To take your Amazon business to new heights, there are certain tasks that you can outsource to make your business more efficient. These include hiring employees, virtual assistants, or even a third-party company.
When starting your retail arbitrage, wholesale, or private label business, there’s typically a lot of prep involved to get your products ready for Amazon. You must create an FBA shipment, label each unit with an FNSKU barcode, package according to Amazon’s terms, and ship to Amazon’s fulfillment centers.
Properly preparing your products for FBA is very important. If you have fragile items, you must ensure they’re protected from damage during transit. If you prep your products incorrectly, Amazon may refuse delivery or charge you extra to fix the mistakes.
If you have lots of products, that could mean hours and hours put towards prepping, packing, and shipping – and that’s where third-party Amazon FBA prep centers come in.
In this article, we’ll go over what Amazon FBA prep centers are, why you might want to use a prep center, and some reputable Amazon prep center services to use for your business.
What is an Amazon prep center?
An Amazon prep center is a service that receives and adequately prepares your inventory, then ships the inventory for you to Amazon’s fulfillment centers.
The prep center will handle everything for you: bubble wrapping, bagging, labeling, packaging, and shipping.
If you are reselling wholesale products or sourcing items via online arbitrage, you can choose to send all of your inventory directly to the prep center. That way, you never need to see or handle any products. All you do is place the order.
That can also be done for your private label products if your supplier doesn’t prep your inventory for you.
Why use an Amazon prep center?
There are many benefits in using a prep center for your Amazon business. Let’s go over them so you can decide if using one is right for you.
- Saves time
By outsourcing this time-consuming process to prep and shipping experts, you free up more time in your day to focus on other aspects of your business, such as sourcing new products.
- Free up space in your house or warehouse
A big downside to running an ecommerce business is having to deal with tons of inventory at all times, especially with a home-based business. If, for example, you are doing retail arbitrage, your home is likely cluttered with products waiting to be prepped and shipped to FBA. Using a prep center allows you to free up that space.
- Scale your business
By freeing up your time, you’re able to focus on scaling your business and finding profitable products to sell on Amazon. Focus on what you’re good at and delegate the rest.
- You don’t need to purchase packing supplies
When you’re constantly packing and shipping your FBA shipments, you need to have a steady supply of shipping boxes, packing tape, packing materials, shipping labels, and so on. No need to carry these supplies or purchase expensive equipment.
- Fast turnaround time
Most FBA prep centers have 24-28 hour turnaround times so your inventory will be live for sale on Amazon fast. If you have lots of products, it may take you longer than that to process everything for FBA, especially if you work alone. Prep centers will get your inventory to Amazon quickly so you can start making sales.
- Potentially save on sales tax
Some Amazon prep centers are often located in states without sales taxes, allowing you to save money when using their address.
- Bundle products for you
If you sell bundled products on Amazon, a prep center can help ensure your products are packaged together and labeled properly.
What does it cost to use an Amazon prep center?
Each prep center you contact will have different pricing but on average, you can expect to pay $1.00 to $2.00 per unit. The price will usually depend on the volume you send and the size of the products. The smaller and lighter the products are, the cheaper it will be per unit.
What to look for in an Amazon prep center
Now that you know what a prep center is, how do you choose the right one for your Amazon business?
Depending on where the prep center you use is located, you can save on additional shipping costs. For example, if you are importing goods from China, you would want your prep center to be close to the shipping port to save money on shipping from the port to the prep center.
This is an obvious one, right? Every business owner wants to ensure which product or service they use makes financial sense for the business. Though a good deal does not always just mean a good price, it also means a reliable service. Take a look at the pricing of a few prep centers compared to the services they offer and decide which is best for you.
As Amazon sellers, we need to make sure our inventory is available for sale as fast as possible. If you sit on inventory for too long, you will be missing out on sales. Find a prep center that will process and ship your inventory within 24-48 hours so it gets to Amazon’s fulfillment centers in the fastest time possible.
Sales-tax free state
If you source products via online arbitrage, you’re likely being charged sales tax to have products shipped to your location. If you use a prep center in a state that does not charge sales taxes, such as Delaware, Alaska, Montana, New Hampshire or Oregon, you will be able to purchase products from online retailers without paying the tax yourself.
If you source wholesale or import products from overseas, you won’t need to worry about paying sales tax.
Climate controlled storage
If you sell perishable goods, such as food or goods that may be affected by extreme heat/cold, it’s important to find a prep center that has climate controlled facilities.
Amazon prep centers in sales-tax-free states
As mentioned above, some prep centers are located in sales tax free states so if you are doing online arbitrage, simply enter the address of your prep center to avoid paying your states sales-tax.
Pricing: As low $0.90 per unit
Turnaround time: 24-72 hours
Location: Multiple locations
Services: Amazon FBA prep, third-party fulfillment and storage, cold storage, returns, etc.
2. Smart Prep Center
Pricing: As low $1.15 per unit
Turnaround time: 24-48 hours
Services: Amazon FBA prep, third-party fulfillment and storage, freight forwarding, returns, etc.
Pricing: As low $1.20 per unit
Turnaround time: 1-12 business days (depending on your required speed)
Location: New Hampshire
Services: Amazon FBA prep
There are many other prep centers available in sales-tax-free states, and in nearly every state in the country, but this should give you a good start on finding a reputable prep center for your business. Remember, do your due diligence before working with any company.
If you are looking for a prep center located close to your business, search for “Amazon prep centers near me” and you will likely find many potential businesses to work with.
Focus on finding products instead of prepping inventory
We hope this article helped you understand what an Amazon prep center is and how using one could be beneficial for your business.
Do you have any more questions about prep centers? Let us know down in the comments!
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