Imagine spending months developing a best-selling product, only to see it flooded with negative reviews and plummeting sales because counterfeit or substandard versions from other sellers entered the supply chain. This frustrating scenario has become all too familiar for many Amazon merchants. Now, the e-commerce giant is taking decisive action to address the issue.
Amazon recently announced through its global seller portal that it will terminate its long-standing "commingled inventory" system effective March 1, 2026, while simultaneously updating eligibility criteria for manufacturer barcodes. The policy shift has sent ripples through the Amazon seller community, raising questions about its implications for business operations.
I. The End of Commingled Inventory: A Fundamental Shift
The commingled inventory system allowed multiple sellers offering identical products to share a single inventory pool within Amazon's Fulfillment by Amazon (FBA) network. Under this model, when different merchants sold items with matching manufacturer barcodes (UPC/EAN), Amazon would ship products from the nearest warehouse without distinguishing between sellers. While this improved delivery speeds, it created quality control nightmares—high-quality products could receive poor ratings due to inferior versions from other suppliers.
Amazon cited two primary reasons for discontinuing this practice during its Accelerate 2025 conference:
- Mature Logistics Network: The original efficiency advantages have diminished as Amazon expanded its U.S. warehouse network. With fulfillment centers now located closer to customers, the cost benefits of shared inventory no longer outweigh the operational complexities.
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Brand Protection Challenges:
The system enabled counterfeit products to infiltrate legitimate supply chains, creating several problems:
- Brands spent approximately $600 million annually on relabeling services to cover manufacturer barcodes with FBA labels
- No quality control over which inventory reached customers, allowing expired, damaged, or fake products to ship
- Reputation damage when brands received complaints about defective items actually supplied by other sellers
II. New Barcode Rules: Divergent Impacts for Brands and Resellers
Amazon FBA uses two primary barcode systems to track inventory:
- Manufacturer barcodes (UPC, EAN, JAN, ISBN)
- Amazon barcodes (FNSKU labels beginning with "X")
The policy changes will affect brand owners and resellers differently:
Benefits for Brand Owners: Registered brand owners can continue using manufacturer barcodes without FNSKU labels, providing several advantages:
- Elimination of relabeling costs
- Simplified shipping directly from manufacturers
- Improved inventory control
- Consistency with offline retail channels
Challenges for Resellers: Non-brand owners face new requirements:
- Mandatory FNSKU labeling on every unit, even for products with existing manufacturer barcodes
- Increased operational costs for labeling
- No exemptions for authorized resellers
III. Strategic Implications for Sellers
The policy changes reflect Amazon's effort to improve supply chain transparency and combat counterfeit products. While creating short-term adjustments, the move may benefit compliant sellers long-term by enhancing consumer trust.
Key adaptation strategies include:
- Brand Owners: Complete Amazon Brand Registry enrollment to maintain manufacturer barcode privileges while strengthening quality control and differentiation.
- Resellers: Allocate resources for FNSKU labeling processes and explore brand authorization partnerships to improve competitiveness.
- All Sellers: Monitor policy updates closely, optimize inventory management, and prioritize customer service excellence.
While the transition presents operational challenges, it also creates opportunities for sellers to distinguish themselves in an increasingly regulated marketplace.