If you’re an Amazon seller in Australia looking to scale, reduce costs, or improve customer experience, one of the biggest decisions you’ll face is whether to go with Fulfilled by Amazon (FBA) or Fulfilled by Merchant (FBM).
Both models have their advantages, but choosing the right one depends on how you sell, where you store stock, and what kind of control you want over your customer experience.
In this guide, we’ll break down FBA vs FBM, including:
• What each model involves
• The pros and cons for Australian businesses
• How to decide which is right for your operation
What is Fulfilled by Amazon (FBA)?
FBA means Amazon takes care of your storage, packing, and shipping. You send your products to Amazon’s fulfilment centres, and they handle the rest, even customer service and returns.
Pros of FBA:
• Prime eligibility: Your listings are eligible for Amazon Prime, making them more appealing to fast-shipping customers
• Hands-off logistics: You don’t have to manage warehousing or packing
• Amazon handles customer support: Including returns and refunds
Cons of FBA:
•Storage and fulfilment fees: Can add up quickly, especially for slow-moving or bulky stock
• Less control: Branding, packaging, and customer experience are all standardised by Amazon
• Complicated for international sellers: For Australian businesses selling overseas, shipping inventory into Amazon warehouses can create cost and compliance headaches
What is Fulfilled by Merchant (FBM)?
FBM means you list your products on Amazon but handle storage, packing, and shipping yourself, either in-house or through a third-party logistics provider (3PL).
Pros of FBM:
• Greater control: You manage packaging, shipping speed, branding, and even returns
• Potentially lower costs: Especially for businesses with strong local logistics or slow-moving inventory
• More flexible: You can sell across platforms (not just Amazon) without being locked into their warehousing
Cons of FBM:
• You’re responsible for delivery performance: Delays or poor packaging can hurt your seller rating
• No automatic Prime badge: You’ll need to qualify for Seller Fulfilled Prime (which isn’t available in Australia at date of writing)
• You need a reliable fulfilment process: Either in-house or through a trusted partner
FBA vs FBM: Which One’s Better for Australian Sellers?
Here’s a side-by-side breakdown to help you decide:
| Feature | FBA | FBM |
|---|---|---|
| Prime Eligibility | ✅ Yes | 🚫 Not by default |
| Control Over Branding | 🚫 Limited | ✅ Full control |
| Packaging Customisation | 🚫 Amazon-branded | ✅ Your own packaging |
| Inventory Flexibility | 🚫 Must store in Amazon warehouses | ✅ Store anywhere (including 3PLs) |
| Upfront Costs | ✅ Lower initially | 🚫 May need to invest in systems or partners |
| Profit Margins | 🚫 Fees can eat margins | ✅ More control over costs |
For many small to mid-sized Australian businesses, FBM offers a smarter long-term path, especially when paired with the right fulfilment partner.
Why More Sellers Are Switching to FBM, and Getting Local Support
FBM gives you the flexibility to scale on your terms, with more control over your customer experience and profit margins.
At Direct Mail Solutions, we help Australian Amazon sellers take the stress out of FBM. From pick-and-pack to storage, same-day Australia Post collection, returns handling and even kitting, we give you the infrastructure of a major retailer, without the FBA headaches.
Want to Know What FBM Could Look Like for You?
Whether you’re just getting started or looking to scale, we can help you run a seamless FBM operation that rivals Prime standards, with our seamless 3PL services.
Get a quick quote today and see how we can take fulfilment off your plate, so you can focus on growing your Amazon business.
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