Amazon is making changes to its fulfillment programs for sellers. FBA prep services will no longer be offered, meaning sellers must ensure they meet FBA prep requirements themselves. The secondary effects for distributors could be significant.

Key Takeaways

• Amazon’s decision to end FBA prep services shifts responsibility upstream, increasing compliance risk across the supply chain.
• Distributors and 3PLs face both added pressure and new opportunities through value-added prep services.
• Success depends on scalable processes, clear accountability, and updated pricing models.

Amazon’s Fulfillment Shift Is Bigger Than Sellers

FBA, or Fulfilled By Amazon, previously included prep services at Amazon fulfillment centers. Beginning in 2026, those services are no longer available. While many see this as a seller issue, the impact extends across the supply chain.

What Fulfillment Programs Is Amazon Ending?

Sellers were once able to rely on Amazon for prep tasks such as labeling and protective packaging. Now, sellers must handle prep in-house or outsource it to partners.

A Quick Overview of the FBA Prep and Labeling Changes

Amazon has phased out labeling, poly-bagging, and bubble wrapping services. As of January 1, 2026, all prep responsibility lies with sellers and their distribution partners.

• Barcode labeling
• Poly-bagging
• Warning labels
• Impact packaging
• Safety inspections
• Bundling

Why Amazon Is Making This Change

Amazon states that most sellers already have strong packaging capabilities. Responsibility for proper packing is now shifted upstream, and sellers or shippers will be accountable for packaging-related claims.

Why This Matters to Distributors

Distributors Are Now Part of the Compliance Chain: Distributors may now inherit prep and labeling responsibilities, increasing stakes for errors and delays.

Increased Pressure From Seller Customers: Sellers will expect distributors to deliver Amazon-ready packages, often with tight margins and high expectations.

Operational Impacts Distributors Should Prepare For

• Changes to Warehouse Workflows: Facilities may need new prep stations, added labor, and process updates to maintain throughput.

• Inventory Accuracy and Handling Risk: Increased SKU complexity and compliance risk require more structured, repeatable processes.

The Growing Role of Value-Added Services (VAS)

• Prep and Labeling as a Differentiator: Prep services can become margin-positive offerings that differentiate distributors from competitors.

• Bundling, Kitting, and Custom Packaging Opportunities: Distributors can generate additional revenue through packaging, kitting, and omnichannel prep services.

Technology and Process Changes Distributors May Need

• Labeling, Tracking, and Documentation: Automated barcode labeling and tracking systems will help reduce errors and improve compliance.

• Systems Integration and Visibility: Integrated systems that attach prep instructions to SKUs and orders will be critical for compliance.

Cost, Pricing, and Contract Considerations

• Labor and Material Cost Implications: Prep increases labor hours and packaging material costs, requiring pricing model reassessment.

• Updating Customer Agreements and SLAs: Clear definitions of compliance responsibilities will help avoid disputes as Amazon tightens enforcement.

How Distributors Can Turn This Change Into an Opportunity

• Becoming a Strategic Partner Instead of a Vendor: Distributors can help sellers navigate compliance and strengthen long-term partnerships.

• Preparing for Future Amazon Policy Shifts: Scalable processes will position distributors to adapt to future changes in Amazon logistics policies.

Amazon’s Fulfillment Changes Require More than Tactical Adjustments

Amazon’s decision shifts operational and compliance demands upstream. Distributors that formalize prep processes and invest in scalable workflows will be better positioned to protect margins and strengthen customer relationships.

BoxLogix works with distributors navigating fulfillment and automation challenges like these every day. Connect with our team to explore how structured process design and automation can help your operation adapt and grow.

Frequently Asked Questions (FAQs)

What Amazon fulfillment programs are ending in 2026?

Amazon is ending its FBA prep and labeling services. Sellers must now complete all prep requirements themselves or outsource them.

What are Amazon’s FBA prep requirements sellers must now handle?

Requirements include barcode labeling, poly-bagging, warning labels, impact packaging, bundling, and quality inspections.

How do Amazon’s fulfillment changes impact distributors and 3PLs?

Responsibility for prep shifts upstream, increasing operational demands and compliance risk.

What warehouse processes need to change to support FBA prep?

Distributors may need dedicated prep stations, added labor, structured workflows, and enhanced documentation.

How should distributors update pricing and SLAs?

Pricing should reflect added labor and materials, while SLAs should clearly define compliance responsibilities.