Amazon is quietly rewriting the rules of vendor profitability in 2026. Across Co
By Martin Heubel · June 13, 2026 · Curated by George's Blog
Amazon is quietly rewriting the rules of vendor profitability in 2026. Across Consumables, Softlines, and Hardlines, shipping costs on <$15 items are eating Amazon's Contribution Margin on every order.
As a result, Vendor Managers are raising Net PPM targets and pushing vendors for new selection with higher ASPs.
But Amazon’s shifting demands haven’t met the reality of most 1P vendors (yet), who still treat Amazon as a bolt-on to their other channels.
They still list the same products and price-pack architecture across Walmart, Target, and Amazon and then wonder why pressure on Net PPM keeps rising.
Amazon needs entry-level price points to win shoppers, but also higher ASP items to counterbalance the CM hit those lower ASP units cause. Without both, Amazon's economics don't add up.
Which is exactly why your VM keeps coming back for more.
So if you haven't worked on premiumising your Amazon assortment, you may want to recalibrate your priorities.
Here's how:
1️⃣ Test price points and demand through virtual bundles
2️⃣ Convert your best-performing VBs into hard bundles
3️⃣ Launch differentiated assortment where possible
4️⃣ Prioritise SIPP packaging when launching new products
5️⃣ Ask for a lower account-level Net PPM target in return
6️⃣ Make premium-priced selection part of your trade negotiations
Yes, hard bundles and value packs incur upfront investments. But the annually compounding opportunity cost of inaction far outweighs the one-time development cost.
We're entering an era where Amazon protects its invisible bottom line below Net PPM.
Is your assortment strategy ready for it?
♻️ Repost to share, and
💭 Comment your thoughts below.
#amazonvendor #amazonstrategy