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Businesses The Almighty Buck

Amazon Discounts Other Sellers' Products as Retail Competition Stiffens (reuters.com) 98

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.
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Amazon Discounts Other Sellers' Products as Retail Competition Stiffens

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  • Wonderful (Score:5, Insightful)

    by hackertourist ( 2202674 ) on Monday November 06, 2017 @12:51PM (#55500145)

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

  • Did anyone hear that Wal-Mart's tech incubator WalMart Labs is one of the worst places to work. Not surprisingly almost all the engineers feel they're underpaid

    https://www.google.com/search?... [google.com]
    https://www.inc.com/business-i... [inc.com]

    They're going to lose this one and while I'm not wild about how Amazon has crushed the competition I won't shed a single tear for wally world.

    • by Tablizer ( 95088 )

      It's not like Amazon has a workplace reputation for being rainbows and lollipops. [consumerist.com]

      • Sure. But the compensation package is just good enough to keep people around until they're fully vested and then they take it out the door, it's common to take a long break from work after the end of a stint at AMZN. That's Amazon's formula for keeping top talent around until they're totally burned out and can be replaced with a fresh crop of good engineers to burn.

        You can't pull off that trick with Walmart's attitude towards workers.

        • by Tablizer ( 95088 )

          In general, you can pump them empty and run them into the ground if you pay them well. Another tactic is to pay them poorly but make the work-place friendlier. If you filter and prepare hiring correctly, both strategies can work. And there is the in-between. Perhaps Wal-Mart hasn't tuned it right yet. Until management sees their current strategy failing, they won't change.

          • I happen to be a fan of the deluxe workplace/low pay :)

            I mean it's not like low engineer pay isn't well over median household income anyhow (except for Slashdot's pet closet cleaner). Boozy parties once or twice a week. A boss who has nice things to say. One month of vacay a year.

            It's a shame that most Americans will never know what it feels like to live this way.

  • by Roger W Moore ( 538166 ) on Monday November 06, 2017 @01:01PM (#55500227) Journal
    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?
    • by Anonymous Coward

      Amazon isn't a monopoly. They aren't even the largest online retailer in most of the countries where they operate.

      • by Tablizer ( 95088 )

        It's a near monopoly in the USA. We can expect the same kinds of games and tricks Microsoft pulled, such as taking a loss in Market A to gain market share in Market B to force out competition, forced bundling, ghost product announcements, and other tricks pioneered by the likes of Standard Oil and IBM.

        • It's a near monopoly in the USA. We can expect the same kinds of games and tricks Microsoft pulled, such as taking a loss in Market A to gain market share in Market B to force out competition, forced bundling, ghost product announcements, and other tricks pioneered by the likes of Standard Oil and IBM.

          Not even close. If I want to by something, let's just say a computer mouse, there are literally 20 different physical stores within a 10 minute drive of my house, and I don't live in huge metro area. There are (a quick google search later) hundreds of different online retailers that, do NOT go through Amazon, that I can order from ( https://www.google.com/search?... [google.com] ).

          Claiming that Amazon is a monopoly is almost laughable.

          • by Tablizer ( 95088 )

            Being that brick-and-mortar stores are clearly shrinking, the future growth is clearly on-line. You can order directly from many of the traditional stores, but it's often extra steps to register etc. and you don't know what kind of service you'll get if something goes wrong. Amazon is like McDonald's: (relatively) cheap, predictable, and generally reliable.

            Your defense is comparable to saying Microsoft still had minicomputer OS's as competition in the 1990's (Digital, Wang, Prime, etc.). While technically t

    • by Gilgaron ( 575091 ) on Monday November 06, 2017 @01:20PM (#55500359)
      In this instance, though, they're nominally supporting third party vendors that they are just a payment processor and business aggregator for... it'd sort of be like if Walmart backed coupons for other stores in the same strip mall.
    • No it is not a monopolistic behavior. It is the dot com behavior. Use investor cash to sell services/goods below cost. Show growth, show numbers, hope to sell to someone before the scheme comes undone. It is called The Greater Fool Theory. "I know this business model is unsustainable and it is all going to eventually collapse when it runs of fresh investors, but I hope to cash out long before then".

      It is vaguely like a Ponzi scheme, in the sense that fresh investors pay off the older investors. It has had

      • by Binestar ( 28861 )
        Amazon is profitable. I'm unsure why you're thinking otherwise?
        • Not in its core business. Its cloud is making money, it is under stiff competition. It is using that profit to subsidize the core business. It might work out, or it might not pan out.
  • by JoeyRox ( 2711699 ) on Monday November 06, 2017 @01:03PM (#55500241)
    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.
  • by Anonymous Coward

    I haven't bought from Amazon in 2 years because they aren't competitive with brick and mortar stores anymore. If I buy online it's through in store pickup at Walmart or best buy. Also, brick and mortar stores will price match Amazon; so.... No need to even buy from them. I don't want to wait days for something.... And, for fast service you want me to pay for prime? Lol nty

  • by RhettLivingston ( 544140 ) on Monday November 06, 2017 @01:20PM (#55500371) Journal

    In the late 80s - early 90s time frame, Sam's and Pace (owned by KMart) were in competition. There were over a dozen Pace Membership Warehouses in the St. Louis metropolitan area by my recollection. I personally preferred Pace and thus watched what happened with interest.

    Walmart decided they wanted the business. They proceeded to build a Sam's within sight of almost every Pace at great expense because they had to get whatever land was there instead of cherry-picking sites. It was so blatant that you knew what was going on from day one. After doing so, they opened the stores, set the prices below Pace (running them all at a loss), and fairly quickly put the Pace stores out of business. They then built some more new stores in the area with a different distribution so that they could cover the area with fewer stores and closed down almost everything they had built to put Pace out of business. When Pace started talking lawsuit, Walmart purchased the corpses to shut them up.

    In a remarkably short time, we went from a competitive market to a monopoly market.

    I sincerely hope that we're not seeing similar tactics happen here, but now to Walmart. Having Amazon in competition with Walmart helps us. Losing Walmart in that competition would put us right back in the monopoly situation with an even stronger predator.

    • I don't disagree with your concern, but this action is with third party sellers. It'd not be too hard for them to just use a different online storefront like leaving eBay for Etsy and so on. Amazon only has an advantage so long as their webpage and customer service is the best. Hop on over to Sears.com... the customer service is nearly fawning if you buy something, and pickup at their store when you want something fast is super easy, and they even have some Amazon Primesque service, but that webpage is a
      • Kind of a false dichotomy... one of the stores I buy from one site thats sells on amazon, ebay and have their own eCommerce website. I would bet having only one storefront is more of the exception to the rule. I usually get free shipping from them on ebay so that's the option I use.
    • Interesting note: Many Lowe's and Home Depot stores are located next door to each other, and those stores to MORE business than the other stores! They become "the place" to buy hard-to-find products because customers know if they can't find it in one, they can check the other. I even sometimes check both before buying to make sure I'm getting the lowest price. In other words, Sam's Club locating next to KMart doesn't necessarily put KMart out of business!
  • Amazon Seller Here (Score:2, Insightful)

    by Anonymous Coward
    I know they are trying to paint a happy face on this, but over the past year Amazon has instituted a number of seller hostile policies and we are getting pretty sick of it. Most recently - very recently - Amazon instituted an automatic return policy. It used to be that we would get a return request notification with a reason selected and an explanation from the buyer. This allowed me to save many sales or otherwise turn some frowns upside down. A return request was a great way to get a good seller review. B
    • by Anonymous Coward

      I just did a "bought by mistake" return to a 3rd-party seller on Friday and when I picked that class of reason for return Amazon made it quite clear that I would have to pay for return shipping because the seller was not at fault. The printed return label was also very clear that *I* would have to pay the postage.

      You sound like someone who is just ticked off that you might have to ever accept a return.

    • The big problem with the Amazon automatic return policy is that Amazon doesn't realize when scammers are returning junk. We use Amazon fulfillment to sell our products, and people have bought a new item and returned an obviously old scratched up used item. Amazon blindly accepts it, refunds the purchase, and puts the junk back into inventory. We don't hear about it until another customer buys the junk item and complains. We then typically apologize to that customer and FedEx them a new one at our expens

  • by Anonymous Coward

    Ever since they switched to Amazon Delivery Service in my area I've switched to other online suppliers, even if they are more expensive and/or charge shipping.

    The Amazon drivers, which are a local sub contractor, have driven over my lawn, lost packages and thrown packages onto my property (drive by delivery). Prior to this on the USPS had been guilty of these same infractions.

    Seems UPS and FedEx have higher performance standards.

  • Explain to me how exactly this business model makes a profit for Amazon? Are the discounts subsidized by the $100/year payment for Amazon Prime?
  • The amazon marketplace has watered down the amazon brand for me. Searching for something is a pain with all the 'sponsored item' placements and third party marketplace results. Even when I find something sold by amazon, you have to check reviews to see if their inventory has been tainted by marketplace knockoffs and factory seconds. I figured if they want to be like ebay, I will use the genuine ebay, at least I know that the questionable item will come direct from the seller, and not accidentally be from so

  • by iTrawl ( 4142459 ) on Monday November 06, 2017 @02:54PM (#55501247)

    No, this isn't the usual scheme. Put your stuff for sale on Amazon and buy it back at a discount. Then sell it again and again and again until Amazon stops giving you free money.

  • The situation might differ according to region, but where I live, Amazon almost never provides the cheapest offer on any product, and this didn't change as long as I know Amazon.

    I do still visit Amazon's web page to lookup customer reviews and alike, which seem to be just more abundant there than elsewhere. Buy buying there? Rather not.

    Just last week, I ordered two items: One printed image calendar and one piece of sport supplies. Both where signicantly cheaper at online shops other than Amazon, the cal
  • Its dumping. Its applying 3rd party money (Amazon's) to push a price down to allow a seller or subset of sellers to dominate a market (for an item). Its dumping. Same as solar, same as semiconductors.

"Everything should be made as simple as possible, but not simpler." -- Albert Einstein

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