Amazon started as online book store and has grown to be the worlds largest online retailer.
Amazon invite companies to become Amazon Private Label
Traditionally there have been two ways to sell on Amazon – as a merchant where you list and sell your own products and as a vendor where you sell your products to Amazon retail who purchase from you in bulk. Now there’s a third way which is to become an Amazon Private Label.
Amazon have launched an accelerator inviting manufacturers to become an Amazon Private Label and be listed as Amazon’s ‘Own Brands’. Amazon typically gives their Private Label products premium placement in search results as well as Sponsored Ads placement so you can expect stellar sales. For many search results, Amazon will display a ‘Top Rated from Our Brands’ scrolling box to display Amazon Private Label products as can be seen in the search for AA Batteries on Amazon promoting the Amazon Basics Private Label.
In addition to promoting private labels to consumers, Amazon will automatically promote products you supply as Amazon Private Labels to business buyers through Amazon Business.
As a business, you will need to balance your sales exposure against the downside of becoming an Amazon Private Label. Amazon’s ‘Own Brands’ products are only ever sold on Amazon. You won’t be able to sell the same product on any other marketplace or your own website and will be prohibited from wholesaling it.
“Our Brands is a collection of Amazon private brands and a curated selection of brands sold exclusively on Amazon. With Our Brands, we are bringing high-quality products at great prices to our global network of customers both directly (B2C) and commercially (B2B).”
Amazon will not only own the brand, but as a Private Label Amazon may ask you to tweak the product or even redesign it from scratch. However, generally being an Amazon Private Label supplier won’t prohibit you from having your own Private Labels or selling under your own company name as well. As well as perhaps tweaks to the product itself, products you supply as an Amazon Private Label will of course require different packaging, product stickers, pack sizes and GTINs to those you supply anywhere else.
It’s important to note that Amazon Private Labels are not single products. As an Amazon Private Label supplier you will be creating an entire product line (and possibly multiple product lines). It is also possible that Amazon will commission other manufacturers to supplement the product lines that you supply – they own the Private Label and can switch manufacturing between suppliers should they choose to.
Amazon Private Label benefits
You’ll receive guided support and a free toolset of products to tell your brand story and track performance.
Brands will receive a suite of marketing support executed by our Amazon merchandising team. Products with high ratings and reviews can receive additional placements across Amazon.com.
Venue to Test & Learn
You can easily test new innovative products and get quick customer feedback.
Main Private Label categories on Amazon
|Apparel & Accessories
Business & Industrial
|Food & Beverages
Health & Wellness
Home & Kitchen
Household & Personal Care
Lawn & Garden
Sporting & Outdoors
Tools & Home Improvement
One of our client companies have been approached to produce a significantly large range for an Amazon Own-Brand via Amazon Business / Exclusives.
The Amazon offer to them is pretty strong, as the benefits to sales potential appear to be quite advantageous in competitive categories. Some of the services normally associated with Vendor/Retail are included.
It looks like they will take up the offer for two main reasons;
1) They fear what might happen to their own own-brand if they don’t
2) Amazon have stated there is no risk to them ‘stealing’ the factory in future. It’s more like “an Amazon Franchise”.
All in all it looks like a good deal. It is yet another fascinating change of tactic from Amazon, which could have huge knock-on effects to many.
Hopefully, it’s a good deal to lose your you business.
Amazons promises mean nothing and there’s always the small print. How many FBA members know Amazon can refund a customer and charge you after 2 years?. You soon find out when it happens.
Once sales take off, it will be a good night for your clients brand on Amazon.
Amazon will end up controlling the whole chain in retailing being the manufacture, brand, sales, advertising, cloud computing, warehousing and delivery. Amazon will control all touch points from the moment a product is made to the moment It is sold and delivered.
It is quite a clever move from Amazon because it will bring more people to the Amazon website that in turn will become prime member because Amazon will have thousands or tens of thousands different private label brands with millions of exclusive products that will only be found and sold on Amazon. Being a prime member will then become being a member of a very exclusive club. Which will only accelerate the retail apocalypse.
I think this could terrible idea for manufacturers as Amazon will use your skills and money to develop a product that once it takes off may source from another manufacturer who can produce it for less. This is once again giving Amazon too much power and the power to destroy your whole business just like that!
“It is also possible that Amazon will commission other manufacturers to supplement the product lines that you supply – they own the Private Label and can switch manufacturing between suppliers should they choose to.”
As Ben said….
Time for Donald Trump to take on Amazon. They are becoming to powerfull. What next…Amazon bitcoin
IS it for ney brands, for existing retails or for established FBA sellers? Thanks