How to Become a Vendor Seller on Amazon?

How to become a Vendor seller on Amazon? Keep reading our blog to get the answers to questions like what is Amazon Vendor Central and more!

Amazon is among the most preferred marketplaces both in our country and in the world. While shopping on Amazon or examining your competitors, you must have seen the phrase "Sold and shipped by Amazon.com." The reason for this expression is the Amazon Vendor system.

What is Amazon Vendor?

Amazon offers you two methods to make sales. The first of these is the most well-known Seller Central, and the second is selling through Vendor, which is less known. In Vendor, you become a supplier to Amazon, and Amazon purchases your products. It asks you to send them to its warehouses, and in this way, your product is sold.

Who is an Amazon Vendor Seller?

Businesses that can sell their products to Amazon thanks to the invitation they receive from Amazon are called Vendor sellers. This process starts with Amazon sending you an order on certain days of the week. It then ends with you preparing the orders and sending them to the requested warehouses. You can receive the payment for your goods within a period of 45 to 90 days.

How to Start Vendor Selling?

Unfortunately, becoming a Vendor seller is not up to the initiative of businesses, and one cannot become a Vendor with just any application. The general characteristics of sellers who receive a Vendor invitation on Amazon are as follows:

• Brands that are exposed to intense interest from shoppers on the site

• Amazon sellers who are successful in their field with their own products

• Brands with products that Amazon finds in its trade shows or research that catch its attention

The process generally starts with an email. In this email, Amazon says that it is interested in selling your products and creates an offer by evaluating your business model and profitability. Within the framework of the offers you accept, your supply process of the relevant products to Amazon begins. If you are not a very large company and they have not made an authorized appointment, Amazon behaves with a very low probability of adding a new offer if the offers are not accepted. If you accept Amazon's terms, Amazon will create your Vendor account and enable you to log in. Once you are involved, what you need to focus on is staying faithful to your agreement with Amazon, making the improvements it requests, and not disrupting the supply issue.

What is Amazon Vendor Central?

Amazon Vendor Central is the panel where products, orders, marketing activities, and invoices are controlled after receiving a Vendor invitation on Amazon. This panel is an interface belonging only to Vendor sellers who are suppliers on Amazon; you cannot register, you can only join by invitation.

What Can We Do in Amazon Vendor Central?

Vendor Central is the only place where a direct connection with Amazon is established, and all transactions are carried out through this panel.

The areas you will use in the panel and their features are as follows:

• Orders: The section where you see incoming purchases and where you need to ship them.

• Products: The section where modifications related to products such as images and price updates are made.

• Marketing: The marketing-related section where we can use features like Amazon Vine and A+ Content.

• Advertising: The section reserved for you to run advertising campaigns for your products.

• Reporting: The place where you can see how you are doing in your business.

What is the Difference Between Vendor Central and Seller Central?

Vendor Central is the process of Amazon buying and selling your products, meaning it uses the seller as a supplier, and those who use this model become 1st-party sellers. In Seller Central, you use Amazon as a marketplace and try to sell your products to Amazon visitors. In the Amazon Vendor system, Amazon names you as a 3rd-party seller, not as its supplier. Amazon allows you to be two types of sellers in Seller Central. The first is FBM (Fulfilled by Merchant), where you handle the shipping, storage, and return processes of the products yourself, and the second is the FBA (Fulfilled by Amazon) method, where you transfer all these processes to Amazon and it takes care of them.

Seller Central

• Open to everyone.

• Businesses sell to Amazon's customers/visitors.

• The business determines the sale price.

• The company is free in terms of fulfillment.

• Advertising options are limited.

• Complex sales process.

• Enhanced brand content.

Vendor Central

• Participation is by invitation only.

• Amazon itself purchases.

• Amazon determines the sale price.

• Fulfillment is done by Amazon.

• Multiple advertising options are available.

• Traditional sales process.

• A+ content support.

Pros of Vendor Central

• The fact that the products are sold by Amazon gives trust to the customer, and we can say that this has a positive effect on sales.

• Amazon's marketing services are broader compared to Seller Central.

• Vendor Central means dealing with Amazon only as a buyer. On the other side, you might have to deal with thousands of customers.

Cons of Vendor Central

• Since products are sold to Amazon in bulk, you cannot intervene in how much Amazon sells your products for.

• Amazon imposes serious sanctions when it faces issues with the supply of its orders. Situations that reduce your profitability may be encountered.

• Not diversifying sales channels is one of the biggest threats to a business. Vendor Central can also be risky since Amazon is your sole customer. As a matter of fact, it suddenly stopped purchasing products from some sellers in recent years, so it is necessary to be aware of this.

• Since the sale of products is done entirely by Amazon, a loss of brand control occurs, and non-personalized packaging can make it difficult for you to stand out from your competitors.

Pros of Seller Central

• Free analytical data offered by Amazon for sellers contributes to sellers defining better strategies.

• Pricing is completely under your control. In addition, you can apply different policies in other marketplaces to increase your profitability.

• Since stock control is completely on the seller, there is no risk of facing any sanctions.

Cons of Seller Central

• If companies do not have enough sales and marketing knowledge, reaching thousands of customers can be difficult.

What is the Difference Between Amazon Vendor Seller and Standard Seller?

Being an Amazon Vendor and a standard seller are very different business models. When building the business model of your business or the business you plan to establish, choices are completely about what kind of company model you have built. While Vendor selling is more preferable for company structures that are suitable for wholesale and can handle this, Seller Central is preferred by sellers aiming to proceed with dropshipping in standard selling. Therefore, it is not very possible for companies engaged in standard selling to easily adapt to the Vendor side. Since there are many parameters you need to examine regarding this, it would be beneficial to plan in advance how you will sell and distribute your products.

What is the Difference Between Vendor Selling and FBA Selling?

Both sales types are likened to each other because they are sold by Amazon, but there are important differences. We shared in the first paragraph of our blog that in the Vendor sales type, Amazon buys your products and places you in a supplier position. Here, you turn Amazon into your customer by selling your products to them. However, in the FBA sales method, you are a seller and want to benefit from Amazon's visitors. While displaying your products here, Amazon manages activities such as storage, shipping, receiving returns, and customer service for you. Here, you are still the seller and your customers are Amazon's visitors.

Similarities between Vendor and Fulfillment by Amazon:

• Inventories are held in Amazon warehouses.

• Amazon takes care of customer service.

• Contribution to Amazon Prime sales is possible.

Differences between Vendor and Fulfillment by Amazon:

• Since sales in FBA are done through us, we can see the data. In Vendor, our customer is only Amazon, and we do not see any data.

• In FBA, Amazon stores the products for us and we receive services, but in Vendor selling, Amazon buys the products from us and becomes the new owner.

• While only the payment for sold products is received in FBA sales, payment for all products is received in Vendor sales because they are all purchased from you.

• In FBA, we determine the sales price of the products and a commission is paid to Amazon as sales are made, but in Vendor, Amazon determines the final prices, and if we accept, the price of our wholesale is received.

We examined Vendor as a different technique for selling on Amazon, along with its differences from other Amazon sales models. You can work on producing strategies that will attract Amazon's attention to sell your brand as a Vendor. Whether you sell to Amazon as a Vendor or to your overseas customers via Seller Central, as Navlungo, we will continue to be your biggest supporter in both processes for your cargo and logistics operations.

You can also check out our blog content where we explain what the Buy Box on Amazon is and its importance, which might interest you.