Amazon FBA vs Amazon 3PL: Pros and Cons

Amazon 3PL

Amazon provides the Fulfilment by Amazon (FBA) service so that independent merchants can automate their order fulfilment and delivery processes. The idea is straightforward: Amazon ships, and sellers sell. 

Anyone with a seller account on Amazon has the option of delegating all shipping tasks to Amazon, including returns and refunds, product storage in Amazon’s warehouses, selecting and packaging, and more. Amazon 3PL solution might be useful if you are the owner of an online store with limited storage space or if you recently started an online store and don’t want to handle inventory and distribution.

Amazon receives the goods from the sellers and stores them all before processing the orders as they come in. The rest is taken care of for you as long as you manage the sales and make sure Amazon is kept supplied with your items.

FBA Penalty Fees

Online merchants that are thinking about adopting Fulfilment by Amazon (FBA) may want to think about storing and delivering their goods to Amazon.

However, the regulations for shipping items to Amazon are convoluted and frequently alter. A merchant’s items may no longer be accessible on Amazon due to a variety of faults. 

These activities can result in fines, suspension from selling on Amazon, or even minor punishments like being suspended for a few hours.

Products will be sent to the “problem-solving area” with even one of these errors, where they may languish for two hours, two days, or even longer. If Amazon sellers make several mistakes, they could have to pay fees to exit the problem-solving section. 

  1. Recycling boxes are practical and ethical but make careful to erase, write out with a black Sharpie, or conceal any remaining barcodes with tape or permanent stickers. That box will go to the section where problems are solved if Amazon must infer which label is the correct one.
  2. There must be one barcode for each item in the package. Additionally, each of those barcodes must be specific to the shape and colour of that one item on the Amazon site.
  3. Keep boxes under 50 pounds (23 kg) or as light as possible. Sellers run the danger of being prohibited from delivering any product at all if they frequently break these regulations and submit hefty shipments. No stock, no sales.
  4. Shredded paper, grass, and other loose packaging items are not permitted by Amazon. Use air pillows, huge sheets of 60-lb. weight kraft paper, or polyethene foam sheeting to block access to the problem-solving section, which has a specific vacuum for such items.

Amazon 3PL

When compared to using a warehouse, space will run out more quickly if you operate from home. As your firm grows, you can potentially take up all of your warehouse space.

As you approach your threshold, completing orders could become more difficult and expensive, especially for large or heavy goods. It costs money and takes time to run goods to UPS or FedEx many times each day.

You can overcome challenges like these and expand more quickly without compromising the client experience with the aid of an Amazon 3PL solution.

This information may be useful if you’re debating whether to hire a third-party logistics provider. Let’s go through what Amazon 3PL is and how to tell if it’s the best course of action.

The Procedure For Amazon 3PL Order Fulfillment

ReceivingWithout inventory on hand, a 3PL cannot ship orders. Receiving in Amazon 3PL warehouse refers to both receiving incoming merchandise and storing it. Each 3PL has its processes and spaces for receiving and storing merchandise.
WarehousingAfter receiving your inventory, Amazon 3PL keep your items in 3PL fulfilment facilities. Whether it be a shelf, a container, or a pallet, every SKU has its exclusive storage area.  
PickingOnce a consumer puts an order, the Amazon 3PL fulfilment procedure may begin. You may have heard the phrase “pick-and-pack fulfilment,” which consists of two parts. This is the first part.
You must manually upload orders to some 3PLs’ databases. With your marketplace or eCommerce platform, other 3PLs may smoothly incorporate their cutting-edge technologies.
PackingIt’s time to pack an order securely for delivery once every item has been chosen for it. The packaging materials utilized will depend on your Amazon 3PL’s capabilities, brand preferences, and shipping commodities.
ShippingFollowing this, your purchase will be sent. Most 3PLs will purchase and print shipping labels on your behalf. Other 3PLs have preferred carrier partners, while some 3PLs assess shipping costs from several carriers. With the latter, 3PLs may provide consumers with the most affordable prices for the delivery speed that they individually choose.
ReturnsMany 3PLs also provide return processing services. If a consumer returns an order to your 3PL, they will handle the return and, by their policies and preferences, either replenish the item or discard it.

Pros of Amazon FBA

Customer support

  • One of the benefits of Amazon FBA is that Amazon handles all customer support and reverse logistics issues for orders that are fulfilled through the programme.
  • If you’ve ever used Amazon to return something, you are aware of how simple the returns procedure is.
  • Live chat, phone, and email are just a few of the ways customers may get in touch with employees. Additionally, when it comes to refunds, you as the business owner don’t need to worry about a thing.

Transparent fee structure

  • Amazon’s fees are very open, even though they can occasionally be expensive and confusing. There are no paywalls or small print.
  • Even down to the category level, Amazon’s charge structure is highly transparent. 

Multiple channel fulfilment

  • Using the inventory kept in Amazon’s fulfilment centres to fill orders from other channels is one of FBA’s competitive advantages.
  • Yes, this implies that you may use your Amazon inventory to fill orders if you offer goods on your website.
  • Even while you won’t receive the same benefits from Prime as you would if you sold on Amazon’s marketplace, FBA customers nonetheless stand to gain significantly from it.

Cons of Amazon FBA

No order customization

  • The appearance of an Amazon shipment is well-known to everybody. the well-known brown box with the blue stripe and the Prime logo.
  • It is now a common feature on virtually all American front porches.
  • But if your company prides itself on offering customers a distinctive, personalised unpacking experience, Amazon FBA is just out of the question. Amazon does not provide personalised branding, unique inserts, or unique packaging.

Limited access to Amazon’s team

  • Because of their scale, Amazon just cannot afford to provide each of its FBA clients with personalised attention.
  • This will be a major issue for people who require a lot of assistance when learning 3PL. There is just one hotline account, and there are no specific account managers to aid you along the way or come up with a plan.
  • Amazon FBA might not be for you if you value being able to contact a live person at any time.

No customer interaction

  • On the other hand, during a transaction, you hardly ever engage with your consumers. If developing personal connections with your clients is vital to you, Amazon FBA might not be the right choice.
  • You have more control and management over your consumer base with several smaller 3PLs.
  • Even if you still have other methods to reach your consumers (such as your email list, social media following, and other channels), if you base your business entirely around Amazon, you’ll probably connect with your customers far less frequently.
Amazon 3PL

Pros of Amazon 3PL

More control over warehousing and fulfilment strategy

  • Many smaller 3PLs will genuinely work with you to plan your storage and fulfilment strategy rather than just delivering your items to Amazon and leaving them to handle the rest.
  • This might entail assisting you in distributing your goods in certain regions or entering new markets.

More personal attention to your business

  • Smaller 3PLs are aware that their infrastructure cannot match Amazon’s. What they lack in scale, however, they make up for with individualised care and customised solutions.
  • Many 3PLs will provide you with a dedicated account manager to work with you on strategy development, growth management, and logistical problems.

Brand-building freedom

  • This is perhaps the largest advantage of using an Amazon 3PL rather than Amazon FBA for business owners that truly want to develop a brand rather than merely a product.
  • You are not constrained by the restrictions of Amazon’s closed system, even though it does involve more work on your behalf (more on that in the disadvantages section).
  • You may create your website, handle your marketing, and closely track and interact with your audience, among other things.

Cons of Amazon 3PL

Startup fees

  • While most 3PLs can’t afford to accept your fees on the back end, Amazon 3PL can. That implies that they will have to impose certain up-front fees to make the agreement profitable for them.
  • This might take the form of a recurring monthly fee, an upfront setup cost, or various forms of payment that differ from provider to provider.
  • If you lack the necessary funds, Amazon 3PL might not be available to you at this stage of your business. 

Less flexible with sales fluctuations

  • You can’t hit Amazon with a curveball. Their employees, strategy, and fulfilment technologies are so cutting edge that they can easily handle any amount of sales fluctuations for your items.
  • Smaller Amazon 3PL have fewer resources, including staff, equipment, and storage space. They might not have the resources to help you if you have a significant holiday surge. 

Potentially slower shipping speeds

  • Thanks to its infrastructure, Amazon can transport packages quickly. Amazon 3PL might not be able to match this, especially if they have fewer fulfilment sites.
  • Your ability to convert or keep consumers may suffer as a result of this slow shipment.


Amazon provides the Fulfilment by Amazon (FBA) service so that independent merchants can automate their order fulfilment and delivery processes. Online merchants that are thinking about adopting Fulfilment by Amazon (FBA) may want to think about storing and delivering their goods to Amazon. Amazon 3PL solution might be useful if you are the owner of an online store with limited storage space or if you recently started an online store and don’t want to handle inventory and distribution.