Skip to content
English
Go to merchantspring.io
  • There are no suggestions because the search field is empty.

What is the difference between an Amazon Vendor and an Amazon Seller?

Understand how Amazon Vendor and Amazon Seller differ across inventory ownership, customer sales, pricing, fulfilment, payments and reporting.

Amazon Vendor and Amazon Seller are two different ways for a business to sell products through Amazon.

The simplest distinction is:

  • An Amazon Vendor sells products wholesale to Amazon. Amazon then resells those products to customers.
  • An Amazon Seller sells products directly to customers through Amazon’s marketplace.

These are commonly described as:

  • 1P or first-party: Amazon Vendor
  • 3P or third-party: Amazon Seller

The difference is based on the commercial relationship and who sells the product to the customer—not simply who stores or ships the inventory.

What is an Amazon Vendor?

An Amazon Vendor is a manufacturer, distributor, brand or supplier that sells products wholesale to Amazon.

The relationship is generally managed through Vendor Central. Amazon issues purchase orders requesting specific products and quantities from the vendor. The vendor accepts all or part of the request and supplies the agreed inventory under its commercial terms with Amazon.

Once Amazon purchases the inventory, Amazon generally takes ownership of it and resells it to customers through the Amazon store.

In the traditional Amazon Retail model:

  • Amazon issues purchase orders to the vendor
  • The vendor supplies inventory to Amazon
  • Amazon purchases and owns the inventory
  • Amazon stores the purchased stock within its fulfilment network
  • Amazon determines the customer-facing retail offer
  • Amazon sells the product to the customer
  • Amazon fulfils the customer’s order
  • The vendor receives wholesale revenue from Amazon

The vendor’s customer is effectively Amazon, rather than the individual consumer purchasing through the Amazon store.

Amazon Vendor example:

Amazon issues a purchase order requesting 1,000 units from a brand.

The vendor accepts 900 units and ships them to Amazon. Amazon receives the stock, holds ownership of the purchased units and sells them to individual customers.

The vendor invoices Amazon according to the wholesale arrangement. The amount ultimately received may also be affected by negotiated terms, rebates, deductions, shortages, chargebacks and other Vendor-related costs.

How does Direct Fulfilment work for an Amazon Vendor?

Not all Vendor inventory must be stored and shipped by Amazon.

Under Direct Fulfilment, Amazon remains the retailer and sells the product to the customer, but the vendor stores the inventory and ships individual customer orders directly on Amazon’s behalf.

This is sometimes called a drop-ship model.

With Direct Fulfilment:

  • Amazon remains the customer-facing retailer
  • The vendor holds the physical inventory before the order is placed
  • Amazon sends the customer order to the vendor
  • The vendor picks, packs and ships the order directly to the customer
  • The vendor must meet Amazon’s dispatch, packaging, tracking and delivery requirements

Direct Fulfilment does not turn the vendor into a third-party seller. It remains a 1P arrangement because Amazon is still selling the product to the customer.

What is an Amazon Seller?

An Amazon Seller is an independent business that lists and sells products directly to customers through Amazon’s marketplace.

The relationship is generally managed through Seller Central. The seller owns the inventory until it is sold and is responsible for managing its marketplace offer.

Amazon provides the marketplace and may also provide services such as fulfilment, storage, advertising, customer payments and returns processing.

An Amazon Seller generally:

  • Owns the inventory until it is sold
  • Creates and manages its Amazon listings and offers
  • Sets or controls the selling price, subject to Amazon’s marketplace requirements
  • Sells directly to the customer through Amazon
  • Receives the customer sale revenue less applicable Amazon fees, charges and adjustments
  • Manages inventory availability and replenishment
  • Chooses how customer orders will be fulfilled

The seller’s sale is therefore based on the retail transaction with the customer, rather than a wholesale purchase order from Amazon.

Amazon Seller example:

A brand lists a product for $50 through Seller Central.

When a customer purchases the product, the brand records the marketplace sale. Amazon processes the transaction and deducts the applicable referral, fulfilment, storage, advertising or other fees.

The remaining amount is included in the seller’s Amazon settlement.

How can Amazon Seller orders be fulfilled?

Third-party sellers commonly use one or both of the following fulfilment methods.

Fulfilment by Amazon

With Fulfilment by Amazon, or FBA, the seller sends its inventory to Amazon’s fulfilment network.

The seller continues to own and sell the product, while Amazon:

  • Stores the inventory
  • Picks and packs customer orders
  • Ships orders to customers
  • Manages much of the delivery experience
  • Processes returns according to the applicable FBA arrangements

Amazon is providing a fulfilment service to the seller. Amazon holding and shipping the inventory does not make it a Vendor or 1P transaction.

Fulfilled by Merchant

With Fulfilled by Merchant, or FBM, the seller stores and fulfils the inventory itself or uses its chosen third-party logistics provider.

The seller:

  • Holds the inventory outside Amazon’s fulfilment network
  • Receives customer orders through Amazon
  • Picks, packs and ships each order
  • Provides tracking information
  • Manages fulfilment-related service and returns
  • Remains responsible for meeting Amazon’s delivery and performance requirements

FBM is still a 3P model because the third-party seller—not Amazon—is selling the product to the customer.

Amazon Vendor and Seller comparison

Area Amazon Vendor or 1P Amazon Seller or 3P
Commercial relationship The vendor supplies products wholesale to Amazon The seller uses Amazon’s marketplace to sell directly to customers
Primary platform Vendor Central Seller Central
Who purchases from the business? Amazon The end customer
How demand is initiated Amazon generally issues purchase orders Customer orders are placed through the marketplace
Who owns the inventory before Amazon purchases or the customer sale occurs? The vendor owns it until it is purchased under the applicable Vendor arrangement The third-party seller owns it until it is sold to the customer
Who sells to the customer? Amazon The third-party seller
Who controls the retail offer? Amazon generally controls the customer-facing retail offer The seller generally manages its own offer and selling price
How the business earns revenue Wholesale sales to Amazon Retail marketplace sales to customers
How orders can be fulfilled Amazon Retail or Direct Fulfilment FBA or FBM
Common costs and adjustments Commercial terms, rebates, deductions, shortages and chargebacks Referral fees, fulfilment fees, storage fees, advertising costs, refunds and other marketplace charges
Common operational focus Purchase-order acceptance, receipt rates, shortages, deductions, Sell-In and Sell-Out Sales, fees, advertising, inventory, settlements and account performance
Common profitability measures Raw margin, net PPM and Vendor profitability Product or order profitability after marketplace costs

What is the key difference?

The key difference is who sells the product to the customer.

With Amazon Vendor

The commercial flow is generally:

Vendor → Amazon → Customer

The vendor sells wholesale inventory to Amazon. Amazon then resells it to the customer.

With Amazon Seller

The commercial flow is generally:

Seller → Customer through Amazon’s marketplace

The seller sells directly to the customer, while Amazon supplies the marketplace and any selected support services.

Fulfilment does not determine whether a business is 1P or 3P

It is important to separate the selling model from the fulfilment method.

Amazon may physically fulfil orders in both models:

  • Amazon Retail: Amazon owns, sells and fulfils the product.
  • FBA: The third-party seller owns and sells the product, while Amazon fulfils the order.

A business may also physically fulfil orders in both models:

  • Direct Fulfilment: Amazon sells the product, while the vendor ships it on Amazon’s behalf.
  • FBM: The third-party seller sells and fulfils the product.

This means the location of the inventory or the party shipping the parcel does not, by itself, identify the commercial model.

Can a business operate as both a Vendor and a Seller?

Yes. A business may operate a hybrid Amazon model.

For example, a brand may:

  • Supply established products wholesale to Amazon through Vendor Central
  • Sell other products directly through Seller Central
  • Use FBA for some Seller inventory
  • Use FBM for oversized or specialist products
  • Use Direct Fulfilment for selected Vendor products

Because the same ASIN may appear in different commercial and fulfilment arrangements, users should confirm the relevant account, store and reporting model before comparing performance.

Why does the distinction matter in MerchantSpring?

Vendor and Seller accounts use different source data, terminology and reporting logic.

Amazon Vendor reporting may include:

  • Purchase orders
  • Submitted, accepted and rejected quantities
  • Receipted quantities and shortages
  • Sell-In and Sell-Out reporting
  • Vendor codes
  • Commercial terms, deductions and chargebacks
  • Raw margin and net PPM

Amazon Seller reporting may include:

  • Ordered product sales
  • Units sold and customer orders
  • Amazon settlements
  • Referral and fulfilment fees
  • Advertising performance
  • FBA and FBM activity
  • Seller-owned inventory
  • Product and order profitability

When investigating a discrepancy or explaining a report, first confirm:

  1. Whether the account is Vendor or Seller
  2. Whether the activity is 1P or 3P
  3. Which fulfilment method applies
  4. Which marketplace, store and reporting period are selected
  5. Whether the comparison uses the same commercial and operational scope
Need help?

Contact support@merchantspring.io and include the relevant company, marketplace, account or store, reporting period and any helpful screenshots or exports.