Amazon recently announced that it will reopen enrollment into its long-closed SFP (Seller Fulfilled Prime) program later this year. SFP is one of three Amazon fulfillment options which also include Fulfillment by Amazon (FBA) and Fulfillment by Merchant (FBM). So what does this announcement mean for brands? While the exact timing has yet to be announced, soon merchants will be able to sell with the Amazon Prime badge — while managing their own fulfillment.
What is Amazon SFP?
Here’s a breakdown of the three Amazon shipping options available to sellers:
Fulfillment by Amazon (FBA): Amazon controls the storage of your products, packaging, shipping, and returns. With FBA, Amazon also owns the customer service component.
Fulfillment by Merchant (FBM): In contrast to FBA, the seller owns warehousing, fulfillment, and returns, as well as customer service needs.
Seller Fulfilled Prime (SFP): A subset of FBM where the seller gets the Amazon Prime tag and must meet all Prime requirements. The best of both worlds. It’s important to note that with SFP, sellers are required to manage their own customer service.
Pros and cons of Seller Fulfilled Prime (SFP)
Amazon Prime Tag: This tag is the main selling point for SFP. WBX Commerce data shows that the Prime badge drives sales up to 50% more, plain and simple. Consumers trust it and equate that trust with reliability and quality, whether right or wrong.
Ready to Sell: Managed on your own, your products are always live and ready to sell immediately. There’s no lead time waiting for Amazon to receive and process your products (like with FBA), nor additional preparation time and shipping fees to get products into the Amazon network. This immediacy also benefits ecommerce businesses with expiration-dated products. You can shift your promotion strategy to sell those items closer to expiration faster without potentially throwing products away.
Control: Storing and fulfilling on your own means total transparency and control over your inventory and customer experience. You communicate directly with customers via fulfillment and returns and gain insights that you may not be privy to otherwise. Managing supply also works in your favor as you won’t lose time (and potentially your listing) waiting on Amazon to restock your products.
Highly Regulated: For all the Prime advantages, the program has steep requirements for sellers. Amazon controls shipping on every single order to ensure two-day delivery to customers. A seller must meet delivery speed targets, defined as “2-day or less,” product page views of 55% for standard products and 30% for oversized products; while one-day shipping requires 20% for standard size and 5% or more for oversized items.
Expensive: SFP is operationally complex for ecommerce businesses and can cost far more than FBM in overhead. For example, sellers must have coverage across the U.S. in order to meet Amazon’s SFP requirements for standard-size products. If you need to ship to the West Coast but you’re based in Baltimore, expect to pay more as Amazon controls which carriers can fulfill that delivery. In addition, sellers are required to commit to weekend operations. SFP requires either Saturday or Sunday operations as well as carrier pickup and origin scan commitments. This can translate into considerably higher costs to fulfill products if Amazon requires you to ship the order Next Day and the only option to meet that delivery deadline is a much more costly air-shipping method.
Why people are excited about the SFP program opening back up
For years, Amazon had closed its SFP program and would not allow new sellers to apply. The ecommerce giant did so to fine-tune the way they measured page view and shipping metrics until their software and program support was more scalable & reliable. During this period, sellers could join a SFP waitlist but there was no indicator as to when the program would re-open. Amazon announced that SFP is coming back online because they have nailed down how to provide the customer experience & seller support they want through Seller Fulfilled Prime after years of testing. The news means many brands will have the opportunity to sell on Prime (without using FBA) just in time for the holiday season.
The SFP program is expected to go live some time later this year, most likely in late Q3 or early Q4 2023.
How do I become eligible for SFP?
Seller Fulfilled Prime merchants must meet strict requirements to maintain program eligibility. Here is how SFP eligibility works:
The trial period
Sellers must first complete a trial period to earn their Prime badge. The trial period lasts between five and 90 days, during which brands must successfully fulfill 200 orders with either one-day or two-day delivery. A successful trial period will meet these Premium Shipping metrics:
An on-time delivery rate of at least 92%
A valid tracking ID for at least 94%
A cancellation rate of less than 1.5%
You’ve made it through the trial period — great! Now it’s time to keep your Prime status. Here’s how:
You must meet the following shipping requirements:
99% On Time Shipment Rate (On Time means the carrier has completed an origin scan by the end of the day on the designated ship date)
99% Amazon Buy Shipping Usage (means you purchase shipping labels through the Amazon Buy Shipping program)
Less Than 0.5% Cancellation Rate
And the following detail page view delivery metrics:
1-Day Shipping: Detail Page Views: ≥ 20%
2-Day Shipping: Detail Page Views: ≥ 55%
1-Day Shipping: Detail Page Views: ≥ 5%
2-Day Shipping: Detail Page Views: ≥ 30%
Get started with SFP — the right way
WBX can help
As you can see, Seller Fulfilled Prime is more complicated than just flipping a switch. So partnering with the right team to get your account set up the right way makes all the difference in meeting Amazon’s stringent requirements and giving your customers the Prime experience they expect. WBX Commerce has been an SFP merchant since 2018 and we’ve always maintained our Prime eligibility. We’re a top seller on Amazon and have a 98% customer satisfaction rating with 29,000 positive reviews on Amazon.
Our team can help your brand get started with SFP and will be available to help keep things running smoothly. We’ll help you with:
Shipping templates (which can be complicated)
Meeting page view metric requirements
Troubleshooting delivery speed issues
Drafting comprehensive plans of action if things go wrong (a requirement from Amazon)
Plus, our team of advertising experts can create strategic recommendations on a dual FBA/SFP advertising strategy to help your brand grow sales and spend your advertising dollars more efficiently.
“Amazon re-opening the Seller Fulfilled Prime program is a huge opportunity for brands. SFP offers sellers and their customers the Prime advantage with a fulfillment option that is flexible and puts more control in the hands of the brand. With SFP, merchants can stay in stock more easily while converting customers at a higher rate with the trusted Prime badge. WBX Commerce has been successfully managing SFP for brands since 2018 and can help new brands launch their SFP programs and keep their accounts healthy.” — Marcus Startzel, CEO, WBX Commerce
Partner with the right fulfillment provider to get orders shipped on time
A major part of maintaining your Prime eligibility is getting orders delivered on time. Prime customers are used to fast shipping, and Amazon takes that seriously. It’s important to partner with the right fulfillment provider that can meet those strict delivery requirements. WBX Commerce partners with Ware2Go, a UPS company, to meet our clients’ fulfillment needs. Ware2Go is the industry leader in Seller Fulfilled Prime and consistently meets SFP requirements for national and regional coverage with their:
20+ SFP-enabled warehouses
Saturday fulfillment with a 99% on-time fulfillment rate
Full compliance with 1-day and 2-day delivery page view requirements
Full-service support including Shipping Region Automation Template setup and Prime Badge support
Contact a member of the WBX team to get started with SFP just in time for the peak holiday season! We’ll guide you through the application and trial process, and help keep your account healthy and customers happy.