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FBA or FBM: Which Fulfillment Model Will Maximize Profit in 2025?

With Amazon’s increasing popularity, sellers ask one key question: Should I choose FBA (Fulfilled by Amazon) or FBM (Fulfilled by Merchant)? The answer depends on your goals, product type, and operations. This guide breaks down both models to help you choose the one that maximizes your profits.

What is FBA?

In the Fulfillment by Amazon model, Amazon stores, packs, and ships your products. Sellers send their inventory to Amazon warehouses, where they handle everything, from packaging to shipment, along with customer service and returns.

FBA is best suited for:

  • High-volume sellers – Sellers selling large quantities each month must opt for FBA to be able to manage the scale efficiently. This fulfillment method reduces the workload and provides access to Prime customers, boosting sales potential.
  • Lightweight, fast-moving products – Products that are small, light, and sell quickly are more cost-effective under FBA as they incur lower storage and shipping fees while also avoiding long-term storage costs.
  • Sellers who want hands-off logistics – FBA manages storage, packing, shipping, returns, and customer service. It’s ideal for sellers who prefer to focus on growing their business instead of handling logistics.

Pros of FBA:

  • Prime badge eligibility – Choosing FBA qualifies your products for Amazon Prime, thus increasing visibility and trust among buyers.
  • Faster shipping = more conversions – Amazon’s fast delivery boosts customer satisfaction and can lead to higher sales.
  • Amazon handles returns & support – Amazon handles customer service and returns, saving time and effort and allowing sellers to focus on scaling and managing their Amazon business.

Cons:

  • Storage fees – Opting for FBA implies storage fees, which can be costly if inventory moves slowly.
  • Less control over inventory – Amazon manages the inventory, which limits the direct access and oversight of the sellers.
  • Long-term fees can add up – Items stored for extended periods incur additional long-term storage charges.

What is FBM?

With Fulfillment by Merchant, sellers handle storage, packing, and shipping themselves or through a third party.

FBM is best suited for: 

  • Heavy or bulky products – FBM can be more cost-effective for oversized items that incur high FBA fees.
  • Lower volume or seasonal sellers – Sellers with fewer orders or seasonal spikes avoid storage fees and only fulfill as needed.
  • Businesses with their own logistics setup – Businesses that already have their warehousing and shipping must opt for FBM, as it gives you full control and flexibility.

Pros:

  • More control over inventory – Sellers manage storage, packaging, and shipping, allowing for greater flexibility and control over inventory.
  • No FBA storage fees – Avoid monthly and long-term storage costs charged by Amazon.
  • Better for fragile or oversized items – Sellers can use specialized packaging and handling to better protect sensitive or bulky products.

Cons:

  • No automatic Prime badge – Listings won’t have the Prime badge unless the seller is enrolled in Seller Fulfilled Prime.
  • Sellers handle customer service and returns – Sellers are entirely responsible for all post-sale support, including returns and inquiries.
  • Slower shipping may impact sales – Longer delivery times can reduce visibility and lower conversion rates.

Hybrid Fulfillment: The Best of Both Worlds

In 2025,  a large number of sellers are relying on a hybrid model, using FBA for fast-moving SKUs and FBM for larger or slower-moving items. This gives flexibility, cost control, and Prime access where it matters most.

Cost Comparison: FBA vs FBM

Cost Type FBA FBM
Fulfillment Fees Higher (Amazon fees apply) Lower (you manage costs)
Storage Fees Monthly + long-term charges You control storage costs
Returns & Customer Service Included You handle it
Shipping Speed Fast (Prime) Depends on your setup

Which Model Maximizes Profit in 2025?

The profit margins depend on several factors when choosing the right fulfillment method for your business. These factors include:

  • Product size & weight
  • Sales volume
  • Your logistics capacity
  • Customer expectations

Most sellers see the best results by combining both – FBA for bestsellers, and FBM for niche or bulky items.

Need Help Choosing or Setting Up?

As an Amazon SPN Partner USA, Krolog, a leading Amazon Service Provider Agency, helps sellers grow smarter.

Our services include:

We’ll help you build a strategy, reduce costs, and boost sales with the right fulfillment setup.

Let’s talk about your goals. Connect with us now!

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