What is Amazon's third-party model?

Asked by: Elian Fay  |  Last update: June 17, 2026
Score: 4.2/5 (67 votes)

Amazon's third-party (3P) model allows independent sellers to list and sell products directly to consumers on the Amazon marketplace via Seller Central. Sellers maintain control over inventory, pricing, and branding, while paying referral fees to Amazon. They can handle shipping (FBM) or use Fulfillment by Amazon (FBA).

What is the Amazon third-party model?

Amazon 1P model - in a first-party relationship, the manufacturer (you) sells directly to Amazon as a reseller. Amazon 3P model - as a third-party seller, you sell your products through Amazon as a platform. Amazon 1P/3P model - a hybrid model where you maintain control over profit margins and inventory risk.

What is Amazon's third-party?

Third-party sellers are independent sellers who offer a variety of new, used and refurbished items. Here's what we found. When ordering from third-party sellers on Amazon, you'll use the same checkout process as other Amazon orders. Sellers handle their own fulfillment and customer service, except for Prime items.

What is the difference between Amazon first-party and third-party?

Ok I found the answer: First-party, or 1P, is when you sell wholesale products to Amazon, which resells them to customers under its own label. Third-party, or 3P, is when you market and sell products to Amazon's customers, competing with other sellers within your product niche.

What is Amazon 3P business model?

The third-party (3P) model positions brands as independent sellers on Amazon's marketplace, providing significantly more control over pricing, marketing, and brand presentation while simultaneously increasing operational responsibilities.

These are the 10 BIGGEST Third-Party Sellers on Amazon

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How does Amazon 3P work?

In a 3P (or third-party) relationship, you're an independent seller on Amazon's marketplace, which gives you both more control over your brand and more responsibility for logistics.

How much do Amazon 3rd party sellers make?

Most Amazon sellers make at least $1,000 per month in sales, and some super-sellers make more than $100,000 each month in sales. 40% of Amazon sellers make $1,000 to $25,000/month, which could mean $12,000 to $300,000 in annual sales.

What are examples of the "3P" model?

The integration of the 3Ps—People, Planet, and Profit—provides a comprehensive framework for fostering sustainable growth. By focusing on the well-being of employees, minimizing environmental impact, and ensuring economic viability, businesses can create a balanced approach that drives success.

How to become a third-party for Amazon?

Here's how to become an Amazon 3P seller:

  1. Set Up an Amazon 3P Seller Account. Before you can start selling on Amazon, you need to set up an account. ...
  2. Set Up a Seller Profile. Once you have an active account, you can complete your seller profile. ...
  3. List Your Products. ...
  4. Choose Your Fulfillment Method.

Why does Amazon have so many third-party sellers?

Third-party sellers account for over 60% of all Amazon sales in 2025, according to eDesk's marketplace analysis. This dominance continues despite fewer active sellers due to: Improved seller tools and advertising capabilities. Amazon's strategic focus on marketplace services revenue.

How much of Amazon is a 3rd party?

How many third party sellers are on Amazon, Over 60% of products sold on Amazon come from third party sellers, with the number continuing to grow. According to the latest Amazon seller statistics, third party sellers (Amazon 3P sellers) are crucial to the marketplace's variety and pricing strategy.

Who is Amazon going to use instead of UPS?

Amazon is replacing reduced UPS volume by heavily using its own vast logistics network, bringing FedEx back as a partner for large packages, relying on USPS, and working with smaller regional carriers, aiming for diversification and cost savings as UPS shifts focus from low-margin Amazon business. They're not fully replacing UPS but adding FedEx to handle delivery gaps and large items, alongside their growing in-house capabilities. 

How to spot fake sellers on Amazon?

To spot fake sellers on Amazon, check seller ratings (aim for 95%+), read recent reviews for mentions of fakes or poor service, look for "Sold by [Brand Name]" or "Fulfilled by Amazon," beware of drastically low prices and long shipping, and scrutinize seller names for random characters or poor English. Always verify the seller's profile and shipping details before buying, especially for popular branded items. 

How does Amazon make money from 3rd party sellers?

Third-party sellers now account for more than 60% of physical units sold on Amazon. The company collects referral fees, fulfillment fees (through FBA), advertising dollars, and subscription revenue from these sellers, making this one of its most lucrative segments.

What is a 3P salary?

3P Salary is a system designed to pay salaries for employees based on three basic factors: Pay for position (P1): Pay for the job position. Pay for person (P2): Pay for the capacity of the person holding the job position. Pay for performance (P3): Pay for the results achieved by the person holding the job position.

What does 3 P's stand for?

"3Ps" (or "three Ps") refers to different sets of core concepts depending on the context, most commonly People, Process, and Product (for general business analysis), Planet, People, and Profit (for sustainability/Triple Bottom Line), or Product, Price, and Promotion (for marketing). These frameworks help evaluate business success, strategy, or impact by focusing on these key, interconnected areas. 

What is the 3P rule?

How is The 3P Rule formulized in Leadership? The 3 main P's of The Leadership: Performance, People, and Process.

What are the biggest FBA mistakes to avoid?

10 Amazon FBA Mistakes Sellers Must Avoid in 2025

  • Miscalculating Amazon FBA Fees. ...
  • Poor Inventory Management (Stockouts & Overstocking) ...
  • Ignoring Amazon's Inventory Performance Index (IPI) Score. ...
  • Choosing the Wrong Products for FBA. ...
  • Not Optimizing for the Buy Box. ...
  • Failing to Monitor Customer Feedback & Returns.

How to tell if an Amazon seller is a third party?

If you want to check whether a seller is a third party or Amazon itself, look for the "sold by" line among the product information.

How to become an Amazon 3rd party seller?

Start by choosing a selling plan, then register with Amazon and create an Amazon seller account. Once you configure your account, you can list and price your products, select a fulfillment method, and explore options to promote and advertise.