The ultimate guide to

Amazon Vendor Central

If you are a business that already manufactures, sells or distributes consumer goods, partnering with a global retail superpower such as Amazon could be a smart and accessible way of accelerating your growth.

But what does it mean to become an Amazon Vendor and use the Amazon Vendor Central platform?

In this ultimate guide, we cover everything you need to know – from getting started with the platform, to the benefits of becoming an Amazon partner, and even leveraging Amazon Marketing Services to scale your business. We’ll also compare Amazon Vendor Central with Amazon Seller Central, as the two are distinctly different, but often get confused.

What is Amazon Vendor Central?

Simply put, Amazon Vendor Central is a streamlined platform that enables businesses to sell directly to Amazon.

With numerous benefits such as access to Amazon’s loyal customer base and simplified logistics through the firm’s fulfilment centers, it provides an opportunity for consumer goods businesses to sell their products in large quantities, directly to Amazon, which then sells the products on Amazon.com.

What are the benefits of using Amazon Vendor Central?

1. Large and loyal audience

   When you become an Amazon Vendor, you gain access to Amazon’s global customer base, significantly increasing your brand exposure and creating additional opportunities for sales.

2. Security of wholesale

   You also benefit from the wholesale nature of selling into Amazon – rather than relying on your own marketing and sales channels, by selling in bulk to a single large customer, you guarantee income at scale and, as the relationship progresses, may be able to negotiate favourable sales terms.

3. Simplified logistics and inventory management

   Good inventory management is crucial for any efficient sales operation, but the benefit of becoming an Amazon Vendor is that a lot of the responsibility for inventory management is assumed by Amazon.

   While you are responsible for delivering goods to Amazon at the quantity and on the timeline agreed, Amazon takes care of the rest, including re-ordering stock from you if inventory is running low. This can alleviate considerable stress, particularly if you are fast-growing and do not have customer service, logistic and supply chain functions in-house.

4. Data insights

   Amazon Vendors retain access to all their sales data – and in much greater detail than is available to Amazon Sellers. This information can be used to inform the strategy of your Amazon operations, but potentially be leveraged to influence your approach across other channels too.

5. Strength of an established e-commerce partner

   Finally, Amazon Vendors can leverage tools such as Amazon Marketing Services and Amazon Vine to further enhance the visibility of their brand and build credibility.

What are the disadvantages of the Amazon Vendor program?

While selling into Amazon has many benefits, it can have its downsides too.

For example, Amazon Vendors usually have limited control over pricing and promotions, as these details are part of the initial sales agreement that you make with Amazon.

You might also experience delays in payment processing, which can have a significant impact on cash flow if you are awaiting payment for a large order from Amazon.

There can also be broader challenges associated with the Amazon Vendor business model. For example, if you are heavily reliant on Amazon as your single largest customer, this comes with its own risks and can make it difficult to secure external finance to further grow your business, due to many lenders’ concentration restrictions. In these instances you will need to find a specialist lender that is experienced at supporting Amazon Vendors.

The difference between Amazon Vendor Central and Amazon Seller Central

Amazon Vendor Central and Amazon Seller Central are two distinct platforms offered by Amazon. While both platforms involve selling products on Amazon, there are key differences between them.

Amazon Vendor Central
Amazon Vendor Central is designed for retailers, manufacturers and distributors that sell directly to Amazon, usually in bulk. Amazon then assumes responsibility for the sale of these goods to the end consumer.

Amazon Seller Central
Amazon Seller Central is for individual sellers and businesses that want to sell their products via Amazon’s marketplace. Here, the business or individual retains responsibility for generating their own sales.
You can read more about the differences between the two here.

How to register for an Amazon Vendor Central account

Becoming an Amazon Vendor is not as simple as applying for an account, as the platform is invite-only (unlike registering for an account on Amazon Seller Central).

Amazon’s global team of vendor recruiters will issue you an invite to join if they deem your business a good match for their criteria. This will include factors such as a strong product offering and a clear ability to consistently generate sales – they might look at particularly successful Sellers on Amazon Seller Central, as well as meet businesses through more traditional routes such as trade shows.

Once you’ve been invited and if you agree to Amazon’s terms, an Amazon account manager will grant you access to an Amazon Vendor Central account and you can start selling into Amazon directly.

How to build a successful partnership with Amazon

Building a collaborative partnership with the Amazon team is crucial for maximizing the benefits of being an Amazon Vendor.

1. Establish regular communication

   Regularly communicate any changes to your business that might impact the relationship with Amazon – this could be good news, such as additional products in your catalog – but also any challenges that arise, such as supply chain disruptions. Being honest and upfront about these issues means that they can be mitigated sooner.

2. Utilize Amazon’s expertise

   Seek the guidance and expertise of your Amazon representative in navigating the platform, the processes involved with being a vendor, as well as any changes that could impact you. They know best and will be able to signpost you to tools that will further enhance your partnership.

3. Be positive and professional

   A good relationship with a large retailer such as Amazon can be transformative to your business. By maintaining a positive and professional partnership, even when challenges arise, you’ll build trust and loyalty, which helps both sides of the partnership to succeed.

How to scale your business on Amazon as a vendor

Securing wholesale scale customers such as Amazon could mean significant growth in your sales volume, so the partnership in itself can be a large stepping stone on your scale-up journey. But becoming an Amazon Vendor offers additional opportunities for your business to grow.

Access to the Amazon Vendor platform means your products are being seen by a much wider audience, enhancing brand awareness and positive brand affinity.

Becoming an Amazon Vendor can also streamline your supply chain, alleviating the pressures of stock management, distribution and customer service. This means additional time and resources can be used elsewhere, such as diversifying your product suite, conducting market research or investing in marketing campaigns.

Selling into Amazon also opens the door to opportunities to sell into other large retailers such as Walmart and Target, further expanding your brand reach and access to customers.

Amazon Vendor Central: A great opportunity for growth

Becoming an Amazon Vendor could be an excellent opportunity for growth if you are already a business that sells, distributes or manufacturers consumer goods. However, it can come with its own challenges, particularly if you need to raise external finance.

If you would like more information about funding for Amazon Vendors, our team of lending experts are on hand to help – simply book a call, or use our contact form to get in touch.