Sales Taxes
If you purchase your items on the internet from US retailers (i.e. online arbitrage) you may have to pay sales tax. If you use a pre-purchase center in a state where there is either no sales tax or with a low tax rate, you can save the money. How? How? By sending your stock straight from the manufacturer to the preparation center. If it's located in one of the four states that have zero sales tax (Delaware, Montana, New Hampshire, Oregon), the storage costs incurred while waiting for additional inventory to arrive are likely to be lower than the tax you'd have to pay in your home state. Be aware that the sales tax in the US can vary from zero to seven percent. So, even choosing an office located in a state with a sales tax that's less than two percent could make a difference in your costs.
Climate
If you sell perishable goods like food, the first question you need to inquire of any prep service is whether their storage and receiving facilities are climate controlled. You do not want your items to go bad because they weren't kept in good conditions. This doesn't only apply to perishable goods. Climate control is also important when your inventory is heading to a hot or unstable state. If the conditions of the climate are not managed properly products can get damaged or be affected by damp.
Storage Facility
FBA prep centers' primary purpose is to help you prepare your inventory so that it can be shipped into FBA. But, more sellers are turning to prep centers to store inventory. It is because of two factors. One reason is that it's cheaper than storing all your inventory in the Fulfillment Center. Based on sales rates, they place their inventory at their prep center and then transfer it to FBA. This implies that a seller who sends 10,000 units of inventory to their prep centers each month and sells around 1,000 units per month would only send 1,000 units to FBA each month. The remaining stock will be stored in the center for prep. Amazon's suspension policy is the third reason. Your inventory will be put in the Fulfillment Center if it is suspended. In order to get the item back, you will need to pay per item and it could not be returned for several weeks. You or your prep center are required to check the inventory in FBA in the Plan of Action. Once you are reinstated, you will need to move your inventory to a new location. This is a very expensive procedure that sellers would like to cut down on by storing their inventory at the Prep Center and sending smaller quantities. It is important to ensure that your prep service can be capable of turning inventory around quickly and on a very short notice should you choose to use this method. Also, you should ask about their insurance policies - you'll want your inventory to be secured against fire or theft as they store it!
Processing Time
It is essential to take into consideration the speed at which they prepare your stock. There are many variables which can affect your need for speed. For example, if your sales rate requires that you keep stock in the prep facility, you may expect them to have it ready in 48 hours. Most prep services are upfront with their processing times and may even provide a 24- or 48-hour assurance. If you don't find this information, make sure you inquire, since you don't want your delivery rate to suffer due to your prep service are slow in getting your goods to FBA. Have a look at the top rated Door to Door Delivery site for details.
Inspection
It's important to determine if you FBA prep services also carry out inspections. While this does not replace inspections of your product at the manufacturer's factory, it may be supplemented. Manufacturers are not required to examine shipments because they can lose money if the stock is returned. Imagine that your company checks the goods prior to shipment. Imagine that you've got 10,000 units, and they inspect 20% of the goods. It's likely that your FBA prep team will find problems with your stock when they go through it. Danny McMillan believes that most manufacturers don't look at their products very closely because they know that rejections can lead to higher costs and lower margins. This makes the prep service's inspection even more vital.
In Summary
Although outsourcing your FBA prep can help your company run more smoothly, it can also result in issues for your business. The prep service you choose to use will have to establish an association with you. If they do not respond to your questions, it is a sign they might not be the best fit for you. Chatting with other sellers may also be useful. It is possible to learn about the prep services other sellers use and what they like best. In the end, if you're sending your precious inventory to someone else, you'll want to ensure your inventory is safe.