Choosing between 1P and 3P isn’t about what’s easier. It’s about how much ownership you want over your brand. On Amazon, your model defines your leverage.
1P vs 3P on Amazon: A Choice That Shapes Your Business
Most brands treat their Amazon setup as a logistics decision, but it is more of a business model choice.
- With 1P, Amazon is your customer.
- With 3P, Amazon is your marketplace.
1P: Letting Amazon Lead
- Amazon sets the price, manages fulfillment, and owns the customer relationship.
- In return, you get Prime credibility and minimal operational burden — but tighter margins and limited control over how your brand competes.
- This model works best when distribution matters more than differentiation.
3P: Owning the Outcome
- You control pricing, content, and inventory — and gain visibility into what’s driving performance.
- The upside is flexibility and potential margin expansion. The cost is accountability and operational complexity.
- 3P suits brands that see Amazon as a core growth channel, not just shelf space.
What You’re Really Deciding
This isn’t about tools or fees.
It’s about:
- Control vs ease
- Margin vs effort
- Stability vs adaptability
Amazon 1P vs 3P: How the Models Differ
| 1P (Vendor) | 3P (Seller) | |
|---|---|---|
| Selling relationship | Wholesale You sell inventory to Amazon, which then retails the product under its own storefront. | Marketplace You list and sell products directly to customers using Amazon as the platform. |
| Price ownership | Retail price is determined by Amazon and may change dynamically. | You decide pricing strategy and manage discounts or promotions. |
| Marketing execution | Advertising tools are available, but campaigns often follow Amazon-driven priorities. | You actively manage ads, budgets, keywords, and performance signals. |
| Fulfilment & operations | Amazon controls fulfilment, logistics, and customer service end-to-end. | You choose how orders are fulfilled (FBA, FBM, or hybrid) and handle operations. |
