Sales Taxes
There is a chance that you will have to pay sales tax when you purchase goods on the internet from US sellers (i.e. When you buy products online (i.e., through online arbitrage), you might have to pay salestax. If you use a pre-purchase center in a state where there is either no sales tax or a lower rate, you may save cash. How? Deliver your goods directly to the pre-center. If you're located in one of the four states that have zero sales tax (Delaware, Montana, New Hampshire, Oregon), the storage costs incurred while they wait for more inventory to arrive will likely be less than what you'd be paying in your home state. Keep in mind that sales tax in the US ranges from zero to seven percent. Even a two- or three percent drop in sales tax can make a big difference in the overall cost.
Climate
If you sell perishable goods such as food items, the first question you should ask any prep service is whether their storage and receiving facilities are climate controlled. You don't want your items to spoil because they weren’t stored in the correct conditions. This applies to any perishable item. Climate control is essential if you send stock to a very hot state or a place with extremely fluctuating weather. If climate conditions aren't managed properly your goods could deteriorate or become damp.
Storage Facility
FBA prep is primarily responsible to prepare your inventory for FBA. But more sellers are now using prep centers to organize their inventory. Two main reasons sellers use prep centers are the reason. It's cheaper than keeping your entire inventory at Fulfillment Centers. According to sellers' sales rates, they place their inventory at their prep center and then send it into FBA. If a seller is sending 10,000 units through their prep center and selling about 1,000 units each month, they'll only be able to send 1,000 units per month to FBA. The rest will be kept at the prep centre. Amazon's suspension strategy is the third. The Fulfillment Center will hold your inventory until you get it removed. It costs you each item returned. It may take several weeks to reach you. In your Plan of Action, you (or your prep center) will have to inspect the inventory you received from FBA. It is then your responsibility to get your inventory returned to FBA, repackaged, labeled and sent back to FBA when you have been reinstated. This is a very costly process that sellers want to minimize by keeping their stock at the Prep Center and sending smaller quantities. If you decide to go this route be sure that your prep service will quickly change inventory. It's also essential to inquire about their insurance. Your stock should be insured against fire and theft.
Processing Time
It is essential to take into consideration the speed at which they prepare your stock. There are several factors that will affect your speed needs. If you store your stock at the pre-production center and then ship it back according to sales volume (see above) You would like them to not take more than 48 hours to turn your units around. The majority of prep centers will be transparent about the processing time they will take. They may also offer an assurance of between 24 and 48 hours. If you don't see this information, please ask. You don't want your late shipment rates to be affected because your prep service is taking too long to bring your inventory into FBA. Have a look at the top Door to Door Delivery blog for more.
Inspection
It is also advisable to inquire whether or not the FBA prep service conducts inspections. It's not an alternative to inspections of the product at the manufacturing facility of the manufacturer. However, it may supplement these. Manufacturers don't check shipments too closely, because if stock is rejected, they will be charged more. Imagine your company conducting an inspection before shipping. You've got 10,000 units, and they inspect 20% of the goods. The FBA preparation company is likely to find additional issues in your inventory. Danny McMillan believes many manufacturers do not pay attention to their deliveries because they're aware that rejects can lead to increased cost and less profit. The inspections conducted by your prep company even more vital.
In Summary
You could outsource FBA preparation to make your business more efficient, but it can also slow down your business. It is essential to build an enduring relationship with and trust the prep company. If they refuse to answer your questions, they might be a sign that they're not the right fit for you. Talking to other vendors can be useful as well. Talking to other sellers can assist you in finding out what prep companies they use and, perhaps most important, which ones to avoid. When you're sending your precious inventory to someone else, you'll want to make sure you're sending it in a safe manner.