Operator glossary
Vendor Central (1P vs 3P)
Amazon's wholesale side: you sell inventory TO Amazon at cost and it retails as 'Ships from and sold by Amazon.com' — a different business with different math from third-party selling.
First-party (1P) vendors receive purchase orders from Amazon, ship wholesale, and let Amazon set the retail price; third-party (3P) sellers own price, inventory, and the customer relationship through Seller Central. 1P trades control for scale plumbing — and layers on chargebacks, co-op accruals, and negotiated terms that quietly eat the wholesale margin.
The modern default for brands is 3P, with 1P reserved for cases where Amazon's retail muscle genuinely matters. Hybrid setups exist but need catalog discipline — Amazon retail undercutting your 3P price on the same ASIN is a self-inflicted Featured Offer war.
The numbers
- 1P: invitation-based, PO-driven, Amazon sets retail price; 3P: open registration, you set price and own the buyer relationship.
- 1P margin erosion lives in the annexes: chargebacks, co-op fees, damage allowances, and freight terms.
- Same ASIN can be sold 1P and 3P — and Amazon retail usually wins the Featured Offer when it competes.
Related terms