Posted by Alex Jackson on April 07, 2017
So it may come as no surprise to the reputable third party sellers on Amazon that fraud has become rampant on the site. Knockoffs, fly by night scam operations all sorts of different cons to separate an unsuspecting customer from their cash. It’s a troubling trend but frankly it’s to be expected with the ease of use of the third party interface and the gargantuan amount of traffic and sales Amazon generates it is simply a target too big and appealing to ignore. Amazon has started to take more aggressive measures to combat these issues but in the process is greatly reshaping how the third party seller marketplace operates. A good example of this is the change to their payment policy for new sellers. Amazon has altered the cycle from two weeks for new accounts to 7 days after confirmed delivery of the merchandise. While some new sellers may be a little annoyed by this change its not earth shattering and frankly its a very prudent and effective way to combat some of the more common scams like the sale of a nonexistent item.
Other recent initiatives however have been far less popular with legitimate sellers and have led some to question the motives behind the policy changes. By far one of the most unpopular with sellers is brand gating a policy of charging sellers a one time fee of anywhere between $1000-$1500 for the privilege to sell a specific name brand. What’s more they want invoices from the manufacturer and invoices is not something any business small or large is comfortable sharing. Wondering what brands are affected? You and everybody else this policy has been rolled out in a very bizarre fashion with no official list of brands and with many sellers apparently grandfathered in. While this may dissuade the casual crook with a dozen or so fakes to sell why would a manufacturer of knockoff merchandise bat an eye at spending $1000 if they stand to gain tens of thousands of dollars or more for just a few days worth of sales. It could also be argued that this is simply a move by Amazon to placate disgruntled labels and manufactures who do not want to compete against a third party seller who can undercut them on pricing. Amazon is also handing over a greater degree of control and site policing to brand owners by allowing them to register their logo and intellectual property and enabling them to flag items and sellers as counterfeiters a policy that is completely open to abuse by brand owners. While the fight against fraud is essential in the marketplace to keep and maintain consumer confidence it is important that Amazon does not gut the third party marketplace sellers with burdensome costs, rules and regulations that ultimately are ineffective in resolving the problem and create a less competitive and vibrant market.