By Martin Heubel, Amazon Strategy Consultant at Consulterce
Moving from 1P to 3P is a hot debate among Amazon vendors right now. Unfortunately, I keep hearing reasons that do not justify a switch to a hybrid or full 3P model at all.
For example:
- Bypassing capacity constraints,
- Avoiding price-matching, or
- Escaping vendor negotiations
All these are no valid reasons to change from 1P to 3P.
Amazon does not prioritise 3P over 1P inventory in its warehouses and may also suspend the Buy Box for prices from sellers that are not competitive.
Without a crystal clear business case, most vendors underestimate the number of tools and mechanisms they have to manage themselves when moving to 3P.
This can crush your operation and overwhelm your teams from one day to the other.
Worse, you’ll have to invest in external agencies that can make up for the lack of knowledge within your business.
So if you are planning to switch to 3P:
Do it for the right reasons, and make sure you hire Amazon experts with 3P/FBA experience well ahead of time.
Avoid the 3P shiny object syndrome.
For further information and support, contact Martin Heubel here
