Vendor central is invite-only and makes you a first-party seller. Amazon places large purchase orders for your products and then sells these on their platform. A third-party Seller Central account leaves you in control of virtually every aspect of the selling.
A lot of people assume that once you have been invited to sell directly to Amazon, you are in the big leagues and that this is the ideal way to conduct your business. To become an Amazon Vendor is quite sought-after. Actually, there are pros and cons to both Vendor Central and Seller Central. A combination of both might even be required to get the best results.
A lot of people are looking for advice on using Seller Central having been an Amazon Vendor already. This is due to the fact that there has been a so-called “purge” of many first-party suppliers. Orders have been cancelled, and some vendors are left wondering how they can continue to sell their products on Amazon without the direct orders from the company.
Before diving into the transition, it helps to recognize some of the differences between the two. Becoming an Amazon Vendor might be ideal for your business, but on the other hand, the control of a Seller Central account can open up some exciting possibilities.
Check out the simple comparison below.
First-party selling platform. You are selling to Amazon.
Third-party. You sell to Amazon’s users and straight to the consumer.
Great for using the trust and reputation Amazon has built up with users.
You need to build up product listings and gain traction for your products, including obtaining reviews.
Not much control over pricing or other aspects.
Lots of control over pricing, and even how the items are shipped to customers.
No contact with your customers, Amazon handles all of this.
Plenty of direct contact with the customer possible.
If you want to check out more about these differences, you can read our full comparison.
Having to shift to selling third-party is not necessarily something existing vendors should fear. The graph below shows the share of third-party items sold on Amazon, which continues to grow. It is clear that plenty of companies are experiencing high levels of success.
So, whether you have become an Amazon Vendor but want to control some of your own listings or you have decided that Vendor Central is not the way for you to proceed, you can follow the steps below to perform a full transition, with the opportunity to make more decisions about your products.
As vendors have been hand-picked, so to speak, they will have a contact within Amazon and a contractual agreement with the company. Reach out and let them know that you plan to move away from Vendor selling and towards managing your own products via Seller Central.
If you are going to sell the same products then this can definitely cause a conflict if you don’t alert Amazon, even if they have stopped placing orders.
Those who have a Vendor account are often surprised at just how simple the initial setup of a Seller Central account is. It doesn’t require an invitation, just some simple information about your business.
Seller Central makes it quick and easy to create your account. There are fees attached, explained in detail here. The membership fees start at $39.99 but if you do plan to just start dipping your toe in selling on Amazon you can pay on a per-item-sold basis instead. This really limits sellers, so most who have been Vendors previously will be looking to get the professional plan.
Brand Registry gives you more control over your products and other benefits. For instance, some features get rolled out to brands in the Registry program quicker than they would to other sellers.
If you have a registered trademark, this is an absolute must. To qualify, you need to be able to prove a trademark. More of the benefits of the program are explained on Amazon’s platform, as well as the eligibility requirements:
“To be eligible for Amazon Brand Registry, your brand must have an active registered trademark in each country where you wish to enroll or have a pending trademark application filed through Amazon IP Accelerator. Brand Registry is also accepting brands that have a trademark pending registration in a subset of trademark offices.”
You may have heard people discuss “FBA” and “FBM” in the context of selling on Amazon. These refer to the options for fulfilling the orders.
FBA is popular among sellers who shift large volumes. It stands for “Fulfilled by Amazon” and this means that you ship the products to Amazon and they take care of shipping the orders. This is a much more automated system, ideal for those who don’t want to manage shipments every day. The FBA system can even take care of things like returns and exchanges for you. There are fees for using their warehouses, or if your items don’t sell, but they are often worth it for the extra time this buys sellers.
FBM means “Fulfilled by Merchant” and this means that when an order is placed, you need to handle getting it to the customer, as well as any aftercare that might be required. For larger volumes, this can be a big undertaking.
Amazon is on target to hit over 1 million new sellers this year on its marketplace, with over ¼ of these selling in the US. 73% of new sellers choose to use the FBA program for its added convenience.
If you choose to go along with the majority and opt for the FBA route, you will need to ship a high volume of your units to Amazon’s fulfillment centers for them to process as required. Amazon explains that the process is to “create your shipping plan, print Amazon shipment ID labels, and send your shipments to Amazon fulfillment centers”.
Within Amazon, you can make the most of the advertising platform to boost sales. Both vendors and sellers can take the approach of “sponsored product” listings, which means that you can boost sales through ads within Amazon’s searches. To do this, you have to “win the buy box”. On every listing, there is a buy box, and if multiple vendors are selling the product then you need to “win” this. You do this by offering quicker shipping, better prices, and more.
From this position, your ads should boost your sales. There is a fine art to advertising within your Seller Central account, and vendors may not have had to deal with much of this before, so be prepared to put in some groundwork.
If you are a seller that is currently winning the buy box, but the ad was set up with the vendor account, it won’t continue to run. This is why it is so important to make sure you use the seller or vendor account that is active, even if you take the approach of keeping your vendor account running.
By the time you reach this link in the chain, you will hopefully be making sales. For a vendor transitioning, it can take time to reach high levels of revenue. According to JungleScout, new sellers make an average of $42,000 yearly, but you need to keep your account in good health to get anywhere near that.
“Account Health” is a metric that measures how well you are managing things like controlling your stock and handling inventory, plus dealing with customers. If you are using FBM, the fulfillment of orders also comes into play. If you consistently get bad reviews or fail to ship and deliver on time, you may find your account health slipping and your sales suffering as a result.
Though the Early Reviewer Program is gone, those who struggle with reviews can use tools including Amazon Vine or FeedbackFive which help you to get your products to trusted and prolific reviewers, who are likely to leave feedback. This can boost your health and sales. Remember that keeping your account in good standing is an ongoing process.
In a sense, those transitioning from Vendor to Seller Central are having to start again with Amazon, and though this represents a challenge, it also presents an opportunity for more control, better sales, and new products.
Follow our tips to transition from Vendor to Seller Central as easily as possible, and keep your account in strong health to ensure you build trust with both Amazon and the consumer.