Overview

Staying ahead in Amazon Vendor Central requires more than business-as-usual – it demands a proactive, strategic approach. In an episode of the Marketplace Masters webinar, a panel of Amazon experts shared how vendors can win in 2024 and beyond. Industry leaders Matt Anderson (Chief Strategy Officer at Optimizon, LinkedIn), Bruno Ferreira (Founder of BlueDot eCommerce, LinkedIn), Martin Heubel (Founder of Consulterce, LinkedIn), and James Wakefield (Founder of WAKE Commerce, LinkedIn) unpacked their top tips for Amazon vendor profitability, net PPM negotiations, leveraging a hybrid model (1P + 3P), and more.

This comprehensive playbook distills their insights – and adds our own thought-leadership perspective – into clear strategies any Amazon agency professional or vendor can implement. From mastering Amazon’s profitability metrics to streamlining operations and deciding if an Amazon hybrid model is right for your brand, consider this your roadmap to a successful year ahead.

1. Prioritise Profitability: Net PPM as Your North Star

In 2024, Amazon’s message to vendors is clear: profitability matters more than ever. The panel agreed that Net Pure Profit Margin (net PPM) – Amazon’s internal profit metric – is the key benchmark that can make or break your 1P relationship. Net PPM measures Amazon’s profit on your products after cost, vendor terms, and discounts. If your items don’t meet Amazon’s net PPM targets, they risk being deemed CRaP (“Can’t Realise a Profit”) and may see reduced support or even be dropped from Amazon’s assortment.

Know the Benchmarks: While Amazon doesn’t publicise exact targets, industry ranges are known. For example, hardlines products typically need ~40–45% net PPM, softlines (apparel) around 30–37%, and consumables 27–35%. If your margins fall below these ranges, expect Amazon to push for cost concessions during Annual Vendor Negotiations (AVNs). Martin Heubel stressed looking beyond just net PPM percentages to true bottom-line profit. He advises doing your homework between AVN cycles – analyse last year’s negotiation commitments versus outcomes, and gather data to tell a compelling story during the next round. If Amazon promised +25% growth but orders stagnated due to their tighter purchasing model, use that data to push back on additional concessions. “It really comes down to doing your homework between the annual vendor negotiation cycles,” Martin noted, “ensuring you have the right portfolio and are driving efficiencies in the right areas”.

Improve Your Profitability: Instead of hoping Amazon eases its margin demands, assume the first half of the year will continue the profitability crackdown. Negotiate trading terms smartly: if Amazon asks for higher co-op or marketing accruals, ensure those actually improve net PPM (e.g. focus on cost of goods or supply chain savings). Some ways to boost Amazon’s margin without straight price cuts include:

• Rationalise Your Catalogue: Focus on a profitable portfolio mix. Consider trimming or re-packing low-margin ASINs rather than offering everything. As Matt Anderson pointed out, listing fewer, more profitable SKUs can be wiser than a sprawling catalogue that drains resources. Identify your top 20% products driving 80% of sales and ensure they hit margin targets.
  
  
• Innovate with Packs and Exclusives: If certain items can’t hit net PPM benchmarks, don’t force them. Instead, launch alternative pack sizes or Amazon-exclusive bundles that carry higher margins. This can preserve sales volume while meeting profitability goals.
  
  
• Leverage Joint Cost-Saving Programs: Take advantage of Amazon’s supply chain programs that lower costs for both sides. For instance, Amazon’s Direct Import or Vendor Flex programs can reduce fulfillment costs (items ship directly or from your facility), which improves Amazon’s margin and can count toward net PPM improvement. Likewise, Frustration-Free Packaging (FFP) or right-sizing your packaging (SIOC) can cut Amazon’s handling costs – a win-win that makes low-margin items more viable.
  
  
• Monitor and Adjust Constantly: Don’t wait for the next AVN to assess profitability. Set up internal dashboards (or use a tool like MerchantSpring) to track net PPM by ASIN monthly. This proactive stance lets you address underperformers early – whether via cost negotiations, price adjustments, or marketing support – before Amazon flags them as unprofitable.
  
  

LTV over CPA: Matt Anderson emphasised the importance of targeting high lifetime-value customers to maximise ROI on Amazon. With Amazon Advertising costs rising and margins under pressure, brands must invest where the profit is.

“Increasing cost per click, increasing logistics costs, margin pressures… Amazon’s going to want you to spend more,” Matt noted.

The solution? Identify which customer segments drive repeat purchases and long-term value, and focus your marketing spend there. Rather than chasing every sale, double down on the most profitable customer cohorts to improve overall account profitability. 

This may involve analysing Amazon’s demographic and purchase data via new tools like Amazon Marketing Cloud (AMC). According to Matt, Amazon is opening up more advanced analytics – for example, AMC’s audience analysis and a new “persona targeting” planner – that allow vendors to see which shopper profiles have the best lifetime value and lowest acquisition cost. Vendors who harness these insights can allocate ad budgets more efficiently, offsetting cost increases by improving conversion on high-value audiences. (Note: AMC currently requires SQL/data skills or agency support, but Amazon is rolling out more user-friendly features to help vendors leverage these rich analytics.)

In short, Amazon vendor profitability in 2024 isn’t about growth at all costs; it’s about smart growth. Make net PPM and contribution margin health core KPIs for your team. By aligning internal decisions (assortment, pricing, advertising) to boost Amazon’s margin and yours, you create a win-win that keeps your products in Amazon’s good graces.

2. Annual Vendor Negotiations: Be Data-Driven and Tough

Annual Vendor Negotiations can be daunting – Amazon often comes with aggressive asks, especially if your net PPM is below target. But you’re not powerless. The panel’s advice for AVN success: prepare relentlessly and use data as leverage.

Come to the Table Prepared: Well before Amazon initiates talks, audit your business. Determine your current net PPM by category and how it compares to benchmarks (see above). Identify any “profit leaks” such as excessive chargebacks, out-of-line freight costs, or inefficient trade term spend (e.g. co-op funds that didn’t produce sales lift). These are opportunities to improve margin without simply giving Amazon a deeper discount. If you made concessions last year, track whether Amazon delivered the promised volume or other benefits. For example, if you granted an extra 5% rebate for marketing support, did Amazon actually execute campaigns or drive the expected traffic? Hold them accountable – bring those results into the negotiation.

Martin suggests separating trading terms increases from net PPM fixes. Amazon might ask for +X% in allowances across the board, but that alone won’t save an unprofitable item. Counter by addressing root causes: if Vendor Manager A says “we need 150 bps margin improvement,” consider offering cost relief tied to specific efficiency initiatives (like shifting to a cheaper carton or a consolidated shipment method) rather than a blanket discount. And ask for something in return – for instance, marketing support, stock commitments, or exclusivity – especially if your net PPM is healthy. Remember, if your account is above category margin targets, you have a stronger negotiating position. It’s not unreasonable to push back and propose investing in growth (ads, new product launches) instead of further margin cuts.

Biggest Lever to Close the Deal: When asked “what’s the biggest lever to minimise Amazon’s net PPM demands and still close AVN?”, Martin’s answer was doing the homework between cycles. But another practical tip emerged: portfolio management. Don’t treat all products equally in negotiations. Amazon’s margin view is often at the total vendor level, but they care most about outliers. Identify your worst offenders (low or negative net PPM ASINs) and decide if you can fix them or if they should be removed or transitioned to Seller Central (more on hybrid later). By proactively retiring a few unprofitable SKUs or reengineering them (e.g. higher MSRP, different pack), you can improve the overall margin picture and take pressure off the rest of your line. Show Amazon you’ve addressed their concerns (“we’re discontinuing Item X that was -5% margin, which will raise our average net PPM by 2 points”). This can sometimes satisfy margin requirements without across-the-board concessions.

Finally, don’t be afraid to escalate judiciously. If you truly cannot meet Amazon’s asks without destroying your own P&L, communicate that. Bring your finance team’s perspective on why a certain margin is untenable and what the long-term partnership impact would be. Amazon will “CRaP out” products that consistently lose money, but as Martin noted, they might tolerate a few loss leaders if they’re strategic to selection. If you have a hero product that’s low margin but critical for brand presence, make the case for why Amazon should keep it (strong sales rank, traffic driver, etc.) in exchange for higher margin on other products. Negotiation in the Amazon vendor model is tough, but with data and a clear strategy, you can often find a middle ground.

3. Operational Excellence: Tackle Chargebacks and Supply Chain Inefficiencies

Beyond pricing and marketing, much of an Amazon vendor’s success (and profit) hinges on operational compliance. Chargebacks, shortages, and other supply chain snafus eat directly into your margins. Bruno Ferreira’s key message was that 2024 must be the year vendors “finally align their internal operations with Amazon’s requirements” instead of treating chargebacks as an inevitable nuisance. Every chargeback is essentially a tax on poor process – and one that’s within your power to reduce or eliminate.

“Get Your House in Order”: Bruno recommends a full internal audit of your Amazon fulfillment workflow, from warehousing and packaging to ASN labelling and carrier selection. Ensure your warehouse team understands Amazon’s routing requirements and carton label standards. If you frequently incur chargebacks for things like Unreceived Inventory or Prep Errors, dig into the root cause – perhaps it’s a misunderstanding of Amazon’s Vendor Manual or a training gap for staff. Standard Operating Procedures (SOPs) should be updated and staff re-trained where needed to meet what Bruno calls the Amazon “rules of the game.” The goal is to fulfill POs flawlessly, so you’re not giving back a chunk of revenue in fines.

Common areas to check:

• Carton/Pallet Labels (SSCC/LPN): Are they 100% scan-able and placed correctly? Invest in better printers or QA checks to avoid No-Show or Unscannable Label chargebacks.
  
  
• ASN Accuracy: If cases of shorts/overs, improve your pick/pack verification process. Use a barcode scan confirmation for every carton’s contents to reduce Amazon “quantity variance” claims (shortage deductions).
  
  
• Routing & On-Time Delivery: Late delivery or improper routing can incur hefty fees. Work with carriers who know Amazon’s system, or consider Amazon’s partnered carrier programs if it suits your needs. Bruno noted that some vendors successfully renegotiated rates with their carriers or switched to more reliable partners to cut these costs.
  
  
• Packaging Compliance: Utilise Amazon’s packaging feedback if available. For instance, if items are getting prepped by Amazon (bagging, bubble wrap) and you’re charged for it, consider prepping those items yourself according to guidelines. Similarly, if you get damage-related chargebacks, reinforce packaging or palletise shipments to Amazon’s spec.
  
  

A startling approach, Bruno mentioned: some vendors simply budget for chargebacks as a cost of doing business instead of fixing them. He recounted that one client was even adding a percentage to their cost to cover expected chargebacks rather than solving the issues. Don’t do this. It’s effectively raising your own cost (and potentially your Amazon retail price, making you less competitive). Fix the underlying problems, and that money goes straight back to your bottom line.

Optimise Purchase Order Flow: Another operational tip from the Q&A: manage Amazon’s ordering pattern to your advantage. Amazon’s auto-replenishment can sometimes send many small POs that are inefficient to ship (especially if you declined the Amazon PICS pickup program that consolidates orders). If you find yourself shipping multiple tiny orders weekly, you can take steps to encourage larger, less frequent orders:

• Master Carton Quantity (MCQ): Work with your Vendor Manager or through Vendor Central settings to ensure your minimum order quantities align with full case packs. For example, if your product packs 12 units per case, set the “Order Multiple” to 12. Amazon’s system will then order in increments of full cases, reducing odd-lot orders. Bruno suggested this as a better approach than a dollar-based minimum order value (which Amazon rarely allows vendors to set).
  
  
• PICS (Prepaid Inbound Consolidation Service): If Amazon offers a pickup program (for a fee, often a % of cost), evaluate it. Bruno cautioned to negotiate the % if it seems high, or apply it only to certain categories of products. The benefit of such programs is Amazon will consolidate your POs into truckload pickups, which can reduce your freight hassle and perhaps the total number of shipments. Just ensure the economics make sense – a 4.8% of cost fee (one figure mentioned) might be steep for high-value items but reasonable for lower-priced ones if it eliminates many small parcel shipments. You can sometimes carve out PICS by product type or region to optimise this.
  
  
• Lead Time and Stock Settings: Keeping Amazon well-stocked (within reason) can prevent emergency dribble orders. If you have the cash flow, consider modestly increasing your vendor lead time or ensuring you accept system-driven “advance orders” (like Amazon’s Born to Run program for new launches) to load in more inventory ahead of peak demand. Some vendors also negotiate pre-orders/commitments for seasonal peaks – if your product is highly seasonal, proactively ask Amazon to place a bulk order pre-season (often through a Pre-PO or commitment order program). Martin noted that if you have a Vendor Manager, you can arrange such orders so both parties are prepared for seasonal sales, rather than chasing a moving target with forecasts.
  
  

The big picture is that an efficient supply chain = higher profit + happier Vendor Manager. When you reduce chargebacks and operational noise, two things happen: (1) you claw back margin (which improves net PPM without touching pricing), and (2) Amazon’s algorithms may trust your account more, potentially ordering larger quantities with confidence. Bruno summed it up: many vendors have been “pushing Amazon without looking inside first” – meaning they blame Amazon for margin problems but haven’t fixed internal inefficiencies. 2024 is the time to look in the mirror and tighten up your operations.

4. Marketing & Advertising: Do More with Less by Working Smarter

No Amazon strategy is complete without an advertising plan, but simply throwing money at Amazon Ads isn’t viable as costs rise. The panel highlighted Amazon Marketing Cloud (AMC) and other advanced Amazon Ads tools as game-changers for vendors – if used wisely. Here’s how to maximise advertising ROI in the vendor context:

Unlock AMC Insights: Amazon Marketing Cloud is a relatively new analytics environment where you can run custom queries on campaign performance, funnel metrics, and audiences. For large vendors running DSP (programmatic display ads) or multi-channel campaigns, AMC can reveal, for example, the path to purchase for your customers or how different ad types interact. Matt mentioned Amazon’s introduction of a persona planner tool – essentially allowing brands to build audience cohorts (e.g. “25–34 year-old dog owners who have purchased premium pet food in the last 6 months”) and analyse which segments yield the best lifetime value. By understanding which audiences are your most profitable customers, you can target them through Amazon DSP or Sponsored Display with tailored creatives. The result is higher conversion rates and potentially better ACOS/ROAS, mitigating the impact of rising CPCs. Key tip: if you lack in-house data expertise, consider partnering with an Amazon-focused agency or consultant who can help run AMC queries. The effort can pay off in a more efficient ad spend – focusing on customer lifetime value (LTV), not just one-time sales.

Experiment with New Ad Features: Amazon continually rolls out new ad formats and targeting capabilities. For vendors, some notable ones in 2024:

• Brand Tailored Promotions: This feature (debuted for some US sellers, likely expanding) lets you remarket to specific shopper groups – e.g., people who viewed your product but didn’t buy, or past customers of your brand. Vendors should watch for access to similar functionality either via Amazon Ads or Vendor-Powered Coupons. Retargeting warm audiences can boost conversion without blowing the budget on cold keywords.
  
  
• Video and Premium A+ Content: While these are merchandising tools, they directly impact ad efficiency. A well-crafted video in Sponsored Brands Video or on your detail page can significantly lift conversion rate, meaning your ad dollars yield more sales. As Amazon tightens ad attribution windows, make every detail page visit count by providing rich content that answers questions and builds trust.
  
  
• AI and Automation: Amazon is infusing more AI into campaign management (auto-optimising bids, suggesting keywords, etc.). While you shouldn’t blindly trust automation, use it to handle grunt work so you can focus on strategy. For instance, set rules for Sponsored Products to adjust bids based on time of day or stock levels, or use Amazon’s budget rules to maximise Prime Day and other events.
  
  

Measure What Matters: James Wakefield reminded vendors to get the fundamentals right, including catalogue content optimisation (SEO-rich titles, correct product info) and operational readiness, before expecting ads to work wonders. If your product detail pages aren’t retail-ready or you’re frequently out of stock, ad spending is wasted. It may sound basic, but ensure you have retail fundamentals like winning the Buy Box (for hybrid items), healthy inventory, and great reviews in place. Only then invest to drive traffic. Also, embrace an attribution mindset – use Amazon’s reports or third-party analytics to see the total impact of ads on not just direct sales but new-to-brand customers, etc. Some marketing wins might be indirect (e.g., running Amazon DSP to drive awareness that later leads to organic sales).

In summary, approach Amazon advertising in 2024 like a scalpel, not a hammer. Use data to target profitable niches, refine your messaging, and improve conversion rates. When done right, even a constrained ad budget can fuel significant growth without eroding your margins.

5. 1P, 3P or Both? Navigating the Hybrid Model Debate

Should brands stick with Vendor Central (1P), switch to Seller Central (3P), or use a hybrid model (both)? This question was a hot topic in the panel Q&A. The consensus: the hybrid model can be powerful, but it’s not a panacea for every problem. Brands considering it must do so strategically and ensure they have the resources to manage dual channels.

Understanding the Hybrid Appeal: Many vendors flirt with 3P because of brand control issues on 1P. Common frustrations include Amazon underpricing items (harming brand value), stocking out key products, or a lack of control over content and merchandising. Running a Seller Central account alongside 1P can, in theory, let you list products Amazon won’t carry, maintain pricing at MSRP, and have direct control over detail pages via Brand Registry. For example, if Amazon regularly “craps out” a low-margin item (stops ordering it), you could sell it via 3P to keep it available. Or if Amazon’s price on a product is too low, you might withhold that item from 1P and sell it only on 3P to maintain your desired price.

However, simply going hybrid won’t automatically fix pricing conflicts or operational headaches. Amazon’s algorithms will detect pricing discrepancies – if you try to sell an item on 3P for higher while Amazon has it lower on 1P (or through other retailers), Amazon can suppress the 3P offer (you’ll lose the Buy Box or your listing could even be blocked for “price policy” violations). In short, you cannot easily bypass Amazon’s price controls by shifting to 3P; the better approach is to address the root pricing strategy – ensure your wholesale prices and supply chain don’t drive Amazon’s retail price too low to begin with. Bruno bluntly stated: “Why are you selling at lower prices to distributors that end up on Amazon?” Focus on controlling distribution and MAP, so Amazon itself can price appropriately.

When Hybrid Makes Sense: James Wakefield recommends hybrid as a last resort or a selective strategy. It’s most effective in scenarios like:

• Selection Gaps: You have certain products Amazon won’t vendor-list (e.g. very low-priced items, or new launches Amazon isn’t forecasting well). Selling those on 3P can fill assortment holes and capture sales Amazon is leaving on the table.
  
  
• Backup for Vendor Delisting: If Amazon unexpectedly cuts your vendor account (as happened during the 2019 vendor purge or other shake-ups), a 3P account can act as insurance to keep your business running. Some brands maintain a “shadow” Seller Central presence with offers inactive, ready to switch on if needed.
  
  
• Global Expansion: In markets where you’re not yet a vendor, you might start as 3P to test demand. Or if Amazon is your largest wholesale customer and you worry about over-reliance, a parallel D2C/3P channel can diversify your revenue.
  
  

Resource Intensity: Both Bruno and James cautioned that running a hybrid model is resource-intensive. Vendor Central and Seller Central are fundamentally different business models – one is wholesale, one is retail. Success in each requires dedicated focus. As James put it, many hybrid brands “compete with themselves” by not having a clear delineation of which ASINs go to 1P vs 3P, or by failing to handle inventory properly (e.g., oversupplying Amazon 1P and leaving 3P out of stock, or vice versa). If you choose hybrid, define a strategy such as: “core high-volume items on 1P, niche or premium items on 3P” or perhaps “keep Amazon 1P for bulk wholesale orders, but use 3P FBM for any order Amazon cuts that’s below our MOQ.” There are myriad approaches, but you need a plan.

Also, assign ownership: maybe your in-house team runs Vendor Central while an agency or separate unit manages the Seller Central account (to avoid operational overload). Each side has its own processes (order fulfillment, catalogue management, advertising, customer service). Without proper resourcing, a hybrid approach can lead to the worst of both worlds – confusion, duplicate efforts, and no improvement in performance.

Avoid Channel Conflict: If both 1P and 3P are selling the same ASIN, you risk Amazon price-matching or buy box suppression. To prevent this, many hybrid brands segregate by ASIN – e.g., unique bundles or multipacks on 3P that Amazon 1P doesn’t carry, or different pack sizes. Another tactic: reserve a portion of popular products for Seller Central only when Amazon stocks out. Essentially, your 3P offer only becomes active if Amazon is unavailable. This requires careful monitoring and possibly automated repricing rules.

In summary, the Amazon hybrid model can deliver the best of both: Amazon’s massive 1P purchase orders plus the entrepreneurial control of 3P. But it is not a cure-all for vendor frustrations. Excellence on one channel is better than mediocrity on two. So weigh the pros and cons for your brand – and if you commit to hybrid, do so with eyes open, sufficient resources, and a clear strategy to avoid internal competition.

6. Strengthen the Human Element: Communication and Relationships with Amazon

Amazon Vendor Central can sometimes feel like an automated black box – and indeed much is algorithm-driven – but there are still humans in the loop (vendor managers, support staff) and building good relationships can pay off. Our experts shared a few tips:

• Vendor Manager Relations: If you have an assigned Vendor Manager or Vendor Negotiations contact, treat that relationship professionally and proactively. Provide data before they ask, propose solutions (not just problems), and understand their goals (they likely need to hit margin and growth targets too). For instance, if you know Amazon’s retail team is under pressure to improve profitability this quarter, frame your negotiations or emails in ways that help them meet that goal while advancing yours (e.g., “We can agree to this cost improvement if Amazon can support us with a merchandising campaign to drive volume.”). Also, don’t disappear after AVN. Check in periodically with updates on how initiatives are going – this can set a collaborative tone and sometimes lead to opportunities (like inclusion in a beta program or marketing event).
  
  
• Vendor Support Tickets: The day-to-day issues (listing errors, invoice disputes, etc.) often go through Vendor Support. Here, Bruno had a great piece of advice – remember there’s a human on the other side. The Amazon support rep reading your case has a mountain of tickets to get through. Writing a polite, clear message can make a difference. Start your cases courteously (“Hi team, hope you’re doing well. I need help with…”) and provide all relevant details (PO numbers, ASINs, screenshots) in the first message. This increases the chance of a quick, accurate resolution. As Bruno humorously suggested, the rep might pick your ticket out of dozens if it’s pleasant to read instead of a frustrated rant. While this might not always improve outcomes, it certainly doesn’t hurt. Persistence is key too – follow up diligently on unresolved issues, reference previous case IDs, and escalate to a supervisor if you hit a dead end on a genuinely critical problem.
  
  
• Use All Avenues: Sometimes vendor support fails to fix a problem via normal channels. In those cases, explore alternatives: your Vendor Manager (if it’s critical, they can internally escalate to the right department), Amazon’s Vendor Central feedback (periodic surveys or feedback forms where you can highlight chronic issues), or even your Amazon advertising or marketplace consultant contacts if you have any (they may have internal connections). Professional networks like LinkedIn can also be a place to find Amazon contacts (e.g., an Amazon category lead) – approach with caution and professionalism, but forging a connection with Amazon personnel in your category can provide insights or advocacy that pure ticketing cannot.
  
  

James noted that dealing with Amazon will always have challenges – listing changes that revert, support answers that miss the point, etc. Accepting this reality with a level head, and creating internal processes to manage it, will save your sanity. For example, implement a ticket log system: track every case, update its status, have standard operating procedures for common issues (like “what to do if an EAN is linked to the wrong ASIN”). Over time, your team will get faster at resolving repeat problems and even preempting them.

7. Looking Ahead: Embrace Amazon’s Evolution (and Competitors)

What does the rest of 2024 hold for Amazon vendors? The panellists offered a few predictions:

• Continued Profit Focus, then a Pivot to Growth: Martin expects Amazon retail to keep a laser focus on profitability in H1 2024, as CEO Andy Jassy pushes to prove the retail business can be sustainably profitable. That means tough negotiations and cost discipline will persist in the short term. However, by mid-2024 (around Prime Day) or H2, Amazon could swing back toward growth mode – especially as external competition heats up. The rapid rise of low-cost rivals like Temu, SHEIN, and TikTok Shop is putting pressure on Amazon to defend its market share. We may see Amazon dangle new incentives or ease up on terms to encourage more selection and sales growth from vendors in late 2024. Action item: Don’t blow your entire annual budget on Q1–Q2. Reserve some marketing dollars and flexibility for H2 opportunities. If Amazon offers a special promotional package or beta program for vendors later in the year, you’ll want resources to take advantage.
  
  
• Data Transparency (for a Price): Matt predicted Amazon will roll out more ways for vendors to access consumer data – potentially at a cost or with strings attached. For instance, we might see premium analytics packages (beyond the basic business reports) that vendors can pay for, or new tools that link retail data with advertising insights. This aligns with Amazon’s trend of monetising every aspect of the platform. As a vendor, be prepared: the insights could be extremely valuable (as discussed with AMC), but factor these into your budgets. Additionally, Amazon might introduce new premium services for vendors (akin to the now-sunsetted Amazon Vendor Services program) that offer hands-on account support for a retainer fee. Time will tell, but it’s wise to stay informed about Amazon’s announcements via Seller/Vendor Central news and industry blogs.
  
  
• Changes in Vendor Compliance and Programs: Bruno anticipates Amazon will update some vendor compliance policies in 2024. Already, we saw hints in the US of stricter packaging and safety requirements. Europe is likely to follow. Keep an eye on Amazon’s Vendor Manual updates – ensure you adapt quickly to any new labelling or shipping rules to avoid surprise chargebacks. On the flip side, Amazon might refine programs like Frustration-Free Packaging, SIOC incentives, or direct fulfillment to encourage vendors to participate (possibly with financial benefits or fewer chargebacks if you comply). Being an early adopter of such initiatives can put you ahead of competitors and even give leverage in negotiations (“We invested in these improvements that save Amazon money…”).
  
  
• Vendor Central Account Streamlining: One noteworthy development: Amazon has been consolidating vendor accounts, especially smaller ones. Some brands received notices encouraging them to shift to Seller Central if their volume was below certain thresholds. If you’re a smaller vendor, this could continue into 2024 as Amazon optimizes its 1P program to focus on larger, more profitable brands. The so-called “2024 vendor central shake-up” means you should either scale up your Amazon business or have a contingency plan (like hybrid) if Amazon ever says, “we won’t be issuing POs anymore.” Larger vendors are not immune either – but they’re more likely to be pushed to improve metrics than to be cut.
  
  

Bottom line: Agility is key. The vendors who succeed will be those who treat Amazon not as a set-and-forget sales channel, but as a dynamic ecosystem requiring constant strategy tweaks. If you invest in data capabilities, operational excellence, and strategic planning (with a medium- to long-term view, as James urged – think 3–5 years ahead), you will ride out the fluctuations and come out on top.

Conclusion: Seize the 2024 Opportunity – And Get Support if You Need It

2024 promises to be a pivotal year for Amazon vendors. The playbook for success centres on profitable growth: zeroing in on high-margin products and customers, running a tight supply chain to avoid profit leaks, and leveraging every tool Amazon offers (from advanced analytics to new ad features) to outsmart your competition. It’s also about making shrewd decisions on channel strategy – be it pure 1P, hybrid, or even exploring 3P – based on what truly fits your brand’s goals and capabilities.

If there’s a final takeaway from our panel of experts, it’s that winning on Amazon requires a holistic approach. No single tactic will carry the day. You need to get the fundamentals right (great product, great content, efficient operations) while also engaging in the higher-level strategies (negotiation, data analysis, multi-channel coordination). It might sound demanding – and it is! – but the reward is a thriving partnership with the world’s largest retailer.

Need help on this journey? You’re not alone. Tools like MerchantSpring’s intuitive insights platform for Amazon vendors can provide a clear view of your performance and identify where to act – whether it’s margin improvement or advertising optimisation. And don’t hesitate to lean on expert agencies or consultants for specialised areas (e.g., Amazon advertising or technical ops). Sometimes, an outside perspective or software solution can unlock growth that plateaued under a DIY approach.

If you’re hungry for more insights, subscribe to our Marketplace Masters podcast and MerchantSpring’s newsletter – we regularly share Amazon vendor tips, case studies, and updates on the latest trends. And of course, if you want to see how MerchantSpring can transform your Amazon reporting and analytics, get in touch with us for a demo or free trial.