Friday, February 26, 2010

Case Study; Using Amazon's Webstore and Fulfillment Sevices

Amazon has something to crow about with its Webstore and Fulfillment services -- and it's not shy about doing so.

Blue Harbor, LLC, a seller of cell phone accessories, started using Amazon Services in the third quarter of 2009, two years after setting up business in New Jersey. With the addition of the Fulfillment by Amazon (FBA) and Amazon WebStore services, they have seen an unexpected spike in their online sales. According to Anuj Goel of Blue Harbor, "Sales volumes increased on average 40 percent to 65 percent for each product we listed on for fulfillment with FBA. The first spike in sales on Amazon occurred when we won the Buy Box in our category. The second, and perhaps more important, is when we started using FBA."

Goel describes Fulfillment by Amazon as a convenient and powerful tool to boost sales. Getting set up was straightforward and the user interface walked them through the process for listing and shipping inventory to Amazon's fulfillment center. With Amazon handling customer service questions, Blue Harbor can focus more on sourcing and sales of their products.

Blue Harbor finds people shop on because they trust the Amazon brand. They know they will receive their orders when promised; and they like the free Super Saver Shipping and Prime discounted shipping. Being able to offer these benefits to shoppers instills the same level of trust in Blue Harbor making their products all the more appealing.

Blue Harbor is eager to increase their offering through Fulfillment by Amazon. Currently, the cost savings on warehousing and the order processing is marginal. However, they calculate a substantial drop in overhead as they increase the inventory they offer through FBA and decrease the volume they fulfill themselves. Says Goel, "FBA is significantly more potent than we anticipated, it augments our business well, and the benefits far outweigh the costs."

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