Amazon’s ongoing contraction of its first-party Vendor Central program is accelerating faster than most industry observers anticipated, with a wave of offboarding notices hitting mid-tier brands in Q2 2026. Sellers, brand managers, and agency operators interviewed by Ecommerce Times describe a program that once served as a badge of legitimacy now operating more like a liability — and an Amazon that is systematically pushing volume back onto third-party sellers through Seller Central.
The pattern is consistent: brands generating under $5 million annually in Vendor Central purchase orders are receiving termination notices or simply watching their purchase orders dry up without formal communication. Those that remain active are being squeezed on co-op fees, marketing development funds, and first-cost pricing pressure that has eroded margins to the point where 3P economics look genuinely favorable.
According to data from Marketplace Pulse published in late June 2026, the share of Amazon’s U.S. GMV flowing through third-party sellers now stands at 63%, up from 58% two years ago. The shift is not accidental.
Why Is Amazon Cutting Vendor Central Accounts Now?
The business logic behind Amazon’s vendor contraction is straightforward, even if the execution is messy. Operating a 1P retail program requires Amazon to carry inventory risk, manage purchase orders, handle chargebacks, and absorb supplier price increases. The 3P model offloads all of that onto the seller while Amazon collects referral fees, FBA fulfillment fees, and advertising spend regardless of who wins the Buy Box.
“Amazon’s Vendor Central program has always been a margin problem for them at scale,” said Jason Eddleman, VP of Marketplace Strategy at Tinuiti, in an interview with Ecommerce Times. “They want the catalog breadth that 1P gives them, but they want 3P economics. The move to hybrid or full Seller Central migration is exactly what benefits their P&L.”
“We had $3.2 million in Vendor Central POs last year. In Q1 2026, we got $180,000. There was no notice, no explanation, just silence. We had to build a Seller Central account from scratch while our wholesale inventory sat in their fulfillment centers.” — Marcus Thorn, founder of home goods brand Alder & Stone
Thorn’s situation is illustrative. Alder & Stone had operated as a pure 1P vendor for six years, relying on Amazon’s retail team to handle pricing, listing content, and advertising buys. The abrupt reduction in POs forced an emergency migration to Seller Central in February 2026, a process Thorn describes as operationally brutal. “We had to figure out FBA inbound placement fees, set up our own PPC campaigns, negotiate our own A+ Content, and fight chargebacks we didn’t even know existed — all simultaneously.”
What Does a Vendor Central to Seller Central Migration Actually Require?
For brands navigating this transition in 2026, the operational lift is significant. Agencies that specialize in Amazon channel management describe a 90-to-120-day migration timeline for a catalog of 50 to 200 SKUs, with the following workstreams running in parallel:
- Listing reclamation: Vendor Central brands often have locked ASIN content controlled by Amazon’s retail team. Reclaiming Brand Registry authority and editing titles, bullets, and A+ Content under Seller Central requires formal brand registry validation and, in some cases, Amazon support escalations that take weeks.
- FBA inbound logistics rebuild: Vendors ship pallets to Amazon’s receive centers under PO terms. Sellers must transition to FBA inbound shipment plans, navigate the placement fee structure Amazon introduced in 2024, and decide between single-location and distributed inbound strategies.
- Pricing authority and Buy Box strategy: Under 1P, Amazon sets retail pricing. Under 3P, the seller controls pricing but must compete for the Buy Box against resellers who may have bought existing vendor inventory at wholesale and are now undercutting on the same ASIN.
- PPC buildout from zero: Vendor Central brands using Amazon Marketing Services (AMS) must rebuild campaign architecture under Seller Central’s advertising console. Historical AMS data does not transfer, meaning brands lose keyword performance data accumulated over years.
- Account health and compliance: Seller Central metrics — ODR, late shipment rate, ASIN-level defect rates — are unfamiliar territory for brand teams that operated entirely inside the 1P wholesale model.
“The brands that struggle most are the ones that treated Vendor Central as a set-it-and-forget-it channel,” said Cara Petersen, Director of Amazon at Envision Horizons, one of the agencies seeing the highest inbound volume of 1P migration requests this year. “They have no internal Amazon operations capability, no catalog management, no PPC muscle. They’re essentially starting from scratch with a live revenue line at stake.”
How Are Sellers Handling the Buy Box Problem After Migration?
One of the most tactically complex challenges in the 1P-to-3P migration is the reseller Buy Box problem. When a brand sells to Amazon through Vendor Central, Amazon controls the retail listing and the Buy Box. But parallel resellers — distributors, liquidators, wholesale accounts — may have purchased inventory from the brand at trade prices and listed the same ASINs on Seller Central independently.
After migration, a brand launching its own Seller Central account often finds itself in a three-way Buy Box competition against Amazon’s own remaining vendor inventory (being liquidated at a discount) and unauthorized resellers who bought inventory through distribution channels.
“We had 14 resellers on our top ASIN when we launched our Seller Central account. Amazon was still selling down their vendor stock at $4 under our price. We couldn’t win the Buy Box for six weeks.” — Priya Kaur, Head of E-Commerce at wellness accessories brand Solstice Goods
Kaur’s team used a combination of Brand Registry’s Report a Violation tool, cease-and-desist letters to unauthorized resellers, and a temporary price match to Amazon’s clearance price to consolidate Buy Box ownership over approximately 45 days. “It worked, but it cost us margin we hadn’t budgeted for. The migration financial model we built didn’t account for a six-week Buy Box lockout.”
Pricing intelligence tools including Informed.co and Seller Snap are seeing elevated usage from brands navigating this exact scenario, according to agency sources. Repricing logic that allows brands to temporarily floor their price to match or slightly undercut Amazon’s own liquidation activity — then gradually pull price back up as vendor stock depletes — has become a documented migration tactic.
What Does the PPC Rebuild Cost and How Long Does It Take to Stabilize?
For brands that spent years running Sponsored Brand and Sponsored Display campaigns under Vendor Central’s AMS interface, the PPC rebuild in Seller Central is expensive and slow. Industry benchmarks from Tinuiti’s Q1 2026 Amazon Advertising Report suggest that brands in their first 90 days on Seller Central PPC run ACoS 35% to 55% higher than their eventual steady-state, driven by a lack of historical relevance signals and the absence of conversion rate data at the ASIN level.
“We budget for a 120-day normalization period on PPC for migration accounts,” said Eddleman. “The first 30 days are pure data collection. You’re burning spend to establish which keywords convert. Days 31 through 90 are optimization. Day 91 onward you’re finally running something that looks like a real account.”
At a catalog level, brands with 100 SKUs migrating to Seller Central should expect to invest between $15,000 and $40,000 in PPC setup and the normalization phase, based on agency quotes reviewed by Ecommerce Times. That figure excludes the A+ Content production, listing copywriting, and any 3PL or inbound logistics costs associated with the FBA transition.
Are Any Brands Choosing to Leave Amazon Rather Than Migrate?
Not every brand offboarded from Vendor Central is choosing to rebuild on Seller Central. A smaller but notable cohort is treating the 1P exit as a catalyst to diversify off Amazon entirely — accelerating investment in DTC infrastructure, Walmart Marketplace, and, in the home and lifestyle categories, TikTok Shop.
Walmart’s Fulfillment Services program, which now covers over 150,000 U.S. sellers as of Q2 2026, has absorbed a measurable share of brands exiting or deprioritizing Amazon. WFS fee structures remain approximately 8% to 12% lower than FBA on comparable item sizes, and Walmart’s advertising platform — while smaller — offers CPCs that brands describe as 30% to 40% below equivalent Amazon sponsored placements in competitive categories.
“Losing Vendor Central was painful. But it forced us to ask a question we’d avoided for three years: are we building a real brand or are we building an Amazon business? The answer changed our whole roadmap.” — Marcus Thorn, Alder & Stone
Thorn’s team is now running Seller Central alongside a Walmart Marketplace presence launched in April 2026, with DTC on Shopify accounting for 22% of revenue — up from 8% before the vendor offboarding. “We would never have made those investments if Amazon had just kept writing purchase orders.”
What Should Brands Do Right Now If They’re Still on Vendor Central?
Agency leaders and marketplace consultants are consistent in their advice for brands that remain on Vendor Central today but see declining PO activity or have received informal signals from their Amazon vendor manager about program changes.
- Audit your ASIN ownership: Verify Brand Registry status on every ASIN in your catalog before a migration is forced. Reclaiming content control retroactively is significantly harder than establishing it proactively.
- Build a Seller Central account in parallel: Open the account, complete identity verification, and establish FBA inbound capability before you need it. Reactive migrations under revenue pressure produce worse outcomes than planned ones.
- Map your reseller network: Identify every authorized and unauthorized reseller on your ASINs now. Tighten distribution agreements and build MAP enforcement infrastructure before you need to compete for your own Buy Box.
- Model the margin stack honestly: Seller Central economics include referral fees (typically 8% to 15%), FBA fulfillment fees, inbound placement fees, and advertising. Build a full landed-cost-to-net-proceeds model per SKU before assuming 3P is more profitable than the 1P margin you’re currently running.
- Retain a migration specialist early: Agencies including Envision Horizons, Tinuiti, and SupplyKick have developed documented migration playbooks. Engaging one 60 days before a forced transition is materially different from engaging one the week POs stop.
The broader trajectory is clear. Amazon is structurally exiting the wholesale procurement business for all but its largest, most strategically critical vendor relationships — major CPG, top-tier electronics, and essential consumables categories where 1P inventory is a competitive necessity. For the long tail of brands that built their Amazon strategy around the prestige of a Vendor Central invitation, 2026 is the year that prestige expires.
