The first 10 years of Amazon FBA

Fulfillment by Amazon is a decade old and it’s remarkable how meaningful it become to ecommerce over the last 10 years. From the post A Decade of Fulfillment by Amazon (FBA) at Marketplace Pulse, which covers marketplaces and Amazon extensively:

Today two out of every three top Amazon.com sellers use FBA. It has become harder for sellers to do their own fulfillment, and achieve scale. Amazon has launched services like Seller Fulfilled Prime, and more recently FBA Onsite in an attempt to enable sellers to offer Prime without using FBA. The key is Prime, not FBA, so there is going to be future developments to achieve that without Amazon having to build more warehouses.

When the service launched, it’s hard to believe many predicted how big it would become. Certainly, competitors didn’t jump to launch competing services, and now find themselves far behind. More from the post:

…The competition is thus a decade behind to realize the importance of fulfillment.

A marketplace with thousands of small sellers handling their own fulfillment is both inefficient, and doesn’t meet the expectations most modern shoppers have. Fulfillment needs scale to work effectively. Marketplaces work best when they enable sellers to grow, in e-commerce that means helping sellers compete meet the high expectations of reliable, free, and fast shipping.

A few more highlights:
  • Twelve years ago on September 19th2006 Amazon announced the Fulfillment by Amazon service.
  • Fulfillment by Amazonor FBA for shortis a service allowing sellers to offload most of their warehouse operations to Amazon for an extra fee.
  • We created Fulfillment by Amazon because it is good for Amazon.com customersand thereforegreat for our third-party sellersWith membership in Amazon Prime growing every daymore and more Amazon.com customers want a great deal on shipping and to receive their orders quicklyFulfillment by Amazon makes it possible for sellers to offer Amazon.com customers this convenience.”
  • A decade ago Amazon made three long-term betsPrime membershipsfulfillment consistencyand third-party sellers are going to be key.

Where do you see FBA going in the future? Has it peaked in terms of percent of sales or is there more room to grow?

Andrew @ EcomLoop
EcomLoop founder. I've worked in ecommerce since 2005, beginning with my own ebay store. I've run multiple independent ecommerce businesses on Magento, Joomla, and more recently, Shopify and WooCommerce. I believe marketplaces should be looked at as a sales channel and that all independent businesses should strive to build a direct connection with their audience for long-term success.

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