How to read this guide. Each point carries a short tag. Amazon policy or Widely reported means Amazon's own policy wording or a point described consistently across the industry. Benchmark survey means self-reported figures from a 2026 survey of 227 1P vendors and the same series' 2025 wave, which are directional rather than Amazon data. Reported by vendors and Industry estimate mark single vendor accounts or typical ranges that Amazon has not confirmed. The preparation and negotiation sections are our recommended practice, not Amazon policy. Amazon's Vendor Central help pages sit behind a login and were not reviewed for this guide.
Amazon asks for more almost every year. The vendors who protect their margin build leverage early, bring ASIN-level numbers that include chargebacks and freight, trade every concession for something measurable, and agree their walk-away point with leadership before the kickoff.
If you want support preparing those numbers, our Vendor Central consulting work starts with an ASIN-level margin review.
Key takeaways
- AVN usually opens in Q4, often early November Widely reported, and took 3.1 months on average in 2026 Benchmark survey.
- The average trade term increase halved, from +91 bps in 2025 to +50 bps in 2026. Vendors who conceded still gave +116 bps on average Benchmark survey.
- About 1 in 2 vendors faced punitive measures such as Buy Box suppression, order stops or deal suppression Benchmark survey.
- Vendor Managers now ask for written deal funding and advertising commitments inside the AVN Benchmark survey.
- Vendors describe price decrease and allowance demands, accruals that stack up and are hard to see, Born-to-Run rejections and unresponsive Vendor Managers Reported by vendors.
How AVN works and when it happens
AVN is the yearly reset of cost prices, allowances, funding, payment terms and programme commitments between Amazon Retail and a 1P vendor. Some Amazon buyers call it a Joint Business Plan Widely reported.
- Kickoff: usually Q4, often early November Widely reported. We recommend starting your preparation by mid-August.
- Duration: 3.2 months in 2025 and 3.1 in 2026. Hardlines averaged 2.7 months, Consumables 3.2 and Softlines 4.0. Collaborative negotiations closed in about 2 months, confrontational ones in about 4.3 Benchmark survey.
- Early signals: margin compensation support emails tend to arrive in August and September, before the AVN formally opens Industry estimate.
- Managed accounts: a Vendor Manager leads a 2 to 6 hour kickoff covering Amazon initiatives, a performance review, 12-month priorities and a growth target with proposed terms Industry estimate.
- Unmanaged accounts: vendors in the Vendor Success Programme (VSP) receive templated proposals by email or in Vendor Central to accept or reject, with no direct Vendor Manager contact Widely reported.
- Europe: negotiations run locally, pan-EU coordinated or pan-EU managed, often through one lead market or an EU key account manager Industry estimate.
- Opening ask: opening investment asks of 4% to 8% are common. Amazon anchors high and expects counter-proposals Industry estimate.
Amazon argues from Net PPM. That metric leaves out chargebacks, Amazon Ads spend and freight, so it can look healthy while your remittance tells a different story. Low Net PPM can lead to CRaP status (Can't Realise a Profit): first loss of ad and promotion eligibility, then removal from Subscribe & Save, Buy Box suppression and finally no new purchase orders Widely reported.
In 2026 there were fewer Vendor Managers, each covering more accounts, more templated email asks, and Amazon leadership stayed out until an account escalated Industry estimate.
Typical terms and asks
| Term | What it is | Typical range or trend |
|---|---|---|
| Co-op, MDF, base accrual | Percentage deducted from invoices for marketing, often described as a listing fee | Often 5% to 10%, said to have risen from about 6% to 8% to 10% for many brands by 2025 Industry estimate |
| Damage allowance | Covers goods customers return as damaged; the data behind it is rarely shared | Commonly 5% Industry estimate |
| Freight allowance | Funds Amazon supply chain programmes such as PICS, Direct Import, Direct Fulfillment and WePay | Asked of 21% of vendors in 2026 Benchmark survey |
| Overstock allowance and return rights | Can replace the right to return undamaged overstock | One vendor reported a new 2% allowance in 2026 Reported by vendors |
| Payment terms | Days to pay plus any early payment discount | 2% 60 days EOM is typical; 90 and 120-day asks reported in 2025 Industry estimate |
| AVS (Amazon Vendor Services) | Paid dedicated support contact | Often 1% to 3% of sales Reported by vendors |
| Subscribe & Save | Flat accrual or pay-as-you-go funding | Example of a 3% flat rate negotiated to 2.5% or a flex plan Reported by vendors |
| Volume Incentive Rebate | Rebate tied to sales tiers | Illustrative tiers of 0.5% to 2% Industry estimate |
| Margin guarantees (CSA, GMM, GMA) | Funding that keeps Amazon at a target Net PPM, sometimes called price protection | Margin support secured from 17% of vendors in 2026 Benchmark survey |
| Provisions | Temporary holdbacks for receivables, missing actuals and aged receivables, not final deductions | Recalculated daily Widely reported |
| Programme asks | Amazon Business, Vine, Direct Import, Direct Fulfillment, advertising letter of intent | Advertising commitments asked of 16% of vendors in 2026 Benchmark survey |
Facing an AVN ask you are not sure how to answer? Book a USD 100 AVN preparation review.
2025 vs 2026: what the benchmark data shows
| Measure | 2025 AVN | 2026 AVN |
|---|---|---|
| Average change in trade terms | +91 bps (to about 18.6% of net sales) | +50 bps |
| Vendors whose terms rose | 93% | About 50%; the rest held flat or reduced |
| Average concession among those who conceded | Not reported | +116 bps |
| Vendors whose net margin declined | 49% | 39% |
| Vendors facing punitive measures | 50% | About 1 in 2 |
| Average duration | 3.2 months | 3.1 months |
| Average cost price change | Not reported | +1.0% |
| Cost price increase accepted, with vs without a margin guarantee | Not reported | 57% vs 26% |
| Top incremental asks Amazon secured | Higher base accruals, AVS, longer payment terms, Direct Import and Direct Fulfillment | Deal funding 23%, freight allowance 21%, base accruals 19%, margin support 17%, advertising 16% |
Benchmark survey Every figure in this table is self-reported industry benchmark data, mainly from an anonymous 2026 survey of 227 1P vendors collected April to July 2026 (about 57% UK and EU, 42% North America) and the same series' 2025 wave. Treat it as directional, not as Amazon data. The 2024 comparison point was +69 bps.
What vendors are saying
Reported by vendors These points are paraphrased from recent vendor and practitioner discussions about Vendor Central and AVN. They are individual accounts, not verified cases.
- Price cut plus a higher damage allowance. A senior key account manager reported a new Vendor Manager asking for both at once. Experienced practitioners advised understanding the Net PPM driver, asking for the Vendor Manager's reasoning, declining the opening proposal and knowing the walk-away point.
- Provisional co-op rates. A Vendor Central manager received a new provisional co-op rates email and felt terms were becoming less transparent. An ex-Amazon Vendor Manager explained that provisional co-op agreements are a back-up only and should not accrue.
- Accruals stacking up. A practitioner described AVN accruals as death by a thousand cuts: SPA, higher freight allowances, damage fees and Subscribe & Save funding added on top of each other.
- Born-to-Run rejections. A vendor saw Born-to-Run ASINs rejected as an unfavourable submission, with Amazon asking for an unspecified cost reduction and no Vendor Manager to discuss it. Replies suggested modelling the retail price Amazon needs for profitability and being clear about the goal of the BTR.
- Mislabelled shipments. A vendor shipped more than $100K of POs with the wrong unit UPC labels and was worried about shortage claims, with no help from the Vendor Manager.
Key challenges and how to overcome them
The fixes below are our recommended practice, not Amazon policy.
1. Price decrease and allowance demands from a new Vendor Manager
Common in AVN and usually driven by Net PPM Widely reported. New Vendor Managers sometimes ask for a lower price and a higher damage allowance at the same time Reported by vendors.
How to respond: ask for the Vendor Manager's reasoning and monthly margin data, decline the anchor, know your walk-away point and counter with ASIN-level Net PPM that includes chargebacks and freight.
2. Trade terms that creep up and stack
93% of vendors raised terms in 2025, and vendors already above 25% of net sales conceded again in 73% of cases in 2026 Benchmark survey. Vendors describe accruals as death by a thousand cuts Reported by vendors.
How to respond: total every accrual as one figure, audit each term's return and target the empty ones, turn accruals into growth-tied rebates, and push back when temporary funding is converted into a permanent accrual.
3. Opaque or provisional co-op
Provisions are temporary holds, recalculated daily Widely reported. Vendors report provisional co-op emails, and the view that provisional rates should not accrue Reported by vendors.
How to respond: reconcile accruals against remittances every month, dispute and escalate any provisional rate that accrues, and make co-op conditional on placement reporting.
4. Punitive measures
About 1 in 2 vendors faced Buy Box suppression, PO stops or deal suppression. Those hit with two or more measures conceded +100 bps against +39 bps for others Benchmark survey.
How to respond: agree with leadership in advance how much disruption you will accept, fix price parity before the AVN, and hold cash and stock in reserve, since these measures are usually short-lived.
5. Net PPM gap and CRaP risk
Net PPM leaves out chargebacks and freight, and low PPM leads to suppression and then delisting Widely reported.
How to respond: track Net PPM per ASIN every month, fix weak ASINs with new pack sizes, bundles or cost changes, or delist them on your own terms.
6. Cost price increases rejected or tied to margin guarantees
With a margin guarantee, 57% of cost price increases were accepted against 26% without, yet 44% of vendors who gave a guarantee still lost margin Benchmark survey.
How to respond: give early written notice with cost evidence. Keep any CSA, GMM or GMA limited to specific ASINs, time-limited (2 to 8 weeks), capped in dollars and reviewed by legal.
7. Born-to-Run rejections asking for unspecified cost cuts
Vendors report unfavourable submission rejections with no Vendor Manager to discuss them Reported by vendors.
How to respond: model the cost and retail price at which Amazon's margin works, be clear what the BTR is meant to achieve, and consider launching on 3P where policy allows.
8. Damage allowance with no data behind it
Rarely backed by shared data Industry estimate, and often raised alongside price decrease asks Reported by vendors.
How to respond: ask for damage and return reports, fix packaging and agree a step-down plan, for example from 5% to 3% Reported by vendors.
9. Pressure for longer payment terms
90 and 120-day asks were reported in 2025 Industry estimate.
How to respond: put a cost on the financing, give longer terms only in exchange for something specific, and reject category standard anchors.
10. Chargebacks, shortages and labelling errors
Shortage disputes are limited to invoices from the last 2 years, and re-disputes need a Vendor Manager or AVS contact Widely reported. Vendors report mislabelled POs worth more than $100K with no Vendor Manager help Reported by vendors.
How to respond: automate dispute tracking, fix the top reason codes before the AVN, document label errors early and file disputes as soon as they are eligible.
Our shortage claim and chargeback recovery service handles this dispute work and the root-cause fixes behind it.
11. Unresponsive or missing Vendor Managers
Fewer Vendor Managers and more templated email asks Industry estimate, with account managers not responding Reported by vendors.
How to respond: build relationships with the Vendor Manager's manager and above through quarterly notes showing what you did for Amazon's margin, and use escalation as a route to Amazon leadership.
12. Low leverage and high dependence on Amazon
1 in 3 vendors make 60% or more of their online sales on Amazon, although dependence did not decide outcomes in 2026 Benchmark survey.
How to respond: hold new launches back for 60 to 90 days, delay signing the advertising commitment, diversify channels, and never make a threat you will not carry out.
13. Terms in the paperwork that were never discussed
A vendor found a Defective line added to their 2026 terms Reported by vendors.
How to respond: ask for a written summary, check it line by line against the purchasing terms in Vendor Central, and audit monthly.
Preparation calendar
Recommended practice, not Amazon policy.
| When | What to do |
|---|---|
| Right after signing | Log every commitment (advertising letter of intent, promo funding, accrual changes) and debrief leadership |
| Q1 | List your leverage: upcoming launches, price parity gaps, senior relationships |
| Q2 | Model total cost to serve across 2 or 3 scenarios, agree your walk-away plan, and start quarterly notes to the Vendor Manager and their manager |
| Q3, by mid-August | Answer Amazon's margin support emails with your own red lines and give early notice of any cost price increase |
| 90 to 31 days before kickoff | Audit terms and remittances, build the ASIN file, set margin floors, spend ceilings and payment term limits, and get approvals |
| Last 30 days | Refresh the data, rehearse likely objections and decide who speaks on each point |
Data to bring:
- Net margin per ASIN after all terms, chargebacks and shortages, reconciled to remittances.
- Amazon's Net PPM per ASIN next to the chargebacks and freight it leaves out.
- Total cost to serve: invoice, accruals, freight, AVS, advertising and programme fees.
- Operational record: fill rate, ordered vs shipped, on-time delivery and chargebacks by reason code.
- What each term cost last year, and what it visibly paid for.
- Whether Amazon delivered last year's commitments.
- Your category position from market research data.
- Cost change evidence (materials, freight, duties) for any cost price increase.
- A request for Amazon's monthly margin development on your account.
Negotiation playbook
Recommended practice, not Amazon policy.
- Put your numbers on the table first. If Amazon frames the conversation, you spend the whole AVN defending against it.
- Stay neutral in the kickoff. Do not accept or reject anything. Ask how the proposal was built and correct errors early.
- Reply within 5 to 10 days. Anchor your counter well below your target and state your two or three central asks.
- Trade, never concede. Link every give to a measurable get: payment terms, placements, a rebate tied to growth, or help with disputes.
- Give the Vendor Manager a story to sell internally. Show how your proposal still meets Amazon's margin and growth goals.
- Plan for escalation. Match Amazon's seniority, keep your senior people in reserve and expect the escalation phase.
- Control the close. Get a written summary of which agreements are amended or ended, match contract dates to service dates and audit monthly.
Walk-away and hybrid 1P/3P options
- 47% of vendors say hybrid 1P/3P is becoming more relevant Benchmark survey. Modelling your 3P economics gives you leverage in the negotiation.
- Amazon's Standards for Brands policy bars a brand from selling as a 3P seller any product that Amazon sells, and Amazon can enforce it without notice Amazon policy.
- Very large vendors (around $50M) may be required to stay on 1P Industry estimate.
- Lower-risk uses of 3P include covering Amazon out-of-stocks, seasonal items, reintroducing CRaP'd ASINs and testing new products.
- In early 2025, vendors reported Amazon ending some smaller 1P relationships; Amazon has made no public statement about this Reported by vendors.
Caveats
- Amazon publishes no public AVN guide, and Vendor Central help pages were not reviewed because they require a login.
- Most figures come from one self-reported benchmark survey series weighted towards Europe, so treat them as directional.
- Vendor discussions are paraphrased individual accounts, not verified cases.
- Check anything tagged as reported by vendors or as an industry estimate against your own account data.
How is your AVN going this year: collaborative, or another round of asks?