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Amazon Discounts Other Sellers' Products as Retail Competition Stiffens (reuters.com)

Posted by msmash on from the assuming-more-control dept.

Amazon is slashing prices of products from third-party sellers on its website, moving beyond its more typical method of discounts on items it sells directly. From a report: The "discount provided by Amazon" applies to products including board games and technological gadgets offered by other merchants as the holiday season approaches. The retailer has been trying to compete aggressively on some items to win sales and draw customers away from low-priced rivals like Wal-Mart Stores. The move allows Amazon to sell the products at lower prices while still giving full price to the sellers. "When Amazon provides a discount, customers get the products they want at a price they'll love, and small businesses receive increased sales at their listed asking price," an Amazon spokeswoman said in an emailed statement, noting that businesses can opt out at any time.

5 of 98 comments (clear)

  1. Wonderful by hackertourist · · Score: 4, Insightful

    the old "drive all your competitors out of business" ploy. This time, powered by a global conglomerate.

    1. Re:Wonderful by cayenne8 · · Score: 3, Insightful

      30 years ago, Wal-Mart pushed all the small shops out of the small towns; now, Wal-Mart is pulling up roots in those same small towns, leaving the residents with no retail grocery options.

      What happens to the bears (consumers) when all the fish have devoured one another, and the lake stands empty?

      I dunno....maybe the mom and pop stores come back?

      In business like anything else, if there is a void, it will be filled.

      --
      Light travels faster than sound. This is why some people appear bright until you hear them speak.........
  2. Can anyone say "monopoly"? by Roger+W+Moore · · Score: 4, Insightful

    Isn't this a perfect example of monopolistic behaviour? Use your large size to sell a service at zero or even below cost to drive anyone not using your service out of business?

  3. An end run around collecting sales tax by JoeyRox · · Score: 4, Insightful

    Amazon sells nearly everything its third-party sellers do. I noticed after Amazon started collecting sales tax in my state they began to feature third-party sellers much more prominently in my browsing sessions, none of who collect sales tax because they're mostly virtual resellers with a physical presence in only one state. Amazon still makes money by charging transaction fees on the seller. The fact they're subsidizing discounts for these third-party sellers is more proof of Amazon's sales tax strategy.

    1. Re:An end run around collecting sales tax by Waffle+Iron · · Score: 3, Insightful

      In that case, the 3rd-party seller is supposed to collect sales tax for customers any state where Amazon is warehousing their inventory (which could be over 20 states, each usually requiring separate registration and quarterly filing).

      I can imagine that the number of sellers actually 100% compliant with this crazy system is pretty small.