This session was recorded as part of the Amazon Vendor Summit on Day 1. In this session, Flying Tiger Partners co-founders Nick Gezzar and Kara Babb unpack what actually changes when brands move from 3P to 1P—and why the shift is far more than an account switch. Drawing on their experience as former Amazon Vendor Managers and brand operators, they explain how Amazon evaluates 1P candidates, the signals that matter most (scale, selection gaps, distribution, logistics strength, and demand creation), and why 1P success requires a mindset shift from control to influence. The session also cuts through common myths about 1P, outlines how commercial terms and net PPM truly shape pricing and growth, and offers practical guidance on when a full 1P move, hybrid model, or staying 3P actually makes strategic sense.
Paul Sonneveld
Next up, we have Nick Gezzar and Kara Babb, Co-Founders of Flying Tiger Partners. They’re going to walk through what really changes when brands move from 3P to 1P and how to make that shift successfully. They'll also highlight the signals that Amazon it looks for when deciding whether a hybrid or a full switch makes sense. Let me just bring them to the stage here. There we go Welcome, Nick and Kara. It's great to have you here. Thank you for jumping on.
I really look forward to what you have to say. I mean, fun fact, for those of you who tune into our Marketplace Masters series often, how do I get or how do I transition from a 3P to a 1P account is actually one of the most frequently asked questions we get. So very keen to hear you know, how do I get access to a 1P account? And then actually how do I make it work? And Amazon's perspective on the whole thing. So over to you, the stage is yours. If you need any presentations warmed up on my side, I can help with that. Otherwise feel free to share your screen.
Kara Babb
Awesome. Thanks, Paul. Can't hear you, Nick. Sorry. Can you hear me now?
Nick Gezzar
All right. Well, I'll do the introduction while we wait for our slides to show up. We are Flying Tiger Partners. That's Nick Gezzar and Kara Babb. Before becoming a consultant, I was a senior Vendor Manager at Amazon for the Apple business, the single largest vendor that Amazon has, where you really get to learn all the ins and outs of everything a very demanding vendor needs from Amazon and what all is possible.
I also I got to work as a senior account executive in the Ads org, where I worked in the office category, servicing some household names and printers and other devices. Prior to that, I was in more of the classical brand management world, working at Procter & Gamble and Lindt Chocolate, respectively, working on portfolios of hundreds of millions of dollars of products across America. Kara?
Kara Babb
Yeah, thanks. I was just seeing if I could present. Kara Babb, similar to Nick, my background is in vendor management at Amazon. I was there for a few years, but different than Nick, I managed about three thousand vendors within the kitchen category. Primarily talked to the top two or three, but it was a different experience at managing that many vendors within the category.
And after leaving Amazon, I went over to the brand side. So worked at large enterprise organisations like Newell Brands, Phillips Lighting, now called Signify, Zenus. So kind of a mix of product types, whether it's heated blankets, smart lighting, or mattresses and boxes covered it. So I like to say I both brought the pain as a Vendor Manager, and I've also experienced the pain on the brand side. So I have kind of both sides of the experience to bring to the table now in our consulting business.
And we, you know, primarily focus on 1P vendors, whether it's helping them improve their business with Amazon negotiations, kind of all the stuff, all the levers you have to pull and understanding from an Amazon perspective, what matters. And then also what we're talking about today, which is helping qualified 3P sellers become, make the transition, potentially get an invitation to become a vendors.
Ah, fabulous.
Nick Gezzar
All right. And we're up. Okay. I'll take us on to the next slide. So even though 1P and 3P fundamentally do the same thing, which is make goods available to customers across America through Amazon, it is a completely different game being a seller, as opposed to event being a vendor, as opposed to a seller, you know, just the very shape of it's different. As a seller, you're owning your inventory. You're bearing all that risk when you're 1P, it's just like a traditional retail relationship with brick and mortar. Amazon's purchasing your inventory, and they're taking on some of that risk.
As a 3P seller, you get to set your own prices, and you have very granular control of the way things show up in your store. Whereas the 1P it's Amazon's property. They're the ones selling it, and they get to set the prices. I think we heard that in the last presentation. That's one of the other most common questions. How do I influence prices? We'll talk about that a bit more as well, but that is a, it can be a disorienting loss of control for a lot of seasoned e-commerce operators when they get there. When you have a 1P relationship, you also have a much better personal relationship with the folks at Amazon. You got a Vendor Manager and AVS that you'll be able to have that quite as much. As far as your business models go, the fees are more predictable.
Kara Babb
Continue what you were saying. But yeah, the fees are much more predictable. You have it on an annual basis that you get to through annual vendor negotiations. Whereas on the seller side, as we saw, I think even a couple of weeks ago, Amazon can jack up fees whenever. And the interesting thing we find is when sellers move from 3P to 1P, their profitability can improve significantly.
Like, there's a reason Amazon really likes sellers, and the selling model is because they make so much more money off of sellers than they do within the vendor program. But that's also why they're very careful with who they bring onto the vendor program. It's invitation-only for a reason. Cause they have to, well, they want to be able to provide more stuff and more brands as a 1P. They also want to make sure they can protect their margins at all costs.
OK, so talking about how a brand can get into 1P, if you're like a lot of the business owners we talk to, there's a lot of rumors out there and there's a lot of kind of telephone being played and secret tricks, X, Y and Z. But, you know, there's really just three main ways to do this. So number one is you can wait for an invitation. This has been happening somewhat more lately for very specific brands, primarily in the beauty category, where they're actually not so much as being invited, but being strong-armed. I've heard of brands and spoken to brands who've had 1P reach out to them and say, you are going to become 1P. Like you don't have an option because you're a strategic brand. So that's very unusual and really mainly for these brands that have a very strong kind of social following, which we'll get into in a minute.
The other option that I've heard is kind of becoming a booming business is to purchase a business with a 1P account. Nick and I like to describe this as potentially buying like a car that's on fire because, technically, each vendor central account is specific to the company that manages it. So you can buy a business with a 1P account, but you're technically going against Amazon's terms of service. And if they find it out or if it comes on their radar, you'll get shut down, and you lose that investment.
The other option is to reach out proactively. When Nick and I were at Amazon, at various times, we always had random vendors reaching out to us. Like when I was in the kitchen category, I had vendors who were talking about pet brands reaching out to us. I'm like, I don't care. When I went to different trade shows, I'd have brands chasing me down. Again, didn't care because they weren't a priority for me. Or the other option is to engage experts like Nick and myself who've developed an approach to do this and a proven method where we'll be able to successfully bring on brands in a way that Amazon supports, is all compliant, and can lead to future success.
Nick Gezzar
Right. So one of the questions we get a lot, too, is what makes a brand compelling for 1P? Like what makes Amazon think this is a viable candidate and actually go through the effort to take them on? First off, this should be primarily for manufacturers and brand owners. They want to be working directly, cutting out any kind of middlemen or intermediaries, having at least the exclusive rights to the brand. It's pretty much table stakes for becoming 1P.
Following that, your brand needs to be meaningful to the category. And there's a lot of ways you can look at this. Very few brands are going to be an A-Plus in all of these metrics, but it's about that combined story and structure of your business that Amazon's looking for. The first step is sales volume. It's pretty obvious. They're going to bring you on to the 1P&L. It needs to make some kind of an impact overall.
Generally, around twenty million is where you start being able to get their attention. Thirty gets even better, but that varies by category and isn't always the deal breaker that you would expect it to be. Looking at one of the other criteria here in selection gaps. 1P wants to be the everything store. So for any category or subcategory, Amazon wants to have that 1P control of their store.
A good example of that is earlier this year, we were able to help onboard a brand in home storage, you know, things you slide under a bed with a little cover, keep your winter jackets in there. Well, it turns out that some vendor in that subcategory had just exited 1P. So there was a gap. So that made it very attractive for Amazon to bring this one on and We were able to negotiate some really good terms for them.
The next one is broad distribution in the market. I was talking to a business development manager while pitching a brand. He mentioned, yeah, it's very important that Amazon's looking for parity with these other stores. They're not looking for Amazon-specific brands to be brought into 1P. What they want is what Walmart has, what Sam's Club has, what Target has. If it's on somebody else's shelf, Amazon wants it on their shelf as well.
The next one is logistics capability. One of the things Vendor Managers look at is vendor lead time. What is the time for when a PO is issued, sent to the vendor's warehouse, how long until it shows up in the right fulfillment center? We were consulting with a potential client, actually, not too long ago. Fortunately, their logistics capabilities were fairly sparse. They had a single warehouse in New York City. And you can see how that could cause some logistical problems if they need to get their goods to a warehouse in Anaheim, California. That's a lot of road miles. It's a lot of time. It's going to cause a lot of lag in this rather tight supply chain that Amazon likes to run. We can speak in greater depth about it, but generally, you want to be able to have at least coastal coverage and a little bit of middle. But just one warehouse is rarely going to be enough to satisfy Amazon's requirements.
Kara Babb
Yeah. And then moving next to kind of these more indirect influences. One is vertical integration. So what we're seeing these days, especially with the pressure of tariffs, if you are a brand who doesn't own your factory or your manufacturing capability, you obviously have that additional buffer that goes between you and Amazon. Amazon is very interested in different ways to improve their total profitability. I think that's going to be a really big theme for next year as they try to claw back a lot of the losses they've seen from tariffs and cost increases. So a brand that owns its own factory can actually cut down and provide better costs, whether it's through Amazon global logistics, direct import, or just providing better costs in general to Amazon. That can be very attractive.
Another one is name recognition and respectability within the category. So this is a funny one. I think we've all seen kind of the sellers that are like Z Y X W P Q R two, you know, and it's, you can't, it's not really a word. You need to have maybe a name that sounds like an actual brand. Ideally, it's one to Nick's earlier point that has other distribution within the market because ultimately, whether you have a name that's recognised because it's on Walmart or Costco, or you have a really strong social media presence, the whole point is that Amazon wants you to bring customers to them. Amazon struggles with traffic, as we heard from Alyssa earlier, especially with external traffic, getting that to site. So a lot of retailers care about.
Amazon's especially looking at TikTok. Now, with its growth there, I've seen with my brands a very strong halo effect, both from TikTok posts. So like whether it's an organic post or it's influencers, as well as items listed on TikTok shop. So Amazon's paying very closely to some of those. For example, we had a business development manager within beauty asking if we knew of any factories or brands that could help fill a critical selection gap within the infrared kind of skin therapy area, kind of those weird masks, because those were blowing up on TikTok shop, but they did not have an FDA-approved option within the category. So, you know, that's just another example of how closely they're looking because it's been shown that, you know, the majority of customers, when they go and discover a product, they're doing it on social.
Now, to Nick's earlier point, and just one last thought, you don't need to have all these things. It's about developing this kind of like Rubik's Cube kind of standalone menu options that you can put it together. So for example, maybe your sales volume is sub-twenty million, but you fulfill a critical selection gap. Or you're not vertically integrated, but you are distributed at Walmart, Home Depot, Costco, and Amazon has that FOMO. They want brands that are in those other places. Don't get discouraged if you don't have all of these, it's sometimes about finding the right combination and the right kind of angle, which we understand, you know, understanding what the Vendor Manager wants to pitch these. Okay.
So what does it take to succeed as a vendor? A lot of brands we talk to when they think about going 1P they think, you know, I, they're just focused on getting the invitation. They don't think about what happens once you get the invitation and start selling. As we mentioned earlier, you're really shifting your mindset from controlling to influencing. And what made you successful as a seller won't entirely make you successful as a vendor. So, you know, what are the things that you have to think about? This is a truly a mindset shift and where we see a lot of brands trip up. So kind of going into, or Nick, do you want to talk about commercial terms? Yeah. Sorry, Nick's having some connection issues.
Nick Gezzar
I'm actually chopping, I'm chopping in and out. I'm actually going to drop off and jump back in on a different browser. So I'll be back in one sec.
Kara Babb
All right, I'll keep going. Okay. So I think Paul even asked a question in the comments, but what are the difference between seller and vendor in terms of commercial terms? You know, from a seller perspective, you have your cost, you have all your fees, you have the cost for you to even bring it inbound, that all affects your P&L. From the vendor, it's really important to understand the core structure of commercial terms. We also talk with some brands in the US that are not as familiar with this, even though they've been selling as vendors.
You need to understand not only what percentage goes to co-op, what percentage goes to damage or freight, but also how Amazon weights those buckets internally in terms of how they contribute or affect their contribution profit, which is truly their core profit metric. You need to understand and partner in good faith, right? You need to be able to artfully negotiate to protect your P&L while making sure it is a kind of mutually incentive relationship to Amazon. And really know the levers that you have to control. So you can't necessarily control pricing directly, obviously, in the US manufacturer or retailers are priced independently, but you can know the factors behind it.
So, to an earlier question in the previous session, not only making sure you have channel control, but also understanding how Amazon's net PPM influences the pricing because it's all driven by an algorithm. So you need to know the ways to kind of manipulate the different variables that influence the net PPM that further influence price. For example, when I was at Zenus, big box items, heavy items, our pricing was not competitive versus 3P compet. We are 1P. Our pricing was not competitive versus 3P kind of like furniture competitors because Amazon's net PPM, their profitability requirements were so high, like forty eight, fifty percent because eighty percent of our business was being run through direct import. So Amazon was bearing a huge cost to do outbound shipping to the end consumer.
So by shifting to more of a dropship model or having a blend of dropship and direct import, we're able to offset Amazon's cost to serve, their cost to ship, which then enabled them to have a lower net PPM and more competitive pricing. So it's not just seeing kind of the face value, but also understanding like how the different levers and inputs work together and how you can manipulate them. Nick, do you want to talk about, I think you have some good examples around partnering good faith and the programs too.
Nick Gezzar
You know, with sort of partnering good faith, it's just understanding that it may feel like Amazon's always out to get you, but they're not. Sometimes they're bringing proposals that aren't entirely unreasonable if you see it from their perspective. A lot of vendors get very defensive very quickly because they don't necessarily understand the tone of the negotiation or the intent of it. And as far as understanding the retail relationship, like knowing your commercial terms is crucial, especially in these early onboarding stages. Before you get that invitation, you're going to negotiate all your baseline commercial terms and the price list with that Vendor Manager. That's effectively your starting position on the board. And you will have to fight tooth and nail to ever improve that.
Generally, terms go one way when Amazon's negotiating over the long term. They want them to go up. So you want to start in the best position possible. And you see a lot of aspiring vendors sometimes take that first offer from Amazon without trying to negotiate anything down, change the terms at all. And just starting out in an already unfavourable positio,n you're not setting yourself up for really good long-term success. But we saw with some of the clients we've got onboarded, saving them literally over a million dollars a year in fees in year one, just from the terms. Sorry, I kind of lost the sync of this since I was in and out due to my bad connection.
Kara Babb
No problem. So I think the only other thing we want to mention here in terms of succeeding as a vendor is it's all about, while we say influence is important, you have to really control and manage that influence. So, for example, I had a client that had agreed to a multimillion-dollar marketing package with Amazon, but they kind of sat on it, and they didn't actively manage where those dollars were being invested. And so at the end of the year, they woke up and said, well, where's our money gone? And Amazon had been billing them and taking that direct deduct from payment, but there was nothing to show for it.
So it's all about really pushing and encouraging your Vendor Manager to help you explore new, cool things at Amazon that only 1P sellers or 1P vendors have access to. For example, some of the new things I've been hearing of are these kind of experiential or in-person events and activities that are being run by the Vendor Managers in some categories. Direct import as managed by Amazon.
So not necessarily managed through global logistics where you're kind of driving your own, your own bus as managed by Amazon is another, you know, another area you can ask for. And it's really about making sure you're asking questions and, driving your business, even though you're not necessarily in direct control of some of the levers that you have to pull. Awesome. Okay, I think we're moving on to Q&A now, right?
Nick Gezzar
Yeah, I actually don't have control of the slides at this time.
Kara Babb
Oh, okay, cool.
Nick Gezzar
There we go.
Paul Sonneveld
Yeah, I quietly took over from you, Nick, while you dropped out. Seamlessly took the reins, but not so good. I think we have quite a few. I've dropped a couple of questions in there that I've collected over time, and a couple of others there as well. In fact, I have a lot of questions, so I'll do my best not to ask too many. But I also want to hear more from the audience. So if you have a burning question on particularly how you transition to 1P, make sure you put that in the chat. I'll get it to these guys.
So, let me just kick off I don't actually have the question kind of here in the chat but my main question was you must have people like because i get this question all the time people that come to you and say hey can you help me get onto 1P i have this idea that 1P is going to make my life better much better than 3P i want to get on 1P can you help me get an invite. What is your thirty-second framework to even entertaining the question? What questions do you ask and how do you sort of quickly triage whether actually this is worth talking more or no chance. Thanks for your time. Let's move on. What's that thirty-second framework you have in your mind?
Nick Gezzar
All right. So if we're just doing it, sorry, I was chopping up a bit. So just a fast triage on a 1P candidates.
Kara Babb
What are the things you look for?
Paul Sonneveld
Yeah. Sounds like you want to take that one, Nick. So I'll hand to you.
Nick Gezzar
If we were doing like, thirty-second-speed dating kind of format here. First thing we look at is the category, see their trailing, twelve-month sales along with the prior period to know if there is growth or not. Then we'll do a little bit of research into the category to see if there's any kind of selection gaps, if these guys are going to compare, and the most importantly, ask about their logistics network. How many warehouses they have nationwide? These are generally going to be the biggest discriminators that we see. And then if those clear, then we want to start really digging into the details so we can build that right presentation to show to the folks at Amazon.
Paul Sonneveld
Do you want to add something there Kara?
Kara Babb
Yeah, I was going to say if you're going to self kind of self-select because we're also very careful who we work with partly because it's our reputations on the line if we bring on a dud. And also because we don't want to waste anybody's money or time but if you're a seller and you're like well, I'm you know less than fifteen million dollars a year I only sell on Amazon And like I work through, you know, I don't actually do like huge volumes yet. Like that's probably in a situation where you might want to find another path, like maybe something like the company Gravana, where it can act like as a 1P incubator.
And what we find works best for the clients that works best for are ones who really need a more profitable situation where they have really low price items, or they're looking to grow rapidly, and they need it, need a more consistent like income stream. So it's not initially sold on a consignment basis, but through these big chunks of cash via PO helps them grow faster, invest in their own logistics network or in additional manufacturing. It's kind of like for brands that are looking to go to the next level in terms of size and operational sophistication.
Paul Sonneveld
Awesome. All right. Let me pick on another one here. What are you, like this one, I think is great. I think there are conceptions or perceptions about the benefits of 1P, which ones would you say the benefits won't be our most tangible and real, versus which ones do you feel like are just overstated, you know, maybe not ground in reality. Like, what would you put at the bottom and the top of the list? Who wants to take that one first?
Kara Babb
I mean, I'll take that. The top of the list is profitability. We see a market change in the profitability to the brand when they shift from seller to vendor. As I mentioned, there's a reason Amazon loves sellers. And then two, is kind of conversion rate customer trust, especially in certain categories like supplements or healthcare or beauty. Customers typically want to buy, they trust shipped and sold by Amazon, potentially a little more than shipped by or sold by Paul's store shipped by Amazon.
I'd say those are like the two big ones, and tied with profitability is that like cashflow perspective. Because there's fewer, I mean, so much of the placements on Amazon are now open to 1P and 3P working. I mean, I just had a conversation with my client and their Vendor Manager last week. Like, what can you do for us? What cool stuff can we access? And they're like, well, most of it's owned by ads, and ads are accessible for 1P and 3P. So I'd say like top of the list is that like monetary direct P&L impact and customer confidence that hopefully leads to improved conversion rates. Nick, what do you think?
Paul Sonneveld
Anything you want to add there, Nick?
Nick Gezzar
You know, in terms of 1P benefits that are a bit mythological, we have encountered some clients or potential 1P vendors who believe that Amazon can just force growth on you. Like, oh, we're going to 1P, and Amazon will grow us. The rules still apply. You still need to have demand for your products. Let me have a quality product, good logistics. Amazon does not just bestow growth upon you. It's a surprisingly persistent belief we've heard from a couple of pockets of Candidates out there.
Kara Babb
The other misconception is that a Vendor Manager can do anything. So it used to be back in the day, when I was a Vendor Manager, I could influence forecasts. I could work with my in-stock manager to cut POs. I mean, at this point, they can do bulk orders, bulk purchase orders with working with their in-stock managers. But most of the ordering and forecasting is owned by the central supply chain operations team. That's entirely algorithmically generated. Like it's the VM has very little control.
So, again, like if structurally you think looking at 1P versus 3P can help you grow your business overall, you'll still have to drive it. But from a kind of programmatic and structural perspective, one can be helpful to certain brands. I also saw, Paul, you said something about international expansion. One thing we get asked is, hey, if I'm one in Germany, will I just get one in U.S.? The problem is U.S. They're a little we're a little arrogant, especially Amazon U.S. And they'll say, OK, that's cute. You're in Germany as a 1P. Come over here, sell 3P and then grow, and we'll talk. So it's not like you get 1P in another country and it's a silver bullet to get it in U.S.
Paul Sonneveld
On the topic of benefits, there is certainly, that's why I put this question up, perception around brand control, right? But in practice, I mean, we have brand registry, right? It's available to both 1P and 3P, but in practice, as an Amazon Vendor, do I have more, I would say, meaningful control over my brand, PDPs, merchandising, brand store, and the like?
Kara Babb
I would love to say you do, but not really. They both, both seller and vendor work with similar support teams, you know, in India or the Philippines that are helping. Like when you say, Hey, I need to improve, I need to fix my variation. You send it to your CSM, your customer success manager, because you're paying for AVS, for example, which is like kind of like a specialised brand person for your business. They then send it to an offshore team. The team takes time to turn it around and fix it. If it breaks, they have to go back and fix it again.
Or say that 3P sellers are hijacking your 1P brand, 3P sellers can still hijack the content. 1P content is supposed to override 3P, but it's in practice, I see it happen all the time where that's not the case. Amazon also, with very few exceptions will not gate 3P sellers. So if you're in a premium beauty category, you can pay an extra fifteen percent, and they won't let any other 3P sellers sell on your brand. But no other categories have that option. So it's again like it's really like there's no silver bullet for protecting your products on 1P. There used to be, but it's definitely changing.
Paul Sonneveld
All right. Next question comes from Jonathan. very timely and very reliant to some of our previous sessions. How do I get on Amazon Fresh?
Kara Babb
Well, that program is closing. So they're actually spinning down Fresh. There is a new program that they've added where if you go to your cart, they'll suggest different Fresh options like groceries. So they are still working on grocery, but there's no longer a separate Amazon Fresh team. So it's a kind of general grocery team.
Paul Sonneveld
I guess the perhaps the broader question, and Jonathan, feel free to clarify here. Um, yeah. You know, if I'm selling a grocery product, particularly that's in maybe in a cold chain environment, uh, or, or kind of a shorter shelf life. And maybe that's meant I haven't been able to sell it through the 3P model, but I'm keen to sell it through Amazon on the 1P model. Um, how would I, go about that? Any tips or advice for Jonathan on that front?
Kara Babb
I'd say it's a similar situation to others that we spoke about in terms of distribution. But within that particular space, Amazon looks very closely at Walmart within grocery and kind of temperature-controlled type products. Are you on Walmart? What is your social presence look like? You've seen some of these brands that are in the kind of grocery food space that have blown up on social, and then Amazon wants to bring them on. So it's a similar, the kind of the similar structure applies of like, how big is your business? Where are you, where else are you selling? What does your logistics situation look like? And putting together the right kind of pitch or proposal for that Vendor Manager to make them interested in bringing on your products.
Paul Sonneveld
All right. Last question here from Jody. What insights can you provide about the PPM program? Will agreeing to a PPM improve sales? Now, I must admit, full disclosure, I'm not completely sure what the PPM acronym stands for here.
Nick Gezzar
Is that a GMM agreement? Guaranteed minimum margin?
Kara Babb
So just for some definitions, net PPM is your net margin, whether it's per product or in a total. Because Amazon doesn't share their below-the-line costs and their core profitability metrics, net PPM is what they use to converse with vendors. But that net PPM does influence everything from your pricing, to forecast how much Amazon buys from you as well as whether or not you're eligible for advertising and how you rank and search those little Amazon's choice badges it's not just because people buy a lot of it but because that product's really profitable to Amazon.
So, from a profitability perspective profitability drives every decision the Amazon retail team makes for the most part. If you're speaking to a guaranteed margin agreement, we typically steer our clients away from that actually have a client and helping them negotiate to get out of one right now, because it's just like a bandaid that can cover all number of sins. And it's just money taken out of your pocket, no matter what.
So I think making sure that you are meeting your Vendor Manager's goals from net PPM perspective, however, that needs to be kind of cooked, right? So different buckets have different levels of impact; how you can structure that, you know, so it also makes sense for you will ultimately drive your business forward because if you're not profitable to Amazon, they're not going to buy your products, they're not going to let you advertise, they're not going to show you top of search or anything like that. Nick, you wanna add anything?
Nick Gezzar
I was going to add that, A GMM is generally not a beneficial thing to agree into. And from my Vendor Manager experience, if one of my peers were able to secure a GMM, they're preparing their promotion doc next. That's a big win for Amazon, rarely favourable for a vendor. We would never advise our clients to enter those. And to answer your original question there, it really... is very unlikely to improve your sales on its own. And if you are agreeing to a GMM, Amazon will definitely need to give you something considerable to help drive sales. If you're just giving it away just to appease them, you're just going to see less profit and it's not going to on its own really improve your sales.
Kara Babb
It's more important to understand why Amazon's asking for that. What are the root causes that are degrading their profit margin or what's happening out there? So for example, when my clients, they have a lot of issues with channel conflict, price matching, Amazon doesn't want to go through the hassle of asking them for a price protection agreement every time there's a match. Or, you know, they only kind of like Nick's earlier point, they only have one warehouse where they're trying to fulfill everything. So Amazon's shouldering all the inbound and outbound costs for the products. So, really start asking some good questions. Ask some questions of like, why this GMM? What are you trying to solve here?
Paul Sonneveld
All right. That is great. So to summarise, GMM very rarely sounds like a win-win to me. So certainly steer away from it unless Amazon brings something extremely compelling to the table. But great question, Jody. Really, thank you. And I appreciate you clarifying that you were talking about GMM as well. Kara and Nick, we're going to have to wrap up this particular session. It's been very engaging, very interesting. Lots of questions we didn't get around to. But I know, Kara, you're hanging around for our expert panel a little bit later on. So we look forward to really diving into some of those questions a little bit deeper. Thank you, guys.
Kara Babb
Thank you.
Paul Sonneveld
And I look forward to continuing the conversation.
Kara Babb
Thanks, everybody.
Nick Gezzar
Thank you, Paul. Thank you, everybody, for attending.