For years, Amazon has trained both sellers and customers to equate the Prime badge with speed, reliability, and trust. But behind the badge, many brands are rethinking the cost of convenience. As fulfillment fees rise and control over customer experience shrinks, sellers are asking a strategic question: Is Fulfillment by Amazon (FBA) helping us grow or holding us back? Increasingly, the answer isn’t to abandon Amazon, but to use it more intelligently. A hybrid fulfillment strategy is emerging as a way to keep Prime eligibility while enjoying better margins, stronger brand control, and increased growth opportunities.

Why are sellers rethinking Fulfillment by Amazon?

With FBA, Amazon controls the packaging experience, shipping speeds and methods, customer service, and returns. Costs associated with Fulfillment by Amazon (FBA) add up quickly. Many sellers report losing 10-30% of margin to FBA fees, depending on product size, storage time, and returns. They also have a limited ability to differentiate their brand.

When faced with these limitations, sellers find it harder to build brand loyalty and, at best, find it frustrating to have limited visibility into their customer data.

How does Fulfillment by Amazon limit brand growth?

Retailers like Walmart, Target, and Nordstrom often discourage or prohibit Amazon fulfillment. This means sellers solely using FBA will struggle to scale with valuable retail partnerships. Since almost 60% of customers discover products in stores, this limitation puts a significant strain on opportunities for brand growth.

Fulfillment by Amazon works well for Amazon-first brands, but for brands pursuing omnichannel growth, many are choosing a hybrid fulfillment model.

Can sellers “partially leave” fulfillment by Amazon?

Yes! Savvy sellers have discovered outsourcing some of their fulfillment needs to a 3PL while keeping others with Amazon as an effective strategy. Amazon serves as a sales engine for the brand and handles certain SKUs or regions, and a 3PL handles the rest of the U.S. and all non-Amazon sales.

With the hybrid model, sellers can maintain competitive delivery speeds while gaining more control over operations and costs.

What is Seller Fulfilled Prime (SFP)?

Sellers can opt into the Seller Fulfilled Prime program to take advantage of the increasingly popular hybrid approach to shipping providers. Seller Fulfilled Prime (SFP) is an Amazon program that allows sellers to ship orders from their own warehouse or a 3PL while still offering the Prime badge by meeting Amazon’s strict delivery and performance standards.

To qualify for the program, sellers must:

• Deliver products within 1-2 days nationwide
• Ship same-day (or have very fast handling times)
• Maintain strict performance standards

Seller Fulfilled Prime requires a strong logistics infrastructure, national coverage, and operational precision. For this reason, most individual sellers cannot meet these strict standards alone. Partnership with a proven 3PL is a safer bet.

How does Seller Fulfilled Prime grow retail partnerships?

Retailers often prohibit the use of Fulfillment by Amazon because they don’t want to share customer data with their competitor, Amazon. For e-commerce sellers ready to expand into retail establishments, they must be prepared to partner with a 3PL provider that will ship to them.

Not all 3PL providers are prepared to help with this type of growth. Large, enterprise-only 3PLs often only ship directly to consumers. Look for a provider like Sweetwater Logistics that specializes in serving smaller brands with high‑touch service to both consumers and retailers.

How can I find a reputable 3PL that will integrate with Amazon to provide 2-day shipping services?

A qualified 3PL should be able to demonstrate they have the operational discipline needed to meet Amazon’s standards, including:

• Strict pick and pack process
• Barcode scanning for accuracy
• Real-time tracking updates

They must also be able to integrate with Amazon Seller Central and ensure compliance with SFP rules.

For optimal pricing and brand growth, 3PLs should have multiple warehouse locations to help sellers reduce shipping zones and have the capacity to handle seasonal spikes in demand including the ability to deliver to retailers.

What factors determine the best 3PL partner for Amazon sellers to choose?

Sellers looking into partnerships with a 3PL need to consider whether the provider has fast nationwide coverage, proven accuracy in fulfillment, and the ability to deliver to retailers. 3PLs with high operational accuracy, over 99%, achieve this high mark only when they have a standardized process and verification systems in place.

Sweetwater Logistics, for example, has an order accuracy rate of 99.998% because of their barcode scanning process used for every item and a weight and dimension verification process to prevent overcharges. This is one example of the metrics proving they are fit to maintain the strict requirements of the Seller Fulfilled Prime program.

Build a Smarter Fulfillment Strategy

The future of e-commerce growth isn’t about choosing between Amazon and everything else; it’s about building a fulfillment strategy that supports both. Sellers who rely solely on Fulfillment by Amazon often find themselves constrained by rising costs and limited growth opportunities. Those who adopt a hybrid strategy gain the ability to scale across channels, protect their margins and strengthen their brand.

At a time when profitability and growth matter more than ever, sellers who win will be the ones who treat fulfillment as a strategic advantage. If you have questions about how Sweetwater Logistics can help you reach your goals, reach out to us!