A sudden storm is sweeping through Amazon's marketplace, leaving thousands of Chinese sellers scrambling. Imagine investing years of effort and substantial capital to join Amazon's official "Brand Registry" program, only to receive abrupt termination notice right before peak sales season. Thousands of sellers now face a clearance countdown for billions in inventory. What happened? Why would Amazon abruptly cancel this heavily promoted program?
The Unanticipated End of Amazon's "Brand Registry" Program
To understand this crisis, we must first examine Amazon's "Brand Registry" program structure. Essentially, Amazon licensed four of its proprietary brands—Umi, Eono, Hikaro, and Find—to third-party sellers. In exchange for marketing support and traffic, sellers handled manufacturing, inventory, and customer service while paying a 10% royalty fee atop standard commissions.
For Chinese manufacturers with export supply chain expertise, this represented a golden opportunity. One seller, Zhang, joined in 2018 after Amazon's account managers emphasized program security and marketing advantages. "We abandoned existing product lines to focus exclusively on this," he recalled.
The program expanded globally across Europe, Japan, and North America, encompassing 3,500+ products by 2019. Yet on November 17, 2022, an email blast announced its immediate termination, allowing inventory sales only until March 31, 2023. Amazon cited "ongoing evaluation of programs" without further explanation.
Rigorous Vetting Meets Sudden Collapse
The shutdown detonated like a depth charge among sellers who endured exhaustive onboarding. Approval required factory audits (BSCI/SMETA compliance), product certifications (2-10 months), and patent clearances—a 6-15 month process costing up to six figures.
"We started preparations in 2020," said seller Wang. "The compliance hurdles were enormous—social responsibility reports, internal approvals—we only launched sales this June." His "reward"? Five months of operation before termination.
Inventory Catastrophe and Vanishing Traffic
"Completely unexpected," summarized sellers' reactions. Even Amazon's own account managers appeared blindsided, with 100+ reportedly facing layoffs by December 1.
The fallout is multidimensional:
Inventory Glut: Amazon's four-month clearance window proves woefully inadequate. "Some small sellers might liquidate stock, but larger operations need 6-8 months minimum," Zhang explained. Products bearing Amazon's logos face post-March IP violations if sold elsewhere.
Traffic Erosion: "Our product rankings are plummeting," Wang noted. Many report disappearing ad placements for Eono/Umi brands, suggesting Amazon has already deprioritized the program.
Financial Ruin: Sellers describe "fire sale" pricing with slim-to-negative margins. One merchant abandoned new arrivals at fulfillment centers, calculating that promotion costs would outweigh potential returns.
Industry estimates suggest the crisis impacts 1,000+ Chinese sellers with collective inventory valued between hundreds of millions to billions of dollars—including major cross-border e-commerce players.
Seller Demands and Platform Silence
Outrage centers on perceived contract breaches. "We operated strictly by the rules," Zhang emphasized. "Amazon's unilateral termination violates good faith." Others criticize the platform's failure to consult sellers before dismantling their primary revenue streams.
Key demands include:
- Retaining product listings post-termination
- Restoring advertising capabilities
- Extending the sales deadline
While some account managers promise to relay concerns to headquarters, concrete responses remain elusive. Amazon's sole statement confirmed the cancellation as a "business adjustment" while pledging to "protect seller interests"—a vague assurance that fails to address immediate crises.
With legal actions and government complaints looming, sellers brace for a protracted battle. "Mutual understanding could resolve this," one seller remarked. But as liquidation clocks tick, patience wears thin. The coming weeks will determine whether Amazon can salvage trust with its international merchant base—or face lasting reputational damage.