Sales Taxes
Online retailers in the USA may allow you to source goods (e.g. online arbitrage) you might have to pay sales tax. It is possible to save money by choosing a prep centre in a state with no sales tax or low rates. How? You can send your inventory directly to the pre-processing center. You can send your stock directly to the prep center if it is located within one or more of the states that have no sales tax (Delaware Montana New Hampshire Oregon). The storage costs they incur while they wait for additional inventory to arrive will be lower than the taxes you would pay in the home state. The sales tax in the US can range from zero to around seven percent. A prep center located in a state where sales tax is reduced by 2 or 3 percentage points can have a dramatic impact on your costs.
Climate
It is important to inquire with your prep service if climate control is available for perishable products like food. You don't want your goods to become damaged just because they weren't stored in good conditions. This doesn't only apply to perishable goods. The control of temperature is vital for those who ship goods to a very hot state or one with highly fluctuating weather. If the conditions aren’t properly managed, items may become damaged or lose value.
Storage Facility
FBA prep centers' primary purpose is to prepare your inventory for be shipped into FBA. But, more sellers are turning to prep centers to store their inventory. There are two major reasons why sellers are doing this. The primary reason is that it's cheaper than stocking your entire inventory at Fulfillment Centers. Based on the speed of their sales sellers keep their inventory in their preparation center, and then move the stock to FBA. This implies that a seller who delivers 10,000 units of inventory to their prep center every month and sells around 1,000 units per month would only be able to send 1,000 units to FBA each month. The rest of the inventory will be stored at the prep center. Amazon's suspension philosophy is the second. The Fulfillment Center will hold your stock until you have it removed. To have the item returned, you will need to pay for each item, and it could not be returned for a while. Your prep center or you will be required to inspect the inventory placed in FBA as part of your Plan of Action. When you're reinstated, your stock must be labeled and repackaged before you are able to return it. It is an expensive process, which sellers try to cut down on by storing their inventory in the Prep Center and submitting smaller quantities. This is a good option if you want to turn inventory around quickly. Ask about their insurance. This is essential because you want your stock to be safe from fire or theft.
Processing Time
The most important factor to consider when choosing the FBA preparation service is how fast they can prepare your inventory. There are a variety of factors that will affect your speed requirements. For example, if your sales speed requires you to hold stock at the prep center, you might expect them to get it ready within 48 hours. A lot of prep centers have transparency regarding processing times and offer 24-48 hour guarantees. If you're unable to see this information, you can ask. Your late-shipping rate will not be affected if your preparation service is slow in getting your inventory into FBA. Check out the recommended Door to Door Delivery website for details.
Inspection
It's important to determine if you FBA preparation services also conduct inspections. It's not an alternative to product inspections at the factory of the manufacturer. But, it may help them. Manufacturers don't check shipments too carefully, as if the product is rejected, they will be charged more. Imagine your manufacturer performing an inspection before shipping. Your company inspects 10,000 units. They also check 20% of the goods. The FBA prep company will most likely discover other issues with your inventory. Danny McMillan believes manufacturers don't always inspect shipments closely enough because they realize that rejecting stock can increase their costs and decrease their margins. The prep service you use should examine the shipment.
In Summary
You can outsource FBA prep to help your business become more productive, however it may also slow your business. You'll have to develop an alliance with the prep company, so if they are dismissive when you ask questions This is a clear warning that they might not be the best choice. Chatting with other sellers may also be useful. You will be able to determine which prep services they use and, even more importantly the ones you should stay clear of. In the end, if you're sending your precious inventory to someone else, you'll want to ensure your inventory is safe.