Amazon Begins Charging Sellers of Select Brands

Amazon Begins Charging Sellers of Select Brands

Charging a fee for selling certain Brands? That’s preposterous! Or is it? Imagine you are the customer searching through Amazon for Nike or Legos. When you find the exact product you’ve been looking for, you immediately buy it, right? What if you purchased that product, but it wasn’t what you thought it was? This ruins Brand trust and loyalty.

Amazon is trying to keep their customers happy by avoiding any counterfeit sellers or fake products. However, charging sellers and requiring such a difficult application process for approvals is causing frustrations for Brands and even third party sellers who have approval from those Brands to sell.

The First Casualty

The Toy Category is the first to be hit, but this could soon trickle into other categories and Brands, such as shoes (Nike). Looking at the newly restricted brands, the popularity and ease of access for outside sellers is leading the way. If you search for Lego, Pokemon or Nike you will find pages of products. From those pages, which ones are real?

Amazon’s goal is to keep customers happy by preventing counterfeit sellers and fake products. After all, without customers, there won’t be any sales. The process needs updating and further review, but the end result could potentially be good for customers and Brands—it’s just a matter of time before this process is fine-tuned.

The Reason for Charging Sellers

Initially it seems Amazon is charging Brands to fight counterfeit sellers, but it also accounts for fake products. Amazon is taking a giant step toward ensuring customers have the best experience, but it might still post a threat to actual brands selling their products on Amazon. Why? Because it will now cost them money. While some counterfeit sellers and products are eliminated, how does Amazon prevent them from creating new listings with Brand names using unknown, generic names? There’s still a loophole Amazon needs to work through.

According to Internet Retailer, an Amazon spokesman stated, “We want customers to be able to shop with confidence on Amazon. We consider several factors when determining qualifications and criteria to sell certain products. For certain products and categories, Amazon requires additional performance checks, other qualification requirements and fees.”

The Good News

While Amazon is implementing these new charges for sellers and select Brands, there is a light at the end of the tunnel. The good news is that not all sellers will be charged the $1,500 fee. Instead, those Brands or sellers who have been on the marketplace for longer (grandfathered in), Amazon might wave the fee.

Brand and category fees will make it harder for many sellers on the marketplace, but it could be a good thing for customers because it works to eliminate sellers trying to scam customers. We want our customers to feel confident in their purchases and requiring approval or fees is an attempt to keep those counterfeit sellers with fake products out and real brands in.

What are your thoughts on Amazon’s decision to charge sellers and place restrictions on certain Brands?