Curious about transitioning from vendor to seller? A five-step plan

12 April, 2021
4 minute read
how to transition from amazon vendor to seller 1

As a vendor who might be seeing changes to Vendor Central and processes, you may be curious about selling on Amazon's Seller Central platform as a backup strategy for your business. If you’re wondering what might happen to your vendor relationship if Amazon changes its policies or stops raising POs — especially with recent issues during the ongoing global pandemic — it may be prudent to investigate spreading your risk when it comes to working with Amazon.

Whether by the vendor’s choice or because Amazon has decided to not continue the relationship, some vendors are looking for more information on their options. A natural contingency plan for worried vendors may be creating a seller account on Amazon. This might look like a hybrid approach or a full transition from vendor to seller.

Here are the steps to take when setting up your seller business on Amazon, tailored to vendors.

Step 1: Create an account in Amazon’s Seller Central

Unlike Vendor Central, those wishing to sell on Amazon’s marketplace don’t need an invitation. Seller Central is a self-service management tool that is open to everyone, and it’s easy to open an account in your locale. The timeframe for getting set up can take several weeks because Amazon will need to verify documents and information. Be sure to take this into account when considering your business's timeline.

Certain Amazon categories require approval, such as Grocery & Gourmet food. See the full list here. Gated categories and products will require documentation when applying. The specifics will depend on if you are the brand owner, reseller, or manufacturer.

Step 2: Enroll in Amazon’s Brand Registry

All brands with a registered trademark should enroll in the Brand Registry as soon as possible. The Amazon Brand Registry allows registered brands greater control when it comes to their brand and offers a range of benefits. This means more access to controlling product listings and information, intellectual property rights violations, and more. Plus, Brand Registry sellers get access to additional features, such as A+ Content, Brand Stores, Sponsored Brands, and the Early Reviewer Program. If you are creating a new Brand Registry account, this may add even more time to your setup, as it will need to be linked to your seller account. Again, take this into consideration when considering your business's timeline.

Step 3: Order fulfillment setup

On Amazon, there are a few different options for how you will fulfill customer orders. These are Fulfillment by Amazon (FBA), Seller Fulfilled Prime, and Fulfillment by Merchant (FBM).

If choosing FBA, you will send your inventory to an Amazon Fulfillment Center.  Amazon will then manage orders, returns, and customer service for the items on a seller's behalf.  To facilitate this, Amazon charges a small fee. This method is popular. It allows for the best sales traction, as products are eligible for Prime and attractive to customers for fast, free shipping. Most customers do not even realize there is a difference between FBA and vendors.

Seller Fulfilled Prime is when sellers ship products to customers from their own warehouse. These products are still potentially eligible for Prime delivery. Choosing this option may cut down on costs for sellers. But, the seller must prove they can ship according to Amazon policy and standards, or Amazon will not allow this option.

Finally, there is FBM. Sellers who choose this fulfillment method will be responsible for shipping products directly to the customer from their own warehouse using their own methods. Prime shipping is not an option with FBM, so sellers who go this route often miss a big segment of customers who enjoy Prime memberships. FBM is a good choice, however, for large or bulky products. Heavy or big items result in greater shipping and storage fees, so it may make sense to ship directly to the consumer instead of double shipping and storing with the seller and then with Amazon.

Step 4: Create or transition Amazon Advertising

Vendors and sellers can set up advertising in Amazon Advertising. When adopting a hybrid approach, you will need to manage and strategize with your advertising approach. Sponsored Products will only run when you win the Buy Box, whereas Sponsored Brands will run even if you are not. As a result,  if you are a seller winning the Buy Box but your Sponsored Product ad was set up with your vendor account, it will not run. It is best practice to use the Amazon Ads account with the seller or vendor account you plan to use.

Step 5: Manage your account well

Selling on Amazon is very different than being a vendor. Seller Central requires more time and direct management than what you might be used to in Vendor Central. Sellers must handle inventory, control the retail side, deal with customer service, and the fulfillment of orders.  Choosing the FBA side can help reduce some work, but it is still more high-touch than being a vendor. Training your team and creating a strategy for managing your business is important.

If you have struggled to get reviews, you may also consider enrolling in Amazon Vine in Seller Central. Amazon Vine is free for Professional Sellers (whereas for vendors, there is a fee to enroll). This program will allow you to get legitimate reviews from trusted reviewers. Additionally, the seller platform allows you to use FeedbackFive. This is an external tool that is not available on Vendor Central, but it integrates well with Seller Central. If you need more reviews, this is a good place to start.

Lastly, if you are a current vendor with Amazon (especially a larger one), Amazon may be reluctant to lose you from the retail side. Be prepared to argue your case and back it up with data. You will also need to avoid direct competition and conflicts of interest with Amazon’s retail side.

Need more help?

Though there are many considerations, it is important to consider if Seller Central is a part of your future on Amazon. If you are interested in a hybrid approach or moving to Seller Central and need assistance, please contact us.  Experts at eCommerce Nurse can help you with the right approach for your specific business and goals.

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Carina McLeod

Carina McLeod

Carina spent over seven years working in Vendor Management at Amazon UK and now is the CEO and Founder of eCommerce Nurse and Vendor Society. Carina loves sharing her Amazon knowledge and helping vendors and sellers grow their business on Amazon.

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