The best of both vendor and seller accounts combined in the Amazon Hybrid model
Brands have different options when it comes to selling their items on Amazon. You can choose between an Amazon Vendor Account or an Amazon Seller Account. But there’s also a third option few people know about: The Amazon Hybrid model. Read on to see if this is the right option for your business.
Amazon Seller account vs. Amazon Vendor account
Most companies opt for an Amazon Seller Account. Why? Because any retailer can quickly sign up in minutes and start selling their products or services via the Amazon marketplace as third-party retailers (3P). This option gives you much control over your inventory, product selection, and access to powerful analytics in addition to Amazon services such as Fulfilment by Amazon (FBA). You are making your selling and logistical process a bit easier.
An Amazon Vendor Account is an invitation-only platform for brands that want to sell their products to Amazon directly. Meaning you’d be a first-party retailer (1P). As an Amazon vendor, you’d sell your products in bulk directly to Amazon. The online retailer is then responsible for selling them to shoppers worldwide. They set the selling price and handle all logistics.
Amazon Hybride Model
Amazon’s Hybrid model is the best of both worlds as it allows you to have a role as a seller and a vendor. So not only do you sell via the Amazon marketplace as a third-party seller but also directly to Amazon as a first-party seller. Thus increasing your sales opportunities while reaching an ever bigger target audience. But there are even more advantages than that:
1. Always have products in stock
As a vendor, you are dependent on Amazon putting in order requests with you. But that is not always guaranteed a steady income. And if Amazon stops ordering your products, you could lose your place in the Amazon Buy Box. But by adopting a hybrid selling strategy, you can always recoup your losses by also selling your products on the Amazon marketplace. Meaning you are not entirely dependent on Amazon to buy your products and always have a plan B you can quickly turn to.
2. Control over logistics and pricing with access to data
You have no control over your content or logistics as an Amazon vendor. However, that’s not the case as an Amazon seller. As a seller, you control how your product and brand look and feel. You can also choose to set up your preferred logistic and shipping method if you opt for a Fulfilment by Merchant option. So you can even ship items labeled as “dangerous” by Amazon.
As a seller, you also decide on your items’ prices. An aspect that’s not possible if you only sell via Amazon’s vendor program. This additional control over your products and content is the significant advantage of having a seller account.
Lastly, an Amazon seller account offers access to a treasure trove of data about your products and potential customers.
3. Faster product listing
Amazon Vendors get to sell to the online retailer in bulk. However, it can take some time before your items are listed, as they have to be vetted by Amazon. By having a seller account on the side, you can list your products immediately and start making a profit quicker.
Appropriate strategy
The benefits of Amazon’s hybrid model are clear, especially for Amazon vendors. But to take advantage of this opportunity, developing a smart strategy is important. Because if you mirror your item selection and price across both accounts, Amazon will remove you from the platform.
To begin, you need to know how both the Amazon vendor and Amazon seller accounts work, what conditions are attached to each and how to best manage them. Given that you cannot copy and paste your item selection and prices from Amazon to the marketplace, a diverse product range is required.
Consider which account to use for which products you offer. For example, you launch a new product. It makes sense to start selling it via your Seller account on the Amazon marketplace so that you can control the marketing around the item in addition to collecting data about the customer. If the item is a hit and you’ve been offered a spot as an Amazon vendor, you can remove it from the marketplace and sell it in bulk to Amazon, knowing that this product is quite popular.
Seller vs. vendor – which products to sell where
A vendor account is ideal for selling your most popular products, of which you carry a large stock. You can continuously supply Amazon with large quantities and be sure they will sell. However, seasonal items or limited edition products are best sold via the Amazon marketplace. It allows you to quickly launch them and control the price and content. Also, you can’t expect Amazon to order seasonal items in advance. In this way, you can sell in a more agile manner.
Alternatively, if you sell large electronics such as washing machines and individual parts, it would make sense to sell the bigger item in bulk to Amazon and the specific parts via the marketplace. There is no standard demand for these smaller items, and if returned, you can still refurbish them and sell them again via the Amazon marketplace.
Products that are not necessary all year round or need continuous stock are perfect for selling via your Amazon seller account. This gives you more control over the marketing and price point while giving you access to data to stimulate sales. If an item is not available, that does not reflect poorly on you or your brand. However, there will be consequences if you cannot deliver a bulk order as an Amazon vendor. That option is better for items that you always have in stock.
Setting the price
Adopting the Amazon Hybrid model is not possible for every company. But if you have the inventory, product range, and capacity to handle two different accounts, the pros outweigh the cons. You get access to two sources of income and a wider audience.
Looking to set up your hybrid strategy but not sure where to start? Our VNDR. Amazon experts can help you. Simply shoot us an email!
