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Amazon Retailer or Amazon Agency? A Quick Guide to Choosing the Right Partnership for Your Brand

Mario Formica
Feb 25, 2021 12:57:00 PM

 

Amazon Wholesale vs. Amazon Agency

Over the past year alone, the popularity of Amazon and online shopping skyrocketed (44% growth YoY in the U.S.) due to the impact of COVID-19 on consumer habits. But the trend toward online shopping started long before the pandemic hit, and it doesn't seem to be going away any time soon. If you’re a brand owner looking for ways to take advantage of the sheer opportunity Amazon and ecommerce as a whole holds for your business, you've got a lot of options to choose from.

For brand owners who simply don't have the time, resources, or expertise to fully manage their own marketplace efforts, there are two main solutions available for you:

  1. Working with an Amazon wholesaler/retailer, or...
  2. Working with an Amazon agency/consultant.

To help you decide which one is the best fit for your brand, we'll compare and contrast the two and take a detailed look at the pros and cons of each option. (If at any point you’d like to connect and talk through your options further, here’s where to find us.)

  

Amazon Retailer/Amazon Wholesale

When you work with an Amazon Retailer, essentially, you sell your products in bulk to a third-party seller (or sometimes multiple sellers) who will then resell those products on the Amazon marketplace on your behalf. When it comes to Amazon, brands that sell through a retailer can partner with Amazon directly (first-party or 1P) or with a third-party seller (3P). Learn about their key differences in our blog post, Amazon 1P vs 3P.

Pros of selling Wholesale on Amazon

  • Being paid upfront for your products by a retailer via a purchase order (1P or 3P)
  • Possible option to unload of all Amazon responsibilities, from Amazon Customer Service to Case Management (3P only)
  • With some wholesalers, access to a team of Amazon advertising experts who can enhance your advertising campaigns (3P only)
  • With some retailers, you receive a main point of contact (Account Manager) to help expand into new products on Amazon and manage your overall platform (3P only)
  • If selling FBA, you may be provided with assistance getting your products from your warehouse to Amazon (1P or 3P)

Cons of selling Wholesale on Amazon

  • Lower profit margins
  • Untrustworthy sellers can lead to the breaking of MAP Price
  • Your brand voice can be adjusted by Amazon or the retailer once they have access to your product listings
  • Handing off all responsibilities to Amazon or an unknown third-party can be frightening, especially if you have reason to question their trustworthiness, or have a hard time getting them to respond to your requests (ie. Amazon Case Management)

Is selling Wholesale on Amazon the right choice for you?

If you’re looking to offload all Amazon responsibilities, selling products to an Amazon retailer (either 1P or 3P) offers a lot of advantages. However, and this can’t be stressed enough, it is essential to find a transparent and reliable third-party seller whom you can trust with your brand. You also need to understand the potential risks that come with handing that much control to an unknown retailer—be sure to do your research before giving them the keys. 

Even better scenario is selling to a single third-party seller who can really approach your brand as a whole on the marketplace (and perhaps help you expand into others) by tackling end-to-end marketing, advertising, logistics, and more. Here are a few case studies and videos that explain why a single, experienced 3P seller should be a key consideration if you choose to sell Wholesale, or if you are currently selling Wholesale to multiple sellers on the marketplace:

  

Amazon Agency/Amazon Consultant

Working with an Amazon agency is a lot like hiring a marketing firm or working with a consultant: You retain full control of your brand’s product listings, logistics, and presence on Amazon. But, working with an agency means you’ll have a dedicated team of experts to help make decisions and guide you through every aspect of your Amazon business—and depending on who you work with, access to this team can cost much less than if you were to hire a full-time employee internally. For sellers who lack experience and resources, an Amazon agency can take over creating, optimizing, and executing product listings and Storefronts, an effective Amazon ads strategy, and more so you can handle all other business needs.

Pros of an Agency partnership

  • Retaining ownership of your inventory on Amazon
  • Product margins remain the same
  • More control over branding and pricing
  • Access to expert advice and guidance at less than a cost of a single employee
  • Working with a team of experts who will be able to take a lot of day-to-day responsibilities off of your plate, as well as enhance your Amazon Advertising strategy

Cons of an Agency partnership

  • You are paying a consultant to grow your sales as opposed to partnering with someone who will purchase your products in bulk
  • While working with an Amazon agency can reduce your workload, it doesn't offload all of your responsibilities in the way that selling your products to a 3P seller does
  • You will still have to stay up-to-date with the Amazon platform and learn how to use the various tools Amazon makes available in order to be successful (though a good Amazon agency should help manage or guide you through this process)

Is an Amazon Agency partnership the right choice for you?

Before making a decision on whether or not you should partner with an Amazon agency, ask yourself or your team the following questions:

  • Do I/we have the time and resources to manage Amazon daily?
  • Will I/we be able to stay on top of the ever-changing trends and best practices?
  • Am I/are we happy with our Amazon marketing strategy and performance?

If your answers to any of the above is no, an Amazon agency is the right choice for you. If you’re still having trouble deciding if Agency is the right way to go, read some helpful case studies, resources, and interviews with fellow brand owners here:

  

Should you sell yourself (sans partnership)?

After reading all of this through, you might be one of the brave souls thinking to yourself: Should I just forgo any type of partnership, agency or wholesale/resale, and tackle it all myself? 

If you have the time, expertise, and motivation to build a profitable presence for your brand on Amazon, selling yourself is obviously the best way to limit expenses and keep your profit margins high. For many brand owners, though, this simply isn't an option. Doing all that’s required to succeed on Amazon while still managing all the other elements of your business is a tall order, and even if you feel up to the challenge—you still might be missing out on growth opportunities that an experienced seller or agency who is constantly testing and executing on Amazon can offer.

 

Take your brand to new heights with SupplyKick

If you’re feeling overwhelmed, frustrated, or you’re not happy with your current Amazon sales, product listing research/SEO, or advertising performance, why wouldn’t you seek change?

At SupplyKick we offer two types of partnership:

  • As a Wholesale partner, we buy your products in bulk and sell them on Amazon on your behalf—all while executing marketing, logistics and fulfillment, and brand management on the marketplace.
  • As an Agency partner, we act as an extended part of your team and execute based on your business needs—whether that's help with Amazon marketing, advertising, logistics, fulfillment, brand management, customer service, and much more.

Want to discuss your Wholesale and Agency options further? Reach out to get a conversation started with our team. To stay connected with the latest Amazon news, trends, results, and insights, be sure to sign up for our newsletter.

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