What does Amazon FBA mean, and how is it different from FBM?

What does FBA mean on Amazon?

FBA stands for Fulfillment by Amazon. Amazon describes it as outsourcing order fulfillment to Amazon: it receives and stores your inventory, picks, packs and ships each order, handles customer questions, and processes returns. FBA products are eligible for Prime shipping.

You still own the brand, the listing, pricing, advertising and inventory planning. What you hand over is the warehouse and the parcel. Amazon also offers Multi-Channel Fulfillment, which ships orders from your other sales channels out of the same FBA inventory.

What does FBM mean on Amazon?

FBM means fulfilled by merchant: you list on Amazon but store, pack and ship orders yourself or through your own 3PL. Amazon calls these seller-fulfilled orders.

With FBM you own the customer experience end to end. Buyers message you, return requests come to you, and the A-to-z Guarantee applies: if you do not resolve a problem, the buyer can claim against you. That is the real trade-off, more than the fees.

FBA vs FBM: what are the differences?

Side by side, from Amazon's own pages:

What performance standards apply to FBM sellers?

Amazon's Order Performance policy sets these minimums for seller-fulfilled orders. Missing them can cost you your FBM selling privileges or the affected offers:

Since 29 June 2026, Amazon also requires accurate handling times on seller-fulfilled SKUs. It recommends Automated Handling Time, which sets handling time from your shipping history and adds late shipment rate protection.

FBA or FBM: which suits a $100K a month brand?

Usually both, with FBA doing most of the volume. At $100K a month the Prime badge, Amazon's delivery speed and handing off customer service are worth the fees for your core, fast-moving SKUs.

FBM earns its place in four cases: oversized or heavy items where FBA fees eat the margin, slow movers that would pile up storage and aged inventory fees, custom or made-to-order products, and as a backup offer so a stockout at Amazon does not take the listing offline. If you can hit Prime delivery speeds yourself, Seller Fulfilled Prime keeps the badge.

The decision should be made SKU by SKU, from landed cost, FBA fees and velocity, not account-wide. We model it that way for clients on our FBA management, alongside inbound planning and AWD. One of those brands, a health and wellness company, grew from $40K to $115K a month in six months.

What do Amazon FBA fees include?

Amazon's FBA page lists these fee types, on top of the referral fee every seller pays:

• Fulfillment fees per unit shipped.
• Monthly storage fees, plus aged inventory fees for items stored over 181 days.
• Returns processing fees.
• Removal, disposal and liquidation order fees.
• The FBA inbound placement service fee for spreading inventory across fulfillment centers.

Referral fees apply to FBA and FBM alike. They vary by category: many categories are 15% with a $0.30 minimum, and Amazon's pricing page shows a range from 3% to 45%. Selling plans are $0.99 per item sold on Individual or $39.99 a month on Professional.

Use Amazon's FBA Revenue Calculator on a real SKU before deciding. Fees change most years, so recheck before each peak season.