Amazon Vendor | Inside Amazon Direct Fulfillment: The Operational Playbook for 1P Vendors

In this episode of Marketplace Masters, host Paul Sonneveld goes deep on the operational side of Amazon Direct Fulfillment with Chris Khoo, founder of KhooCommerce and one of the most experienced operators in the Amazon vendor world.

Most vendors treat Direct Fulfillment as "FBM for 1P," backup inventory, or a chargeback eraser. Chris explains why the reality is more demanding, and more valuable. Amazon calls it dual fulfillment internally, and used well it protects the buy box, bridges out-of-stock gaps, and captures demand spikes that traditional PO cycles simply can't respond to fast enough.

Paul and Chris covered:

• Which products are built for DF: bulky, high-value, multi-part, and seasonal items, and why small, low-value products rarely justify the handling cost
• The real disqualifier: whether your warehouse can actually run direct-to-consumer fulfilment alongside palletised PO shipments
• A day in the life of a well-run DF operation: order sync, batch picking, label automation, and carrier cutoff times
• How Amazon measures DF performance, why on-time shipping compliance is the metric that can get you removed from the program, and who really controls the carrier (AOC vs VOC)
• EDI vs SP-API integration, and why the inventory feed is the link most vendors overlook
• How to think about margin and cost recovery when Amazon pushes DF in your annual vendor negotiation
• Real cases: the vendor who went from one order a day to 400 in 48 hours unprepared, and the glassware brand shipping millions per month through a fully automated DF flow

If you run a Vendor Central account, this is a serious upgrade to your operational playbook.