to take to use Prime:

• Step 1: Qualify for SFP and complete the trial period
• Step 2: Store inventory in your warehouse
• Step 3: Process orders
• Step 4: Ideally pick, pack, and ship on the same day as the order
• Step 5: Process the order with the preferred carrier

Read on to find out the benefits of the SFP program, why you might not want to deliver with the Prime option, and how to qualify.

The main benefit of Seller Fulfilled Prime is that your products receive Prime status, giving them more visibility in search results. Amazon generates around 70 percent of its sales in Germany from Prime members. With SFP, you can get a slice of that while keeping your fulfillment largely independent of Amazon.

Other benefits of the SFP program include:

• High visibility: Items appear in the search results of Amazon customers who specifically filter for Prime products.
• Full control: The shipping processes remain in the hands of the seller and are largely independent of Amazon’s internal processes
• High impact on branding: Using your own packaging and labels reinforces brand identity
• Good opportunities to sell: Products in the Prime by Seller program have a higher chance of ending up in the Buy Box or can be submitted for flash offers on the Deals of the Day page, providing additional visibility
• More financial flexibility: You have free choice of the shipping provider and therefore more leeway in terms and conditions

The list of benefits of Seller Fulfilled Prime is long. However, several factors may discourage merchants from using the service. You should be aware of the following facts before deciding to use Prime by Seller:

• Customer Service: Amazon will take over the customer service. The marketplace handles order tracking, refund requests and returns. This is communicated as an advantage. However, some retailers are critical of the fact that interaction with customers takes place exclusively via Amazon. Although this saves time, the influence on the customer experience is lost at this point.
• Responsibility: Retailers have control over the shipping process – but they also bear all the responsibility for shipping. Clean fulfillment processes are therefore essential.
• Requirements: DThe bar is high for online retailers who want to use the Prime logo with their own fulfillment.

Are you attracted to the benefits of SFP and can you live with the drawbacks? Before you can sell your items through Seller Fulfilled Prime, you need to familiarize yourself with the guidelines Amazon has put in place.

To be eligible for Prime, sellers must ship their items on time and reliably. Specifically, sellers must meet the following criteria:

• Delivery promise: The delivery promise is the amount of time customers can expect to receive their goods. Merchants must meet specific delivery criteria based on the category, location, size, and weight of their products.
• Punctuality: The Prime business is time-sensitive – which is why Amazon requires a minimum on-time delivery rate of 90 percent for Prime orders.
• Tracking: Your parcel service must offer tracking, as a valid tracking ID is required for at least 99 percent of shipments and must be provided to Amazon.
• Cancellations Cancellations: A maximum of 0.5 percent of all orders can be canceled.
• Shipping costs: Amazon requires you to offer free shipping and returns to Prime members. Exceptions apply to heavy products and cross-border deliveries.
• Availability: Prime-registered products must be available nationwide.
• Trial period: Amazon verifies that you meet all Prime by Seller requirements during a trial period.

These guidelines are ongoing and subject to change. For example, in June 2023, Amazon adjusted the required delivery speed.

EThere are no longer fixed delivery speeds. Instead, the delivery speed threshold will be calculated hourly at the store level. Only the 90 percent of Prime-eligible listings that offer the fastest actual delivery speed will receive the Prime logo.

Amazon monitors compliance with the SFP requirements very closely. If you want to meet them reliably, your fulfillment processes must run smoothly. Automated and digital workflows can help.

With Alaiko, you can reap the benefits of SFP with your existing resources, even as your volumes grow, and give your customers another reason to choose you with the Prime option.

As an experienced fulfillment service provider, Alaiko takes the hard work out of fast shipping. You invest your energy in customer satisfaction, developing your products, ensuring a unique post-purchase experience, and opening up new sales channels, while Alaiko runs it all reliably in the background.

Another advantage is that you can use special fulfillment rules in the Alaiko OS to specify that a special flyer – e.g. with a voucher code for the next purchase via your online shop – is enclosed with every Prime order. Thanks to automated processes in the warehouse, this will be placed directly in the parcel and your customers will be more likely to place their next order in your store rather than on Amazon. This opens up new sales channels for you.

To make sure goalkeepers have everything under control, sports equipment manufacturer T1TAN offers goalkeeper gloves and accessories in its own Amazon store. The company relies on Alaiko for fulfillment, with impressive results:

• 90 Precent Next Day Deliveryfor deliveries within Germany
• 100 Precent Acknowledgement Rate – all Amazon orders placed before 2 pm are handed over to DHL on the same day
• 100 Percent visibility of shipping and returns status
• Reduction in support tickets on issues such as shipping, late delivery, or tracking numbers
• Tripled sales since switching to Alaiko – with the same team size in support

If Amazon is or will be an important sales channel for you, the Prime program is an indispensable sales lever. With Seller Fulfilled Prime, you can sell your items under the Prime label on the world’s largest marketplace using your existing warehouse processes.

Unlike Amazon FBA, you have more control over the customer experience and can ship your items in your shipping boxes. However, you give up control of customer service.

If you prefer to communicate with your customers yourself and Prime is not an option for the time being, Amazon Fulfilment by Merchant may be an option. In either case, efficient and reliable fulfillment is important and Alaiko can help.

The header image is by Erik Mclean on Pexels, the other image by T1TAN.