Amazon FBA Listing Transfers vs. Account Transfers
You are now either the proud owner of a new Amazon FBA business or have just sold your FBA asset on our newly redesigned marketplace.
Now that the deal is complete, the process to migrate the asset to the new owner begins. This is where things can get a bit tricky with Amazon FBA businesses.
Because this business model revolves around selling physical inventory, the migration process for Amazon FBA is a bit more complex than, say, a content site.
When migrating a content site, updating the account details and any affiliate or advertising links is usually a large portion of the work required to transfer it to a new owner. Amazon FBA, on the other hand, has a few more hoops to jump through before you can be sure that everything is complete.
When it comes to having our migration team exchange ownership of any Amazon FBA asset from seller to buyer, it is helpful to have an informed idea of what this entire process consists of.
What is the Amazon FBA Migration Process?
The migration of any Amazon FBA business starts the same day it is sold.
Once we have received the funds from the buyer for the business, we take the listing off the marketplace and notify our migrations team that they can start their work.
The entire process for migrating an Amazon FBA business can take anywhere from 4–12 weeks, depending on whether the asset will require a listing transfer or an account migration. This process can also take less time, depending on how prepared both the buyer and seller are for this part of the deal.
During this period of the transition, it is important to remember that the seller is responsible for maintaining the business, even when they are not receiving any income to their accounts. While this might not sound like a happy time for the seller, there are certain actions that both the buyer and seller can undertake prior to this stage to speed up the overall time it takes to complete it.
So, let’s find out just how long you can expect each process to take, what each method requires on both the buyer’s and seller’s part, and how you can be better prepared for this leg of the journey.
Amazon Account Migration
We will begin with the less complicated method for migrating an Amazon FBA business to a new owner, and that is with a complete Seller Central account acquisition.
In an account migration, the process will usually take about 4–8 weeks depending on the size of the business, and it requires less work compared to a listing transfer. Every Amazon FBA business will be different depending on the structure and backend setup the seller has decided to build their empire on, but a few basic steps will be followed for most assets that fall within these two different FBA acquisition methods.
To make it easier for you to come back to this article during the migration process, we have decided to outline this process for you as a list of key events that will usually take place in the following order during the migration period:
1. Notify Amazon using Our Script
When you begin the migration process for any Amazon FBA asset, both the buyer and seller will need to inform Amazon of the impending changes to their accounts.
If the buyer has an existing Amazon account, they will need to inform Amazon they would like to open a new account using a script we provide. If the buyer is new to Amazon, though, no further action is needed from them at this time.
The seller will need to inform Amazon that they will be making changes to their account as well by using a script that we provide which is meant to cover these changes based on what has been accepted in the past.
2. Changing the Account Details
Once Amazon has approved the seller’s request to make these account changes, the seller will update their Amazon Seller Central account to include the buyer’s information, including the following:
- Email account
- Phone number
- Bank account details
- Credit card
- Legal entity & Employer Identification Number (EIN or full name and SSN)
- Secondary phone number or authentication app
Recently, the process of obtaining secondary account approval has become much easier. At one time, Amazon required secondary account approval for buyers who already had an FBA account. Now, Amazon does not require this secondary account approval as long as the buyer uses a different legal entity than that on the older account. Both the buyer and seller will also need to inform Amazon before making these changes, so keep that in mind.
Tip: To speed up the entire process, have a legal entity and bank account (that is not already linked to an Amazon account) ready to be used for the buyer’s new account.
3. Digital Asset Transfer
After you have started changing the account details to those of the new owner, you will begin the process of transferring any other digital assets (business software accounts, subscriptions, etc.).
Social media accounts, email and push notification lists, and trademarks can all be transferred over to the buyer at this time. Keep in mind that transferring a US trademark will usually take about 60 days to be finalized; however, the receipt once the seller completes the application will be sufficient to continue the process.
4. Inspection Period Begins
After the ownership of all the major revenue-generating assets has been migrated to the buyer, we begin the inspection period.
The inspection period consists of a 14-day time frame during which the buyer can verify that the revenue is above 50% of what the listing advertised.
We do this to protect both the buyer and the seller, as we want everyone to benefit from the deal. We offer this inspection period as an additional safety net to ensure that both parties are happy with the acquisition.
Miscalculations don’t happen often, but when they do, our migration advisors go through their checks again to verify that everything was reported accurately. During this inspection period, the buyer must also keep every detail of the asset identical to the way that the seller had the business configured.
If the buyer would like to make any changes to the asset prior to the end of the inspection period, they may do so, but in doing this they void their option to back out of the deal if things should turn for the worse.
After the inspection period has been completed successfully, we will release the Buyer’s funds minus our commission to the seller. Once the seller has been paid out based on the agreed upon upfront amount, the deal is done and the migration is complete.
This method is quite straightforward when you consider the overall process; however, a small number of Amazon FBA businesses are not eligible for an account migration. Some accounts, cannot be transferred as per Amazon regulations or the seller may have multiple brands under one account but only want to sell one.
In any case where the Amazon Seller Central account will not be included in the acquisition, we will need to perform a listing transfer. The process for this can be a bit more complicated, as you will soon discover.
Amazon Listing Transfer
If the seller can’t include their account with the business, or the account doesn’t meet the requirements to be eligible for an account migration, we will need to perform what is known as an Amazon listing transfer.
This process can take anywhere from 8–12 weeks, as it requires a few more steps than a simple account migration. Listing transfers include additional steps, as will be discussed, and due to the time required to complete each step, this method will usually take the longest to complete.
Having a better understanding of what is required from both the buyer and the seller during a listing transfer will help move the needle in a timely manner.
1. The Buyer Sets Up their Account
As opposed to an account migration where everything is transferred to the new owner, with a listing transfer, the buyer will need to set up a new Amazon Seller Central account if they don’t already have one or inform Amazon of their future account addition using our script.
2. The Seller Gathers Inventory Forecasts
Now that the buyer has an active Amazon account, the seller will need to report their current inventory levels, locations, and data-driven predictions for how much inventory will be needed over the next few months.
After this data has been collected, the seller will retain 3–4 weeks’ worth of inventory in their storage facility, or if needed, replenish this inventory to maintain 3–4 weeks’ worth for the duration of the migration period. This process of removing inventory from the seller to the buyer is known as the “removal order” and is meant to keep enough inventory in the seller’s account to avoid a stock-out.
3. The Buyer Sets Up a Third-Party Logistics Service (3PL)
After the buyer has completed their account setup, they will then need to set up a 3PL account in order to receive any inventory left over from the seller.
Once this 3PL service account has been established and is ready for inventory, the buyer will send all of the 3PL providers’ details to the seller, which is required for the next step.
4. The Seller Ships the Removal Order Inventory
As mentioned, the removal order requires that the seller maintain 3–4 weeks’ worth of stock in their account and ship the remaining inventory to the buyer’s 3PL provider. Not only does this give the seller enough inventory based on their forecast report to avoid any sudden stock-outs, but is also the first time the buyer will receive inventory into their account.
Keep in mind that while the inventory does technically belong to the buyer at this point, the seller will be responsible for shipping this inventory to the buyer’s 3PL.
5. Brand Registry
At this time, if applicable, the buyer will need to apply for an Amazon Brand Registry account using the same email as the account used for the business.
Once the buyer has opened their Amazon Brand Registry account, the seller will need to give them the highest-level permission to the listings via their own Brand Registry account by adding the buyer’s store ID.
6. The Listing Information is Copied to the New Account
When it comes to selling products with Amazon FBA, some business owners like to take the ‘more is better’ approach when choosing how many products to include within their line.
Occasionally, we might come across an Amazon FBA business selling tons of products, and the sheer amount of work required to transfer that many products on your own could make you go insane.
Luckily for you, when you use a brokerage service like the one we offer, you not only avoid having to perform this operation all on your own, but can also benefit from our assistance in transferring listings to your new account and/or from your old account seamlessly and effortlessly.
Important note: The buyer will retain the same reviews and rankings that each listing had under the seller’s account, because these are integrated into the listings and not the account itself.
7. Shipping Plan Updates
Once the buyer has access to the listings’ Brand Registry, the seller will need to send the shipping plan information to the buyer.
These details will include information from the manufacturer or supplier, such as the “shipping from” address, label sizes, quantity of cartons, dimensions of cartons and pallet (# and weight), and other details the buyer will need to relabel their products.
After receiving this information from the seller, the buyer will then need to update their Amazon account with these details and generate a new fulfillment network stock keeping unit (FNSKU). This is a unique label identifier that will now link the listing id to the buyer’s account rather than the seller’s.
8. The Buyer’s 3PL Relabels the Inventory
Now that the buyer has their inventory being relabeled with the updated details (at their own expense, mind you), inventory can now start being sent to the warehouse specified by Amazon when the shipping plan was created.
The buyer will start to ship their newly relabeled inventory to Amazon’s fulfillment center, and at the same time, the buyer can now begin to copy the seller’s listings over to their (still not yet active) account.
9. The Seller Sends Over the Pay-Per-Click (PPC) Details
Once the buyer has transferred all of the listings’ ASINs into their account and has relabeled inventory incurring storage costs at Amazon’s storage facility, the seller will send over all the details from their PPC ad campaigns.
Every single detail and option used for the buyer’s PPC accounts must be 100% identical to the seller’s. This is necessary to ensure prior to beginning the inspection period, as any deviation from the seller’s account will not qualify to begin this inspection period review.
Upon completion of setting up the buyers’ PPC ad campaigns to match those of the seller’s, the buyer is now ready to begin selling their inventory once they have a sufficient amount of stock within their account.
10. The Buyer Activates Their Account
Now that the buyer has relabeled products in their account, all of the listing details have been transferred over, and the PPC ad campaigns have all been duplicated, the buyer is ready to set their account to ‘active’ and begin selling their products.
As soon as the buyer has set their account to ‘active,’ the seller will then raise the price of their account’s product listing by at least $10. Now that the buyer is selling the same product for less than the seller’s listing, the buyer’s listing will show up as the primary listing and the inspection period begins.
11. Listing Transfer Inspection Period
During the 14-day inspection period, the buyer will need to keep a watchful eye on the revenue being generated to make sure they don’t drop more than the 50% threshold discussed earlier. After the inspection period is complete, the funds are released to the seller. The seller will then ship the inventory remaining from their removal order, and with that, the buyer will have complete ownership of the asset and all of their inventory.
It is worth noting that the buyer could also choose to void this inspection period if there are any sudden changes or improvements they wanted to get started on prior to its completion. We doubt that any seller would fuss about receiving their money sooner than later as well.
Key Differences Between Each Method and Takeaways
Whether you are acquiring an Amazon FBA Seller Central account or performing an Amazon listing transfer, the opportunities within this business model are endless.
The key to building a successful Amazon FBA business will lie in finding a great quality evergreen niche product in a growing market, with minimal competition, above-average margins, and a well-optimized business backend with minimal effort required to maintain it.
With an Amazon Seller Central account migration you save time, as the process to perform this method is far less labor intensive when you compare the overall requirements to complete it to a listing transfer, where you will need to create a new account and enter the ASIN and PPC details for each product manually.
Whichever method you happen to be performing during your Amazon FBA business acquisition, we know the process will be smooth for you, as we have a dedicated team of migration analysts in place to ensure this outcome for you.
If you are ready to begin the next leg of your digital journey to successfully own your own Amazon FBA business, it all starts with setting up a buyer’s call with one of our business analysts to get you on your way to gaining that profitable exit you’ve always planned on.
If you aren’t quite sure whether now is the best time to exit your Amazon FBA business in light of the current global economic trends, we have you covered there as well.
When you set up an Amazon FBA exit call with one of our seasoned business analysts, they can help you make all of the needed improvements on your business today. This way, when the day you are ready to exit does come, it will be a profitable one.