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 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 customersand thereforegreat for our third-party sellersWith membership in Amazon Prime growing every daymore and more customers want a great deal on shipping and to receive their orders quicklyFulfillment by Amazon makes it possible for sellers to offer 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
Are you looking to start or grow a standalone ecommerce shop? I help independent businesses achieve success on the Shopify and WooCommerce platforms. As the owner of multiple ecommerce businesses, I've had the opportunity to get experience with nearly every aspect of the ecommerce industry. I started EcomLoop to help other quality independent businesses using my knowledge and experience. To stay on top of new ecommerce developments, I publish The EcomLoop Weekly Loop, a blog and email newsletter with original thoughts and curated links to help independent businesses improve their businesses.