Introduction
Choosing between FBA (Fulfillment by Amazon) and FBM (Fulfilled by Merchant) is one of the most important decisions an Amazon seller will ever make.
Get it right, and you scale smoothly.
Get it wrong, and you’ll burn cash — or worse, ruin your customer experience.
In this comprehensive guide, we’ll break down:
- Pros & cons of FBA and FBM
- Cost comparison
- Shipping, storage, returns
- Prime eligibility
- When to use each model
- The best hybrid strategy for most sellers
Let’s dive in.
What Is Amazon FBA?
With FBA, Amazon handles:
✅ Storage
✅ Picking & packing
✅ Shipping
✅ Customer service
✅ Returns
You ship your inventory to Amazon’s warehouse. They handle the rest.
Pros of FBA
- Prime eligibility = more sales
- Fast delivery & trusted experience
- Offload fulfillment headaches
- Better Buy Box win rates
Cons of FBA
- Storage & fulfillment fees
- Long-term storage penalties
- Limited control over returns
- More expensive for oversized or low-margin items
What Is Amazon FBM?
With FBM, you handle:
✅ Storage
✅ Shipping
✅ Customer service
✅ Returns
It’s all on you — or your third-party logistics (3PL) partner.
Pros of FBM
- More control over inventory & returns
- Can be cheaper for slow-moving or oversized products
- Flexibility with bundles or custom packaging
- No FBA prep hassles
Cons of FBM
- No automatic Prime badge (unless using SFP)
- You must manage shipping times
- Customer service burden is on you
- Harder to win the Buy Box
FBA vs FBM: Cost Breakdown
Here’s a basic comparison (as of 2025):
| Cost Type | FBA | FBM |
|---|---|---|
| Fulfillment Fee | $3.22 per unit avg. | Varies (you pay carrier) |
| Storage (per cubic ft) | $0.87–$2.40 (standard size) | Your warehouse or 3PL |
| Returns | Free to customers, you eat cost | You manage/refund/replace |
| Prime Eligibility | Included | Only with SFP (hard to qualify) |
For small, fast-moving products → FBA usually wins.
For bulky, slow-moving, or low-margin products → FBM might be better.
When Should You Use FBA?
✅ You sell small, lightweight products
✅ You want to scale quickly
✅ You rely on Prime trust and visibility
✅ You don’t want to manage logistics or customer service
When Should You Use FBM?
✅ You sell oversized, heavy, or low-margin items
✅ You already have warehouse/3PL infrastructure
✅ You want control over branding, packaging, or bundles
✅ You sell made-to-order or custom goods
✅ You want to avoid long-term storage fees
What About a Hybrid Model?
Many successful sellers use both FBA and FBM:
- Use FBA for fast sellers or Prime-heavy categories
- Use FBM for backup inventory, oversized SKUs, or customized items
- Maintain flexibility during Q4 and FBA restock limits
📦 Example:
- Your top 10 SKUs → FBA
- Everything else → FBM or via your 3PL (like Marketplace Valet)
FBA vs FBM: Which Wins?
It’s not about “either/or.” It’s about what works per product and per season.
FBA Wins When:
- Speed matters
- Prime eligibility = more trust
- You’re scaling without fulfillment help
FBM Wins When:
- Margins are tight
- You want brand control
- Your own fulfillment is cost-efficient
Real-World Seller Examples
🔹 A pet supplies brand moved all heavy items to FBM → saved $12,000/year in FBA fees
🔹 A supplements brand launched new SKUs via FBA for faster sales velocity
🔹 A home goods seller used FBM during Q4 restock limits to avoid stockouts
Final Thoughts
In 2025, it’s no longer a question of FBA vs FBM.
Smart sellers use:
✅ FBA for Prime trust & speed
✅ FBM for cost control & flexibility
✅ A hybrid model for maximum ROI
Need Help Managing Both?
At Marketplace Valet, we help brands:
📦 Store inventory
🚚 Ship FBM orders fast
📊 Navigate FBA strategy
✅ Maximize sales while reducing costs
Let’s build your ideal fulfillment strategy →
📩 justin@marketplacevalet.com
🌐 https://marketplacevalet.com
