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Interesting approach. Not sure if they can replace the lean operations of most FBA sellers with an integrated company without compromising the profitability. Al
by simlan 6y ago
Interesting approach. Not sure if they can replace the lean operations of most FBA sellers with an integrated company without compromising the profitability. Also FBA at scale is not necessarily cheaper then running your own logistics.
- baybal2 6y agoI always considered that having dis-aggregated logistics was a plus for operating on marketplaces as online shop. It's not a given that Amazon can run logistics automation better than you yourself, or a 3rd party. At least in many countries other than USA, you would really need to have multiple logistics options for same products, and you almost always need that for cross-border.
- hef19898 6y agoAt scale, I would opt for a 3PL running logistics. Amazon is earning insane profits with FBA, at scale it is totally possible to not juts meet FBA prices but even getting close to Amazon's internal FBA costs. That would give you quite a nice margin benefit. It would be harder to ramp operations down so Using FBA, you just stop sending to Amazon. That is not counting the overhead needed to manage your "own" logistics.
- deleted 6y ago[deleted]
- lots2learn 6y agoNot true. FBA is not a profit center according to an Amazon employee I spoke with.
- hef19898 6y agoNo idea how prices are in the US, in Europe so they should have margins in excess of 15 - 20 %. Former Amazonian from operational logistics. Not saying their prices aren't competitive, for smaller volumes they very much are. Amazon is just milking their volume effects to a a max.
- lots2learn 6y agoFBA is not a profit center according to an Amazon employee I spoke with.