CNBC reports that “Amazon is adding a new charge for third-party sellers who ship their own products instead of paying for the company’s fulfillment services.
“Beginning Oct. 1, members of Amazon’s Seller Fulfilled Prime program will pay the company a 2% fee on each product sold, according to a notice sent to merchants last week, which was viewed by CNBC. Previously, there was no such fee for sellers.
“‘We’re updating our requirements for Seller Fulfilled Prime to ensure that it provides customers a great and consistent Prime experience,’ the notice states.”
CNBC offers the following analysis:
“Amazon’s marketplace has been an increasing focus of antitrust investigators in the U.S. and abroad, many of whom believe the company uses its power to squeeze the merchants that sell on its platform. Regulators have examined whether Amazon pressures sellers into using its services in exchange for preferential treatment on the marketplace.
“The fee increase comes as the Federal Trade Commission is reportedly gearing up to file a long-awaited lawsuit against Amazon as soon as this month. The agency has been probing the company on a number of fronts, including its treatment of sellers on the marketplace, which now accounts for roughly 60% of its overall retail sales.”
KC’s View:
The timing would seem to be curious, like Amazon is poking the FTC bear.
Maybe Amazon could have positioned this differently. Maybe Amazon could have raised the rates for everybody, and then offered a discount to vendors that use all of its services.
Nothing wrong with that, methinks. Don’t many businesses offer better prices to best vendors/customers?
I also believe that Amazon has a legitimate point about wanting to preserve the Prime experience, especially because during the pandemic many customers found it to be inconsistent and not living up to the value proposition. That’s a problem, and Amazon needs to do what it can to address it.
But there would appear to be plenty of headwinds. The New York Times reports that “a group of booksellers, authors, and antitrust activists are urging the government to investigate the company’s domination of the book market.
“On Wednesday, the Open Markets Institute, an antitrust think tank, along with the Authors Guild and the American Booksellers Association, sent a letter to the Justice Department and the Federal Trade Commission, calling on the government to curb Amazon’s ‘monopoly in its role as a seller of books to the public.’
“The groups are pressing the Justice Department to investigate not only Amazon’s size as a bookseller but also its sway over the book market — especially its ability to promote certain titles on its site and bury others, said Barry Lynn, the executive director of the Open Markets Institute, a research and advocacy group focused on strengthening anti-monopoly policies.”
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