They say you can’t out Amazon, Amazon right. They also say, if you can’t beat them join them. Which is why many website investors want to learn how do FBA websites work, so they can work with one of the biggest companies in the world, Amazon.
However, if you don’t know much about websites yet, investing in them or some of the types of online businesses out there available today. You have come to the right place/blog where you can learn a whole stack of great information on your journey to buying online businesses for passive income.
Although for this very blog post, I want to answer for you. How do FBA websites work? What does FBA mean and why should you be considering an FBA website for your next investment.
What FBA stands for is Fulfillment By Amazon. Which means you could buy a website business where the business buys their entire inventory. Send it to Amazon and they will ship it out to each of the customers each time they order.
There are also other order fulfillment companies available other than Amazon which many business do use. Just like what Zappos Shoes did in it’s early days when they bought all their shoes and had them sent to the order fulfillment company named Elogistics. From their when Zappos got an order ELogistics would send them right out the customer for Zappos.
So when you see online businesses for sale using the FBA method. You can immediately answer the questions of ‘how do FBA websites work?’
When you understand ‘how do FBA websites work?’ It is very similar to the drop ship method. Where online businesses will use the actual wholesalers or suppliers to ship the products directly out to their customers. For example a website using the drop shipping method will receive an order from the customer online. From there the website owner will automatically make that same order through the supplier. Although the website owner will pay the wholesale price and the supplier will ship the product to the websites customer for them.
Unlike how FBA websites work, using the drop ship method may cause the business to purchase to pay a little more per product. However when using the FBA method, the business can purchase large quantities of stock for the cheapest wholesale price possible and have it sent to Amazon for fulfillment.
One last thing I have not touched on also, which is how do FBA websites work business which create there own products. Where this becomes exceptionally great is when the businesses products have been created by the owner, or a third party they can be sent to Amazon to distribute those products to the customers for the business. Meaning the business can focus more on creating the products or marketing the website.
FBA really isn’t a ground breaking way to do business because there have been order fulfillment companies around for a long time. Although FBA has really opened up website entrepreneurs to more opportunities to create, buy and sell websites for passive income using their FBA method.
Have you or do you own a FBA website, have you been looking at building, buying or selling one and what have you learnt about FBA websites you could contribute in a comment for the community?