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The impact of Amazon's market distorting power is somewhat overstated here, as the 30-45% includes FBA. Walmart has a comparable service, WFS, which looks compe
by willseth 5y ago
The impact of Amazon's market distorting power is somewhat overstated here, as the 30-45% includes FBA. Walmart has a comparable service, WFS, which looks competitive, but it's not always cheaper and can cost more than FBA (https://www.helium10.com/blog/walmart-wfs-fees-vs-amazon-fba https://www.helium10.com/blog/walmart-wfs-fees-vs-amazon-fba)
Of course that doesn't mean Amazon won't inflate FBA rates and squeeze sellers further, but it seems like currently the issue is about higher (non-FBA) seller fees forcing higher prices on competing services with lower seller fees because of Amazon's most favored nation clause. Unfortunately, Stoller doesn't break this down with enough detail to get a good understanding of its impact. In fact, this is pretty misleading:
"Now, if this were all that was happening, sellers and brands could just sell outside of Amazon, avoid the 35-45% commission, and charge a lower price to entice customers."
Sellers will always have shipping and fulfillment costs, whether or not they use the in house service, so the real consequence seems to be over the fee portion Stoller quotes as 5-10%, and it's unclear how much more this is relative to Amazon's competitors. Amazon's behavior is still anticompetitive, but MFNs aren't rare or illegal, and they're typically enforced by a business with more market power over its competitors (how else could you get someone to agree!).
TLDR; It seems clear that Amazon is inflating market prices, but not to the degree Stoller suggests, and I suspect it will be a much more difficult case to make for the same reason. IANAL.
- willseth 5y ago(I have to admit I was maybe a little too annoyed at Stoller's devotion to repeating essentially: "DID YOU KNOW THAT FREE SHIPPING ISN'T REALLY FREE GUYS??? But maybe everyone else didn't find it as patronizing.)