Bottom line up front: Starting January 1, 2026, Amazon will stop offering all FBA prep services, including labeling, bagging, and bundling. Brands must be 100% ready with alternative solutions or risk shipment rejections, delays, and lost sales.
For thousands of Amazon sellers, January 1, 2026, marks the end of an era. Amazon will permanently discontinue all Fulfillment by Amazon (FBA) prep and labeling services for U.S. inbound shipments, including inventory shipped directly or through Amazon Warehousing and Distribution (AWD), Amazon Global Logistics (AGL), Amazon SEND, or via the Supply Chain Portal.
This is a fundamental shift that will impact millions of marketplace sellers who have relied on Amazon to handle the final steps before inventory becomes FBA-ready.
What’s changing exactly?
After January 1, 2026, any new FBA shipment must arrive fully prepped and labeled. All units must arrive ready to go—barcoded, bagged, bundled, or wrapped as needed. The services being eliminated include:
- FNSKU barcode labeling
- Poly-bagging and bubble-wrapping
- Product bundling and kitting
- Stickering and safety label application
- Any other prep work Amazon previously handled
There will be a brief grace period: shipments created before January 1, 2026, will still be eligible for prep services, even if they arrive at Amazon’s fulfillment centers in early 2026. But once the clock strikes midnight on New Year’s Day, sellers are on their own.
Why Amazon made this move
Amazon said it initially introduced prep services, which include labeling, bubble-wrapping, stickering, and bagging items, to help protect products and avoid damage during the shipping process. Over time, sellers’ packaging capabilities have improved, reducing the need for Amazon’s prep offerings.
The reality is more strategic. Amazon’s fulfillment centers are increasingly automated. Manual services like labeling and poly bagging are incompatible with the company’s push for scalable, robotics-driven fulfillment. With an estimated 300+ prep centers now operating in the U.S. and 500+ globally, Amazon sees an opportunity to streamline operations while pushing prep responsibilities back to sellers and their partners.
The impact on your business
This change creates both immediate operational challenges and long-term strategic considerations:
Immediate operational impact
- Full prep responsibility: You’ll need to handle all labeling, bagging, bundling, and compliance requirements
- Higher complexity: Compliance risk increases, and any lapse in prep puts inventory at risk for rejection, delays, or added fees
- Cost considerations: Whether handling prep in-house or outsourcing, you’ll need to budget for new labor and material costs
Strategic implications
- Operational agility becomes critical: The brands that can adapt quickest will maintain a competitive advantage
- Supply chain maturity: This change aligns with larger brands’ existing workflows but requires smaller sellers to upgrade their operations
- Cash flow planning: Inventory financing becomes even more important when prep delays can derail your sales velocity
The 3 best options moving forward
Amazon recommends three approaches: sellers can take full control by packaging and labeling goods before shipping, outsource to vetted third-party FBA prep services, or enroll in Amazon’s SIPP program to ship products in ready-to-ship packaging directly to customers.
Option 1: Bring prep in-house
Taking full control means investing in:
- Staff training on Amazon’s detailed prep requirements
- Equipment for labeling, bagging, and bundling
- Quality control processes to ensure compliance
- Workspace setup for prep operations
Option 2: Partner with third-party prep centers (MOST POPULAR)
The most popular choice among experienced sellers involves outsourcing to specialized 3PLs that:
- Understand Amazon’s requirements inside and out
- Offer quick turnaround times
- Have nationwide facilities for faster delivery
- Provide dedicated account management
Kickfurther can help! We have an extensive network of partners who can help you with outsourcing. Contact partnerships@kickfurther.com if you’d like to be connected to one of them.
Option 3: Leverage SIPP (Ships in Product Packaging)
For eligible products, enrolling in Amazon’s SIPP program allows you to ship directly to customers without additional prep, potentially avoiding prep requirements entirely.
Why this makes inventory financing more critical than ever
This change amplifies the importance of having sufficient working capital to maintain smooth operations. Here’s why:
- Prep delays = Cash flow disruption: Any hiccup in your new prep process can delay inventory reaching FBA, directly impacting your sales velocity and cash generation.
- Higher upfront costs: Whether you’re setting up in-house prep or paying a 3PL, you’ll have new costs that hit before your inventory starts generating revenue.
- Seasonal vulnerability: The brands most at risk are those that struggle to fund large inventory purchases ahead of peak seasons. If prep delays compound cash flow challenges, you could miss your most profitable selling windows.
- Inventory financing as insurance: Having access to inventory financing through platforms like Kickfurther ensures you can maintain adequate stock levels even when facing operational disruptions or higher prep costs.
The sellers who thrive through this transition will be those who plan ahead, secure reliable prep solutions, and maintain the financial flexibility to invest in inventory without cash flow constraints.
Action plan: What to do starting TODAY
Q3 2025 – Today
✅ Audit your SKUs: Identify which products currently rely on Amazon prep
✅ Research solutions: Evaluate in-house capabilities vs. outsourcing options
✅ Budget for changes: Factor new costs into your financial planning
Q4 2025
✅ Secure partnerships: Demand for prep services will surge—book capacity early
✅ Run test shipments: Work out operational kinks before the deadline
✅ Plan for peak season: Ensure your new process can handle holiday volumes
Q1 2026 and beyond
✅ Maintain compliance: Stay updated on Amazon’s evolving requirements
✅ Monitor performance: Track how prep changes affect your operational metrics
✅ Optimize costs: Continuously refine your prep strategy for efficiency
The bottom line
While it may seem daunting, this change is also an opportunity. The brands that move fastest and put best-in-class processes in place now are the ones most likely to succeed in 2026 and beyond. The sellers who treat this as a chance to build more resilient, efficient operations will emerge stronger.
The countdown to January 1, 2026, is on! Will you be ready to turn a potential disruption into a competitive advantage?
Need help making sure your inventory financing can support you through this transition? Check out Kickfurther’s funding solutions built specifically for Amazon sellers like you.