Selling on Amazon FBA from New Zealand. Is it possible?

You’ve definitely heard of Amazon, and probably bought some things off the platform, but did you know you can set up an account to sell your own products without actually having to store, pack or ship the products yourself? That is the service that Fulfilment by Amazon (FBA) provides.

This article will take you through what exactly Amazon FBA is, whether it is available in New Zealand, how you can sign up and some other key things you should know to sell your products on Amazon.

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What is Amazon FBA and how it works.

FBA is a service for e-commerce businesses to outsource their order fulfilment to Amazon. Order fulfilment includes storing the product at one of Amazons’ fulfilment warehouses, packing the items and shipping them to the customer after a purchase has been made.

To opt into this service, businesses need to set up a seller account on Amazon.

Is Fulfilment by Amazon available in New Zealand?

Unfortunately, Fulfilment by Amazon (FBA) is not yet available in New Zealand. This means that there are currently no warehouses located in New Zealand that are used to ship products to customers within New Zealand.

Although it is not confirmed, to keep up with the demand from New Zealand buyers from Amazon in Australia, this status may change. So, this beckons the question, what can an e-commerce business in New Zealand do if they want to sell their products on Amazon?

Fortunately, it is possible to sign up to Amazon in Australia and use the Australian FBA system as Amazon has included New Zealand as part of the Australia system.¹

Important to note

When you sign up to be a Seller on Amazon Australia from New Zealand, and store your products on Australian soil in a designated Amazon warehouse, you will need to understand the key jurisdictional differences when it comes to Australian business laws, your tax obligations in Australia and New Zealand, and the export and import requirements on the products you intend to sell. For export rules specifically, you can start with studying the Amazon guide here.

Whenever multiple jurisdictions are involved, it's important to speak to a tax consultant that understands the local business laws for trading in and between Australia and New Zealand.

Benefits of using Amazon FBA instead of fulfilling orders yourself

The processes involved in order fulfilment can take up a lot of time, so the ability to outsource some or all of the involved processes can mean more time to work on your business. Here are some of the benefits that come with using FBA instead of fulfilling the orders yourself.

• Wide-spread logistics that cover Australia and New Zealand
• High demand for amazon goods
• Buyer trust
• Range of shipping choices for your customers
• Can explode your business to new global customers
• Includes 24/7 customer service for your customers

These are just a snippet of the benefits that come with using Amazon to handle your order fulfilment products for you.

How do you sign up to Amazon FBA in New Zealand

Before you’ll even have the chance to use Amazon FBA in New Zealand, you’ll need to visit the Australia Amazon site to set up an Amazon seller account. To do this, you’ll need to have a few things ready including²:

• Identity document to verify your identity
• Mobile phone number
• Proof of your business validity
• Credit card to pay for the monthly subscription fee
• Proof of address
• Bank account details

Once you have gone through all the verification steps, and Amazon accepts your details, you’ll be able to access Seller Central and begin listing your products to sell. This is the point when you can sign up to use FBA. The steps to set up FBA on your account are as follows⁴:

1. Add your product with its description on Seller Central
2. When asked to choose a “Fulfilled by” value, choosing Amazon over Merchant to designate it as FBA inventory

From this point, you’ll then need to prepare your products as per Amazon’s requirements to be sent to an Amazon fulfilment centre.

Amazon seller fees

When it comes to the monthly subscription fee, there are two packages you’ll need to choose from based on the amount of products you are intending to sell. These are³:

• The individual plan is for those selling less than 50 products a month for $0.99 AUD per unit
• The professional plan is for those selling more than 50 products a month, and want access to selling APIs, reports and different programs for $49.95 AUD per month inclusive.

How do you send your products to Amazon warehouses

Below we’ll go into more detail about using FBA Australia as a New Zealand Amazon Seller.

Are there Amazon warehouses in New Zealand?

No, there aren’t any Amazon warehouses in New Zealand. Your inventory will be stored, packed and sent from Amazon fulfilment centres in either Sydney, Brisbane or Melbourne if you decide to use FBA Australia.⁵

As there is no preferred carrier provided by Amazon to ship your products to the warehouse, you will need to arrange your own shipping to the warehouse in Australia.

You could also find an Australian FBA Prep Service that can accept and prepare your goods, then send them over to the amazon warehouse on your behalf.

How to remove your products from amazon warehouse

If you decide that FBA isn’t the best option for your business anymore, you can request for Amazon to dispose of or return your inventory to you. To do this, you’ll need to put through a FBA order removal request through your Seller account. Fees are incurred for returned or disposed of items.⁶

What fees do you pay with Amazon FBA

To use Amazon FBA does come with a variety of fees. At minimum, you should expect to pay⁷:

• A flat fulfilment fee based on product weight and dimensions start at $2.04 AUD for 0-100 grams, upwards of $27.17 AUD for items weighing 25kg.
• Items that weigh more than 25kg will incur the base rate of $27.17 AUD + $1.43 AUD per kg thereafter.

On top of this, there are other fees that may be incurred to use FBA⁸. To get an idea of some common fees that may need to be factored in, let's have a look at storage and shipping fees using Amazon FBA.

Fortunately, FBA Australia includes New Zealand at no extra cost within its shipping network.¹

FBA Australia Fees for storage

You can store your inventory on a monthly basis at the various fulfilment centres in Australia. However, if you have inventory that has been stored in a fulfilment centre for longer than 365 days, then higher fees will apply. The fees are as follows.⁹

Storage time	Fees
Monthly	January - September = $19.40 AUD per cubic metre/per month October to December = $26.50 AUD per cubic metre/per month
Long-term	$160 AUD per cubic metre or $0.10 AUD per item depending on which capacity is greater

Fees are assessed by Amazon staff daily, so each month can fluctuate depending on how much space your products are taking up. These fees do not include GST or any other taxes.

A short note on Amazon global shipping

If you want to sell your products to other marketplaces on Amazon, you’ll need to sign up to Amazon Global Selling. Unfortunately, FBA inventory cannot be exported outside of Australia and New Zealand at the moment.¹

This means you’ll need to fulfil these orders yourself. You should be aware that certain products could be restricted for global shipping and you will be liable for any taxes abroad.¹⁰

What should you be aware of before you sign up to FBA

While Amazon FBA could transform a business and give it massive success, there are some pitfalls you should be aware of before signing up to the service. Pitfalls include:

• It’s still up to you to manage your stock levels and cash flow
• Extra fees incurred on products being returned, used and refunded by Amazon with no questions asked
• Possibility of products not selling
• Potential to pay long term storage fees on non-selling stock
• Costs might outweigh your sales
• Meet both NZ and Australian tax obligations

This list is not exhaustive and you should always do your own research. It is also important that you consult with Amazon and a local AU-NZ tax consultant for help with setting up FBA for your business.

Wise international business account

To set up your Amazon Seller account, you’ll need to provide an account to receive your proceeds from your sales. The Wise Business account can allow your business to receive payments from Amazon, as well as pay international suppliers at the real exchange rate with low fees.

If you decide to go Global, you’ll be able to manage over 50 world currencies all in one account. To see how a Wise business account could benefit you, have a look at the product features for yourself.

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Sources:

1. Amazon New Zealand FBA
2. Amazon verified seller
3. Amazon seller plans
4. Amazon sign up to FBA
5. Amazon warehouses
6. Amazon FBA removal request
7. Amazon fulfilment base fees
8. Amazon types of fees
9. Amazon storage fees
10. Amazon Global Selling

Sources checked on: 01 August 2022