Amazon to End FBA Prep Services in 2026, Forcing Sellers to Seek New Logistics Partners

Amazon to End FBA Prep Services in 2026, Forcing Sellers to Seek New Logistics Partners

Amazon has announced plans to discontinue its Fulfillment by Amazon (FBA) prep and labeling services in the United States effective January 1, 2026. The program, which offered sellers support with labeling, poly-bagging, and packaging to meet inbound shipment standards, has been a key resource for thousands of businesses. Its removal is expected to trigger a surge in demand for independent logistics providers, including fulfillment center Florida operations and 3PL Tampa facilities.

Mid-Sized Sellers Under Pressure

For many small and mid-sized brands, Amazon’s prep services were an affordable solution for meeting the marketplace’s strict compliance rules. Without it, companies—especially those earning between $1 million and $5 million annually—will need to secure outside prep centers or build in-house processes.

According to Marketplace Pulse, more than half of Amazon’s top sellers already work with third-party logistics providers. Industry analysts expect this number to rise sharply as sellers move to avoid shipment rejections, suppressed listings, or penalties due to labeling and packaging errors.

Financial and Operational Strain

The transition comes during a period of rising warehouse rents, ongoing carrier surcharges, and increasingly complex tax nexus rules. Losing Amazon’s prep service will add to the financial burden for sellers already managing tight margins.

“By pulling out of FBA prep, Amazon is forcing brands to rethink logistics. Those who act early with the right partners will keep margins safe and sales growing,” said Atahan Kangal, founder of Fifth Shelf, a Tampa-based e-commerce accelerator and logistics provider.

Independent Providers Step In

The gap left by Amazon is expected to create opportunities for regional 3PLs and prep centers that can handle labeling, kitting, pick and pack, and even temperature-controlled solutions for specialized categories like beauty, apparel, and cold chain. Subscription commerce brands may also shift to subscription box fulfillment providers, an area where Amazon’s program never fully adapted.

Preparing Ahead of 2026

Industry experts warn that delaying action could leave sellers scrambling for warehouse space and competitive pricing in late 2025. Recommended steps include:

• Auditing prep processes for compliance accuracy
• Securing early partnerships with 3PL or fulfillment providers
• Locking in fulfillment pricing before demand spikes
• Adding secondary fulfillment partners to diversify risk

Those who plan ahead stand to gain stability in costs and availability, while late movers may face higher rates and limited capacity.

Industry Outlook

Amazon’s withdrawal continues a larger trend of shifting logistics responsibilities and costs to sellers. From higher FBA storage fees to stricter compliance rules, the marketplace is pushing merchants to shoulder more of the operational load.

Independent logistics providers are positioned to become more central in 2026 and beyond. The most successful operators will be those capable of combining accuracy in preparation with scalable warehouse capacity, competitive pricing, and flexible support for both B2B and B2C shipments.

About Fifth Shelf

Fifth Shelf is a Tampa-based e-commerce accelerator and logistics provider, operating a 3PL warehouse that serves regional and national brands. The company specializes in order prep, fulfillment, and multi-channel support, helping sellers adapt to changes such as Amazon’s exit from FBA prep services.