For customers on Amazon, shopping can be a seamless experience. You place your order (sometimes with 1-click!) and two days later a package arrives on your doorstep. This process is so seamless that some customers don’t even know that third-party sellers list products on Amazon, they think everything is sold by the behemoth online retailer itself!
While this process is smooth as butter for the customer, most people don’t see the vast number of fulfillment centers spread across the US that Amazon operates to get purchases to customer’s doorsteps. Amazon has changed the online shopping experience by using its network of fulfillment centers.
This vast network of fulfillment centers has been a major competitive advantage for 3rd party sellers on Amazon. Instead of having 1-2 US warehouses or drop-shipping from your manufacturer overseas, you can (for a fee) have Amazon use their vast amount of data and machine learning to allocate your inventory to their nationwide network of fulfillment centers. This used to be one of the best options for improving shipping time and providing a great experience for customers, until….
At Shopify’s “Shopify Unite 2019” event in Toronto, Canada earlier this year. Among other things, Shopify announced the release of their Shopify Fulfillment Network or SFN for short.
Qualified Shopify users can apply to be one of the first SFN users. SFN’s intelligent inventory allocation algorithm can predict the optimal inventory quantity for the nearest distribution center to ensure fast, lower-cost delivery. After your customer places an order, SFN takes care of which warehouse to ship from and which shipping carrier to utilize. Who can argue with better customer experience and less work for you?
Will Shopify Fulfillment network take over Amazon? It’s hard to say, and only time will tell. We, for one, are happy to see some additional competition challenging Amazon Fulfillment for the top spot of proving customer value.