Amazon’s Latest Push: Shifting 1P Vendors to Seller Central

Earlier this week, a significant amount of Amazon vendors — the brand manufacturers that sell inventory directly to Amazon, who then in turn sells it to the end user — did not receive their usual purchase orders from the company.

Typically, Amazon has a consistent PO structure that they utilize for replenishment, so when these first-party (1P) vendors noticed that their usual bulk orders had not come in from Amazon, a wave of discussion coursed through the Amazon ecosystem.

Prior to this, some brands reported that Amazon suspended their Direct Fulfillment accounts last week. These brands, who are vendors that dropship product directly to customers on behalf of Amazon, received notice from Amazon that said the following:

“Your direct fulfillment warehouse has been suspended. As a result of the suspension, the inventory for all items in this warehouse is set to zero; no new orders will be sent until it is reinstated. If you have any open orders, please do ship them.”

Moreover, some vendors reported receiving the following notice from Amazon:

“I would like to inform you that our internal team has reviewed your business with Amazon and strongly believes that Amazon customers would be better served if your products were made available through Seller Central. As we are constantly looking for ways to improve the customer experience, we recommend you setup a seller account to continue your business with Amazon.”

When Digiday requested for commentary on the situation, an Amazon spokesperson replied and said, “We regularly review our selling partner relationships and may make changes when we see an opportunity to provide customers with improved selection, value, and convenience.”

So far, it seems that enterprise vendors, such as those generating multi-millions in annual sales on Amazon, have not been impacted by the changes. A commonality that the vendors Amazon suggested move to the third-party marketplace is that they all have an annual GMV of $10 million or less on Amazon.

If you are a vendor that has been affected by Amazon’s policy that dictates you are only to sell via Seller Central moving forward, Feedvisor can help you understand, optimize, and accelerate your third-party (3P) channel presence.

If you are a vendor that has been affected by Amazon’s policy that dictates you are only to sell via Seller Central moving forward, Feedvisor can help.

Feedvisor equips brands with the tools and expertise necessary to succeed on Amazon and enables real-time price optimization, strategic advertising campaign management, brand presence optimization, inventory replenishment management, fulfillment logistics, and SKU-specific conversion analysis.

This drastic shift in PO structure impacted thousands of vendors quite suddenly and more vendors are expected to be asked to move to the 3P marketplace over time. Whether you are a vendor or seller, it is critical to have a strategy in place to protect and preserve your business — Feedvisor provides the AI-powered technology and data-driven intelligence to help you maximize discoverability, sales, and profits on Amazon.  

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