In the era of online marketplaces, most eCommerce merchants and brands find themselves at the mercy of order fulfillment solutions operated by the powerful corporations who act as gatekeepers for these platforms – for example, Fulfillment By Amazon and Walmart Fulfillment Services. Each platform requires merchants to send inventory to their warehouses and follow their unique policies and requirements. All of them also come with their respective fees and surcharges. Sellers seeking a better deal have often turned to Third Party Logistics Providers (3PLs). They do so with the ambition of not just regaining control and autonomy over their logistics, but also boosting their profits. The problem, however, is that the vast majority of 3PLs operate from an extremely limited number of locations – hampering the seller from being able to offer customers the free, fast shipping experience that they now expect and demand. To solve this problem, a disruptive, radically different strategy is needed – a peer-to-peer order fulfillment network.  

While merchants have worked with traditional 3PLs, a peer-to-peer network is an entirely new idea. Those merchants who have used traditional 3PLs are often unaware of their pros and cons. Far fewer are aware of how they compare to a peer-to-peer network. In this article, we take a deep dive, looking at every factor that influences a seller’s choice of fulfillment partner, and compare traditional 3PLs to peer-to-peer networks on each of them. We highlight how a Peer-to-Peer network can offer significant advantages compared to working with legacy 3PLs.

Cost

Traditional 3PL – What Do They Have in Common With Traditional Hotels?

Think of a time when you stayed at a boutique, traditional hotel – are you struggling to find or remember when you last did that? In the era of Airbnb, these single-location hotels have entirely faded. 

Why is that? 

The reason is not competition – there is still a segment of travelers looking for a more economical, boutique experience compared to staying at a large hotel chain like Marriott or Hilton. The reason is that these traditional hotels are asset-heavy businesses that have no economies of scale. Because they primarily operate from a single location that they rent or own, they are significantly prone to cost pressures driven by land availability and rental rates. They are also vulnerable to cost pressures around staffing. 

All this has meant that a marketplace model with a vast network, such as Airbnb (almost anyone can rent out a space), offers significant advantages to travelers that traditional hotels cannot hope to match. 

What if we told you a traditional 3PL is exactly like these hotels? 

A traditional 3PL usually operates from an extremely limited number of locations (2-3 at the most). This provides them with no economies of scale. They are also asset-heavy businesses that rent or own their properties. With warehouse lease rates at an all-time high, these traditional 3PLs are forced to pass on these extra costs to their customers. This is compounded by the fact that staff in the warehouse now expect to be paid $19 / hr. At this rate, this is no longer a minimum wage occupation. With multiple players, such as Walmart and Target, setting up fulfillment centers to deliver their eCommerce orders, traditional 3PLs must pay people more if they are to staff their warehouses. This is also a cost pressure that has to be ultimately absorbed by the merchants who work with them. 

Peer-to-Peer – What do Cahoot and Airbnb Have in Common?

Airbnb’s business model is asset-light – their idea is simple but powerful – anyone that has a spare room at their house that they don’t use can monetize it. 

This two-sided marketplace model generates network effects, with millions of customers (property owners and travelers) interacting to ensure the platform offers competitive prices constantly. It is no surprise that Harvard Real Estate Review found that in the business districts of major US cities, Airbnb is, on average, 28% cheaper than traditional hotels.

We have a similar idea for the future of eCommerce – rather than everyone building more warehouses as part of their own private, isolated networks, what if we optimized what’s already available? 

Cahoot’s peer-to-peer network aims to unlock the potential of over 2 million retailers with their own warehouses. Any merchant with excess capacity in their warehouses can monetize it by becoming a fulfillment partner for Cahoot. 

Our two-sided marketplace model generates network effects, with numerous businesses (sellers and fulfillment partners) interacting to drive prices downward. Just like Airbnb has a massive spread of listings, our model provides us with a vast network of strategically located warehouses across the country. And just like them, we’re on average 30% more economical than the previous solutions customers used.

Quality

Traditional 3PL – “Fast Shipping or Economical Shipping? Pick One”

With the limited number of locations these traditional 3PLs operate from, it becomes near impossible for them to cover the country through economical ground shipping in under two days. 

Based on our research, inventory needs to be spread across at least 4 strategic locations if a merchant is aiming for 2-day delivery to the entire contiguous United States (the lower 48 states). If the brand aims for 1-day delivery, it requires nine strategic locations. 

When we talk about ‘strategic’ location, we mean it – a location is only strategic if it is located near a major population center. Suppose you’re a brand in the Midwest. In that case, it makes no sense to get excited about saving costs on inbounds by working with a traditional 3PL in Maddison, WI, when most of your orders might be coming from Southern California! Great candidates for strategic locations include New York, Chicago, and Southern California, as examples.

Most traditional 3PLs do not have warehouses at strategic locations – forcing their customers to decide whether to use economic ground services (but not meet the customer expectation for fast delivery) or incur extremely high costs by providing fast delivery through air shipping.

Peer-to-Peer – “Fast Shipping and Economical Shipping – Get Them Both.”

A Peer-to-Peer Fulfillment Network has a vast network of strategically located warehouses nationwide. With such a network, it is possible to cover the entire country through ground shipping in under two days. This makes it possible to meet the customer’s expectation for fast shipping while using economical services. 

Many sellers might face hefty fees with platform-specific fulfillment services, such as Fulfillment By Amazon (FBA) for Amazon and Walmart Fulfillment Services (WFS) for Walmart. Merchants have no viable alternative because the only way traditional 3PLs can hope to offer the delivery speeds customers are used to is by using expensive air shipping. As no seller is willing to take a margin hit that deep, they are stuck with fulfillment services run by the marketplaces themselves. 

With a Peer-to-Peer network, you do not have to make an either-or decision – you get the best of both worlds – providing both your business and your customers with benefits. Our network offers cost savings that boost your bottom line while also improving the experience your customers have.

Service Levels

Traditional 3PLs – Struggle to Offer The Bare Minimum

Traditional 3PLs just about get the basics done (with a lot of huffing and puffing and seller pain) – receiving your inbounds, picking, packing, and shipping your orders out the door on time. If you’re trying to handle additional requirements – such as operating the warehouse, arranging for carrier pickups, or fulfilling orders on the weekends, you’re likely out of luck. 

The problem is that these ‘additional’ requirements are now becoming table stakes as this is what programs like Amazon Seller Fulfilled Prime expect. Additionally, customers expect their orders faster and faster, meaning that doing the basics alone may no longer be enough even to stay afloat.

Those aiming to compete with Amazon, including large retailers like Walmart are realizing they must offer customers Prime-like experiences. Walmart’s shipping standards are also challenging – products with 2 and 3 day delivery speeds are ranked higher in search results, win the buy box more often, and see higher conversion rates. Sellers are also expected to ensure that they deliver 95% or more of orders within the promised time to customers. 

Many of these 3PLs may also be unable to offer late cut-off times. Late cut-off times allow for carrier pickups and scans to occur the same day, meaning more of your customers will receive their orders in 1 or 2 days. 

Perhaps most worryingly of all, customer support can often be erratic, unreliable, or slow to respond. Shipping and order fulfillment is a crucial part of your business operations. Lengthy resolution items can mean significant outages and downtime for your company.

Peer-to-Peer – Meet and Exceed the Gold Standard for Order Fulfillment

With Cahoot’s peer-to-peer network, you don’t just have to do the basics. We help sellers on Amazon meet and surpass the demanding criteria of the Seller Fulfilled Prime (SFP) program. The SFP program’s requirements are arguably the most challenging in the industry. Any merchant who can meet and surpass them has an excellent order fulfillment strategy in place.

We support warehouse operations, carrier pickups, and delivery on the weekends. We also offer late cut-off times, ensuring that you can increase the proportion of customers whom you service with 1- and 2-day delivery. 

Our US-based customer support team is also ready and responsive to any of your questions. We know that eCommerce order fulfillment is complex, and things don’t always go as planned. What’s crucial is ensuring that those issues are addressed quickly, getting your business back on track. With our team, you can count on minimum downtime.

Technology

Traditional 3PLs Try to Handle Fulfillment Without Tailormade Tools

Many traditional 3PLs solve just one piece of the problem – the task of order fulfillment itself. Most of them fail to provide customers or their employees with the shipping software technology needed to speed up order fulfillment at scale. 

The technology that most traditional 3PLs deploy is not much more advanced than what a micro-shipper fulfilling their orders on their own might be using. 

Even if traditional 3PLs deploy technology, it tends to be legacy software, like ShipStation. Such tools require constant human intervention and oversight. For example, for every single customer order that is received, a tool like ShipStation requires staff to compare rates across different fulfillment locations and carrier services, manually identifying the cheapest option to pick.

Such systems mean that an enormous amount of time is wasted every single day by employees simply rate-shopping for shipping labels when they could be engaged in higher-order work. 

For other workflows like keeping track of inventory, traditional 3PLs deploy similarly clunky, inflexible software incapable of meeting today’s needs. This runs the risk of accepting customer orders on SKUs that are out of stock, leading to canceled orders and unhappy customers. Unfortunately, your customers aren’t going to blame your 3PL’s poor technology when there are issues with their deliveries – they’re going to point the finger at you.

Peer-To-Peer – Scale Order Fulfillment with Purpose-Built Software

While our peer-to-peer network provides nationwide coverage, our next-generation shipping software supercharges productivity and accelerates order fulfillment. 

For every order received, Cahoot’s software can intelligently compare multiple warehouse locations and shipping services, instantly determining the most economical shipping label that meets customer delivery promises. 

Our software is designed and purpose-built from the ground up to excel at scale. When your order volumes surge, manually printing shipping labels can be a massive source of inefficiency. With Cahoot, all your shipping labels are ready to print in one click – dramatically speeding up fulfillment and freeing up staff to concentrate on higher-order work.

Our technology comes with other intelligent features – such as optimizing packaging choices for Multi-Line, Multi-Quantity (MLMQ) orders, as well as intelligently keeping track of inventory decrements. Color-coded alerts on our dashboard provide merchants with real-time visibility into dipping inventory levels. This allows for proactive decision making to accelerate sales, rather than scrambling to react too late.

Redundancy and Backup

Traditional 3PL – Highly Vulnerable to Single Point Failures

eCommerce order fulfillment is not an easy thing, and there are potentially many things that can go wrong – such as 3PL delays with receiving your inventory, damages to inventory in transit, misplaced inventory, or carrier errors. 

There are also things for which it is difficult to account for – such as unexpected, extreme weather events that disrupt carrier operations. 

While you can strategize to minimize or avoid some issues, others are simply out of your control. Unfortunately, this is where a traditional 3PL is highly vulnerable. When you operate from a single location, an outage in that location can be catastrophic. Your entire order fulfillment operations come to a grinding halt, putting your sales on pause. Worse, customer complaints will surge, resulting in lots of negative reviews and refund requests. 

Customers today may not be forgiving even of circumstances outside your control, such as weather events – they ask a pertinent question, “Why weren’t you prepared with an alternative strategy?”

One minor issue at your 3PL can quickly snowball into a disaster for your brand reputation and customer loyalty. The only option sellers have is to find fulfillment partners whose solutions come with excellent risk mitigation, ensuring that orders reach customers no matter what.

Peer-To-Peer – Always Lights On For Your Business

A network of warehouses in different locations ensures that you’re inherently much more likely to keep your business operations constantly running smoothly. 

You’re de-risked on multiple dimensions – if there’s terrible weather in 1 location, you can still fulfill orders from another warehouse. If there are issues with a carrier over there, you can ship from another location. If there’s an outage there….you get the idea.

(We would like to say that the odds of all these events occurring simultaneously are almost close to zero).

This ensures that you’re constantly selling and customers are constantly getting their orders. They may also really appreciate how your business is always ready to serve them, no matter the circumstances. Unexpected, adverse circumstances don’t result in angry customers and negative reviews when working with Peer-to-peer fulfillment networks, they’re just another opportunity to continue selling and keep providing your customers a great experience. 

Scalability

Traditional 3PL – Works Initially, But Stumbles at Scale

Going back to our earlier example, let’s say you’re a brand starting out in the Midwest, and you found a great traditional 3PL in Madison, WI. You’re thrilled because your geographical proximity to them means that you’ll be saving a lot on inbound freight costs (sending your inventory to their warehouse on a truck).

In your first few days, most of your customers are your friends, who spread the word about your brand to their circles. Most of your orders tend to come from the Chicago area and Michigan – things are working well with the traditional 3PL. You can service your customers with fast delivery while using economical ground shipping. 

At some point, your brand surges in popularity, and you start receiving orders nationwide – you’re thrilled and can already imagine the cash registers ringing! However, after an initial surge, you soon see very few orders coming in. After doing some investigation, you discover that your 3PL’s inefficiencies are costing you – customers in Southern California are receiving their orders far too slowly. Worst of all, knock-off listings on the Amazon marketplace have seized on your idea, and are now winning against you because they’re offering customers faster shipping. You also see a surge of refund requests, from customers who are unhappy with the time it’s taking for their orders to arrive. 

Traditional 3PLs are ill-equipped to deal with spikes in order volume that happen naturally as you scale. These companies don’t become an enabler of your growth; they can be just the opposite – a bottleneck that slows you down. 

The problems with traditional 3PLs mount at the worst possible time – once you start seeing orders come in from Southern California, let’s say you identify another fulfillment partner in Los Angeles. Now you have two contracts, each with its own pricing structure. There are 2 different SLAs for order fulfillment and you have to pick which location each of your orders is routed to, all on your own. Managing these two 3PLs can completely consume your bandwidth, overtaking your focus on the activities that actually matter – selling and taking care of your customers. 

Other problems emerge as you scale – let’s say you’ve somehow figured things out, and have made DTC fulfillment work with these two traditional 3PLs. As you grow further, you start sending pallets to retailers all over the US, such as Target, Nordstrom or Home Depot. Suddenly, your 3PL has no space for your containers and struggles to handle B2B fulfillment. Additionally, many of these traditional 3PLs may lack the EDI technology which is a prerequisite to work with many retailers and brands.

Peer-to-Peer – Accelerates Growth By Scaling Alongside You

Let’s imagine you’re the Midwest brand again. This time, you’re working with Cahoot’s peer-to-peer network. When you start out, you ship orders from one of our Midwest fulfillment centers, providing customers with free, fast shipping. 

When your brand surges in popularity, things don’t fall apart – you simply add more nodes on the Cahoot network to fulfill orders from. You use our fulfillment centers in Southern California to ensure you deliver a high-quality experience to your customers on the West Coast. 

You also work only with 1 vendor, offering you 1 contract. This ensures you can scale nationwide fulfillment, with none of the process management overhead that working with traditional 3PLs brings.  

We also have experience and expertise in handling B2B fulfillment, in addition to DTC fulfillment. Whatever the spike in order volume you see, we’ll make sure that you actually celebrate your success. You won’t be spending your time thinking, “Can our fulfillment keep up with all this growth?”

Traditional 3PL – Great for Regional Shipping

Traditional 3PLs do a reasonably good job of servicing the specific parts of the country that they are located in. For example, a traditional 3PL on the West Coast might be great for orders in all states in that part of the country.  

Because of the restrictions on the number of locations they have, these 3PLs find offering nationwide coverage at affordable rates extremely difficult. 

While these models may work for brands with a strongly regional customer base, the problem is that nearly every seller dreams of scaling nationally and globally at some point – these 3PLs can often become a hindrance when the sellers do decide to start expanding.

Peer-to-Peer – Great For National Programs Like Amazon SFP

Previously, Amazon’s  Seller Fulfilled Prime (SFP) program had a regional component – brands could fulfill orders just in their region of the country on their own while still featuring the Prime badge on their product listings on the Amazon marketplace. However, Amazon now expects fast shipping across the entire contiguous U.S. on the program – products across every size category must be delivered in 3-5 days, while approximately 70% of orders on standard-sized products must be delivered in under 2 days.

Traditional 3PLs will find it nearly impossible to meet this requirement using ground shipping because of their location constraints. Using air shipping is not an option for sellers in most cases because that erodes any cost savings they were hoping to see over FBA.  

Analytics and Reporting

Traditional 3PLs – Decisions Made on Instinct

Traditional 3PLs tend to make most decisions using a combination of intuition and guessing. Some of the most crucial pieces of the eCommerce order fulfillment workflow are – Which warehouse to dispatch an order from, and which box to pack the items in?

Most traditional 3PLs do not have the purpose-built technology needed to determine the warehouse each order should be sent from. At best, a rudimentary heuristic based on the customer’s ZIP code might be deployed. The problem is that you could be losing money on every shipment. Until you invest in the right technology, you’ll never actually know the full extent of your losses. 

The second crucial factor is the choice of box to use. Traditional 3PLs have a limited number of boxes of the most popular sizes. They randomly throw products into any box that fits. In the best case, an ad-hoc heuristic might be defined to map each SKU to a box, by eyeballing the box and product sizes. This creates problems on multiple dimensions. The first is that the overall cost of packaging materials increased 30% in 2022, while the cost of paper and cardboard increased by as much as 50% that year. This means that if you’re selecting larger sized boxes on each order, your costs surge. More crucially, the shipping carriers set their prices in tiers, based on the dimensional weight of items. This means that the wrong choice of box for a lightweight item can tip it over into a higher pricing tier than is actually needed. Sellers can bleed money on both avenues – cost of supplies, and the fees they pay to the shipping carriers. Today, there is also a growing consumer demand for environmentally responsible, sustainable packaging. When items reach environmentally conscious consumers in oversized boxes, it can negatively impact the experience they have with your brand. 

Lastly, most traditional 3PLs do not offer enough variety of warehouse locations to actually place your inventory close to where most of your customers live – even in cases where they have multiple warehouse locations, they could still place your products in the wrong fulfillment center! 

 The only way to eliminate ambiguity and make the optimal selection each time is to ensure decisions are guided by past data and real-time technology automation – unfortunately, most 3PLs do not offer that.

Peer-to-Peer – Decisions Informed by Data

With Cahoot’s Peer-to-peer network, we let data and technology make the most critical decisions.

For order routing, our next-generation software intelligently compares multiple warehouse locations, carriers and shipping services before picking the most optimal location and service that can meet the delivery promise committed to the customer. 

We use advanced 3D bin technology to evaluate the % fit of items in boxes, ensuring that each SKU goes into the best-sized box. Our software also comes with intelligent automation for Multi-Line, Multi-Quantity (MLMQ) orders, where our system learns from box and SKU dimensions, as well as past packaging choices to optimize box selection. 

Lastly, while warehouses on our network are located near major population centers, it still means nothing if we don’t place your inventory in the location closest to where most of your customers live. We go deep and sweat the details to identify geographic trends in your historical orders, ensuring that we set you up to see maximum savings. 

Flexibility and Agility

Traditional 3PL – High Switching Costs, Painful Migration

Traditional 3PLs often do not operate with flexible, merchant-centric models where you can build from what you have. Like we mentioned earlier, each of them comes with limited geographic coverage of the country, and offers their own pricing contract and SLA. 

Let’s say you’re working with a traditional 3PL that gives you coverage on the East Coast. While their services are good, you’re trying to find out if there’s a way for you to expand to the West Coast. Traditional 3PLs do well when they have as much of your inventory tied to their warehouses as possible. You may be hit by high fees on both fronts – the removal fees from the East Coast 3PL, and the inbound fees with the West Coast provider. 

Worst of all, once you do manage to migrate your inventory over, you’ll still have to deal with the process management overhead that comes from working with two fulfillment partners.

While this does not sound like an easy process, we’ve put together a step-by-step guide on how to migrate from one fulfillment partner to another, which you can read here.

Peer-to-Peer – Seamless, Painless Migration

A Peer-to-Peer Network is the most merchant-centric, merchant-inclusive platform for Order Fulfillment. Cahoot’s Peer-to-Peer network is not a ‘winner takes all’ arrangement. We’re not just an option for merchants looking for ultrafast eCommerce order fulfillment, we’re also an option for 3PLs looking to serve their customers better. 

When our customers are happy with using their existing 3PL to serve a particular part of the country, say the West Coast, we can flexibly scale nationwide coverage on top of their current setup. They can bring their 3PL to our network, where we provide them with an economical way to cover the East Coast. 

In fact, one of the biggest features of the peer-to-peer model is that it can be a way through which traditional 3PLs can overcome their geographical constraints while helping merchants achieve free, fast nationwide shipping.

Integration and Consistency

Traditional 3PL – Extremely Fragmented, Increased Overhead

Many traditional 3PLs were designed for the older, pre-Amazon Prime era of eCommerce when merchants fulfilled orders from just one or two channels. In today’s world of online marketplaces, traditional 3PLs may not support all of the different marketplaces. You may have to work with one 3PL for your Walmart orders, while handling Shopify fulfillment through another. The depth of integration also matters – for example, does the technology these 3PLs use transmit inventory count information back to the sales channel so that you avoid receiving orders on out-of-stock items? Can they transmit tracking information back to the channel? And does your order fulfillment help you meet the unique expectations customers have on each marketplace?

As you work with multiple 3PLs, your ability to offer consistent order fulfillment may be severely compromised. With these providers, handling the basics of order fulfillment becomes challenging. When it comes to exception management on specific orders, the problem worsens. 

Let’s imagine you’re working with warehouses from two 3PLs, each with their own SLA – the first has a cutoff time of 1PM, the second 12PM. Suppose an order comes in at 12 30 PM – but there’s been an unexpected issue with the first warehouse. You’re unable to reroute the order to the second warehouse because it’s already past the cutoff time there. The problem stems from the fact that each warehouse has its own SLA and none of them are integrated to each other.

If you’re seeking to expand sales channels or achieve nationwide coverage, the number of such fragmented, siloed warehouse nodes increases exponentially – drowning you and your team in process management. You may need to hire dedicated people to babysit and oversee this operation, which negatively hits your costs.

Peer-to-Peer – Unified, Simple and Consistent Across Every Channel

With a Peer-to-peer fulfillment network, you get custom-built, out-of-the-box integrations for all major marketplaces. We pull all the critical information about orders and their delivery due dates into our system, while pushing back updated inventory and carrier tracking information to the respective channel. This extends to our fulfillment operations – we ensure that you stay compliant with the unique requirements that each marketplace has, such as usage of a particular shipping carrier / service, or branded packing slips. 

With Cahoot, you spread your inventory across multiple warehouses, but work with just one partner. This ensures that you can offer a consistent experience on every order. This solid foundation makes exception management much easier to handle. When orders may not make it in time because of issues at one node, we can intelligently reroute it from another location with minimal overhead. We also offer consistent SLAs and every node on the network is tightly connected. 

With a Peer-to-peer fulfillment network, the number of warehouses and sales channels increases, but there’s always only minimal process management needed. You and your team will get back more time to focus on growing the business. 

Environmental Sustainability

Traditional 3PLs – Excess Packaging Waste and Greenhouse Gas Emissions

Customers today expect brands to be sustainable and environmentally responsible in their operations. A traditional 3PL exacerbates problems for brands across 2 different dimensions, packaging, and emissions. 

Traditional 3PLs tend to have a random, haphazard approach to packaging – they have a few boxes of the most popular sizes, and the warehouse staff simply place the item into whichever one might be available on hand. 

When the customer receives the order, they might be annoyed that their item was delivered in an overly large box, generating more waste for the environment. For environmentally-conscious shoppers, such experiences can ruin their relationship with the brand, completely turning them off from future purchases. 

A bigger problem can arise because of the limited number of warehouse locations. Due to this, they’re forced to use air shipments or keep packages in transit for longer on the road. All this increases emissions released, worsening your brand’s carbon footprint and weakening your sustainability credentials.

Peer-to-Peer – Eliminate Packaging Waste and Slash Emissions

While our network of strategically located warehouses, you’ll nearly never use air shipping (unless customers specifically ask for it). You’ll be able to offer fast and economical ground shipping – which is great for your customers and the environment. But we go a step further and help you cut down packaging waste also.

As we mentioned before, our software’s 3D Bin Technology and its Multi-Line, Multi-Quantity Automation features help ensure you always use only the necessary amount of packaging material.

Lastly, environmental sustainability is the core cause that a peer-to-peer network is fighting for – in a world where everyone is using up more resources to build logistics infrastructure for their own private network, we’re aiming to use the Power of Many to build a more sustainable fulfillment network, without compromising on today’s sky-high customer expectations. 

Reliability

Traditional 3PL – Fail to Live up to Their Promises

Most people tend to choose a traditional 3PL because they think a company dedicated to logistics and shipping can do a better job than a fellow merchant fulfilling your orders for you. 

However, as we’ve discussed in the sections above, we think traditional 3PLs are still operating to serve the old paradigm of eCommerce. While you may feel that you are ‘in safe hands’ initially, the reality may be very different and disappointing.

Most traditional 3PLs may promise a lot, but struggle to deliver even the basics. Where does this disconnect come from? Most sellers are extremely busy and cannot afford to spend endless hours vetting their 3PL’s performance and services. Decisions may be taken with limited information and time – unfortunately, this leads to a lot of unpleasant surprises after the inventory has been received and orders start flowing in. 

It’s worth asking – how can merchants rigorously vet their 3PLs to make sure their claims are actually true? With Cahoot, you won’t have to worry about that – because we’ve already taken care of that.

Peer-to-Peer – Only The Best Warehouses Pass Cahoot’s 44 Point Checklist

Some people think that working with a traditional 3PL (with their own warehouse space) is better than operating in a peer-to-peer network. Most people who feel this way share one concern, “How Can I Trust Another Merchant to Deliver My Orders?” 

A similar concern was shared by many people when Uber first rose to popularity, defeating the cabbies in London and New York’s famous Yellow Taxi. In London, people must spend 3 years training to be accepted as a cab driver. With Uber, nearly anyone could start driving taxis instantly. A similar sort of nervousness was prevalent among people, who asked, “How can we trust getting in a car with a stranger?” 

Interestingly, the data challenges the popular perception – according to research conducted at NYU, humans trust authentic sharing economy workers more than their neighbors and colleagues (and nearly as much as their families). The keyword in that sentence is authentic. Authenticity is built by high levels of trust and transparency – such as Uber drivers providing their details and a profile picture on the platform.

Similarly, we recognize that building authenticity is crucial. Order fulfillment is a crucial aspect of business operations, and you don’t want to be handing that task over to someone you can’t trust. 

We foster trust with our sellers by rigorously vetting fulfillment partners. Cahoot has a 44-point checklist that warehouses must pass if they are to become part of our eCommerce order fulfillment network. This ensures that only the best warehouses, with excellent packing practices and order fulfillment standards, make the cut. Cahoot also has zero tolerance for defects and regularly reviews the performance of its fulfillment partners.

We think that a warehouse in the Cahoot network has been through more rigorous vetting than the review that the average seller does on a traditional 3PL. This means that there’s a good chance that a Cahoot warehouse is better than the one at your traditional 3PL. With our vetting and audits, you can rest assured that it’s a safe and trustworthy one, too.

Privacy and Security

Traditional 3PLs – Lax Data Security Measures

With traditional 3PLs, your customer information moves across multiple systems without proper safeguards. They might request for all your order and customer information to be transmitted to whatever technology they are using. If that is different from their shipping software, then your proprietary data enters another system outside your purview. 

While you may have signed contracts with the 3PL, your data still rests on multiple systems that they operate, with minimum visibility. Worse, you are entirely reliant on their information security practices, which may be minimal or even non-existent. 

In the era of Europe’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), no company can afford a data breach. Under a regulatory framework like GDPR, customers have the right to request for deletion of their data. If sensitive details like their name, phone number and address are already on systems that your 3PL controls, it increases exposure and risk to your business.

Peer-to-peer – Robust Data Privacy and Governance Measures

While having confidence in the order fulfillment standards of our warehouses is important, another concern sellers might have is, “How can we trust that other merchants will not see or use our customer data?” 

While Uber built high levels of trust in people, it still could not change the fact that people were indeed getting into a car with a stranger. To safeguard its customers and set their fears at ease, Uber has put in place various safety measures on its app. Some of these include GPS tracking, the ability to transmit location information to emergency services, logs of historical trips as well as the very famous rating system – where both riders and drivers review each other after each ride (a social incentive to behave respectfully). 

With Cahoot’s peer-to-peer fulfillment network, you can sit back and relax knowing that every order will be fulfilled on time. However, we do know that another merchant is responsible for fulfilling your order, and take data privacy extremely seriously. We provide a single platform where you get total control and visibility into your data. When our fulfillment partner prints a label to ship your order, they see the customer’s first name, but only the initial of their surname. Only the absolute essential information needed for order fulfillment is shared with the fulfillment partner, while all other product / brand / customer information remains with the seller.

Community

Traditional 3PL – You Work With a Vendor

Working with a traditional 3PL is often nothing more than a transaction – you pay them a lot of money, and they perform the task of order fulfillment for you. 

While getting your orders out to customers is vital, there’s often little differentiated value addition that you get from the engagement.

Peer-to-Peer – Work With a Partner To Cut Costs and Generate Revenue

With Cahoot’s peer-to-peer network, you can have ultrafast eCommerce order fulfillment by partnering with us. But it doesn’t have to end there. If you have excess capacity in your own warehouse, you can actually double up as a Fulfillment Partner on the network to monetize that and bring in additional revenue. Order Fulfillment is a growth driver, not a cost center – with us, those words definitely ring true. This is similar to how Uber drivers in their home city become riders when they’re traveling! 

Whatever your needs, Cahoot can deliver differentiated value to your business. Reach out to us today to get started!  

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Hola, Amazon Sellers! We’ve got some news for you. It is predicted that the 2021 holiday season is going to witness eCommerce sales of $206.88 billion with a rise of 11.3% in the US.

With the holiday season knocking at our doors, Amazon sellers are putting their best foot forward in optimizing their listings for grand traffic, massive sales, and greater profits.

If you want to reap the benefits of this holiday shopping season, then there is no better time than this! But how can you stand out in such a fiercely competitive environment? 

For Amazon sellers, a winning holiday keyword strategy is one of the best ways to improve their listings’ discoverability. By investing early in seasonal keyword optimization, you can acquire high positions in SERPs ahead of the competition and increase traffic and sales exponentially. 

So, are you ready for the revolutionary 2021 Amazon holiday shopping sales? Let’s make the seasonal keyword optimization magic happen with some powerful seller moves. But before we unveil some of the best Amazon keyword practices, let’s understand the fundamentals of Amazon SEO and how it works.

What is Amazon SEO?

The first page of Amazon’s SERP is one of the most coveted pieces for every seller. It has the power to convert one-time page visitors to buyers and bring about a stunning increase in overall profits.  

Like Google, Amazon analyzes the search results through its algorithm, which again includes several factors like –

• Product Title with high-converting keywords
• Product Description with relevant keywords
• Product Features with clear bullet points
• Appealing Product Images
• Good Ratings and Reviews
• Competitive Product Price

The underlying search engine is known as A9. The algorithm deploys several parameters to engineer the relevancy of millions of listings stored in its database with the search terms used by the shoppers.

Behind closed doors, Amazon’s search engine algorithm – A9 is constantly being renewed and refined. Although no one really knows its formula or how exactly it works, there are some widely known factors that influence it.

What is A9?

A9 is Amazon’s product ranking algorithm which provides the results depending on the terms or keywords or queries added by users in Amazon’s search box. The results displayed are catalyzed by the shopper’s preferences, past orders, and keyword matches.

How does A9 work?

The A9 algorithm selects the product listings to be displayed to potential buyers and their rankings based on some criteria like:

• Relevant keywords added in listings that match with customer search queries
• Previous customer preferences and behavior
• Customers’ past purchases

While customer preferences and their past purchases aren’t in your hands, what you can influence is your product’s organic ranking by optimizing your listings and making them SEO-friendly.

Why Should You Optimize Amazon Keywords for This Holiday Season?

The goal of Amazon’s search engine is to provide customers with the most relevant product results in relation to the search queries they insert. When it comes to product listings, Amazon looks at keywords present in various fields of the listing like title, description, and bullet points. To display products for every time they are searched, Amazon “indexes” these keywords in its database, i.e., collecting, parsing, and storing the search terms. 

Therefore, a crucial portion of your Amazon marketing strategy is to ensure that your listings have an optimized Amazon product title, descriptions, and bullet points with high-converting and relevant keywords. This is even more significant to the holiday season as it brings about an exponential increase in traffic as compared to other times.

Your listing should be optimized in a way that A9 can locate it, and it should also be compelling for customers to pay enough attention to your products and brand.

It is recommended that during the holiday season, holiday-based search terms like “gift pop-up cards”, “Christmas gifts”, etc. should be added to your listing content.  

Note: When you craft your listing content, make sure it flows naturally. Avoid keyword stuffing, as this diminishes the credibility of your product listing, and drives away potential buyers from your product page to your competitors’ pages.

Tips on Optimizing your Amazon Product Listing with Seasonal Keywords

Here are a few tips and tricks that will help you tackle Amazon’s A9 ranking factors and make your listings holiday season ready in no time:

Step 1: Perform Relevant Keyword Research

Before you begin with keyword research, you should pause and set your goals for your products and brand and why would you want to leverage keywords for your listings.

Do you wish to improve your listing’s search rankings? Are you launching a new product this holiday season? Are you trying to compete with existing sellers selling seasonal products?  

Once you define your goals, your keyword research task gets way easier than it actually is.

Generally, you want to add those keywords to your listings that are more specific and searched for the most by shoppers. For instance, listing Christmas bells as “bells” in your product title will likely have a negative impact on where your product appears in the SERPs as it will attract a lot of irrelevant traffic who aren’t even searching for Christmas bells.

Since long-tail search terms are considered more effective, you must incorporate long-tail keywords into your product listings to optimize for Amazon’s SERPs.

Another efficient strategy is to implement the next-to-highest ranking Amazon keywords for your listings. Small-scale third-party Amazon sellers launching new holiday/seasonal products can face overwhelming competition for the top keywords.

In such cases, optimizing a listing for the keyword “Christmas bell” and expecting to land at the top of Amazon’s SERP is not favorable. Therefore, it’s a good idea to opt for a more specific long-tail keyword like “Christmas Tree Decoration Bells”.

Top Seasonal Keywords

Here is a list of the best seasonal keywords collected by us that you may use for your product listing content –

• Gifts for Men
• Gifts for Women
• Christmas Decorations
• Christmas Socks
• Kids Halloween gifts
• Jazz Christmas
• Halloween Gifts Adults
• Thanksgiving Candies
• Cyber Monday Deals
• Toys Black Friday Deals
• Christmas Gifts
• Classical Christmas

How to Perform Keyword Research?

There are several third-party Amazon seller tools for performing keyword research that uses AI and ML technology to provide the most accurate data.

One such tool is SellerApp’s keyword research tool that analyzes thousands of data points to offer high-converting keywords for every seller type. The following are the SellerApp features that analyze keywords in a more innovative way –

• Product Keyword: Get the best keywords, their relevance score, monthly search volumes and cost-per-click, to increase your listing desirability and discoverability.
• Reverse ASIN lookup: Compare your product to the competition and learn from their keyword strategies. Search any ASIN and see which keywords are ranking for that listing.
• Index checker: Check if your backend search terms entered in Seller Central are indexed or not. Optimize your product discoverability as per Amazon’s best practices.
• Keyword Tracker: View real-time keyword ranking position, change in their position, indexed products, and data-driven recommendations to improve Amazon listing SEO.
• Keyword Booster: This tool will show you all the optimal keywords for your product. Here, you can find and sort keywords based on their frequency. Copy and paste your keyword list into the Keyword Booster. Filter your keyword results by the variety of duplication filters, remove unwanted words and characters. Copy the cleaned keyword list from the Keyword Booster with the copy button and paste the optimized keyword list on your Amazon product info page.

Step 2: Make Your Product Title SEO-Friendly

Product Title is one of the most crucial factors that have the power to exponentially boost your product’s visibility and rankings. Make sure that you add all the relevant information in your title and craft a catchy product title.

According to Amazon, a product title should include the following:

• Brand
• Product
• Material
• Quantity
• Color

Note: A product title in the Amazon search is limited to 100 characters only. Therefore, use the space in a rightful manner – do not overstuff it with keywords, keep it appealing and simple.

Amazon has provided guidelines on how to craft good product titles. Your product title should include product information such as brand, product line, color, size, material or key feature, and packaging or quantity. Here, you must also include 1-2 relevant keywords that can influence product conversion and click-through rates.

If you are selling seasonal products, make sure to include holiday special keywords in your product title to get more visibility.

Ensure that the initial 5-6 words of the title are clear, crisp, and intelligible. These simple techniques make the title eye-catching as well as optimize it for the Amazon search.

Step 3: Optimize the Bullet Points

Amazon provides slots for adding bullet points that explain your products in a clear and concise manner to shoppers. Bullet points are found under any parent/child ASINs on the listing page.

They are usually paid more attention than the actual product description. Therefore, you should leverage this space to explain all the compelling features and benefits your product has.

In this section, add secondary keywords that are important but may not fit in the title, for example, keywords that are seasonal and resonate with the upcoming holiday/festivities. There is no need to repeat keywords from the title or other sections.

Simply use high-converting keywords throughout your product listings that you have gathered from your keyword research.

It is estimated that Amazon will index the first 1,000 bytes for your bullet points. Therefore, you must make sure that your bullet points should be 200 bytes max for them to be indexed.

Step 4: Craft a Product Description that Converts

Amazon’s A9 algorithm will prioritize those listings that have the power to convert and have made a considerable amount of sales in the past. Therefore, your product description should be crafted in a way that adds value to your listing and unveils its lucrative benefits, rather than just being informational.  

Add in only the most relevant keywords that pertain to your product’s unique features, its type and texture, and overall utility.

The product description is also an ideal way to portray your brand and its vision, attract the target audience, and focus on the problem-solution framework. The character length of your description should be 2,000 characters, including spaces. Remember to make it short and crisp and not a huge chunk of complex texts.

Step 5: Do Not Forget the Backend Keywords

Amazon also offers sellers the opportunity to add hidden search terms, which are called “backend keywords.”

Although not visible, these keywords constitute the backbone of your listing’s rankings on Amazon SERP.

You can get up to 249 bytes for adding other very relevant keywords for your product that weren’t fit to be added into your listing content visible to customers like title, description, and bullet points. The best part about this section is that here, you can include –

• other high-ranking long-tail keywords,
• holiday-related keywords like “gift ideas”, “gift pop up cards”,
• misspellings that are searched the most by customers,
• synonyms that shoppers might look for,
• translation words of your products in Spanish or French or any other language.

Here, you don’t need to add product identifiers, like your brand or product name, or content that is irrelevant or repetitive.

Final Thoughts

If you stay proactive and prepare well for the 2021 holiday season, nobody can cease your progress. For even the most advanced Amazon sellers, optimizing keywords takes immense effort, time, and analyzing capabilities. Even though it all seems too overwhelming in the beginning, it can be streamlined with the right AI-powered Amazon keyword tool.

The truth is the more you can streamline the seasonal touch points across your Amazon business, the easier it will be to attract relevant traffic and scale-up.

We hope that this step-by-step guide benefits your Amazon business and fuels your seller journey to success. If you have any more questions, get in touch with us!

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The One-Stop-Shop is a new VAT scheme that was introduced in July 2021 across the European Union. It offers an alternative for online entrepreneurs and Amazon sellers who, until then, had to register for VAT in a variety of countries if they wanted to expand their business across the EU.

The One-Stop-Shop was accompanied by changes concerning the delivery thresholds in the EU, the taxation of goods sold to end customers across borders, and the VAT registration and filing duties.

In this article, we will dive into the specifics of the One-Stop-Shop program and discuss what opportunities the OSS offers to Amazon sellers and FBA users.

Threshold Changes that Came With the Introduction of the One-Stop-Shop

Until July 2021 online sellers had to register for VAT in their home country and in all EU countries to which sales exceeded the delivery thresholds. The thresholds were set by each European country individually and were usually set at 35,000€ or 100,000€. 

In all countries in which sellers were registered for VAT, they also had to submit VAT returns. Following the filing of returns, VAT needed to be paid separately to each tax authority, following differing deadlines and formats. Furthermore, all sales prior to the crossing of the threshold limit were taxed with a domestic VAT rate and the VAT had to be paid to the domestic tax office. This meant that sellers had to continuously monitor several threshold limits and payment deadlines at once.  

The country-specific thresholds were replaced by an EU-wide threshold of only 10,000€ when the One-Stop-Shop was introduced. This new, lower threshold is reached by all cross-border sales to European countries combined and, therefore, crossed much earlier. This also means that sellers often have to register in several countries at once. A solution to this is the voluntary registration for the One-Stop-Shop scheme.

The One-Stop-Shop for Amazon Sellers

For business-to-consumer cross-border sales, a One-Stop-Shop registration replaces foreign VAT registrations. Additionally, the EU-wide delivery threshold is no longer applicable. This means that all sales – even the first – are subject to country-specific foreign VAT rates. Thresholds do no longer need to be monitored and no further VAT registrations are necessary – as long as goods are only stored in the home country.

Since no further VAT registrations are necessary, neither are regular foreign VAT returns. Instead, a regular OSS report needs to be prepared and submitted to the tax authorities in the country of OSS registration, the sellers’ home country in the European Union or their country of choice if they are not based in the EU.

Of course, a VAT registration in the home country and the submission of domestic VAT returns are still necessary, as the One-Stop-Shop only applies to cross-border transactions. For the same reason, the usability for the One-Stop-Shop is greater for basic Amazon sellers than for sellers making use of Fulfillment-Programs such as Amazon FBA. Amazon sellers generally only store their products in their home country and the goods are then delivered from there to customers EU-wide. FBA programs, on the other hand, enable sellers to store their products in a variety of foreign European countries.

The One-Stop-Shop and Amazon FBA Sellers

Within the PAN-EU FBA program for example, sellers’ products might be stored in England, France, Germany, Italy, Spain, Poland and the Czech Republic. As soon as products are stored in a country, VAT registrations are mandatory. Therefore, sellers participating in the PAN-EU program need to register for VAT in all countries mentioned above. However, participation in the One-Stop-Shop is still possible.

Deliveries from the home country to foreign countries are taxed with foreign VAT rates and appear in the OSS report, as detailed above. Deliveries from foreign warehouses to customers in the same country are settled in a foreign VAT return, while cross-border deliveries to third countries are again appearing in the OSS report filed in the home country. Lastly, deliveries from foreign warehouses to customers in the seller’s home country appear in the domestic VAT return.

As evidenced, the usability of the One-Stop-Shop for Amazon sellers using FBA is smaller than the advantages of the OSS for basic Amazon sellers storing only in their home country. However, the new scheme can still be advantageous. This depends on the delivery volume, the chosen FBA program, and the customer base and is best decided on a case-by-case basis.

Technical Solutions for the One-Stop-Shop

If you want to or have to use the OSS to fulfill your VAT duties in Europe as an Amazon seller another challenge facing you are the different VAT rates. This is especially true if you sell products from several niches or Amazon product categories to which country-specific reduced VAT rates apply. A solution comes in the form of the hellotax OSS full-service package.

This VAT service provider specialized on the Amazon and FBA E-Commerce business offers their proprietary OSS software in combination with an OSS registration. The software automatically calculates VAT rates and compiles reports which aid in the creation of OSS reports. The hellotax team of local tax accountants then regularly files your OSS returns.

The OSS service can also be used in conjunction with the regular VAT services, which include VAT registrations EU-wide and the submission of regular VAT returns. All your VAT duties are therefore taken care of by one service provider and you can concentrate on scaling your Amazon business while staying worry-free and VAT compliant across the European Union.

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As sellers and Amazon arrive at the conclusion of Prime Day 2023, all eyes have shifted to the fall and Q4 holiday shopping season that lies ahead. The online retailer wants sellers to start planning, and it has already announced the Lightning Deal submission deadlines for the rest of its major 2023 deal events – the Fall Prime Deal Event and Black Friday / Cyber Monday.

What Events / Weeks do These Include?

The company has announced Lightning Deal Submission deadlines for 2 events: 

• Fall Prime Deal Event (known informally as the 2nd Prime Day)

Amazon announced this event, available exclusively to its Prime members for the first time in October 2022. While many speculate the company introduced it to force another wave of shopping from its customers in the lull between Prime Day and Q4, it is still a great opportunity for sellers to capitalize on. 

• Black Friday / Cyber Monday week

Amazon, like every other retailer, aims to capitalize on the surge in sales during this festive time of the year, as the holidays approach. 

When do I Need to Get my Deals in?

• For the Fall Prime Deal Event, you must get your Lightning Deals in by August 11, 2023. 
• For Black Friday / Cyber Monday, you must get your deals in by September 1, 2023 

Note: Amazon has only announced deadlines for Lightning Deals so far. You can also submit Coupons and Prime Exclusive Discounts for these events. The company will announce the deadline for these later.

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Watch On-Demand Webinar: Amazon SFP – How To Sell and Win in 2023

In June 2023, Amazon announced they would reopen enrollment for their Seller Fulfilled Prime (SFP) program. Like most things in the Amazon world, the news was received with mixed reactions by sellers. For those familiar with the Amazon ecosystem, they know that this program is challenging. Many feel the list of requirements is daunting and that Amazon holds them to higher standards than the ones it sets for its in-house Fulfilled By Amazon (FBA) logistics network.

Most people are familiar with the requirements that Amazon expects sellers to meet, but far fewer are aware of the roadblocks that make success hard to achieve. An even smaller number are aware of the strategies they can deploy to meet Amazon’s criteria and surpass them. We’ve outlined all of that and more in our Ultimate Guide: 

• We start by helping you understand what the program actually is. 
• We then examine how the issues FBA is facing make SFP relevant for sellers. With the headwinds confronting FBA, customers are getting their deliveries slower, and costs are rising for sellers. 
• As Amazon continues to face business pressures in its eCommerce division, the problems with FBA are only likely to increase for sellers, making diversification of order fulfillment operations beyond it essential. 
• We then explore why Amazon, despite its skepticism, is reinstating the program. 

• Despite the daunting SFP requirements, the reward can be immense – we highlight the value success in the program can deliver to your business. 
• However, SFP success is not easy, and many sellers find the program extremely challenging – we do a deep dive into the most common stumbling blocks that trip up even experienced Amazon merchants. 
• Finally, we give you an essential cheat sheet needed to start selling and winning on Amazon Seller Fulfilled Prime!

What is Seller Fulfilled Prime?

Why is SFP More Relevant Now Than Ever Before For Sellers?

• The “Prime Effect”: Everybody Wants Fast Shipping
• FBA Deliveries Become Slower, And Customers Feel The Pain
• Amazon Prime Is Expensive, But Is It Worth It?
• Why Are FBA Deliveries Late? – Severe Staffing Problems Create Prime “Snail Zones”
• FBA Challenges Increasing

FBA – Expensive, Difficult To Manage, Full of Tricky Issues

• Inventory Threshold Restrictions
• Margins Erode Further Amid Peak Season Surcharges
• Storage Fees Rise as Amazon Runs Out of Space
• Demand Forecasting Crucial as Removal and Disposal Fees Surge
• Why Can Amazon Raise Prices, But FBA Sellers Can’t?
• It’s All Likely To Get Worse With Amazon’s Cost Cuts
• Business Pressures in Amazon’s eCommerce Division
• Aggressive Cost-Cutting Likely To Slow FBA Even Further
• What Can You Do As A Seller? – Diversify Beyond FBA
• Sellers Have Traditionally Relied on FBA
• Seller Fulfilled Prime – The Essential Alternative Strategy to FBA

Why is Amazon Reopening SFP? – It’s The Government!

What Are The Seller Fulfilled Prime Requirements?

What Competitive Advantage Does SFP Provide Your Business?

Why is Succeeding at Amazon SFP hard?

• Nationwide 2-Day Delivery Forces Most Sellers to Use Expensive Air Shipping
• Amazon Expects Delivery in 2 Calendar Days, While Carriers Operate on Business Days
• The Misleading Pageviews Metric
• The Juggling Act Between Cut-off Times, Economical Shipping, and Meeting SLAs
• Operational Excellence Needed
• Challenging to Staff And Operate Warehouses on Weekends
• Arranging for Carrier Pickups on Weekends
• Managing Weekend Operations Can Overwhelm Sellers
• Unnecessary Surcharges From Amazon Buy Shipping

What’s the Cheat Sheet to Sell And Win on SFP?

What is Seller Fulfilled Prime?

Before we do a deep dive, it’s essential to understand – what is Seller Fulfilled Prime?

For those unfamiliar, Amazon Seller Fulfilled Prime is a program that enables sellers to pick, pack and ship their orders on their own – using either an in-house logistics operation, a traditional 3rd party logistics provider (3PL), or order fulfillment networks. SFP can provide sellers with many benefits, such as: 

• Tight control over their inventory 

• Ownership of their logistics and order fulfillment operations 

• Freedom from the high fees associated with Amazon FBA 

• The ability to provide unique experiences for customers, such as custom packaging

• The ability to meet the consumer expectation for free and fast shipping even on slow-moving, seasonal, larger-sized, and heavier SKUs 

While all these are great, the biggest one for any seller is that the program allows your product listings on the Amazon Marketplace to feature the coveted Prime badge. With around 148 million subscribers in the United States, Amazon’s loyalty program has a great promise for the end customer – pay $139 (plus taxes) annually, and Amazon will deliver you stuff for free in under two days. 

The program has far more profound implications for sellers – their ranking on Amazon search results and ability to feature in the “Buy Box” is heavily and positively influenced by ensuring their products are Prime eligible. It’s also no secret that most shoppers on Amazon toggle the filter when browsing the store just to see products that qualify for Prime. All this means that an Amazon merchant’s survival, let alone success, largely depends on ensuring each SKU is Prime-eligible. 

Seller Fulfilled Prime offers sellers the best of both worlds – the Prime badge and autonomy over order fulfillment. However, it isn’t all smooth sailing, and sellers have tended to shy away from the program because of its exacting standards. However, there are indications that the present time is a good one to begin seriously considering enrolling in the program. 

SFP – More Relevant Now Than Ever Before For Sellers

Several reasons have combined to make Seller Fulfilled Prime more relevant than ever before to sellers, some of Amazon’s own making and others that are not as palatable to the company: 

The “Prime Effect”: Everybody Wants Fast Shipping

When Amazon first introduced Prime in 2005, it announced that it would ship customer orders over $35 for free in 2 days. At the time, people in the industry thought that the company had lost the plot and that this strategy would surely fail. It took competitors over a decade to offer free 2-day shipping – retailers like eBay and Walmart introduced their competing services only in 2017. 

However, when Prime moved from its 2-day timeline to free 1-day shipping in 2019, Walmart and BestBuy responded almost immediately, offering customers the same experience. That captures just how much Amazon has raised the bar and redefined customer expectations – the Prime effect means that all of us expect everything delivered in under two days for free. 

The stakes are high for eCommerce merchants across every channel – it does not matter whether you serve customers through a Shopify storefront, eBay, Amazon, or Walmart – you have to meet the consumer expectation for fast order fulfillment. 

Shipping is no longer a back-office operation; it has become the defining element of the customer experience. 

The company that created the Prime Effect is arguably the most customer-obsessed organization in the world. For years, Amazon has focused relentlessly on creating value for its customers – often at the expense of sellers on its platforms. At every turn, the company has weaponized the size of its customer base and the network effects of its marketplace model to squeeze sellers while delighting customers. 

People, regulators, and governments aiming to call out the company on some of these practices have been met with a frequent refrain, “As long as the end customer is happy, how does it matter?” But why are customers so happy with Amazon, and how does the company have so many of them (most of whom are Prime members)? The most important reason is Amazon’s ability to ship products in under two days, nearly always on time. 

A few years ago, people would laugh at you if you suggested that FBA was missing delivery timelines or that Prime was not consistently two days or faster. However, recent developments indicate that the end customer is also beginning to suffer. A decline in the customer experience is worrying for both sellers and Amazon itself. After all, if Amazon fails to deliver FBA orders quickly and accurately, the company breaks the promise at the heart of all its success.

FBA Deliveries Become Slower, And Customers Feel The Pain

Amazon Prime Is Expensive, But Is It Worth It?

While everyone pays $139 (plus taxes) for their Prime membership, the service is not uniform across all customers. In a story that Vox published, the publication explains how research conducted by a former Amazon employee revealed that an astonishing 1/3rd of the counties in Washington State had a delivery time as high as five business days on Prime qualifying orders. For many customers, an issue with Prime is no longer a rarity – it is increasingly common. We (just like the rest of you) were busy shopping this Prime Day! Here’s an example of our experience with the slow Amazon Prime: 

For a checkout on Wednesday, the latest it should take a Prime order is Friday – however, Amazon commits to delivery only as later as Monday of the coming week! When angry customers in some of these “slow zones” ask Amazon why they’re missing their promise of delivering every Prime qualifying order in 2 days or less, the company says that the clock does not start ticking from when the customer places their order, but when the shipment goes out the door from their warehouse:

While Amazon may make the Terms of Service around Prime hard to understand, the fine print explanation is little consolation for frustrated customers. After all, you still pay full price on products despite shelling out $139 upfront as a Prime member; you’ve paid that only for free and fast shipping. Is Amazon Prime even worth it if most orders take longer than two days to fulfill?

Worst of all, Prime has no recourse for customers who receive delayed orders. Amazon says it may reimburse customers the shipping fees of delayed orders. But what does it look like for Prime orders with no shipping charges? Customers on social media have various stories – after calling Amazon customer support, some got a free month of Prime. Others report getting a discount on Prime membership or gift cards to redeem on future purchases. 

The real question is – what has led Prime to this scenario, where certain regions of the country get their orders much more slowly than others? 

Why Are FBA Deliveries Late? – Severe Staffing Problems Create Prime “Snail Zones”

Amazon worked aggressively during the pandemic, nearly doubling the footprint of its logistics network. According to the company, hiring staff to work in their warehouses was one of the biggest challenges they worked through to make the expansion possible. With staff in the warehouse now expecting to be paid $19 / hr, this is no longer a minimum wage occupation. 

While no one operating warehouses find staffing them easy, Amazon faces a uniquely challenging set of circumstances. Another  Vox story reports that the company is at risk of exhausting the entire available labor pool for warehouse staff in the US by 2024. With nearly every major retailer, including Walmart and Target, getting into the e-commerce order fulfillment game, workers are no longer constrained by the wages Amazon may offer them – they are free to pick from any employer who can provide them a better wage and benefits. Vox mentions that the company is most at risk of running out of people to hire in some areas of the country – Phoenix, Arizona; California; Memphis, Tennessee; and Wilmington, Delaware. This extreme labor shortage in certain regions creates “Prime Snail Zones,” where customers may experience significant delays in receiving orders. 

It isn’t surprising that Amazon is facing these severe challenges – the company has churned through warehouse staff at twice the rate of the broader retail and warehousing industry. Its aggressive practices around how it hires and retains warehouse staff may have begun catching up on it. After all, a job at a fulfillment center is grueling and challenging work – Amazon’s questionable practices might have exacerbated quit rates in a profession with extremely high turnover rates. (If you’re interested in learning more about how challenging working in USA fulfillment centers can be and some of Amazon’s practices, watch this fun, funny, and informative John Oliver episode!).

While they could find people at low wages when they were the only game in town, the company might be looking at raising wages for workers to make itself attractive in an increasingly crowded market. Those increased wages mean increased costs for Amazon. And given the well-documented business pressures on the company’s e-commerce division, the company may pass them on as surcharges to its sellers rather than absorb them as a hit to its bottom line. Perhaps raising wages is a lever that the company does not want to pull to solve its staffing problems – which might provide some rationale for launching its “Hub Delivery network,” which aims to enlist the help of small businesses in its last-mile delivery operations. Businesses with a secure storage facility can sign up with the program and handle the delivery of around 30 packages for the company daily. 

Regardless of all the issues Amazon may face, customers do not care – they have tasted the free, 1-2 day shipping experience for almost 20 years and expect it everywhere. Amazon is at risk of becoming a victim of its success. When customers do not receive their orders on time, it does not just impact the customer’s experience with Amazon – it impacts their experience with your brand and the reputation they have for your service quality. 

With customers beginning to face pains, sellers must begin exploring alternative FBA strategies to keep delighting their customers with free, fast order fulfillment without becoming beholden to Amazon to make that possible. After all, if FBA takes as long as five days, while you fulfill your orders in under two days as an SFP seller, you can deliver a superior customer experience, which gives you a significant competitive advantage.

FBA Challenges Increasing

While the interests of FBA sellers are rarely aligned with Amazon’s own, recent times have been particularly complicated for them. A slew of restrictions and surcharges have all combined to erode seller margins and make the search for an alternative order fulfillment strategy essential. 

Amazon has always focused on keeping its customers happy, mainly at the expense of its sellers. While customer experience has begun to take a hit, sellers have faced challenges for years, with recent times proving particularly difficult.

FBA – Expensive, Difficult To Manage, Full of Tricky Issues

In the last year alone, FBA sellers have seen it all – from restrictions on inventory to peak season surcharges. The program has become challenging to manage simply because sellers do not have visibility or transparency into what Amazon’s future changes to the program may entail. A single change that Amazon makes to FBA can completely disrupt sellers’ plans for Q4 and the holiday season, making business planning and predictability in operations very difficult to achieve. 

FBA sellers facing challenges is not new – merchants have been playing catch up for years to Amazon. However, the impact of recent changes has been brutal to absorb for sellers: 

Inventory Threshold Restrictions

• In the peak holiday season of 2022, around 5% of sellers (many forums claim a much higher percentage) were hit with inventory threshold restrictions, impacting their ability to restock products. These limits left sellers to make difficult decisions between multiple bad choices – for example, removing some items to free up space to restock faster-moving ones or investing extra marketing dollars with Amazon to turn over their stock quickly. 

• Such experiences have left a bad taste in the mouth of sellers – after all, if Amazon restricts your restock limits and the product goes out of stock, your listing becomes inactive through no fault of your own. (Seller Fulfilled Prime allows sellers to avoid such scenarios – however, the onus is on the seller to ensure replenishments and inventory distribution are taken care of!)

• The most difficult pill for sellers to swallow was that these revisions to their restock limits happened during the peak Q4 season for 2022. Merchants were not amused, and this comment from Amazon’s Seller Forums captures the prevailing sentiment well:

Margins Erode Further Amid Peak Season Surcharges

• Sellers were also hit with a peak season surcharge for the first time in 2022. While Amazon revised its fees in 2023 to one fulfillment fee that does not distinguish between peak and non-peak seasons, there is always an element of unpredictability around the company and updates they may announce to their pricing.

• On average, the peak season surcharge was $0.35 for every item sold using FBA. 

• FBA is most frequently used by sellers with small and lightweight items – for these SKUs, the margins can often be wafer thin, with the potential for a $0.35 hike to tip the merchant into loss-making territory.

Storage Fees Rise as Amazon Runs Out of Space

• In an announcement from Amazon, Dharmesh Mehta, the Vice President for Worldwide Selling Partner Services, said, “This year, we saw some sellers use more of our storage than we expected or believe was needed to serve customers well, and that constrained how much product from other sellers could be sent into FBA.” 

• While they may not refer to it directly, it is clear the company is constrained for space in its warehouses and chose to increase long-term storage fees for sellers in 2023 – Amazon has introduced its Storage Utilization Ratio metric, using which it now levies a surcharge on sellers that have inventory sitting in the company’s fulfillment centers for more than 180 days. Previously, long-term storage fees only applied on items sitting in their warehouses for more than 365 days.

Demand Forecasting Crucial as Removal and Disposal Fees Surge

• With Amazon now introducing significant surcharges for the removal and disposal of inventory in its warehouses, it makes demand planning and forecasting more crucial for merchants. Unfortunately, with the economic and macro uncertainties, this has come at the worst possible time. Despite being an incredibly challenging time to forecast demand predictably, sellers must attempt to do so with as much accuracy as possible to avoid being impacted by these fees.

• Depending on the weight tier the item falls into for standard-sized products, your removal and disposal fees can increase anywhere from $0.45 to $1.06. 

• Depending on the weight tier the item falls into for oversized products, the increases in removal and disposal fees range from $1.62 to $4.38.

Amazon Can Raise Prices, But FBA Sellers Can’t!

The most apparent solution for sellers to absorb all these surcharges might be – to pass the extra cost onto the end customer. However, on Amazon, the solution is more complex than simply raising your price to reflect these increased costs. You would think sellers have one major worry – “How will my customers react to the price hike?” They have something far more significant to worry about – having their listing suppressed entirely. 

•  When a seller attempts to revise the price of their product upward to keep pace with these surcharges, they may run into an error that looks like this: 

• Amazon is a company that prioritizes the customer at every turn over the seller – and this is one of the best examples. Their algorithms constantly look at the prices of various products, comparing them across various sellers on and off their marketplace. The algorithms do this to ensure that Amazon always maintains the best price compared to any other competing marketplace. Your listing gets deactivated if the company’s automatic algorithms report a false positive and flag your products as priced too high.  It is well known to sellers that Amazon is a different game – while associates take care of the products on the shelves of brick-and-mortar stores, AI and automation take care of Amazon’s enormous marketplace. The most frustration for the seller comes from the fact that Amazon chooses to act as a self-appointed pricing regulator – it ensures the customers always get the best prices on the Amazon marketplace compared to any other platform but impacts the ability of the seller to absorb FBA costs isolated to Amazon. These issues are complicated and cumbersome to resolve for sellers on their own, but there is no other choice – it is nearly impossible to get on the phone with someone from Amazon. 

It’s All Likely To Get Worse With Amazon’s Cost Cuts

Setting aside the declining customer experience and mounting challenges for sellers, the party at the center of everything is Amazon – the company witnessed skyrocketing demand during Covid which drove a boom in e-commerce. However, the company faces numerous challenges amid the resumption of in-person life, the present inflationary environment, and a slowdown in consumer demand. Faced with an urgent need to restore growth, profits, and the confidence of its investors, the company has scaled back its aggressive investments in FBA – which could make the times to come even more challenging for sellers.

Business Pressures in Amazon’s eCommerce Division

• Amazon worked overtime to keep up with the boom in consumer demand that e-commerce witnessed during the Covid-19 pandemic, doubling the size of its already enormous logistics network. 

• The company found hiring warehouse workers to expand its network a drag on its bottom line. It isn’t surprising, given that the average wage for warehouse staff is now $19 / hr. Working in warehouses is no longer a minimum wage occupation and is one of many factors affecting Amazon. 

• In its first quarter results for 2023, the company reported complete flatness in sales from its e-commerce division, while the cost of fulfillment surged by 21% year on year. 

• With the pressures on its business, the company can no longer afford to continue aggressively investing in building its network – in fact, it’s seeking to do the opposite.

Aggressive Cost-Cutting Likely To Slow FBA Even Further

• CEO Andy Jassy has identified FBA as an area where the company can improve its bottom line by cutting costs. 

• The cuts have been aggressive, with the company canceling plans for as many as 99 warehouses that it planned to set up. 

• It has also begun consolidating its network from a national model to a regional one, featuring eight major, interconnected hubs.

• All this means that delayed deliveries may become ever more frequent on FBA.

With all these events swirling around sellers, some quick and decisive strategy pivots in order fulfillment may be essential to meeting customer expectations in the times ahead. 

What Can You Do As A Seller? – Diversify Beyond FBA

For sellers operating on Amazon, the approach has often been relatively straightforward – let Amazon FBA take care of it all, with Fulfilled By Merchant (FBM) or SFP as a backup in the rare event of an emergency. However, given the present challenges, a backup may no longer suffice – sellers may need to devise an entirely new order fulfillment strategy.

Sellers Have Traditionally Relied on FBA

• According to Statista, 64% of Amazon sellers use Fulfilled By Amazon exclusively to deliver their orders, with only 15% choosing to completely cut ties with FBA and handle everything independently. 

• There are good reasons for this – the algorithm determining whether a product listing will win the Buy Box uses fast order fulfillment as a leading criterion. The fact that FBA listings are automatically Prime eligible is attractive for many sellers (SFP listings also have a great chance to win the Buy Box, while merchant-fulfilled non-Prime orders trail well behind).

• The well-known A9 algorithm, which ranks products in search results on Amazon, also prefers listings with fast order fulfillment, which has led sellers to lean in heavily on FBA (again, a Seller Fulfilled Prime order can show up favorably, subject to the merchant doing other things right – such as optimizing for the right keywords in their product detail page copy). 

The question sellers might ask is – why to do all the extra work with SFP when it is easier to win the buy box and rank well with FBA itself? This question meant that FBA was the de-facto choice for many years, with SFP / FBM listings being backups for rare emergencies. But with those emergencies becoming more frequent and the operational excellence of FBA under serious question, it is time for sellers to identify an alternative strategy.

Seller Fulfilled Prime – The Essential Alternative Strategy to FBA

While Amazon may be working through numerous challenges, the reality of the situation is apparent for all players in e-commerce – free and fast shipping is here to stay. When the 150 Million Prime members apply the Prime-only filter when browsing for products on Amazon, they do it for no other reason than fast and free delivery. 

Customers simply do not care about the issues plaguing Amazon – their only expectation is free and fast order delivery. Therefore, issues with FBA do not simply affect Amazon – late orders ruin the customer experience and, by extension, the relationship people have not just with Amazon but with your company. 

The imperative becomes clear – Seller Fulfilled Prime is no longer a backup to be used in the rare event of an FBA emergency; it is an essential alternative strategy to customer delight and business growth.

However, while we’ve outlined all the issues confronting Amazon, this company bends to no one – sellers, investors, the government, or even regulators. The only stakeholder the company is genuinely interested in is its customers. So why would the company re-introduce Seller Fulfilled Prime when Amazon’s style has always been to keep steamrolling its domination upon the e-commerce world?

Why is Amazon Reopening SFP? – It’s The Government!

Amazon themselves are not particularly enthused about the program. In an interview at the Code 2022 conference, CEO Andy Jassy remarked that he did not believe that 3rd party sellers could meet the timelines that Amazon does and that outsourcing Prime order fulfillment had the potential to “significantly degrade” or even “eradicate” the quality of the experience on the program. That is a strong opinion – which begs the question, why reopen it now? 

Aside from the issues with FBA and Prime that Amazon may be working through, it may have had its hand forced by several external problems it is facing now – from governments and regulators in multiple markets:

• In the European Union, the company faced allegations that its Buy Box algorithm favored FBA and that it used non-public data on its 3rd party sellers to develop competing brands and private-label products. 

• Faced with the prospect of being fined a staggering $47 Billion, the company made several concessions – including agreeing to let Prime sellers have their pick of carriers for delivery operations and to shut down the use of non-public data on its sellers for brand and product development.
  
• Now, these issues have begun to confront the company closer to home. The Federal Trade Commission, headed by Commissioner Lina Khan, alleges that Amazon equates the sale of 3rd party products on its marketplace to using its FBA network. The FTC is preparing “The Big One,” a lawsuit centered around the preferential treatment that Amazon affords FBA – which it intends to file before August.

• The American Innovation and Online Choice Act (S.2992) is a bipartisan piece of legislation gathering momentum in the US Senate focused on opening up more choices for the American consumer online – including loosening the chokehold that Amazon has over the logistics piece of Prime. 

Faced with all these challenges, Amazon may be looking at reintroducing the program as a way for it to get ready for its day in court – what better way to prepare for its day in court than by showing to regulators that by reopening Seller Fulfilled Prime, it is not stifling competition on order fulfillment – rather, it is doing just the opposite, while at the same time, providing the end-customer a high-quality experience through the Prime promise of free and fast shipping. 

So now that we’ve explained all of this, it’s time to get into the details – what is the list of requirements that Amazon expects its sellers to meet for Seller Fulfilled Prime? 

Seller Fulfilled Prime Requirements

On August 8, 2023, Amazon announced wide ranging changes to the criteria it expects sellers to meet on the SFP program. The list remains lengthy and as challenging as ever. Here are the latest SFP requirements, which will go into effect October 1, 2023: 

• Maintain an On-Time Delivery Rate greater than 93.5% (A delivery is on-time if it is delivered on or before the delivery date promised to the customer when they checkout).
• Maintain a Valid Tracking Rate (VTR) higher than 99% – a package has Valid Tracking if it has atleast one carrier scan. This scan must occur before the package is delivered, to ensure it provides a tracking number that can be used by the customer to track their order on Amazon.
• Any product linked with a Prime shipping template must offer a minimum shipping speed of 3-5 days to the contiguous United States (the lower 48 states), across all 3 size tiers – Standard, Oversized and Extra Large.
• 30% of product detail page views on standard sized products must promise 1-day delivery to customers. The requirement for 2-day delivery is 70%. For oversized products, these metrics are 10% and 45% respectively. For Extra Large products, 15% of product detail page views must promise 2-day delivery (there is no 1-day expectation for these SKUs as of now).
• Merchants must now first go through a pre-qualification process before starting their SFP trial. In the 90 days leading up to their trial, they must self-fulfill at least 100 packages, with a cancelation rate <2.5%, valid tracking rate >95% and late shipment rate <4%. Once they are on the trial, they must ship at least 100 packages in 30 days, while meeting all the SFP program requirements. During this entire period, the Prime badge will not be visible on listings to customers. After successful completion of the pre-qualification and trial period, Amazon will enable the Prime badge for your listings.
• Sellers must provide free returns for all eligible items weighing less than 50 lb, for any seller or buyer related reason.

Amazon originally announced that they would charge a fee of 2% of the unit price for every item shipped via Seller Fulfilled Prime, or a minimum of $0.25. Amid growing pressure from regulators, the company waived this fee to avoid negative reactions from sellers and officials. The company removed the fee a few days before September 26, 2023, when the Federal Trade Commission and 17 US states sued Amazon for anti-competitive behavior.

The critical thing to remember (which is the kick in the teeth for sellers) is that Amazon FBA does not face any penalties for missing any of these – whereas, in SFP, the onus is on the merchant to diligently track these metrics and ensure you never fall below the standard. 

If this list appears daunting, you’re not alone – many sellers feel these criteria are tough to meet. So before even looking at where the challenges and roadblocks lie, it’s worth asking – why is it worth being part of the program, and what value can it deliver to your business?

The Competitive Advantage SFP Provides Your Business

• Profitability: The most significant advantage SFP can give your business (after you’re unshackled from all the FBA fees) is profitability. While FBA offers great rates for small, lightweight and fast-moving SKUs, it may not be the best option for big and bulky SKUs. For these SKUs, you can improve margins and profits significantly through SFP.
• Superior inventory management: When you work with FBA alone, you face problems when trying to expand to other sales channels. Let’s say you’re trying to expand to Walmart. Now you’ll have no choice but to inbound them some of your inventory as well to cover the same geographic regions, creating redundancies. By participating in SFP, you can utilize the same pool of inventory and warehouse infrastructure to fulfill orders across Walmart, Shopify and all your other sales channels. This reduces the buildup of redundant inventory and makes your operations leaner and more efficient.
• Potential to surpass FBA delivery times: With all the cost cuts, business pressures, and staffing shortages at Amazon, it’s probably true that an SFP seller with an excellent operation beats FBA on order fulfillment timelines (simply because the adherence to the 93.5% on time delivery criteria is likely to match or exceed what Amazon does on average). 
• Accelerate sales with Prime on every SKU – FBA is optimized for lightweight, fast-moving SKUs. However, the consumer expectation today is for free and fast shipping on every e-commerce order. FBA does not make economic or practical sense for some larger-sized and heavier SKUs. With SFP, you can finally have the Prime badge for these products, which will significantly boost their sales rank and buy box win probabilities. With this, you can drive increased sales of these SKUs, growing revenues.
• Freedom from Q4 restrictions and surcharges: For long-tail, slow-moving or seasonal SKUs, FBA’s long term storage fees can become a drag on margins and profits. With the right SFP fulfillment partner, you can eliminate high storage fees and peak-season surcharges, which improve your margins for these classes of SKUs.

• Improved predictability and planning: Freedom from all these Q4 surcharges means you can clearly plan your operations for the rest of the year. Free from the threat of sudden surprises, you can plan your goals for the close of the year with more confidence and certainty. 

• Potential to Scale Beyond Amazon: Many merchants are already consumed by the busy work of working with FBA to handle their Amazon operations and all their other platform-captive fulfillment partners (for example, Walmart Fulfillment Services for Walmart). An excellent SFP operation can serve as a template through which you can achieve fast shipping across every platform without being beholden to the constraints of each marketplace. Additionally, you will be able to do so more cost-effectively than Amazon’s Multi-Channel Fulfillment (where Amazon fulfills orders for merchants across other platforms). You will also be free from the constraints that using MCF brings (such as being unable to use it to fulfill Walmart orders).On Walmart for example, listings offering 2-day delivery rank higher in search results, win the buy box more often and see conversion lifts as high as 50%. Sound familiar? But once you’ve figured out a strategy for Seller Fulfilled Prime, you’re in a great position to extend that to Walmart, without having to work with Walmart Fulfillment Services. This means you’re free from the headache of having to learn their processes and guidelines. With SFP, it will cost you the same to ship orders across every sales channel. This is unlike MCF, where shipping orders originating outside Amazon is significantly more expensive.
• Savings in time and money: While moving away from FBA can provide significant cost savings, working with a partner like Cahoot means fewer things to worry about and more time back on your plate. Rather than constantly reaching out to Seller Forums for help or reading FBA documentation to understand how the latest changes affect your business, you can put that time into the things that matter – ideating great new products, coming up with creative marketing campaigns, and delighting your customers every moment of every day.

While these are all great benefits for sellers and provide their businesses with significant competitive advantages, making a success of the SFP program is highly challenging. Most merchants know that the requirements list is rigorous and demanding, but few are aware of the exact stumbling blocks that trip up people. Fewer are aware of solutions available to overcome these roadblocks and win at SFP.

Succeeding at SFP is hard – here’s why

While the list of criteria is long and rigorous, we’ve identified the most challenging aspects of the program that trips up most sellers: 

Nationwide Fast Delivery Forces Most Sellers to Use Expensive Air Shipping

• In the past, Amazon had “regional Seller Fulfilled Prime” – which allowed sellers to manage order fulfillment in certain geographical parts of the country while still having the Prime badge on their product listings. 
• The Regional SFP program allowed merchants who owned a single warehouse or worked with a traditional 3PL with a single warehouse location to meet the program’s requirements through economical ground shipping.
• However, Amazon now expects sellers to make products across every size tier available within 3-5 days (at the most) across the entire continental U.S. – additionally, approximately 70% of standard sized item orders must be delivered in under 2 days across the nation.
• The new requirements eliminate the possibility of regional models working any longer – having your inventory stationed in just one location means that shipments to certain parts of the country cross multiple shipping zones. The only way to deliver orders on time in such “single-node” operations is by using expensive air shipments. Making expensive shipments by air completely nullifies any cost savings merchants hoped to achieve when leaving FBA – in fact, it could worsen things.
• It becomes vital in such a scenario to use an SFP fulfillment partner with a strategically located network of fulfillment centers, such as Cahoot, whereby it is possible to cover the entire country in 2 days while still using economical ground shipping rather than express air shipments. Such a network is one of the very few ways it is still possible to both have nationwide coverage and significant cost savings over FBA. 
• Lastly, sellers must ensure that their product listings are classified correctly by Amazon. The metric for % of product detail pageviews that must promise a certain delivery speed is based on the size tier the item falls into (if an oversized or extra large item is classified as standard sized by mistake, you will be under pressure to get a large number of orders of those items delivered in under 2 days). 

Amazon Expects Delivery in 2 Calendar Days, While Carriers Operate on Business Days

Amazon now expects sellers to make Prime deliveries in 2 calendar days (necessitating the need to work with carriers that support weekend pickup and delivery). This requirement has caused sellers a lot of pain and grief, and here’s why: 

The Misleading Pageviews Metric

In its latest round of revisions to the program criteria, Amazon has increased the percentage of product detail pageviews that must promise 1 calendar day and 2 calendar day delivery. 

Now, 30% of product detail pageviews for standard sized products must promise  1 day delivery, while 70% must promise 2 day delivery. But when does your listing promise 1-day delivery, and when does it promise 2-day delivery? 

Let’s understand this with a few examples:

Let’s imagine every order is delivered the very next day after it ships. If a customer views your order on a Monday and places their order before the cutoff time, you will ship it that same day, and it reaches the customer the next day. In this case, Amazon displays a 1-day delivery promise and this pageview counts towards your 1-day metrics. 

In this second case, when a customer looks at the product detail page after the cutoff time, you ship the order the next day after it is placed, and it reaches the customer the day after. This therefore fails to meet the 1-day promise, but meets the 2-day delivery promise. 

In this last case, it gets really bad. If a customer views your listing on a Saturday evening, the item is expected to ship only on Monday (assuming you don’t ship Sundays) and it will be delivered to them on Tuesday – a full 3 days later. 

In this case, such a pageview counts toward neither the 1-day nor 2-day metrics. The implication is clear – your listings will display 2-day and even 3-day delivery promises for significant periods of time. The mapping between the number of warehouses you have, the percentage of the US population you can service with 1-day delivery, and the % pageviews that actually promise 1-day delivery is not linear. This graphic illustrates that:

If you have warehouse locations, you can cover 42% of the US population with 1-day delivery. But different customers look at your product detail pages at different times of the day, and see different delivery speed promises. 

As per our research, in reality, only 21% of pageviews may actually promise 1 calendar day delivery. To meet the new Seller Fulfilled Prime delivery requirements, it could take as many as six to nine strategically located warehouses.

These demanding metrics mean that traditional 3PLs will find it nearly impossible to help Seller Fulfilled Prime merchants (learn more about why traditional 3PLs are failing, and how peer-to-peer order fulfillment networks are designed to help you find success on SFP here). It becomes crucial for merchants to partner with order fulfillment networks that have warehouses at different strategic locations across the country, ensuring customers from anywhere see fast delivery promises.

While merchants may want to upgrade to a better fulfillment partner who is better positioned to meet these requirements, it’s easier said than done to leave your current 3PL for better alternatives. Many merchants don’t know how to evaluate and find the perfect fulfillment partner for them. If you’re looking for a step-by-step guide on migrating fulfillment partners, check out our guide here!

The Juggling Act Between Cut-off Times, Economical Shipping, and Meeting SLAs

• With Seller Fulfilled Prime, a late cut-off time can potentially increase the number of orders your carrier picks up that same day, boosting your 1- and 2-day delivery metrics.
• If FBA faces any issues or does not meet the delivery promise shown to the customer on the product listing, there are no penalties for Amazon – but a seller must meet the 93.5% on time delivery criteria set for them. 
• Here’s a graphic we’ve created for how delivery timelines look like when operating with a 2 PM cutoff time (based on our discussion of the pageviews metric):

• Sellers must carefully make the tradeoff between increasing their cutoff times (if they can schedule a late pickup with their carriers) versus also ensuring that those orders reach the customer the next day. Increasing the cutoff times increases the % of pageviews that promise 1 and 2 day delivery, but you must ensure that you can actually get the product to the customer’s doorstep within the time you’re promising.
• Here also, sellers need to strategically place their inventory in a network of warehouses to avoid shipping orders placed close to cut-off times through expensive overnight air shipments. Placing inventory in different strategically located warehouses will enable nationwide coverage through economical ground shipping, all while meeting the customer’s expectations. 

The shift to calendar days has had the most significant impact on the operational side of things – sellers now have to plan a whole different way of running their business and schedules, which have also become challenges: 

Operational Excellence Needed

Challenging to Staff And Operate Warehouses on Weekends

• As we’ve mentioned before, staffing is often the biggest bottleneck towards finding success with order fulfillment. 

• With weekend pickup and delivery expected to meet the calendar day-based SLA, most merchants with a single warehouse or those working with 3PLs face difficulties succeeding in the program. 

• If you own and operate your warehouses, paying your staff to work on the weekends or hiring additional people may eat into your margins to unfeasible extents. 

• Traditional 3PLs, which are asset-heavy, also face cost pressures around labor – which they may be forced to pass onto sellers. 

• While these options erode any cost savings that sellers see over FBA, you are not without alternatives – consider platforms like Cahoot, where each of our fulfillment centers is vetted for operational excellence and meets this challenging requirement.

Arranging for Carrier Pickups on Weekends:

• In addition to warehousing, your carriers are another critical element in making your logistics work. 

• Not all carriers offer weekend pickup and delivery – some may require you to be a large shipper and maintain minimum order volumes. 

• All this means you may have to contact your account manager at the various carriers and enquire about possible options. 

However, while all this can be done, the biggest reason sellers shy away from SFP is the heavy amount of process management, collaboration, and busy work needed to keep this operation running. 

Managing Weekend Operations Can Overwhelm Sellers

• It becomes easier to understand why so many sellers shy away from Seller Fulfilled Prime – between working with multiple 3PLs to ensure your inventory covers the country, to operating and staffing your warehouses on the weekend as well as coordinating with your shipping carriers to arrange for weekend pickups, it can seem incredibly overwhelming. 

• As a seller, the SFP program can drain your bandwidth, time, and resources. 

• You might often wonder whether managing so many stakeholders and sifting through so much busy work is worth it when FBA offers you only one party to work with – even if that party is Amazon, whose interests often tend to be misaligned with yours. 

• It does not have to be this way – sellers must spend time identifying partners who provide a unified experience where they get to work with just one vendor. Platforms like Cahoot help sellers meet and surpass the SFP program while ensuring you deal with only one company rather than coordinating between multiple 3PLs and carriers, preserving precious time and resources for you and your business. 

Unnecessary Surcharges From Amazon Buy Shipping

• In its latest round of revisions, Amazon no longer mandates the use of its Buy Shipping platform to print shipping labels.

• This is a major relief for sellers, because Amazon Buy Shipping comes with one major issue that they have reported anecdotally – the platform is not great at estimating the delivery timelines for USPS services (the comment below from Amazon’s Seller Central forums highlights the issue): 

• In many situations, Buy Shipping does not accurately estimate the delivery timeline within which a USPS service can make orders.

• In such cases, sellers are faced with a choice to pick from two bad alternatives: fail to show the customer a fast delivery promise (not an option for SFP sellers) or buy a more expensive label from the choices that Buy Shipping does believe are capable of meeting the SLA: 

• This can be tough for sellers to swallow – as order volumes increase, the extra costs paid on each shipping label begin to mount, eroding margins and profitability. Thankfully, Amazon no longer requires the mandatory use of the service. 
• However, this does not automatically mean that you will see increased savings. You still need to make sure that you’re picking the most economical label on every order! This requires technology like Cahoot’s next generation shipping software, which intelligently rate shops across warehouse locations, carriers and shipping services to always print the cheapest label that will meet the delivery promise committed to the customer.

So while a lot can potentially go wrong, sellers can also make the program work for them and find success – by following specific vital strategies. 

To round off our ultimate guide to Seller Fulfilled Prime, we want to help you start finding success in the program by giving you a few top tricks and recommendations to succeed through our handy dandy cheat sheet!

The Cheat-sheet to Winning at Seller Fulfilled Prime

• Achieve Nationwide Coverage With a Warehouse Network – Making orders nationwide in under two days is no easy task. You need to distribute inventory strategically in different locations to cover 100% of the country in this window. Operating from a single warehouse or 3PL fulfillment center will simply not cut it – you need to spread your product placement across a network to meet the program requirements. 
• Use Data to Guide Inventory Placement And Avoid Air Shipping – Even with a network model, it is crucial to analyze where most of your orders are coming from – placing your inventory close to those “order hubs” becomes a vital part of ensuring you will meet and exceed the one and two-day delivery requirements. This also ensures that you can reach all of your customers through economical ground shipping rather than being forced to make expensive air shipments.
• Consolidate Relationships And Eliminate Busywork – SFP can lead you down the rabbit hole of investing in multiple 3PLs and coordinating with numerous carriers to make the program work for you. Sellers need to conduct research and identify a platform that provides a single relationship for you to manage – otherwise, logistics can overtake your focus on the activities that matter – selling and taking care of your customers. 
• Save Every Dollar Across Every Shipment – The whole point of moving away from FBA towards a program like SFP is to extract cost savings. It is essential to align your technology towards automation, whereby you’re automatically generating the lowest price shipping labels on every single order.

• Monitor Metrics Like a Hawk – Amazon provides you with dashboards on Seller Central that provide all the SFP metrics needed. It is crucial to constantly stay on top of these and keep adjusting your strategy to ensure you’re meeting their expectations.

Succeeding in this program is challenging, but we think these tips are a great place to start. As Q4 and the holiday season approach, now is the time for sellers looking to diversify their order fulfillment beyond FBA and offer fast, profitable free shipping across every SKU to identify a partner who can help you win at Amazon Seller Fulfilled Prime. If you’d like to understand how Cahoot can be with you every step of the way, just fill out this form, and we’ll be in touch!

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On August 8, 2023, Amazon announced a wide range of changes to the criteria it expects sellers to meet on its Seller Fulfilled Prime program. The company introduced new requirements, while updating its expectations from merchants across other metrics. These include on-time delivery, valid tracking, nationwide delivery, delivery speed, free returns and program fees. Amazon has also removed the use of the On-Time Shipment metric and no longer requires the use of its Buy Shipping services.

In this article, we breakdown each criteria – explaining the old requirements and the new ones that will go into effect on October 1, 2023. We also explain the impact we expect sellers to face from each of these changes.

Program Requirements and Criteria

On-Time Shipment (OTS)

The On-Time Shipment Rate is defined by Amazon as the number of units that shipped on or before the Promised Ship Date / Total No. of Shipped SFP Units.

Amazon tracks this metric based on when the carrier scan occurs. 

Previous Expectations

If an order is received before the cut-off time Mon-Fri and Sat/Sun (whichever the seller prefers to enable), carrier scan must occur the same day.

A carrier scan must occur the next day if an order is received after the cut-off time.

This is the most important metric in the current Seller Fulfilled Prime requirements.

New Expectations

Sellers will no longer be judged on this metric.

You don’t have to ship the same day if shipping tomorrow is optimal

Under the current Seller Fulfilled Prime guidelines, Amazon requires sellers to ensure a carrier scan is conducted the same day for all orders received before the cut-off time. 

There are situations where this rule forces sellers to unnecessarily use expensive air shipping, at the expense of more economical services. It’s best to understand this with an example: 

Let’s imagine you’re a seller with 2 warehouse locations – one in Los Angeles and the other in New York. Imagine that you receive an order from a customer in Connecticut at 3PM ET on a Monday:

Ideally, you would like to use an economical ground service which can reach the customer in time by fulfilling the order from your New York warehouse. However, because it is past the cutoff time in New York, but before the cutoff time in Los Angeles, Amazon will expect a carrier scan that same day.  The only way for you to ship from Los Angeles and deliver to the customer by the promised date is through an expensive air shipping service. 

However, with carrier scans no longer required on the same day, you can now choose to ship the next day from your New York warehouse through a service like UPS ground – which is 3.5X cheaper than the air service. Such cost savings can only be achieved, however, if you have the right technology in place. Your shipping software needs to intelligently compare warehouse locations, carriers and shipping services to determine the most economical option to use, which still satisfies the customer expectation.

On-Time Delivery (OTD)

The On-Time Delivery Rate is defined as Number of Units delivered on or before the Promise Date (which the customer sees at the time of checkout) / Total No. of SFP Units Shipped. 

Amazon tracks this metric based on 2 parameters – the delivery date committed to the customer when they checkout, and when the package is actually delivered at their address.

Previous Expectations

Under the old program, Amazon heavily pushed the use of its Buy Shipping Service. Amazon might also believe that only the services on Buy Shipping are capable of meeting the delivery promises made to customers. 

Therefore, it was only in cases when labels were bought off of Buy Shipping that sellers were held to the high bar of 97% on-time delivery.

New Expectations

This becomes the most important metric under the new Seller Fulfilled Prime requirements.

Amazon is also going to minimize the provision of “Promise Extensions” (in some cases, the customer is shown a later delivery date because Amazon factors in buffer time due to logistical challenges at the seller’s end).

They encourage sellers to begin by looking at their On-Time Delivery Rate for orders without Promise Extensions (to get a sense of their ‘true’ order fulfillment levels).

No More Protection Through Buy Shipping Usage Available

While the 93.5% on-time expectation is a reduced one, which is more favorable for sellers (they don’t have to be perfect every time), this metric could still work against them.  The major reason for this is that sellers now lose the protection that the previous program afforded – so long as they bought the label on Amazon Buy Shipping, and performed the carrier scan in time, they could not be held accountable for any delays in order delivery due to carrier issues. Now, it no longer matters whether the label was bought through Buy Shipping or if a carrier scan occurred in time – sellers must meet the 93.5% benchmark. The biggest contributor to making it happen are the shipping carriers. The biggest criteria by which Amazon measures success on the program is now in the hands of a factor that the seller cannot entirely control – the ability of the shipping carriers to execute operations smoothly and without disruption.

Buy Shipping Usage

Amazon Buy Shipping is Amazon’s system through which sellers and merchants can purchase shipping labels to fulfill their orders. 

The Buy Shipping Usage % is defined as the Number of Units for which labels were bought with Buy Shipping / Total No. of SFP Units Shipped 

Previous Expectations

Buy Shipping usage is extremely important. Sellers must print nearly every label on Buy Shipping. Complying with program requirements boiled down to printing labels on Buy Shipping, and then ensuring carrier scans occurred on the same day.

New Expectations

Sellers will not be judged any longer by this metric – this is the biggest step Amazon claims it is taking to provide sellers and merchants “greater flexibility of shipping services and carriers”.

In return for being able to pick services off of Buy Shipping, a timely carrier scan will not suffice – the orders need to actually reach the customer within the Promised Delivery Date >93.5% of the time.

More flexibility in picking carriers and services

Amazon Buy Shipping has one major issue that numerous sellers have reported anecdotally. The platform does not do a good job of estimating the delivery speeds of USPS services.  Buy Shipping sometimes excludes USPS services that are actually capable of meeting the delivery date, forcing the seller to pick a more expensive shipping label that it does believe is capable of reaching the customer in time. Buy Shipping also occasionally runs into errors, where it does not return a particular carrier for no particular reason. In all these cases, merchants are forced to buy labels off Buy Shipping, which reduces their usage less than the 99% bar.  

With this requirement gone, sellers are now free to pick the ‘truly’ cheapest service. However, you can see the benefits of this only if you have an intelligent multi-carrier shipping software in place that rate-shops multiple carriers and shipping services to identify the truly cheapest label on each order.

Valid Tracking Rate (VTR)

Amazon provides its customers tracking numbers for them to be able to see where their order is at. 

An order has valid tracking if it receives a first carrier scan (the scan that is performed by the carrier to indicate that the order is in transit). 

Amazon defines the Valid Tracking Rate as Number of Prime packages with a Valid Tracking ID / Number of Prime packages for which shipment has been confirmed.

Previous Expectations

Sellers were not assessed on this metric.

New Expectations

Sellers are responsible for updating shipping carrier, shipping service and tracking number information on Amazon for each order, to enable customers to track the status of their packages.

Less Hassle for Merchants in Meeting This Metric

Amazon expects each package to have at least one carrier scan. This scan must occur before the customer receives their order, so that they can use the tracking number to see where their order is on Amazon. The fact that the carrier scan does not have to occur the same day is a positive for sellers. Many sellers have reported issues with carrier operations on the weekends – their packages are picked up, but no scans are actually conducted on a Saturday. Under the current program, this leads to violations of the OTS metric.  

Under the new program, sellers should not face too many hurdles with getting packages scanned once before they reach customers.

Nationwide Delivery Coverage

This refers to the ability for products to be made available with fast shipping across the contiguous United States (the lower 48 states). 

This expectation is based on the size tier that the item falls into (Standard Sized / Oversized / Extra Large). 

Previous Expectations

Standard-sized products must be made available within the entire contiguous U.S. on fast shipping.

Oversized items can be serviced within specific regions (also known as Regional SFP) – nationwide fast shipping is not required for them.

New Expectations

Products across all 3 of Amazon’s size tiers – Standard Sized, Oversized and Extra Large – must be made available in the contiguous U.S. on fast shipping.

Any product (regardless of size tier) that is configured with a Prime shipping template has a minimum delivery speed of 3-5 calendar days – sellers cannot edit this.

Prime Badge Available Nationwide For all SKUs, but with the Caveat of Higher Shipping Fees

Amazon is now willing to provide sellers the Prime badge nationwide on oversized and extra large SKUs, whereas previously it was restricted to just the specific regional part of the country the seller operated from. The metrics for 1- and 2-day delivery are not yet extremely high. This is on the whole a positive for sellers because the Prime badge boosts search rank, conversion and sales on these SKUs. 

The negative is that the minimum delivery speed across every size tier is 3-5 days. This is a calendar-day based metric, which includes Sundays and Holidays. Therefore, it may not be possible to always use discount services capable of meeting the delivery timeline, such as USPS Priority Mail, FedEx Home or UPS Ground. In some cases, the seller might still be forced to use expensive air shipping.

Delivery Speed Metrics

Amazon tracks this based on the % of Product Detail page views that promise same-, 1- or 2-day delivery to customers. 

This percentage will be calculated based on pageviews from customers across the entire contiguous United States, not just those in your defined regions for Same-, 1- or 2-day deliveries.

Previous Expectations

Amazon introduced the delivery speed metric as a percentage of product detail pageviews that promise customers same-, 1- or 2-day delivery. 

The calculation is based on calendar days, and includes Sundays and holidays.

New Expectations

The delivery speed metrics across all size tiers have increased. They will now be based on pageviews from customers all over the lower 48 states, in addition to those in your defined regions for same-, 1- and 2-day deliveries.

Amazon has said that it does not have targets for Same-Day Deliveries initially.

However, as Amazon focuses on same-day deliveries for its inhouse FBA logistics network, there might be revisions to this in the coming months.

Delivery Speed Expectations Increase Across Every SKU

• This is how delivery promises will be displayed to customers (assuming a cut-off time of 2PM, and that you deliver every order within 1 day after it ships). 

• These metrics have always been the most crucial and challenging for sellers to meet. Sometimes, they’ve been unfairly penalized for them also. Let’s say you’re based in New York, and a customer in Connecticut is browsing your product detail page at 6 PM ET. Even though you may be capable of delivering the package to them the next day, Amazon will still show only a 2-day delivery promise. 

Achieving a high % of 1- and 2-day delivery pageviews nationwide is not easy, and relies largely on ensuring that your inventory is strategically distributed in a network of USA fulfillment centers so that customers from everywhere see fast shipping promises.

Trial Period

Sellers hoping to be a part of the SFP program must go through a trial period where they can prove to Amazon that they are capable of meeting the rigorous criteria of the program. 

During this trial period, when customers shop their products, they will not see the Prime badge on the listings. On successfully completing the trial period and meeting the SFP criteria, Amazon will enable the Prime badge for the listings.

Previous Expectations

Before the trial:

Have a Professional seller account, and activate Premium Shipping. Fulfill 30 Premium orders in 1 month. 

During the trial: 

Fulfill 200 orders in 90 days. Do so while meeting all requirements of the SFP program. 

New Expectations

Products across all 3 of Amazon’s size tiers – Standard Sized, Oversized and Extra Large – must be made available in the contiguous U.S. on fast shipping.

Any product (regardless of size tier) that is configured with a Prime shipping template has a minimum delivery speed of 3-5 calendar days – sellers cannot edit this.

Time to Enrollment Shortens for Some Sellers, While Others May No Longer Be Eligible

Previously, the trial period was longer in length and order volumes – having to fulfill 200 orders in 90 days while meeting the program criteria. Now, if you’ve self-fulfilled 100 packages in the last 90 days (or under, say 60 days) – you can get on the shorter trial of 30 days.  The overall time to Seller Fulfilled Prime enrollment is potentially shorter (if a merchant can move past pre-qualification quickly).

However, when comparing 200 packages in 90 days to 100 deliveries in 30 days, sellers are expected to ship nearly 50% more orders per month – this can exclude sellers with small monthly volumes who were previously eligible to participate in the program. 

Performance Evaluation

Amazon periodically assesses how its SFP sellers are faring, and to check whether they are meeting the expectations set for them.

The evaluations that Amazon conducts on sellers continues to occur at the same cadence that it always has – sellers will not face anything new.

Amazon will begin tracking sellers against the new set of metrics beginning October 1, 2023. 

Resolving Disputes

Needless to say, order fulfillment is complex and mistakes can occur. While merchants face no penalties for mistakes that FBA makes, sellers on Amazon SFP face severe penalties for issues with orders. 

Previous Expectations

The Plan of Action needs to explain why you slipped up, what specific steps you’re taking to fix the current situation and measures that will be put in place to ensure it does not repeat.

New Expectations

An email will be sent the first time a requirement is missed. The Prime badge will be “paused” the 2nd time you miss the same requirement. If you are sure the issue is fixed, you can restart the Prime badge. If you make it through four weeks without violating the same requirement after you restart the Prime badge, your account will be reset. If you do miss the same requirement the 3rd time, you will lose the Prime badge. If you go through the pre-qualification process, you can start an SFP trial again.

Amazon Gives Sellers More Chances, but the Road Back is Extremely Tough

Under the previous Seller Fulfilled Prime requirements, when Amazon found sellers missing a certain metric, it would suspend them from the program and require submission of a Plan of Action. This was harsh – a single mistake could lead to suspension of the Prime badge. This was exacerbated by the resolution process – it can take a long time for Amazon to get back, and if they deemed the Plan of Action not good enough, they could delay reinstatement on the program.

 Now, sellers have 3 strikes per program requirement. Additionally, this gives a chance to sellers to dig into why they missed a metric and work with their fulfillment partner to ensure it does not repeat again. Sellers that have an SFP fulfillment partner with responsive, reliable customer support should not face too much trouble in ironing out their errors and continuing their participation in the program. However, if the 3 strikes do occur, then it is a long, long way back – sellers must begin all over again – right from the pre-qualification process.

Free Returns

When a customer wishes to return a Return-eligible Prime item, the sellers are in most cases required to pay for the cost of the return shipping label, and to provide the customer a full refund. In a small number of cases, the customer might be required to bear the cost of the shipping label – in these cases, a refund is provided after deducting the price of the label.

Previous Expectations

When the return had these Buyer codes, sellers were exempt from bearing the cost of the return label: 

• Accidental order
• Better price available
• No longer needed or wanted
• Performance or quality not adequate
• Incompatible or not useful for intended purpose
• Part not compatible with existing system
• Excessive installation or did not install

New Expectations

Sellers must bear the cost of the return shipping label even in the cases of the above-mentioned buyer reason codes.

Return Costs Rise for Sellers – Even When the Onus is on the Buyer

Previously, in certain cases, sellers could provide refunds after deducting the cost of the shipping label. Now, even in cases where the onus may lie on the buyer’s side, the seller must bear the cost of the return shipping label. This is an additional expense that they must bear, which was not the case previously.

Program Fees

Amazon originally announced that they would charge sellers 2% of the unit price for every item shipped via Seller Fulfilled Prime, or a minimum of $0.25. 

Amid growing scrutiny from regulators over anti-competitive practises, the company withdrew this fee for concerns over how sellers and officials would perceive such behavior. Amazon withdrew the fee a few days before September 26, 2023 when the Federal Trade Commission and 17 US states sued the company for anti-competitive behavior.

Amazon Resources

We hope you found our breakdown helpful and informative!

To read more about the old requirements that the program wanted sellers to meet, visit this page on Amazon Seller Central: https://sellercentral.amazon.com/help/hub/reference/external/G202072550 

To read about the new requirements that Seller Fulfilled Prime will enforce starting October 1, 2023, visit this page on Seller Central:

https://sellercentral.amazon.com/help/hub/reference/external/GXCRLXHNJNPE2DHM

You can also read our guide to selling and winning on Amazon Seller fulfilled Prime to learn everything there is to know about SFP before you start the process in October 2023. 

Offer 1-day and 2-day shipping at ground rates or less.

Recent Blog Posts

Walmart doesn’t just want to be the biggest brick & mortar seller in the world – they know that eCommerce is the way of the future. 

According to webretailer.com, Walmart.com is a relatively distant 3th in US visitors behind Amazon and eBay, but it’s closing the gap with a huge growth rate. 

In their efforts to catch up, Walmart is launching programs aimed at ensuring that their delivery experience can match the vaunted Amazon Prime. Last year, they launched Walmart Fulfillment Services, a new program that enables sellers to store inventory and ship through Walmart’s fulfillment centers.

In this article, we’ll cover how WFS works, it’s strengths and weaknesses, and alternative solutions for sellers that want to deliver fast and free on Walmart.com.

How does Walmart Fulfillment Services work?

At its core, Walmart Fulfillment Services is a competitive answer to Amazon Prime. The single most important element of competing with Amazon is earning parity on fast and free shipping. Without fast and free shipping, Walmart knows that customers will continue to turn to Amazon. The more quickly Walmart can grow WFS and get its sellers to use the network, the better its 2-day shipping coverage will be.

Sellers that use Walmart Fulfillment Services for their Walmart listings go through a relatively simple and hands-off process. Once a seller has an account and listings, and the seller is approved for Walmart Fulfillment Services, then they send inventory to Walmart fulfillment centers and convert their products to Fulfilled by Walmart listings. 

If they didn’t have it already, they’ll then get the Walmart TwoDay badge, boosting impressions and conversion. Then, when a customer places an order, Walmart will pick, pack, and deliver the item – no intervention needed from the seller. Moreover, Walmart also manages the returns process and provides customer service.

Benefits of Walmart Fulfillment Services

Straightforward solution for Walmart

Simply put, sellers that use Walmart Fulfillment Services for their Walmart orders have a low-complexity solution. There aren’t complicated integrations to worry about, and management tools are available through the seller’s account with Walmart.

Enables fast shipping

Since Amazon introduced its Prime program, 2-day shipping has quickly evolved from a “nice benefit” to a “must have”. In fact, a recent McKinsey study found that over 90% of consumers see 2- to 3-day delivery as the baseline. Without it, your offer will see high cart abandonment as shoppers select it, then realize that it doesn’t come with the delivery service they expect.

Walmart Fulfillment Services powers fast and free delivery by automatically enrolling products into the Walmart TwoDay program. Walmart’s studies have shown the program to boost conversion by 30-50% – a massive revenue increase.

Handles customer service

Walmart handles all customer inquiries, refunds, and returns for products sold through WFS. In addition to the TwoDay tag, in fact, WFS products get “Free & Easy Returns” and “Fulfilled by Walmart” tags, which further increase visibility and conversion. 

When it comes to your time, WFS saves you a lot of time by handling customer service. As we’ll handle in the next section, though, there’s a drawback to the “Free & Easy Returns” tag.

Drawbacks of Walmart Fulfillment Services

Point solution that doesn’t work elsewhere

Just like Amazon FBA and other marketplace solutions, Walmart Fulfillment Services works only for Walmart. You likely know already that the best sellers don’t put all their eggs in one basket – they list across multiple marketplaces and often have their own webstore as well. So if you’re one of those top sellers, WFS is only a partial fulfillment solution. 

The benefits of Walmart Fulfillment Services as a simple solution for selling on Walmart fade away when you have to manage alternate fulfillment platforms for other selling channels.

Increased returns

Amazon FBA sellers already are well acquainted with the flipside of easy returns – you may not have to worry about it when a customer calls in a return, but you’ll definitely be worrying about it when you realize how big of a hit your margin is taking. A 5% return rate already sounds like a big issue – but it gets that much worse when you realize that a 5% return rate usually comes out to about a 20% negative effect on net profit.

In its quest to chase Amazon, Walmart has adopted a similar return policy for WFS that enables the customers to process a full refund for almost any reason. Beware – this benefit will boost revenue, but it comes with a big hit to profitability.

Alternatives to Walmart Fulfillment Services

The most cost-effective way to offer nationwide 1-day and 2-day delivery is to adopt a distributed fulfillment strategy. Of course, Walmart Fulfillment Services will achieve this for you, but it’s far from a complete solution.  If you want a more flexible fulfillment approach that can support your multi-channel sales, here are your four best options.

1. Open Multiple Fulfillment Centers: Merchants can take it upon themselves to open multiple US fulfillment centers and control fulfillment. The benefits of total control, though, are offset by challenging market dynamics. Warehouse space has never been more limited or expensive, and hiring for frontline fulfillment workers is so competitive that Amazon is paying as much as $22.50 per hour for new employees. On top of that, opening one’s own centers for Walmart fulfillment ties up significant capital and is risky. Pick the wrong location, and you’ll be left footing the bill.
2. Third-Party Logistics Companies (3PLs): Another option is to outsource fulfillment to multiple 3PLs. Since the majority of 3PLs are smaller operations with just a few locations, you’ll have to work with a few to get nationwide 1-day and 2-day coverage. Fulfillment costs vary between 3PLs, so be sure to use something like a 3PL request for proposal (RFP) template to get an apples to apples comparison.
3. Deliverr: Deliverr uses a network of 3PLs to provide nationwide fast and free shipping to Walmart sellers, and if you use it to fulfill your Walmart orders, you’ll automatically qualify for the Walmart TwoDay badge. Like Walmart Fulfillment Services and other 3PLs, Deliverr does the heavy lifting of fulfillment for their clients. Also like Walmart Fulfillment Services, though, Deliverr is limited in scope. The service focuses on small packages and their fulfillment cost balloons as product size rises. They also avoid the elephant in the room, Amazon, and shy away from doing fulfillment for orders on the largest eCommerce channel. If you use their service, be prepared to add the complexity of other fulfillment solutions as you grow.
4. Peer-to-Peer (P2P) Fulfillment Network: A modern and affordable alternative to working with 3PLs is to use a peer-to-peer e-commerce order fulfillment network. A P2P network is a collective of highly vetted eCommerce retailers who offer up excess warehouse space and resources to provide high-quality Walmart fulfillment to other merchants. As a result, costs are typically lower than what you get with a traditional 3PL fulfillment company, and service levels are higher. With a P2P network, flexible multi-channel fulfillment with nationwide 1-day and 2-day delivery is the norm. The diverse set of merchants ensures that each customer gets a solution customized to their need, while innovative technology ensures the highest quality fulfillment.

Offer 1-day and 2-day shipping at ground rates or less.

Recent Blog Posts

For many sellers in eCommerce, Amazon has long been the platform that they simply could not ignore. However, in recent times, another channel has emerged. Walmart is arguably America’s most well known retailer – the company has a sprawling footprint of around 4,717 physical locations. Recent developments, including the rise of Amazon and the Covid-19 pandemic have pushed the Arkansas-based retailer into investing more in eCommerce.

Walmart expects its eCommerce business to grow significantly in the next 5 years. 

The company’s Chief Financial Officer John David Rainey acknowledged that the majority of the company’s profits come from its physical stores. However, he  expects eCommerce’s contribution to grow significantly in the coming years as more retail becomes digital. To that end, the company has invested $7.2 billion in supply chain, omnichannel and technology infrastructure. Early results from the company are promising – in the second fiscal quarter of 2024,  eCommerce sales grew 24% (compared to 6.4%) for comparable in-store sales. The company also reported that active digital users grew 20% in the quarter. 95% of American consumers visit Walmart stores at least twice a year. While Walmart crossed 150,000 third party sellers on its marketplace as of May 2022, that number pales in comparison to the 1.11 million that Amazon has. However, one thing is certain – Walmart is likely to continue growing investments in eCommerce, and take advantage of the enormous shopper base their physical locations attract. This represents a growing base for eCommerce brands and merchants to sell to.

However, just like Amazon, free and fast shipping is almost a prerequisite for success. On Amazon, customers apply the Prime filter when shopping just to see products that come with fast delivery. In many ways, shipping is no longer a back office operation, it has become central to today’s customer experience. Walmart allows sellers to gain competitive advantages by offering TwoDay and ThreeDay delivery.

In this article, we’ll take a look at what benefits TwoDay and ThreeDay delivery offers on the marketplace, what it takes to earn the TwoDay fast shipping badge, how to ensure you’re compliant with the seller performance standards and some options available to merchants to offer fast Walmart fulfillment.

Walmart TwoDay And ThreeDay Explained

• What is TwoDay and ThreeDay Delivery?
• What Benefits do the Tags Give?
  • High Conversion Lift
  • Boosts Search Rank and Discoverability
  • Fast Shipping Badges

How To Qualify For TwoDay and ThreeDay Delivery

• ThreeDay Delivery
• TwoDay Delivery

Walmart Seller Performance Standards

• On-Time Delivery Rate
• Valid Tracking Information
• Refund Rate
• Cancel Rate
• Seller Response Rate

Options to Offer TwoDay Delivery

• Walmart Fulfillment Services
  • Pros of using Walmart Fulfillment Services
  • Cons of using Walmart Fulfillment Services
• ShipBob
  • Pros of using ShipBob
  • Cons of using ShipBob
• Flexport (Deliverr)
  • Pros of using Flexport (Deliverr)
  • Cons of using Flexport (Deliverr)
• Use Your Own Warehouses
  • Pros of using your own warehouses
  • Cons of using your own warehouses
• Cahoot
  • Pros of using Cahoot
  • Cons of using Cahoot

Conclusion

Walmart TwoDay And ThreeDay Explained

What is TwoDay and ThreeDay Delivery?

As their names suggest, TwoDay and ThreeDay delivery tags are applied to offers on Walmart which feature free delivery to customers in two or three business days. 

In a world where customers are constantly comparison shopping across brands, listings and marketplaces, free and fast shipping provides strong competitive advantages. In many cases, customers choose knockoff or imitation products over superior alternatives simply because of faster delivery. 

The DeliveryTags are a great way to gain prominence on the marketplace, distinguish yourself from competitors and to build customer lifetime value through repeat purchases. 

What Benefits do the Tags Give?

The important thing to understand is that the two day and three day delivery options are slightly different from each other in a few, significant ways. In each section, we’ll examine the difference between them and what benefits sellers get from each.

High Conversion Lift

The single biggest advantage sellers get from offering customers TwoDay or ThreeDay delivery is the increased conversion. In Walmart’s words, these are the conversion lifts that sellers can expect to see with these delivery offerings: 

ThreeDay	TwoDay
As high as 30%	As high as 50%

Boosts Search Rank and Discoverability

Many sellers are already familiar with Amazon’s A9 algorithm. For those not aware, the A9 algorithm factors in a variety of criteria to rank listings on search results in the Amazon marketplace.In a similar fashion, Walmart has what it calls a “Listing Quality Score”. The algorithm applies weights to different criteria (such as price and shipping speed) before ranking listings on search results.

Offering two day or three delivery, and earning fast delivery tags go a long way toward improving your Listing Quality Score, improving metrics such as Buy Box win rates and search rankings. Here’s the difference according to Walmart: 

The filter inclusion is similar to the filter Prime shoppers apply when browsing the Amazon marketplace just to see Prime eligible listings. 

ThreeDay	TwoDay
Buy Box prominence	Buy Box prominence, increased search rankings and filter inclusion

Fast Shipping Badges

On marketplaces like Walmart, customers have almost infinite choice – fast shipping badges are a great way to stand out and quickly become the preferred listing for customers. 

Here’s what you get with TwoDay and ThreeDay: 

ThreeDay	TwoDay
No Fast Delivery Tags	Fast Delivery Tag

How To Qualify For TwoDay and ThreeDay Delivery

Now that we’ve taken a look at all the benefits that two offer, let’s examine what actually needs to be done to qualify for these options.

ThreeDay Delivery

For ThreeDay Delivery, sellers need to perform no extra work! They can simply configure a shipping template with “Standard” shipping method, and then pick a transit time of 3 days.

TwoDay Delivery

Sellers aiming to achieve two day speeds on their Walmart fulfillment (and earn the fast shipping badge that comes with it) have 3 different options available to them: 

• Use Walmart Fulfillment Services 

• Work with Walmart’s partners – ShipBob or Flexport 

• Ship yourself (using your own warehouses or 3PL). 

If you’re choosing to use your own fulfillment, you will need to meet these requirements: 

• Have been a seller on Walmart for 90 days or fulfilled at least 100 orders

• Maintain an on-time shipping and delivery rate greater than 95% 

• Maintain a valid tracking rate greater than 95% 

• Have a cancelation rate lesser than 1.5% 

• Offer free returns 

Let’s assume you do what it takes and you’re now selling more with your fast delivery tags – great! But as sellers know, it’s crucial to stay on top of the requirements of the marketplace to ensure you retain your fast shipping badges and keep your listings active. Here’s what sellers need to do on Walmart: 

Walmart Seller Performance Standards

As per Walmart’s seller help documentation, these are the requirements that merchants on its platform must adhere to: 

On-Time Delivery Rate

Sellers must maintain an On-Time Delivery Rate greater than or equal to 95%. To give this some perspective, let’s compare this against a program like  Seller Fulfilled Prime. 

While SFP has more demanding speed metrics (expecting roughly 30% of orders on standard sized SKUs to be delivered within 1 calendar day), Walmart has higher on-time delivery expectations. SFP expects only 93.5%, while Walmart expects 95% on-time delivery. 

This means that you need to find partners with order fulfillment networks that have warehouses at multiple strategic locations, so that you can shorten the distance to your customers and make your Walmart fulfillment faster.

The only downside is that this leaves sellers at the mercy of the carriers, such as USPS, UPS and FedEx. Their ability to deliver products accurately and on time becomes important. 

Valid Tracking Information

Sellers must maintain a Valid Tracking Rate greater than 99%. This requires strong technology and integrations between your fulfillment platform and Walmart. Whenever you receive orders, your systems must write back tracking information automatically to Walmart.

Make sure that you check your fulfillment partner has solid technology and 2-way integrations (such as Cahoot’s with Walmart) that fetch and push important information. 

Refund Rate

Sellers must maintain a refund rate less than 6%. This applies to reasons that the seller is responsible for, such as items being damaged or incorrect items being received.

It is essential that you identify fulfillment partners with checks, balances and procedures to prevent such issues. For example, Cahoot has scan-verification technology to nearly eliminate the possibility of incorrect items being picked and packed. Additionally, you need to ensure that your fulfillment partner has excellent pick-pack and order fulfillment practices to package items well, following all relevant guidelines and procedures. Warehouses on the Cahoot network must pass a 44 point checklist before they can begin fulfilling orders for sellers – ensuring industry leading fulfillment standards. 

Cancel Rate

Brands must maintain a seller-initiated cancel rate of less than 2%. Such events can commonly occur when orders are received on items that are actually out-of-stock. 

Cahoot has a powerful integration with Walmart that pushes back inventory count information. Additionally, the system also comes with dashboards that provide color-coded alerts about your inventory levels (yellow to indicate it’s time for replenishment, and red to indicate that it needs to be done in a hurry!) This ensures you can minimize stock-outs. 

Additionally, if you’re fulfilling from multiple locations, make sure that your software has intelligent exception management capabilities to handle problems at one node. If stock-outs or bad weather occur, you can still keep your promise to customers if your shipping software intelligently reroutes orders to other locations.

Seller Response Rate

Sellers must respond to customer inquiries that they receive within 48 hours, more than 95% of the time. The reason for this is obvious – Walmart is positioning itself as a serious challenger to Amazon, which has built a reputation for stellar customer experience. Walmart expects its sellers to offer customers a similar quality of service. 

Options to Offer TwoDay Delivery

Walmart Fulfillment Services

Walmart Fulfillment Services is the retailer’s inhouse logistics network, using which you can make your listings eligible for TwoDay Delivery. Let’s take a look at its pros and cons. 

Pros of using WFS

• Automatic eligibility for TwoDay delivery

Just like using Fulfillment By Amazon makes your listings eligible for Prime automatically, using WFS earns you TwoDay Delivery. There is no requirement to meet the qualification criteria. 

• Nationwide Network of Warehouses 

As Walmart invests in growing its eCommerce capabilities, supply chain infrastructure building will be a key focus area. With 31 fulfillment centers dedicated to eCommerce as of June 2022, the company’s warehouse footprint ensures that it is possible to achieve nationwide two day delivery. 

• Competitive Pricing (Depends on SKU mix)

According to Helium 10’s comparison between Amazon FBA and Walmart WFS, the two programs are relatively level with each other on fulfillment fees. Sellers already used to working with FBA might see savings on some SKUs with WFS, while others might be cheaper on FBA. 

The broad implications for sellers are similar to those with Amazon. For fast moving SKUs with minimum storage times that are small or lightweight, WFS will offer great rates. For big and bulky items, you may be able to find better alternatives offering more competitive rates. The real pain with programs like FBA and WFS is seen on long-tail or slow moving SKUs. When items don’t leave a Walmart Fulfillment center quickly, storage fees can rapidly eat into your margins.

Sellers must choose whether to work with WFS or look for alternative providers based on careful analysis of their specific product catalog.  

Cons of using WFS

• Restricted to Walmart

Possibly the biggest limitation of WFS is that it is restricted to just your Walmart orders. This means you’ll probably need to continue using FBA for Amazon, while you seek out another partner for your Fulfillment By Merchant (FBM) or Seller Fulfilled Prime (SFP) orders. You’ll also have to check if this partner supports other sales channels, such as Shopify (DTC), eBay or Target. Finding such a partner becomes harder if you’re selling to other retailers like Nordstrom or Macy’s, and require B2B replenishments as well.

• Poor Fit For Certain SKUs 

WFS does not offer competitive pricing for big and bulky items. Additionally, their storage fees make the service impractical for slow-moving or long tail SKUs. 

For a seller with a SKU mix that features these types of items, WFS may not make a lot of sense.

• Too Much Redundant Inventory For You To Manage 

You’re already used to sending your inventory to FBA warehouses. That has caused sellers significant headaches with inventory receiving delays and damages in transit. If you use WFS to handle Walmart, you’ll have to repeat all your inbounding processes that you did for FBA – if you sent your items to an Amazon warehouse in California to handle West Coast orders, you’ll have to do it again to a Walmart Fulfillment Center. You’ll have to learn Walmart’s guidelines and processes for receiving inventory and get used to working with another partner. 

• Peak Season Storage Fees

While Walmart’s warehouse network is smaller compared to Amazon, they also face similar problems – a large number of sellers vying for limited spaces. This means you’ll face peak season surcharges for storage. 

Image Courtesy: Walmart Fulfillment Services

This illustrates the problem – if you don’t have a SKU that is fast moving, you’re in trouble. This means storage fees triple on SKUs that have been sitting in Walmart Fulfillment Centers for more than just 30 days! 

For SKUs that have been sitting more than a year in their warehouses, the rates can be even more expensive.

ShipBob

Pros of Using ShipBob

• Automatic eligibility for TwoDay Delivery 

As ShipBob is one of Walmart’s approved partners, brands that use them can instantly activate TwoDay delivery. 

• Nationwide network of warehouses 

ShipBob has a global network of warehouses. This allows them to spread inventory across multiple locations to reach customers within the two day window. 

Cons of Using ShipBob

• Rates May Not be The Best 

ShipBob operates their own warehouses. While this may provide them control, it also places significant fixed costs and assets on their bottom line. With leasing rates, warehouse worker wages and carrier rate increases all going up, they may have no choice but to pass on the increased costs to their customers. 

On the other hand, asset-light, powerful models like Cahoot’s peer-to-peer order fulfillment network are designed from the ground up to save customers more. In our experience, 9 out of 10 ShipBob customers see savings when they switch to Cahoot. 

• Customer Service Can be Inconsistent 

As this article explains, ShipBob customers have complained about times when they’ve found it difficult to get hold of someone from the company to fix their issues. Walmart does not hold 3PLs accountable for issues with deliveries, it holds you, the merchant, directly responsible.

Flexport (Deliverr)

Pros of Using Flexport (Deliverr)

• Automatic Eligibility For TwoDay Delivery  

As one of Walmart’s official providers, you get instant access to TwoDay delivery. 

• Nationwide Network of Warehouses 

With over 80 Warehouses, Flexport’s DTC offering (formerly Deliverr) has the scale required to support nationwide 2 day delivery.

Cons of Using Flexport (Deliverr)

• Expensive For Oversized Items

Deliverr’s rates are not competitive for big and bulky or oversized items. If a lot of your SKUs are in this country, you might need to evaluate other options. 

• Uncertainty Around Service Due to Business Challenges

After the exit of Dave Clark from Flexport, the company has been facing significant challenges internally. With recent reports that the company plans to  lay off as much as 20% of their workforce, prospective customers might be nervous about the ability of the company to keep up its service levels and customer experience.

“The real difference-maker for us with Cahoot was [that Cahoot works] across the board and that regardless of where a consumer is, they can get their product in two days. The Cahoot full-service solution simplifies our operations and upgrades our delivery experience at the same time.” 

–Cali’s Books (switched from Flexport to Cahoot)
Speak to a Fulfilment Export

Your Own Warehouses

Pros of Using Your Own Warehouses

• Full Autonomy Over Logistics 

You make the rules, you play by them! Having your own fulfillment operations frees you from having to rely on anyone else for fulfillment. 

• Centralized Inventory Management 

If you can manage your fulfillment for WFS, that allows you to scale the same to your other sales channels and online marketplaces. You don’t need to inbound inventory multiple times. It allows you to become leaner and manage your inventory much more efficiently.

Cons of Using Your Own Warehouses

• Prohibitively Expensive 

With warehouse lease rates, worker wages and carrier GRIs all on the rise, it has rarely been more difficult to absorb the last-mile costs associated with making deliveries. 

A brand aiming to cover the continental US with 2 day shipping requires at least 4 strategically located warehouses (a strategically located warehouse is one that is close to a major population center of the US – such as the Northeast, Southern California, Chicago Midwest region and Texas). This can be a significant drain on your resources. Even for very large brands, the economics are proving hard to justify.

• Can Consume Your Time and Energy 

When you bring fulfillment operations in-house, the complexity of running your own logistics can overtake your focus on the activities that actually matter – selling and taking care of your customers. 

Running your own fulfillment operations can leave you drowning in busy work and process management. 

Cahoot

Pros of Working With Cahoot

• Nationwide Warehouse Network 

Cahoot has one of the largest warehouse networks in the US. We have 100+ warehouses, rivaling Amazon’s 110 fulfillment centers. Other providers, including Walmart themselves and ShipBob do not have as many warehouses. 

Such a huge network offers certain advantages. 

The first is that we have warehouse locations that work for nearly any brand. Different brands see orders coming from different regions. Brands selling well-established, commodity-style products might see most of their orders come from the major population centers, such as the Northeast and Southern California. On the other hand, someone selling surfing gear might see most orders come in from Florida and California. Similarly, someone selling skiing and winter sports equipment might see most of their orders come from Colorado or Vermont. 

Whatever the geographic spread of your customer base, we’ve got warehouses that can deliver products to your customers in 1 or 2 days using economical ground shipping. 

The second is that our vast network allows us to scale to meet the requirements of extremely challenging programs, such as Amazon Seller Fulfilled Prime. What’s challenging for other providers isn’t for us. 

• Great Rates Across All SKUs 

While other providers may not have the best rates across all SKU sizes, we have competitive pricing for all types of items – small, fast-moving, big and bulky, long-tail and seasonal. 

While the likes of WFS and Flexport may become more expensive for oversized items, Cahoot offers competitive rates across the size spectrum. We also have a good track record of offering ShipBob customers meaningful savings on their current shipping fees.

This ensures that you’ll keep fulfillment costs under control and get back more savings to focus on growing your business. 

“We onboarded with Cahoot at the beginning of Q4 with the single goal of reducing our 3PL costs. We have been happy to see considerable savings on SPD costs instantly. The team continue to work with us to ensure we distribute our inventory to the right locations across the US to reduce our SPD label costs. Rather than buying an app or a service, it feels like we have begun a great partnership with the Cahoot team who have a genuine interest in helping our business to succeed.”

––QUICKPLAY Sport

Speak to a Fulfilment Export

• Centralized Inventory Management With Fulfillment Across All Channels

With WFS, you’ll have to work with multiple partners to handle your fulfillment across different sales channels. Cahoot is out-of-the-box integrated with all leading online marketplaces and shopping cart platforms. We also support B2B replenishments. You can use Cahoot as a one-stop shop for fulfillment, ensuring that you can run lean on inventory and streamline your operations. 

Lastly, working with a partner like Cahoot cuts down the number of relationships you need to manage, freeing your team from process management and busy work. Working with a trusted full-service partner is also better than running your own fulfillment operations. You’ll reclaim time, resources and bandwidth to focus on activities that grow your brand, rather than get caught in the complexity of managing logistics.

• Responsive, Personal Support

When comparing providers like ShipBob, Flexport and Cahoot, the quality of customer support matters. There are many advantages to working with a partner rather than Walmart directly, because of their ability to handle fulfillment on other channels. But the key thing to remember is that Walmart holds brands directly responsible for any issues with shipping. And while fulfillment is crucial to business operations, things don’t always go as planned. That’s why it’s important to quickly get help when you need it. Cahoot’s US based team is always ready to offer assistance when you need it, ensuring minimal downtime for your business.

Cons of Working With Cahoot

• Not the Best Fit For Those Just Starting Out 

Cahoot offers the most benefits to merchants with some degree of traction, who are currently shipping 250 orders a month (roughly 10 packages a day). 

Once merchants cross the initial phase, we can help them scale operations with our powerful network and technology. 

Conclusion

Like with Amazon, offering free and fast shipping is critical to succeeding on the Walmart marketplace. 

Offering TwoDay and ThreeDay delivery has a number of advantages – including improving buy box win rates, rankings in search results and most importantly, conversion lift.

Merchants have a number of options available to offer two and three day deliveries, including using Walmart Fulfillment Services, their inhouse logistics, ShipBob, Flexport or Cahoot. 

It’s important for merchants to identify partners with both a large warehouse network, as well as competitive rates across the size spectrum. It’s also important to look for providers that bring full-service capabilities beyond just the Walmart channel, so that sellers can cut down the number of providers they have to work with to manage their logistics. This has the added benefit of streamlining inventory management. Lastly, sellers should make sure to pick a fulfillment partner that offers reliable, responsive support. After all, you’re accountable to Walmart, not your 3PL! 

With the nation’s largest retailer now aggressively investing in eCommerce, it’s a perfect time for all sellers and brands to bring their products to Walmart. The key is in doing so in a way that keeps complexity and costs low, while growing sales with free two and three day deliveries on every order.

Offer 1-day and 2-day shipping at ground rates or less.

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Protect Your Amazon Listings from Search Suppression, Hijackers, and Stockouts

Amazon is a competitive platform. You need to have a quality product, excellent listing content, and plenty of reviews to catch the attention of busy

Amazon is a competitive platform. You need to have a quality product, excellent listing content, and plenty of reviews to catch the attention of busy shoppers. You also need to have plenty of inventory in stock and be prepared to fulfill orders quickly.

Selling on Amazon also requires you to be extremely vigilant. Unfortunately, hijackers and fierce competitors abound. You must pay close attention to the details to keep your business running smoothly. In this article, we’ll share why you need to monitor your Amazon listings and how to do it.

Search Visibility is Essential

Simply put, shoppers won’t see your listings in Amazon’s search results if they are search-suppressed. Since  over 50% of product searches begin on Amazon, a suppressed listing is a real problem that can quickly hurt your bottom line.

Amazon  suppresses listings from search for a variety of reasons, including failure to meet its image requirements, incorrect listing content, and titles that are too long. You can check to see if any of your listings are currently search-suppressed on the Manage Inventory page in Seller Central. If you have suppressed or inactive listings, a hyperlink that says “Search Suppressed and Inactive Listings” will be displayed at the top of the page. Clicking that link will take you to the Fix Your Products page where you can learn more about the issues and find out how to resolve them.

Inactive Amazon listings are not available for purchase and will not appear to customers who are searching for your product. If your product goes out of stock and you don’t have a restocking process in place, the listing will become inactive. Changes such as the manufacturer discontinuing the product or you choosing to stop selling the product can also cause a listing to become inactive. Policy violations are another common reason that listings are inactive.

If your listing is inactive due to a change you’re aware of, it’s not a surprise that you’re not selling that particular product. However, policy violations can be a surprise, particularly if someone else made changes to your listing that caused a violation. Having a process in place to regularly check for search-suppressed and inactive listings can save you a lot of time and money.

Staying in Stock

Amazon customers expect fast and free shipping. Failing to provide it can quickly lead to lost sales and a decline in your product’s organic search ranking on Amazon. It takes a lot of time and resources to build momentum for your product listing at launch, but it takes even more effort to rebuild that momentum for a product that goes out of stock.

Having a system in place that tells you what to restock and when can help prevent these issues. It’s also important to have backup systems in place if you rely on Amazon FBA to fulfill your orders. Delays in shipping and receiving can cause your product to go out of stock. Inventory management is a delicate balance and trends can change very quickly. Having a product go viral on social media is every seller’s dream, but if you don’t have the inventory available to fulfill those orders, your listing is going to suffer while traffic diverts to your top competitors. But you also don’t want to overstock and get stuck paying for aging or excess inventory! Working with a fulfillment solution such as Cahoot can help you manage your inventory for Amazon and other channels so you can deliver the best experience to your customers.

Look Out for Suspicious Activity

Hijackers take over existing Amazon listings, making changes to the listing or price and sometimes even selling a counterfeit version of a branded product. Being hijacked can cause you to lose the Buy Box, revenue, and your excellent seller reputation. After all, buyers who receive a sub-par version of your product or who experience shipping delays will leave product reviews and seller feedback reflecting their experiences.

Battling Amazon hijackers is tough, but regularly monitoring your listings for unauthorized changes can help you identify suspicious activity so you can start building a case with Amazon. Look for changes to your listing content, such as the title, images, and brand name. Changes to the number of offers available or Buy Box ownership may signal hijacking activity if you sell a private label product.

If you suspect hijacker activity on your listing, start by making a test purchase from the other seller so you can determine whether the product is counterfeit. Send a  cease-and-desist letter if your intellectual property or trademark is being used without permission. Report counterfeit products and  any trademark infringement or copyright violations to Amazon.

Aim for Five Stars

Both seller feedback and product reviews are ratings provided by customers via a five-star scale on Amazon. Doing your best to provide a five-star experience to every buyer will set you up for success with both ratings.

Maintaining a strong Amazon seller feedback rating helps protect your overall account health. Seller feedback is provided by buyers about their experience with you as a seller, including packaging and shipping. Ensuring that you have consistent and reliable fulfillment processes is crucial. Amazon looks at your seller feedback score to evaluate how well you meet buyer expectations.

Amazon reviews impact your product’s performance in Amazon’s search results. They also build buyer trust. Strong customer reviews positively impact your ad performance and marketing efforts. Having recent and relevant reviews shows Amazon that buyers like your product, leading to better positioning on the platform. After all, Amazon wants buyers to buy products that meet their expectations. Great reviews along with strong seller feedback show Amazon that you are prepared to deliver the customer experience it expects.

Protect Your Amazon Business

Growing and protecting your Amazon business requires careful attention, but there are tools to make it easier. Amazon doesn’t send alerts for search suppression and other changes to your listings, but  eComEngine does. Our Amazon seller software is designed to make selling on Amazon simpler, from monitoring your listings to getting more reviews.

Becky Trowbridge, eComEngine

Becky Trowbridge is the Digital Marketing Manager at eComEngine. Her mission is to empower Amazon sellers with the information they need to be successful in a competitive market. When she’s not creating content, she enjoys spending time outdoors, trying new recipes, and reading.

Offer 1-day and 2-day shipping at ground rates or less.

Learn More

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Hazardous Materials What is a Hazardous Material? What Items Are HAZMAT? Classes of HAZMAT Items What Classes Can Ship on Various USPS Services? What Changes

Protect Your Amazon Listings from Search Suppression, Hijackers, and Stockouts

Amazon is a competitive platform. You need to have a quality product, excellent listing content, and plenty of reviews to catch the attention of busy