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Originally published on October 18, 2023, updated January 8, 2024
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Supply Chain by Amazon provides end-to-end supply chain management to get products from manufacturers to customers. The program ensures that your products stay in stock, lowers costs, and provides faster shipping to increase customer satisfaction.
Keep reading to learn more about Supply Chain by Amazon, which was announced at the 2023 Amazon Accelerate event.
Supply Chain by Amazon allows you to combine services to utilize Amazon’s logistics and fulfillment capabilities for your entire supply chain, from manufacturer to customer. The services included are:
By combining these services, you can optimize your inventory placement and reduce both shipping and storage costs. You can also automate replenishment for your sales channels, allowing you to manage all your inventory from Seller Central.
AWD auto-replenishment ensures that your products arrive at the correct Amazon fulfillment centers in the right quantities. This increases the potential for same-day and next-day deliveries. Amazon reports that offering same-day or next-day delivery increases unit sales by an average of 15%. Both FBA and MCF products are replenished through AWD, making it easier for you to meet customer demand.
Dharmesh Mehta, Vice President, Worldwide Selling Partner Services, announces Supply Chain by Amazon in a presentation at 2023 Amazon Accelerate in Seattle.
Streamlining your supply chain through Amazon allows you to increase efficiency through fully automated services. Amazon provides lower costs and additional discounts. You can track and manage your AGL shipments and AWD storage, as well as both FBA and MCF inventory, through Seller Central.
Here’s a quick overview of the programs involved in Supply Chain by Amazon.
Amazon Global Logistics: End-to-end solution includes local pickup, palletization, labeling, cargo insurance, and customs clearance at both origin and destination. Available freight services include Standard Ocean FCL (full-container) and LCL (less-than-container) or Fast Ocean FCL and LCL.
Partnered Carrier Program: Offers three inbound shipping modes for products listed on Amazon.com: small parcel (SP), less than truckload (LTL), and full truckload (FTL). Sellers get access to discounted shipping rates from Amazon-partnered carriers.
Amazon Warehousing and Distribution: Third-party logistics (3PL) that can both store and ship products within Amazon’s fulfillment network even if they aren’t sold via Amazon. There are no inventory capacity limits and inventory replenishment can be automated.
Fulfillment by Amazon: Third-party sellers send items to Amazon’s fulfillment centers, where they are picked, packed, and shipped to customers. Items available via FBA are Prime-eligible.
Multi-Channel Fulfillment: MCF is part of the FBA program and works very similarly, but merchants can sell products through your own website or other eCommerce platforms and have them fulfilled by Amazon.
Buy with Prime: Sellers offer products with Prime benefits (including free shipping) in their own stores; orders are fulfilled through MCF.
With Supply Chain by Amazon, Amazon handles everything from picking up your inventory from the manufacturer to delivering products to customers.
Send your inventory to Amazon by using AGL to ship in bulk to AWD or use the PCP to ship to AWD within the 48 contiguous US states. Your products will be stored with AWD and become buyable as soon as they’re received by fulfillment centers. You can store your inventory in bulk with AWD for as long as you’d like. AWD helps keep your products in stock and Prime-eligible due to fast delivery speeds.
Amazon will use your AWD inventory to automatically restock your products in the Amazon fulfillment network. When your product is ordered through the Amazon store, Amazon will pick, pack, and deliver it through FBA. If the product is ordered through your own website via Buy with Prime or another enabled sales channel, Amazon will fulfill the order through MCF.
Amazon states that the ability to send bulk inventory to wholesalers, business partners, and other locations outside of Amazon is coming soon through Multi-Channel Distribution (MCD). This will allow you to use a single inventory pool to stay in stock across all sales channels.
You’ll need to be an Amazon seller to use the Supply Chain by Amazon program. You can access more of the services with a Professional selling plan. Your products must be eligible for AGL, PCP, AWD, and FBA to take full advantage of the program’s benefits.
If you’ve got a Seller Central account and you’re ready to get started, sign in and enroll in AGL and/or AWD. If you’re not already using FBA, you can create an FBA profile and set your desired preferences. By enrolling in FBA, you’re eligible to use MCF. The PCP is built into your selling account, so there’s no need to enroll in it.
Book your first shipment to AWD using Seller Central or Shipper Central. Leave the AWD auto-replenishment feature enabled if you’d like Amazon to send inventory into the fulfillment network whenever it’s running low. Alternatively, you can choose to manage your replenishments manually.
How much does it cost to participate? It depends on the weight and dimensions of your inventory, as well as storage costs. By combining Amazon’s supply chain services, you can expect to increase efficiency and cut storage costs. You’ll also receive discounts on AGL shipments, and Amazon notes that non-holiday storage for standard units is 51% less through AWD when compared to FBA.
Supply Chain by Amazon offers an end-to-end solution to help simplify some of the most complex aspects of running an Amazon business. The cost savings and increased efficiency can be a game changer for many businesses. Of course, it does also require even more reliance on Amazon. As always, it’s good to have a backup fulfillment system in place and to maintain your own inventory records. If your selling account is suspended, hacked, or otherwise unavailable, you’ll want to have access to key information to keep your business running on other channels if applicable.
RestockPro by eComEngine simplifies FBA inventory management and allows you to make notes about suppliers, products, and more. It’s a flexible system that analyzes over 70 data points to help you determine what to restock and when. And if you’re concerned about listing hijacking, search suppression, and other listing issues, check out SellerPulse by eComEngine. It monitors your listings and notifies you when there’s a problem so you can act right away.
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