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Prep Center for Amazon FBA Needed

ecommercewolf

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Jan 8, 2019
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So I've built up my Amazon FBA business to over 10k a month out of an apartment...

However with Q4 coming up and also with my long term goals in mind, I would like to outsource the labeling, prepping, and packaging aspect of Amazon FBA with a prep center.
This will free up a ton of time for me and also clear up space.

The problem is I have not been able to find a reliable trustworthy FBA prep center with good reviews... trust me I've done my due diligence before coming on here to post and maybe get some help.

The FBA prep centers I've researched on Google
- Bad reviews, poor customer experience
- Hold inventory and claim they never received it (some experiences on Reddit say that these prep centers see your inventory as a huge money grab for them and end up stealing inventory)
- Google their address and it does not even look like a legitimate warehouse/prep center.
If you're in this space you know exactly what I'm talking about.

PS: Huge opportunity here for a prep center that does things the right way... I just dont want to be involved in this aspect of Amazon FBA

With that being said, If anybody in the Amazon space knows of a reliable, honest, and efficient prep center please let me know!

It can be a prep center you are currently using or someone you have used in the past.

I'm picky and want to vet properly because I know I'll be sending thousands of dollars of inventory in.

Any help appreciated!
 

Scot

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They do but it will be cost prohibitive at scale and they also only really do poly bags and labels. If you’re like me and ship glass bottles, I need someone who’s going to take specific care to package them.

@ecommercewolf I don’t know if any but I’m following the thread.

If you don’t find one... why not build it out yourself? Take a look at ShipBob. They were e-commerce guys who were frustrated by not having reliable fulfillment outside of Amazon, so they built their own investor funded centers.
 

fmob007

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Can't it get arranged with manufacturers for an extra fee?
 
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ecommercewolf

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They do but it will be cost prohibitive at scale and they also only really do poly bags and labels. If you’re like me and ship glass bottles, I need someone who’s going to take specific care to package them.

@ecommercewolf I don’t know if any but I’m following the thread.

If you don’t find one... why not build it out yourself? Take a look at ShipBob. They were e-commerce guys who were frustrated by not having reliable fulfillment outside of Amazon, so they built their own investor funded centers.
Yeah you're right huge demand here it's just something that never interested me to create my own prep center.

It is mind boggling how few options there are for the massive 3rd party Amazon FBA industry.
There's no clearcut #1 or #2 options how there would be in most industries it seems.
Most FBA prep centers have shady practices or go out of business within a few years.
 

amazonunicorn

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Sep 21, 2019
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Yeah you're right huge demand here it's just something that never interested me to create my own prep center.

It is mind boggling how few options there are for the massive 3rd party Amazon FBA industry.
There's no clearcut #1 or #2 options how there would be in most industries it seems.
Most FBA prep centers have shady practices or go out of business within a few years.
You are basically asking other people for their competitive advantage. Good prep centers don't really need to advertise, they are given by word of mouth through networking.

What's your budget for a prep center? They usually charge per unit, and there can be increased cost to ship into Amazon fulfillment centers.
 

Scot

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They usually charge per unit,
This is the big problem I have with prep centers and why I don’t use them.

My products have shit margins on amazon because they’re grocery. I mostly sell on amazon for brand awareness and try my best to break even.

Most prep services will charge $1.00-1.50/unit. That kills my margin. Where as I could hire 3 day laborers from Craigslist and knock out a whole truckload on inventory in one day and pay them $15/hr. My items, with a good flow, can knock out about 300/hr per person. And pay about $0.30/unit for packing supplies. That comes out to about $0.35/unit.

It’s just not economical.

Sure, hiring day laborers and wasting a whole day to supervise and accomplish this sucks, but until I can find a prep warehouse that charges by time and labor vs a 1 size fits all price per unit, I won’t use it. 5x the cost to outsource is a bad move on my part.
 
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amazonunicorn

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This is the big problem I have with prep centers and why I don’t use them.

My products have shit margins on amazon because they’re grocery. I mostly sell on amazon for brand awareness and try my best to break even.

Most prep services will charge $1.00-1.50/unit. That kills my margin. Where as I could hire 3 day laborers from Craigslist and knock out a whole truckload on inventory in one day and pay them $15/hr. My items, with a good flow, can knock out about 300/hr per person. And pay about $0.30/unit for packing supplies. That comes out to about $0.35/unit.

It’s just not economical.

Sure, hiring day laborers and wasting a whole day to supervise and accomplish this sucks, but until I can find a prep warehouse that charges by time and labor vs a 1 size fits all price per unit, I won’t use it. 5x the cost to outsource is a bad move on my part.
Ok, so it sounds like finding the 'perfect packing service' would not solve your business problem.

Grocery is a difficult category to outsource, because depending on your product's packaging there is often a lot of loss, and broken items in transit. Packers also sometimes charge more to apply expiration dates, and that slows down their process.

This sounds more like a marketing problem.

Money and time spent focusing on building up your brand on Amazon, and increasing sales would mean your business can easily afford the packing service.

What you are doing works right now, but doesn't sound sustainable forever.
 
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ecommercewolf

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You are basically asking other people for their competitive advantage. Good prep centers don't really need to advertise, they are given by word of mouth through networking.

What's your budget for a prep center? They usually charge per unit, and there can be increased cost to ship into Amazon fulfillment centers.
$1 - $1.25 per unit.
 

biophase

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This is the big problem I have with prep centers and why I don’t use them.

My products have shit margins on amazon because they’re grocery. I mostly sell on amazon for brand awareness and try my best to break even.

Most prep services will charge $1.00-1.50/unit. That kills my margin. Where as I could hire 3 day laborers from Craigslist and knock out a whole truckload on inventory in one day and pay them $15/hr. My items, with a good flow, can knock out about 300/hr per person. And pay about $0.30/unit for packing supplies. That comes out to about $0.35/unit.

It’s just not economical.

Sure, hiring day laborers and wasting a whole day to supervise and accomplish this sucks, but until I can find a prep warehouse that charges by time and labor vs a 1 size fits all price per unit, I won’t use it. 5x the cost to outsource is a bad move on my part.
I have some warehouse space and I can start a prep business. But you should be asking why do they charge $1 per unit.

Yes you can hire people and get it done for $.35/unit. So let's say that, that is your barebones minimum.

Not you outsource it to me, I have to pay for the warehouse space, the power, the AC, the insurance, the labor (and their insurance and taxes and SS). What about the unloading of your pallet from the truck, the opening of the boxes, printing the labels and then sticking them on and then putting everything back in the box?

So what do I get for my expenses and time. Do you expect me to charge you $30/hr to do this? If so, then I'd charge $30/hr plus the portion of my warehouse expenses, because then I'm just marking up my labor and eating the rest of the expenses. I'm sure you will be able to find a place that charges by time, but if you do, I bet they have a monthly minimum charge.

Let's run through the math. Imagine you come to me and say I got some prep for you. Tell me how many units you will have each month. How long will these units be stored at my warehouse. Do they need climate control. How much time do you think it takes to unload, load, unbox and rebox your stuff.
 

Kid

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And WarehouseGigs was born.

Instead doing own prep business with all the fixed costs one can make gigs website with reviews and hire people on demand for prep tasks.

If no one will pick on that idea i surely will
 

broswoodwork

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And WarehouseGigs was born.

Instead doing own prep business with all the fixed costs one can make gigs website with reviews and hire people on demand for prep tasks.

If no one will pick on that idea i surely will
An uber for on- demand hourly grunt work would change how I do business starting today. Readylabor is a shitshow, hiring your own guys takes time and you have to keep them busy through peaks and valleys, 1099 guys are great for part fabrication but can't help with the other shit I get slammed with. Please do this!
 

Walter Hay

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@ecommercewolf Have a look at myfulfillmentteam This is an affiliate link that is part of my association with Jim Cockrum’s Proven Amazon Course (PAC). The fulfillment service is part of PAC, so you know it is run by people who know Amazon's requirements.

Sorry if this link is out of order, but I know what a problem it is finding a good Amazon prepping service. Reviews on Google will quickly show that to be true.

Walter
 
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ecommercewolf

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Jan 8, 2019
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Dallas, TX
@ecommercewolf Have a look at myfulfillmentteam This is an affiliate link that is part of my association with Jim Cockrum’s Proven Amazon Course (PAC). The fulfillment service is part of PAC, so you know it is run by people who know Amazon's requirements.

Sorry if this link is out of order, but I know what a problem it is finding a good Amazon prepping service. Reviews on Google will quickly show that to be true.

Walter
I will look into it. Really appreciate it :thumbsup:
 
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ecommercewolf

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Jan 8, 2019
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And WarehouseGigs was born.

Instead doing own prep business with all the fixed costs one can make gigs website with reviews and hire people on demand for prep tasks.

If no one will pick on that idea i surely will
Keep us updated if you do this.
 
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Bekit

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I need warehouse space for another reason, and it wouldn't make money for me yet.

Offering a service like this on top of what I'm doing for myself could possibly allow me to pay for the warehouse space that I need anyway. Win win.

What would I need to do to execute on this? What does an Amazon prep center need to offer in order to skew value and be the absolute best?

Is this something I could execute on and have up and running in a week?

Seems like something that would solve a piece of my puzzle though, while also helping someone else to solve theirs.

*Edit*
Let me acknowledge some of those were lazy questions. A simple Google search brought me up to speed.

I would be curious, though, to know what areas these companies are falling short of the mark. I looked at FBAFlexPrep | Amazon FBA Prep Services, amzFulfillmentCenter | Product Fulfillment Services | Staring from $0.7 , and eFulfillment Service Offers FBA Prep Services .

What are the characteristics that you see there, which would make you say to yourself, "Nah, not going with any of those guys"?
 
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ProblemOd

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The most legit FBA prep services I've come across are from third party fulfillment centers that offer it as a side service and they charge per hour. Usually around the $30-35/hr range.

However there are other relatively minor costs associated, such as receiving a pallet (a few bucks to be honest), and storage, usually around $20/month per pallet.

It's a good deal if you are looking to outsource your non-Amazon fulfillment as well, or need space to store bulk inventory and ship boxes to Amazon.
 
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ecommercewolf

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Jan 8, 2019
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Dallas, TX
I need warehouse space for another reason, and it wouldn't make money for me yet.

Offering a service like this on top of what I'm doing for myself could possibly allow me to pay for the warehouse space that I need anyway. Win win.

What would I need to do to execute on this? What does an Amazon prep center need to offer in order to skew value and be the absolute best?

Is this something I could execute on and have up and running in a week?

Seems like something that would solve a piece of my puzzle though, while also helping someone else to solve theirs.

*Edit*
Let me acknowledge some of those were lazy questions. A simple Google search brought me up to speed.

I would be curious, though, to know what areas these companies are falling short of the mark. I looked at FBAFlexPrep | Amazon FBA Prep Services, amzFulfillmentCenter | Product Fulfillment Services | Staring from $0.7 , and eFulfillment Service Offers FBA Prep Services .

What are the characteristics that you see there, which would make you say to yourself, "Nah, not going with any of those guys"?
A glance at the reviews of each one will tell you how to skew value.
 

Valor

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I use Shipmonk.

Not perfect and not the cheapest, but they do everything you want at reasonable prices.

They have warehouses in CA, FL, and PA.

They have a "special project" pricing of $45 per hour where they will do almost any task you want them to do, including Amazon Prep:


I would have your manufacturer do as much prep as they can first though. That's usually the cheapest/easiest.
 

ProblemOd

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I use Shipmonk.

Not perfect and not the cheapest, but they do everything you want at reasonable prices.

They have warehouses in CA, FL, and PA.

They have a "special project" pricing of $45 per hour where they will do almost any task you want them to do, including Amazon Prep:


I would have your manufacturer do as much prep as they can first though. That's usually the cheapest/easiest.
Do you use them for fulfillment services also? I'd like to ask a few questions since I'm deciding between companies.
 

biophase

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Move to a house
This is what I would do if I were you. To me, the numbers are a no brainer. In fact, I was thinking if purchasing the house next door to me for storage.

Imagine that you end up paying a fulfillment company $2000 a month. But a house down the block costs $250k. You put down $25k, borrow the rest and your payment plus taxes, insurance, electric and internet comes out to $1400. Put the extra $600 to equity and you solved your space problem and own another piece of real estate.

BTW, Get the house with the big garage and high ceilings.
 

Valor

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Do you use them for fulfillment services also? I'd like to ask a few questions since I'm deciding between companies.
I currently use them mainly as a long-term storage option (holding inventory prior to shipping to Amazon FBA) and a fulfillment service for my wholesale orders (they offer wholesale pick and pack prices) and another fulfillment warehouse that I work with in smaller quantities (Deliverr).

I also use them for eBay and Walmart orders right now, but I plan to move all of this over to Deliverr once I get some things worked out with them.

I still use Amazon FBA for my website's orders for several reasons, fulfillment cost being one. Shipmonk's pick and pack prices on individual units aren't particularly attractive, but they work for what I need them for right now: long term storage and wholesale order fulfillment.
 

ProblemOd

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I currently use them mainly as a long-term storage option (holding inventory prior to shipping to Amazon FBA) and a fulfillment service for my wholesale orders (they offer wholesale pick and pack prices) and another fulfillment warehouse that I work with in smaller quantities (Deliverr).

I also use them for eBay and Walmart orders right now, but I plan to move all of this over to Deliverr once I get some things worked out with them.

I still use Amazon FBA for my website's orders for several reasons, fulfillment cost being one. Shipmonk's pick and pack prices on individual units aren't particularly attractive, but they work for what I need them for right now: long term storage and wholesale order fulfillment.

I see, so you pay shipmonk for storage since its cheaper than storage at Deliverr, but Deliverr has cheaper fulfillment so you use them.

But aren't you still getting charged storage charges from Deliverr?

Also, do you offer 2 day shipping on your website for all orders? Because i tried Amazon FBA standard orders a few times and it reallly sucks. Sometimes they won't ship for days.
 

Valor

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I just use Shipmonk for long-term storage to avoid overstocking at Amazon and Deliverr, and I distribute it from there to other locations as necessary. Their long-term storage is cheaper then Amazon's, and Amazon also penalizes you for keeping too much inventory in their warehouse.

So overall, I view Shipmonk as a storage and wholesale fulfillment solution for my business, and I view Deliverr as the better direct-to-consumer fulfillment solution due to their pricing, shipping speed, and partnerships with sites such as Walmart.

For my website, I currently use Amazon Expedited (had the same issues with Amazon standard), and I offer free shipping. My margins aren't huge on my website orders, but I know that I can optimize that down the road; my goals right now with regards to the website orders are maximum customer satisfaction and growing my own customer base.
 
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