Did you know that Amazon has over:
- 2000 facilities including over 200 fulfillment centres
- 1.27M operations staff and partners
- 120K trucks, vans, and planes
- The ability to deliver 10BN+ packages every year?
Multi-channel fulfillment is how eCommerce sellers are taking advantage of this infrastructure to deliver their sales from any platform.
Here’s how:
- What is Amazon Multi-Channel Fulfillment (MCF)?
- How to Use MCF
- The Benefits of Using MCF
- The Drawbacks of Using MCF
- The Cost of Using Amazon MCF
- The Difference Between Amazon Multi-Channel Fulfillment and Fulfillment by Amazon
- Alternatives to Amazon MCF
What is Amazon Multi-Channel Fulfillment?
Amazon Multi-Channel Fulfillment, or MCF, allows sellers to leverage Amazon’s robust fulfillment network to ship orders from various sales channels, not just Amazon. It’s part of the Fulfillment by Amazon (FBA) service but is specifically designed to cater to orders placed outside of Amazon.
One of the key features of MCF is its ability to integrate with major eCommerce platforms, including Etsy, eBay, and Shopify. This seamless integration ensures that order processing is smooth and efficient, regardless of the sales channel.
MCF is available in Australia, Canada, France, Germany, Italy, Japan, Mexico, Spain, the UK, and the United States.
How Does Multi-Channel Fulfillment Work?
Sellers store their inventory in Amazon’s warehouses. When a customer places an order on any of the seller’s platforms, Amazon picks, packs, and ships the product to the customer. This means sellers can manage their inventory through Amazon’s Seller Central – just like Amazon FBA.
Here’s a step-by-step guide on how to use MCF to streamline your fulfillment process:
Step 1: Store Inventory at Amazon Fulfillment Centers
You need to send your products to Amazon’s fulfillment centers. You’ll be provided with a single location to ship to and Amazon will distribute your inventory across multiple centers as they see fit. Once your inventory is in Amazon’s hands, it’s ready for order fulfillment.
Step 2: Integrate Sales Channels with Amazon
Next, you’ll need to connect your various sales channels to Amazon’s system to automate the fulfillment process. This can be done via free apps built by Amazon, this-party integrations, or custom APIs depending on your selling platform and sales volume.
You can also customize fulfillment settings such as individual or bulk order creation, delivery speeds, and packaging preferences to better suit your business needs.
Get the full list of integration apps on the Amazon Supply Chain website.
Step 3: Utilize Unbranded Packaging Options
To maintain brand integrity, you can choose to have your orders shipped in unbranded packaging, rather than the standard Amazon-branded packaging. You can specify your preferences in Seller Central to ensure compliance with your brand standards. This way, you can benefit from Amazon shipping without visible Amazon branding.
Step 4: Manage Inventory and Orders Through Seller Central
Now that you’re connected, Amazon’s Seller Central will be your one-stop shop for managing your inventory and orders. Here, you can adjust inventory settings and track the progress of order fulfillment, as well as monitor inventory data.
However, it’s important to note that you’ll need to handle customer inquiries and service issues, as Amazon doesn’t provide this for MCF orders.
Benefits of Choosing Multi-Channel Fulfillment: What’s in It for Sellers?
Fast Delivery
One of the standout features of MCF is the ability to offer Prime-like delivery speeds for non-Amazon orders by leveraging Amazon’s extensive logistics network with on-time delivery rates exceeding 97%.
Your customers get:
- Expedited shipping options, including next-day and two-day delivery
- Reliable standard shipping typically takes 3-5 business days
- Delivery to extensive locations, including the US and 27 EU countries
Simplified Operations
MCF automates the fulfillment process by providing a single inventory pool for all sales channels, managed in a centralized platform – minimizing operational overhead by leveraging Amazon’s infrastructure.
Unbranded Packaging
MCF orders can be shipped in unbranded packaging, ensuring that packaging materials like boxes and tape are free of Amazon branding to maintain seller brand integrity.
Buy with Prime
MCF sellers can offer Buy with Prime payment options to their customers to offer all of the Prime membership benefits to customers outside of Amazon, including:
- Free 1-2 day shipping
- Free returns
- Feature reviews from Amazon
- And offer 24/7 customer support with Buy with Prime Assist.
Want to know more about Buy with Prime? Read the full breakdown in our Buy with Prime sellers guide.
What’s the Downside? The Drawbacks of Using Multi-Channel Fulfillment
While Amazon MCF offers numerous benefits, it’s also important to consider its potential drawbacks and costs. Here are some of the key challenges for sellers using MCF:
Higher Costs
MCF often incurs higher fees compared to other third-party fulfillment options. These costs can impact your profitability. MCF includes various charges such as pick and pack fees, weight handling, and storage fees, as well as additional fees that may apply during peak seasons and for special handling requirements.
Limited Control & Branding Options
With MCF, sellers have less control over the fulfillment process. The dependency on Amazon’s policies and procedures can restrict your operational flexibility. MCF also has limited options for custom branding on packaging and the delivery experience. MCF uses Amazon-branded or unbranded packaging, which may not align with all brand strategies.
Risk of Competition from Amazon
There’s a potential risk that Amazon may analyze sales data to potentially create competing products. The platform’s access to extensive data can pose a competitive threat to sellers.
Product and Sales Channel Restrictions
Certain product categories are restricted and cannot be fulfilled through MCF. Also, some online marketplaces do not allow fulfillment by Amazon, which limits your sales channel options.
Prioritization of FBA Orders
Amazon prioritizes Fulfillment by Amazon (FBA) orders over MCF orders, which can lead to delays for non-Amazon channel orders. This can affect delivery times and customer satisfaction for orders placed outside of Amazon.
Don’t leave your business vulnerable. Get product liability insurance that scales with you.
Pay-as-you-sell, multi-channel liability insurance for eCommerce.
No obligation quote.
Policies can be canceled at any time, with 30 days’ notice.
The Cost of Using Amazon MCF
Understanding the cost structure of Amazon MCF is crucial for sellers considering this service. Here’s a breakdown of the costs you need to know:
MCF charges include pick and pack fees, weight handling fees, and storage fees. These costs vary based on product size, weight, and shipping destinations. Additional fees may apply for peak seasons and special handling.
Although, unlike Fulfillment by Amazon (FBA), MCF does not charge referral fees for non-Amazon sales.
Pricing is also tiered based on volume and delivery speed. This means that the more you sell and the faster you want your products delivered, the more you’ll pay. However, discounts are available for bulk orders and new seller incentives, which can help offset some of these costs.
It’s important to carefully evaluate these costs against your projected sales and profit margins to ensure that using MCF makes financial sense for your business. Remember, while MCF can simplify operations and provide fast delivery, these benefits should be weighed against the potential increase in operational costs.
For a full breakdown of fees, visit Amazon’s Rate Card.
Storage fees example
Amazon Multi-Channel Fulfillment Pricing Examples
The Difference Between Amazon Multi-Channel Fulfillment and Fulfillment by Amazon (FBA)
| Feature | Amazon Multi-Channel Fulfillment (MCF) | Fulfillment by Amazon (FBA) |
|---|---|---|
| Order Source | Handles orders from Amazon and other sales channels (e.g., own website, other marketplaces). | Exclusively fulfills orders placed on Amazon.com. |
| Shipping Options | Offers a range of shipping speeds, including next-day, 2-day, and standard (3-5 business days) and Buy with Prime checkout options. | Offers fast and free, next-day and 2-day shipping options to Prime members. |
| Fees | Charges separate MCF fees for non-Amazon orders based on order weight and size. | Charges include a flat fee per unit, storage fees, and a 15% referral fee on sales. |
| Integration Requirements | Requires integration with non-Amazon sales channels for order processing. | None. |
| Flexibility | More flexible in handling sales from multiple channels. | Focused on optimizing sales and fulfillment through Amazon only. |
| Service Utilization | Can use the same inventory for Amazon and non-Amazon sales. | Inventory is dedicated to fulfilling Amazon orders. |
| Priority Handling | Non-Amazon orders may face delays as FBA orders are prioritized. | Amazon FBA orders are prioritized during periods of heavy demand. |
Alternatives to Amazon MCF
While Amazon Multi-Channel Fulfillment (MCF) offers a comprehensive solution for multi-channel eCommerce businesses, it’s not the only option available. Here are some alternatives to consider:
In-House Fulfillment
In-house fulfillment allows you complete control over operations and customer service. This option requires significant resources but can be cost-effective for businesses with a high volume of orders.
Third-Party Logistics Providers (3PLs)
3PLs offer similar services to Fulfillment by Amazon and Multi-Channel Fulfillment but with potentially lower costs. They can handle storage, picking, packing, and shipping, freeing you to focus on other aspects of your business.
Other Amazon Fulfillment Strategies
Don’t leave your business vulnerable. Get product liability insurance that scales with you.
Pay-as-you-sell, multi-channel liability insurance for eCommerce.
No obligation quote.
Policies can be canceled at any time, with 30 days’ notice.
0 Comments