Amazon Multi-Channel Fulfillment, commonly known as Amazon MCF, is one of the newest offerings to Amazon sellers. MCF (Multi-Channel Fulfillment) allows businesses to fulfill orders placed on multiple sales channels, including Amazon, their own website, and other third-party marketplaces, all using Amazon’s fulfillment network.
Many ecommerce businesses use Amazon fulfillment services but it can be difficult to decide which is best for your brand. A common Amazon service for ecommerce brands is Fulfillment by Amazon (FBA) service, it’s important to note that MCF allows sellers to expand their sales channels beyond Amazon’s marketplace.
What is Amazon MCF?
On the merchant side, the new service is called Amazon Multi-Channel Fulfillment (MCF), on the consumer side it’s called Buy with Prime (BWP).
Here’s the simple version of how it works for both parties:
- MCF allows merchants to use pooled inventory, stored in Amazon warehouses, to fulfill orders via channels outside of the Amazon platform (e.g., their own website). Multi-Channel Fulfillment is a subset of Amazon’s FBA program.
- BWP allows Amazon Prime members to take advantage of Prime benefits from online stores outside of the Amazon platform. They’ll be able to buy directly from a brand’s site, and still get the get quick and free shipping, simple checkout, and easy returns from Amazon’s logistics and fulfillment.
What are the Differences Between MCF and FBA?
The primary difference between Amazon MCF and FBA is that the Amazon MCF program allows sellers to sell their product on non-Amazon marketplaces, primarily through their own websites, but still be fulfilled by an Amazon warehouse. On the flip side, Amazon FBA only fulfills orders from the Amazon marketplace (i.e., Amazon.com).
With so many options to choose from, it may be hard for sellers to understand which Amazon service is right for their brand. Here is how to differentiate these various services:
- FBA is designed for sellers using Amazon’s platform, handling storage, shipping, customer service, and returns exclusively for Amazon orders. It integrates seamlessly with Amazon Prime, ensuring fast delivery for Amazon customers.
- MCF, on the other hand, supports multi-channel sellers by fulfilling orders from non-Amazon platforms like Shopify or eBay. While it shares resources with FBA (warehouses, logistics), MCF provides flexibility for sellers who operate across multiple sales channels. The key difference lies in their focus: FBA is Amazon-centric, while MCF serves broader e-commerce needs.
How Does Amazon MCF Work?
Amazon’s Multi-Channel Fulfillment service works by fulfilling orders from multiple places online from one pool of inventory, stored in Amazon’s warehouses.
When a customer places an order for a product online (on your site, or another site where your products are listed with the Buy with Prime badge) Amazon’s logistics will kick in to get that product to the customers.
- Your products are stored in Amazon fulfillment centers.
- Amazon receives the orders in their warehouses.
- Amazon proceeds to pick, pack, and ship the order to the customer.
Benefits of Amazon MCF
One of the most significant advantages of utilizing Amazon MCF is gaining access to Amazon’s extensive fulfillment network. Amazon has strategically located fulfillment centers worldwide, allowing for faster delivery times and cost-effective shipping options. By leveraging Amazon’s fulfillment infrastructure, sellers can offer customers expedited delivery speeds and a reliable shipping experience.
Simplified Order Fulfillment Process
Using Amazon MCF, the order fulfillment process becomes a breeze for sellers. When a customer places an order on any of the integrated sales channels, Amazon takes care of the entire fulfillment process, from picking and packing to shipping. This end-to-end fulfillment service ensures that customers receive their orders quickly and efficiently, regardless of which sales channel they used to make the purchase.
Saving Time and Resources
For ecommerce businesses, managing inventory and order fulfillment can be time-consuming and resource-intensive. However, with Amazon MCF, sellers can offload these tasks to Amazon’s capable hands. This not only saves valuable time but also frees up resources that can be redirected towards core business activities, such as marketing and product development.
Integration with Third-Party Sales Channels
Amazon MCF isn’t limited to fulfilling orders from Amazon and your own website. It also seamlessly integrates with other third-party sales channels like Shopify, eBay, BigCommerce, and WooCommerce. This capability empowers sellers to consolidate their fulfillment process across multiple platforms, creating a cohesive and efficient order management system.
Disadvantages of Amazon MCF
Amazon Multi-Channel Fulfillment might not be as cost-efficient as working with a 3PL or other fulfillment provider, especially for sellers with larger volume. Amazon’s storage fees change often, picking, packing, and shipping fees are unpredictable—basically the costs can add up quickly. For merchants new to Amazon fulfillment services, these fees might come as a surprise.
The Importance of SKU Management
For efficient order fulfillment, accurate SKU (Stock Keeping Unit) management is critical which requires significant time and internal resources to manage. Sellers must ensure proper SKU management to continue to adhere to Amazon’s fulfillment process.
Eligibility Requirements
Businesses wanting to use MCF may be required to meet minimum inventory levels in Amazon’s fulfillment centers. This can be challenging for businesses that are just starting out or that have limited resources. Also, sellers lose flexibility by placing a large portion or all their inventory in Amazon’s control. Brands might be subjected to having their inventory moved without any notice. Having very little or no access to your inventory may pose a big challenge for some sellers.
Lack of Personalized Customer Service
One of the most frequent complaints of Amazon merchants is a lack of customer service. Amazon lays out the rules and criteria for their fulfillment services very clearly, but they provide very little support if merchants need anything else. There is no account representative to help you troubleshoot if any issues arise.
Consumer Challenges of Buy With Prime
Not only will merchants face some disadvantages to using MCF, customers may also face challenges with this new service. Here are a few:
- More clicks to purchase. Consumers will have to sign into Amazon and also agree to Amaozn’s privacy and security policies. These are additional pages to the usual checkout process.
- Poor user experience. By adding yet another way consumers can interact with your brand, you may be diluting the pool of options. Customers may be confused by the Buy with Prime before it becomes a customary process.
- Standardized packaging. All products will be fulfilled by Amazon which means they will have Amazon branded packaging. This standardization leaves little room for branding and also more room for potential damages to products.
- No branded customer communication. Since Amazon will be sending out email notifications of order confirmation and shipping details, there will be less room for brands to collect consumers in their own marketing and communications.
- Unclear returns process. If the brand isn’t in high communication with the customer, it may not be clear how to initiate a return. For smaller brands handling returns might be a new and overwhelming endeavor.
Bottom Line
Overall, Amazon Multi-Channel Fulfillment can be a useful tool for businesses that want to improve the efficiency and reliability of their fulfillment operations. However, it is important for businesses to carefully consider the potential costs and requirements associated with the service before deciding whether it is right for them.
If you’re looking for a 3PL who can help support your Amazon business, check out DCL Logistics’ Amazon fulfillment services page or contact us. We look forward to hearing from you! If you are already working with DCL Logistics, contact your account manager to inquire if this the new Amazon MCF service is right for your business.
Tags: Omnichannel Fulfillment, Online Marketplace
