According to reports, on May 21, 2018 Amazon will stop issuing purchase orders through Amazon Vendor Express and will shut down the entire program on January 2, 2019.
“We’re constantly looking for ways to improve the selling experience on Amazon. After careful evaluation, we’ve decided to retire Vendor Express and refocus the business on other selling programs.”
What is Amazon Vendor Express?
Amazon has multiple options for sellers when beginning to put their products online.
The two traditional seller outlets include:
- Amazon Seller Central
- Amazon Vendor Central
But as of 2015, Amazon offered a more flexible third option, bridging the gap between Seller Central and Vendor Central called Amazon Vendor Express.
Vendor Express allowed sellers to transition to vendor accounts, sell their products to Amazon, rather than directly to consumers, without the need of an invitation.
Aside from exposing products to hundreds of millions of customers worldwide, Vendor Express did have its advantages including:
1) It was free to join: Unlike Seller Central, there was no monthly/annual or per-item referral fee to sign up.
2) Initial bulk orders: After a trial period proves a product’s selling potential, Amazon typically responded with bulk orders, which were meant to generate larger sales volumes.
3) “Sold by Amazon”: As a vendor, your listing was associated with the Amazon brand name, being “Sold by Amazon” which often lead to increased buy-box competitiveness.
4) Avoided fulfillment concerns: Typically, once a seller becomes a vendor, Amazon handles fulfillment of sold products, making the products eligible for free 2-day shipping for prime members and free shipping for some non-prime customers.
5) Amazon took care of your customer service: Additionally, Amazon handled customer service 24 hours a day 7 days a week, freeing up the vendors time so they could focus on other business demands.
6) Allowed access to Amazon Marketing Service (AMS): Perhaps the most valuable offering gained by signing up for Vendor Express was being offered access to Amazon Marketing Services (AMS). A valuable feature, AMS allows users to access more robust sales reports, optimize their content, and create advertisements on Amazon.
So, why is Amazon Vendor Express Being Discontinued?
Unfortunately, even with the so called “advantages” listed above the program proved to be unsuccessful.
Amazon sellers who spoke to CNBC about the program, said the program “was fraught with counterfeits from its early days and likely failed to gain traction among high-quality sellers.”
According to our experts, here’s a few reasons why the program wasn’t successful:
1) Before being free, Amazon required a trial period: Though Amazon advertised that Vendor Express was free to join, before an initial purchase order, they often requested a donation of products to use for sampling the market and testing consumer demand.
2) Forfeit of pricing control: Amazon also asked sellers to submit an offered selling price (essentially their MSRP for the product), to which Amazon responded with their predetermined expected price, (aka the price Amazon is expecting to purchase the product in bulk from the business).
3) Higher sales volume did not guarantee increased profit: Because sales are made in bulk but at a lower price, sales volume increased but sellers did not necessarily see an increase in profit.
4) Delayed payments: For profits incurred through Vendor Express sales, Amazon exercised the right to return them to the vendor on a bi-monthly (up to 60 day pay period) schedule. This created problems for sellers who were use to accessing their funds on a bi-weekly (14 day) schedule.
5) Limitations for Creative Content: One notable difference of AMS accessibility between Vendor Central and Vendor Express is that the latter receives no regular access to A+ content, a premium feature that shows more developed and optimized vendor and product pages on the Amazon site. Although Amazon offered a promotion allowing A+ content to new Vendor Express users, it was capped at 5 product pages and limited to products that are “new” on Amazon, ie. not previously listed.
What Should Vendors Using Express Do Next?
The big questions is: Will Amazon 3Ps currently using Vendor Express lose AMS access once the program ends?
According to our Amazon experts at CPC Stratgey, we predict AMS access will remain open but we have not been able to confirm this with Amazon – yet.
In the meantime, Amazon is now recommending Vendors using the Express program transition to become a third party seller.
Of course, the vendor to 3P transition isn’t always a walk in the park and there are several factors to evaluate when considering the shift.
We spoke with David Cooley, Manager, Marketplace Channels at CPC Strategy to discuss the differences between a full vs. partial vendor to 3P transition, as well as the advantages and challenges of the onboarding process.
You can read the full interview here: “How Amazon Vendors Transition to Third Party Sellers“
For more information on the end of Amazon Vendor Express, email [email protected]