Amazon 1P to 3P: Why, When and How to Make the Move

Amazon’s market share continues to grow at the expense of traditional brick-and-mortar channels. Smartphone technology – and free two-day shipping – has forever changed how and where consumers shop. To reach Amazon’s hundreds of millions of customers, many brands and manufacturers begin by selling their products directly to, instead of on, Amazon. Often the formation of these first-party (1P) relationships, where brands and manufacturers act as the vendor or wholesaler and Amazon acts as the seller or retailer, are initiated by Amazon. But while Amazon 1P is the entry point to ecommerce for many organizations, some are evolving their online strategy to take advantage of the opportunities only a third-party (3P) relationship with Amazon provides. This article lays out the reasons why brands and manufacturers may want to consider stopping selling to Amazon and start selling on Amazon. It also suggests when and how to transition from being a first-party vendor to a third-party seller.

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