Becoming a distributor for Amazon can mean two very different things: selling your products directly to Amazon as a wholesale supplier (known as a first-party or 1P vendor), or using Amazon’s marketplace to distribute products to customers yourself as a third-party (3P) seller. Both paths let you move inventory through Amazon’s massive platform, but they differ significantly in how you get started, what you control, and how you get paid.
Two Ways to Distribute Through Amazon
As a first-party vendor, you act as a traditional wholesale supplier. Amazon sends you purchase orders, you ship the products to Amazon, and Amazon handles everything from there: pricing, listing, selling to the end customer, and fulfillment. Your relationship with Amazon looks like a retailer-supplier arrangement. You manage it through a portal called Vendor Central.
As a third-party seller, you list products on the Amazon marketplace and sell directly to consumers. You set your own prices, manage your own listings, and handle marketing. For fulfillment, you can either ship orders yourself, use Fulfillment by Amazon (FBA) where Amazon stores and ships your products, or qualify for Seller Fulfilled Prime where you ship directly but meet Prime’s two-day delivery standard. You manage everything through Seller Central.
The key tradeoff: vendors give up control over pricing and product listings in exchange for Amazon handling the heavy lifting. Sellers keep that control but take on more operational responsibility. Sellers also tend to protect their margins better, since they set their own prices rather than negotiating wholesale terms with Amazon’s retail team.
Getting Invited as a 1P Vendor
You cannot simply sign up to become a first-party Amazon vendor. Amazon must invite you. The company evaluates manufacturers and authorized distributors based on sales performance, brand trademark ownership, and marketplace demand. The unofficial threshold is roughly $5 to $10 million in annual sales, though Amazon’s vendor recruitment increasingly targets enterprise brands doing $20 million or more per year, particularly in categories like grocery, consumer packaged goods, and household essentials where strong supply chain relationships matter.
There are three main paths to getting that invitation. First, strong performance as a third-party seller on Amazon can draw attention from Amazon’s retail team. Second, Amazon’s vendor recruitment may reach out to you directly if your brand fills a gap in their catalog. Third, you can proactively contact Amazon’s vendor recruitment team, though success here typically requires a proven track record and profitable unit economics.
Once you’re a vendor, you negotiate margins with Amazon on an annual basis. You set the list price, but Amazon determines the actual selling price on the site based on market conditions. This is the biggest adjustment for new vendors: you lose pricing control once the product leaves your hands.
Starting as a Third-Party Seller
The more accessible path is becoming a third-party seller, which is open to any business willing to meet Amazon’s requirements. You’ll need a Professional selling account, which charges a monthly subscription fee plus per-sale referral fees that vary by product category. This gives you access to the full range of Amazon’s selling tools and programs.
To get started, create a Seller Central account and list your products. If you want Amazon to handle storage and shipping, enroll in FBA by sending your inventory to Amazon’s fulfillment centers. When a customer orders, Amazon picks, packs, and ships the product and handles customer service on your behalf. If you prefer to manage your own logistics, Fulfilled by Merchant (FBM) lets you store inventory in your own warehouse and ship orders directly.
For sellers who want to offer Prime shipping without using Amazon’s warehouses, Seller Fulfilled Prime is an option, though you must commit to meeting Prime’s two-day delivery promise at no extra cost to the customer. This requires strong logistics infrastructure and a track record of reliable shipping performance.
Using Amazon Warehousing and Distribution
Amazon Warehousing and Distribution (AWD) is a separate program worth knowing about if you’re distributing at scale. AWD is a low-cost bulk storage solution that holds your inventory and automatically replenishes it into Amazon’s fulfillment network as needed. It can also distribute to non-Amazon sales channels.
To use AWD, you need a Professional selling account in Seller Central. From there, you check whether your products are eligible (AWD works with a variety of FBA-eligible products, and Amazon confirms eligibility when you book shipments). You create and track shipments, monitor inventory levels, and manage replenishments all within Seller Central. One limitation: you can’t move inventory that’s already in FBA back into AWD, since the two systems store items differently.
AWD is particularly useful if you carry large volumes of inventory and want to reduce your own warehousing costs while keeping stock ready to flow into Amazon’s fulfillment centers.
Insurance and Compliance Requirements
Once your sales reach a certain level, Amazon requires you to carry business insurance. Specifically, Pro Merchants and any seller generating more than $10,000 in monthly sales must have general liability insurance and commercial umbrella insurance, each with a minimum of $1 million per occurrence and in aggregate. You must comply within 30 days of hitting that sales threshold.
Amazon also requires that you name Amazon and its assignees as additional insureds on your policies. This is a standard requirement in retail distribution relationships, and most small business insurance providers that work with Amazon sellers can set this up. Budget for this cost as part of your business plan, since crossing the $10,000 monthly sales mark can happen quickly if your products gain traction.
Business Documentation You’ll Need
Regardless of which path you take, plan on having several things ready before you start. You’ll need a registered business entity (sole proprietorship, LLC, or corporation), a tax identification number, a business bank account, and, if you’re selling branded products you didn’t manufacture, authorization from the brand owner proving you’re an authorized distributor. Amazon takes intellectual property seriously, and selling branded goods without proper authorization can get your account suspended.
If you’re manufacturing your own products, registering your brand through Amazon’s Brand Registry gives you access to enhanced listing tools, better protection against counterfeiters, and additional advertising options. Brand Registry requires an active registered trademark.
Choosing the Right Path
If you’re a large manufacturer or authorized distributor with millions in annual revenue and you want the simplicity of wholesale, pursuing a 1P vendor relationship makes sense. You ship pallets to Amazon, they handle the rest, and you collect purchase order payments on net terms (typically 30 to 90 days).
If you’re a smaller business, a newer brand, or you want to maintain control over your pricing and customer relationship, starting as a third-party seller is the practical choice. You can begin selling almost immediately, scale at your own pace, and use FBA to tap into Amazon’s logistics without building your own distribution network. Many successful brands start as 3P sellers and later get invited to become 1P vendors once their sales volume and brand recognition reach the right level.