Is Amazon anti-competitive ?

[RetireBy90]

One of the complaints I have heard over the past couple weeks about Amazon is that they use sales data from vendors selling on Amazon to decide which products to offer as Amazon products thus competing with the 3rd part vendors on the Amazon platform. If this is so offensive then why to grocery stores do the very same thing. Just shopping at Giants this morning and right next to 3 3rd party brands of baking powder is a Giant brand that is 30% less. Picked up some Panera soups and there is the Giant brand soup, about 40% cheaper. Recently had to get some meds and for Advil and Nyquil same store brand situation.

Now I like the cheaper store brands of most items. They appear to be very similar product and quality. Meds have the same contents and the grocery store items are the same quality as far as I can tell.

If this was such an issue for Amazon then where was feds for past 10 years dragging the grocery stores in for a visit, or are they next ?

Something to think on, am I missing something ?

 

[Chuckanut]

I think of Amazon the same as I think of China - we can get some win/win value from them, but never, ever, ever, let them be your sole source of product/sales/profits.

I do object to search engines that always show buying something at Amazon as the top choices. Even when I do research (What is the best way to prepare my soil for growing corn?) The first choice is bags of dirt sold on Amazon. The second choice is canned corn sold on Amazon. The third choice is garden tools sold on Amazon.

 

[Aerides]

You're a 3rd party seller. You come across a handful of products, you promote them and market them and build a business of selling them online - and that means on amazon as well as other outlets. It doesn't take long before amazon is 80% of your sales. You're a successful small business, yay!

Then amazon takes notice, contacts your suppliers, buys all your product (from the supplier) and squats on your listings, moving the price down and pushing "ships and sold by amazon" into first place. They may even negotiate with your supplier to shut you out and they become the exclusive seller on that listing. Your items on that listing stop selling. Your business suffers. Your income is depleted. You have thousands invested in inventory that you can no longer sell because amazon will win.

That's the story you hear. Now, that means you aren't constantly looking for and adding new products. So there is absolutely truth to it, and it more often than not impacts very small businesses.

I don't equate it to what grocery store chains do.

 

[RetireBy90]

I don't equate it to what grocery store chains do.

Not to dispute any of the claims but why is it different than I'm selling a Goya bean and Albertsons comes out with the same bean on private brand, sells for 50% of your price and places it on shelf just above your Goya brand?

 

[target2019]

Feds? Which?

When the companies were growing like weeds (Amazon, etc.) all hands were off. Now the anti-competitiveness has become a normal course of doing business.

When everyone got overnight for $80 per year it was a great thing. Now the deliveries are suspect and people are unhappy. And you pay a higher premium for the service.

 

[Aerides]

Not to dispute any of the claims but why is it different than I'm selling a Goya bean and Albertsons comes out with the same bean on private brand, sells for 50% of your price and places it on shelf just above your Goya brand?

Because it's not literally the same product.

What amazon is doing is sitting right on the same beans, the same can, at a lower price. They'put their beans in front of the 3rd party sellers, on the same shelf, and shove the others ones behind them. (virtually anyway)

They've also contacted Goya and said "stop selling to Aeri!" and they're holding 1000 cans of the beans I sent to their warehouse that I can't sell now. That's what it means when amazon takes over a listing.

And you can say "welp, diversify! Sell more things!" but everyone in retail knows you strike gold only with a few things, and those become your bread-and-butter items (80/20 rules). So the 3P's are doing the research, the marketing, and bringing the sales rank to the listings, then amazon takes them over, after the 3P has done all the leg work.

 

[samm]

One of the complaints I have heard over the past couple weeks about Amazon is that they use sales data from vendors selling on Amazon to decide which products to offer as Amazon products thus competing with the 3rd part vendors on the Amazon platform. If this is so offensive then why to grocery stores do the very same thing. ....
Now I like the cheaper store brands of most items. They appear to be very similar product and quality. ....

If this was such an issue for Amazon then where was feds for past 10 years dragging the grocery stores in for a visit, or are they next ?

Something to think on, am I missing something ?

+1 Well said.
I agree with OP

[MOD EDIT]

 

[OldShooter]

To me the signal that eBay and Amazon are a duopoly is the way they are able to treat their sellers as serfs. Huge penalties for small infractions and high-handed behavior in requirements. That is why many eBay listings include pleas from the sellers to contact them directly so a complaint is not registered with eBay. But the duopoly has enough control that sellers have no practical alternative to goveling before these masters and taking whatever they are given.

 

[sengsational]

When a company leverages economies of scale, they get attacked. Walmart as well as Amazon can and do bring prices down. If they can do it profitability, then they've increased the efficiency of getting product to customers. That is plain good IMO. The small merchant left with a warehouse of beans, that's certainly an "ouch", but the buying public doesn't owe her anything. Now if, after wiping out the competition, the big player raises the price, then that's just plain bad. I'm not sure we're seeing that, though.

 

[Popeye]

I think the comparison to store brands is off base. Many of those are made by the same companies. I had a professor years ago who had worked for Quaker Oats or someone similar. He said they made the store brands too. One shift filled the name brand packaging and the next filled the store brand packages.

 

[Scrapr]

I'm with @Aerides Screw Amazon & screw Walmart. Ethics matter. Am I perfect in my boycotts? Of course not. But it's going on 5 years for both of em. I do use e bay as a replacement for Amazon. AWS is the big money pipeline for Amazon and there probably isn't much I can do about that

 

[easysurfer]

I think of Amazon as the big man on campus. Kinda like companies in past glory days.

Walmart, AOL.

Remember all those AOL discs?

 

[braumeister]

I think the comparison to store brands is off base. Many of those are made by the same companies.

That's certainly true in some cases. I had a good friend who worked in the quality assurance part of a large grocery chain. There was one particular type of cookie that we liked, and she said there was only one factory in the country that made it, although it was sold under a variety of brand names -- one big national brand and a number of store brands. Exactly the same cookie except for a very tiny alteration in its shape.

 

[audreyh1]

Amazon is putting up their own huge array of satellites. Hmmmm - I’m not sure I would want them as my internet provider.

 

[ExFlyBoy5]

Now if, after wiping out the competition, the big player raises the price, then that's just plain bad. I'm not sure we're seeing that, though.

Have you seen prices on Amazon, lately? We recently ordered a blender from Amazon's "warehouse deals" and what a deal it was!!! The busted up box showed up but with no motor, just the jar. The rest of the space was filled with packing pillows. We returned it, but I noticed the EXACT SAME blender at Wal-Mart was almost a full $20 less than the "warehouse deal" from AMZN. I get it...as a consumer, you have to shop around. But, that doesn't mean that AMZN isn't in the right, either.

The latest thing may sour me on AMZN further. I ordered some Ring cameras that were quite lacking in my opinion and one of them didn't work at all. I requested a refund and selected the "UPS pickup" from home option. UPS was out the next day and took the package, but never scanned it in...so it still shows as "awaiting pickup". The driver didn't leave a receipt (like they normally do) so I am to assume the package will never make it to AMZN and I am at a loss as to how I will get my almost $400 back.

 

[ExFlyBoy5]

Amazon is putting up their own huge array of satellites. Hmmmm - I’m not sure I would want them as my internet provider.

Well, Space X is doing it as well, so there might be a choice!

 

[audreyh1]

Well, Space X is doing it as well, so there might be a choice!

Less concerned about SpaceX as I don’t use them for shopping or video watching.

 

[karen1972]

Yes store brands tend to go to the original manufacturer and just ask for off label packaging and to get to the price point they want may exclude certain pricier ingredients. If Kelloggs sells you cereal under Corn Flakes and then makes a cheaper brand they sell as Korn Flakes, they get the profit both ways and their manufacturer costs go down as they can buy in bigger bulk and they assume those people are too price sensitive to handle the full colored boxes, the extra thick packaging, etc the 'premium' brand demands, so they dont' water down their brand, but get extra side income for what they deem an inferior product.

Amazon was "come here" we will provide you this totally innocent platform for you to sell your goods on because we are just a distributor who wants to help the little guy sell his products and compete against evil Walmart. Oops we are actually Walmart in disguise, fooled you. Selling generic stuff i am not sure anyone would have cared about, a battery is a battery. My issue is more the designer type stuff they are re-selling and cutting out the inventors of, not sure how many of those can afford to go after Amazon for patent infringement... cutting someone out of the deal is rather uncool, it may be legal but then you better never complain about China reverse engineering anything the US makes.

I'm still waiting for more consumers to wake up that their "subscription" to auto-ship is costing them a fortune. I go on there all the time and look up pricing for household goods and I'm like holy cow this is 20% more pricey than what I can find at the local store. It may be on sale on any given day but the auto-subscription isn't looking for the best deal for you.

 

[OldShooter]

... UPS was out the next day and took the package, but never scanned it in...so it still shows as "awaiting pickup". The driver didn't leave a receipt (like they normally do) so I am to assume the package will never make it to AMZN and I am at a loss as to how I will get my almost $400 back.

I had a similar situation where I dropped my package at a UPS store but neglected to get a receipt. It was never received at Amazon. Some time later I contacted Amazon and the customer service person was able to see intermediate scans as the package moved in the UPS system. So that was evidence that I had indeed sent the return and I got my money. So you may have similar luck. Of course if the package was picked up by a porch pirate and not UPS, you are definitely SOL.

 

[ransil]

Have you seen prices on Amazon, lately? We recently ordered a blender from Amazon's "warehouse deals" and what a deal it was!!! The busted up box showed up but with no motor, just the jar. The rest of the space was filled with packing pillows. We returned it, but I noticed the EXACT SAME blender at Wal-Mart was almost a full $20 less than the "warehouse deal" from AMZN. I get it...as a consumer, you have to shop around. But, that doesn't mean that AMZN isn't in the right, either.

The latest thing may sour me on AMZN further. I ordered some Ring cameras that were quite lacking in my opinion and one of them didn't work at all. I requested a refund and selected the "UPS pickup" from home option. UPS was out the next day and took the package, but never scanned it in...so it still shows as "awaiting pickup". The driver didn't leave a receipt (like they normally do) so I am to assume the package will never make it to AMZN and I am at a loss as to how I will get my almost $400 back.

I received a broken Tv, Amazon sent a UPS return label and UPS picked it up and Fedex dilvered the same TV 2 days later

 

[aja8888]

Have you seen prices on Amazon, lately?.....................

Yeah, we ordered a new LG TV from Best Buy on Friday afternoon. It was delivered this morning. The price was $20+ less than the same one on Amazon.

Sorry to hear about the bad deal on returning the cameras. Try calling Amazon....it's not that easy anymore. Actually,I have tried and can't find a number that gets through.

 

[KarlH]

Walmart as well as Amazon can and do bring prices down.

Sometimes, this is smoke and mirrors as well. Walmart has a sale on Kingsford Charcoal, and its an 18# bag instead of the 20# one at other stores... They order Brand Name detergents in sizes that are slightly smaller than you get at Kroger/Target/Jewel, etc... they use their economy of scale to buy products that deceptively look like good deals until the consumer normalizes the price to the unit and compares, and it turns out that you are paying the exact same price or higher for a smaller number of loads of laundry. When I worked for a major consumer goods company, I learned that Walmart demanded Walmart specific SKUs just to create the illusion of a bargain.

 

[Chuckanut]

I'm still waiting for more consumers to wake up that their "subscription" to auto-ship is costing them a fortune. I go on there all the time and look up pricing for household goods and I'm like holy cow this is 20% more pricey than what I can find at the local store. It may be on sale on any given day but the auto-subscription isn't looking for the best deal for you.

+1

Excellent point. At times Amazon is the price leader or priced low enough that it's not worth the drive to get it at a lower price. But, low prices cannot be assumed. I just ordered a new tracking tile for some items I can't afford to misplace (another cost of growing old?). $30 at Amazon. $30 at the 'normal' discounted price for existing customers on the maker's website. $23 on the special deal that popped up on the tile app.

 

[Chuckanut]

To me the signal that eBay and Amazon are a duopoly is the way they are able to treat their sellers as serfs. Huge penalties for small infractions and high-handed behavior in requirements. That is why many eBay listings include pleas from the sellers to contact them directly so a complaint is not registered with eBay. But the duopoly has enough control that sellers have no practical alternative to goveling before these masters and taking whatever they are given.

It's not just them. Online travel booking sites take a chunk out of mom-and-pop hotels. I want the little hotels to stick around, so I make a point of booking directly whenever possible. Sometimes they will toss in breakfast or a room upgrade.

 

[RetireBy90]

It's not just them. Online travel booking sites take a chunk out of mom-and-pop hotels. I want the little hotels to stick around, so I make a point of booking directly whenever possible. Sometimes they will toss in breakfast or a room upgrade.

DW uses the online travel booking sites to find a good rate on a hotel then calls the hotel directly and gets the same price most of the time. She has found that if she books through a travel site then often the hotel doesn't provide the same amenities such as morning news paper (for me), breakfast, or reward points to brand rewards or card rewards. We visit Key Largo every Jan (hoping to in 2021) and she is able to get a good rate then call and get the room we like, top floor and end unit for best gulf view and little noise from other rooms.