Brands can reach customers on Amazon in two fundamentally different ways. As a Vendor (first party, 1P) you sell wholesale to Amazon, which then sells to consumers. As a Seller (third party, 3P) you sell directly to consumers on the marketplace. Many brands combine the two – a hybrid model.

The main differences

Vendor (1P)Seller (3P)
Who sells to the consumerAmazonYou
Retail priceSet by AmazonSet by you
Your revenueWholesale price from AmazonRetail price minus fees
Commercial termsNegotiated with AmazonPublished fee structure
FulfilmentDeliveries to Amazon on purchase ordersAmazon fulfilment or your own
AccessTypically by invitationOpen to registered sellers

When Vendor can make sense

A Vendor relationship can suit brands with strong demand, established retail operations and a preference for selling in bulk rather than managing individual orders. The trade-off is less control over the retail price and assortment, and terms that must be negotiated.

When Seller can make sense

Selling as a Seller gives control over price, content and assortment, and a direct view of performance. It also requires more operational work: pricing, inventory, customer service standards and advertising all need active management.

Questions to answer before choosing

  • How important is control over the consumer price in your other channels?
  • What is your contribution margin under each model, after all fees and costs?
  • Do you have the capacity to run a Seller account day to day?
  • How would each model affect your existing retail and distribution partners?
  • Would a hybrid model – some products or markets on each – reduce risk?

The right model can differ by market and by product. Treat it as a decision to revisit as the business develops, not a one-time choice.