Author Topic: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09  (Read 5594 times)

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ICToys.com

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On Wednesday, December 12, 2009, Amazon instituted a major change in the 3d party merchant program it has been aggressively building for the last several years.

That morning, without prior warning to any merchants and after spending months emailing merchants encouraging them to "stock up" on specific skus and send inventory to the Fulfilled by Amazon program, Amazon began suppressing the buy box on random (and often best selling) skus, both new, hard to find items, and NOS (new old stock) - out of production items. 

If Amazon does not reverse this decision, they will bankrupt many of their 3d party merchants.   Many merchants have already started moving their business elsewhere. 

Discussions at Amazon:
http://www.amazonsellercommunity.com/forums/thread.jspa?threadID=178725&start=0&tstart=0
http://www.amazonsellercommunity.com/forums/thread.jspa?threadID=178732&tstart=0

The industry has noticed:
http://blog.auctionbytes.com/cgi-bin/blog/blog.pl?/pl/2009/12/1259937285.html

Looks like Wall Street has noticed as well:
http://moneycentral.msn.com/detail/stock_quote?Symbol=amzn

3d party merchant sales - and the FBA program - have been a major part in helping Amazon maintain the stock prices they've boasted of over the last 16 months. 
 
We are actually relatively unhurt by the change, largely because Amazon showing as OOS on many of the seaon's hottest toys has been an incredible boon to our website.   Like an early unintentional Christmas gift.   Looks like eBay probably feels the same way.

http://moneycentral.msn.com/detail/stock_quote?Symbol=ebay&getquote=Get+Quote
« Last Edit: December 04, 2009, 11:01:46 PM by ICToys.com »



Southern Jewel

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #1 on: December 04, 2009, 11:05:02 PM »
Thanks for posting.
I'll post on Twitter, too.
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Donna

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #2 on: December 05, 2009, 02:33:13 AM »
What I find interesting about this is that I've seen Amazon do the same sort of thing - playing with prices on their own goods and even inflating the MSRP on the items.

ICToys.com

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #3 on: December 05, 2009, 10:30:55 AM »
There are ASINs where the buy button has been suppressed and Amazon is in stock.

Southern Jewel

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #4 on: December 05, 2009, 01:11:58 PM »
I've been going through my listings today watching for this.

I wish there were most postings on the Amazon forum boards.

> Well, it looks like they did cut out the FBM shipping
> cost loophole just now, but that just means the items
> will have no buy box at all. I don't know if that's
> worse or better, still going to have very slow sales
> on those items without buybox or going to have to
> sell at a loss on those items to get a buy box back.
>
> Amazon sure has put us bigtime FBA'ers that buy
> things just under retail in a real spot here....Sure
> seems unfair with the timing and lack of notice of
> such a momentus change in buy box policy.
>
> Sure seems like maybe a class action lawsuit might be
> in order. We are going to lose a load of money
> because of this change. I know Amazon has covered
> themselves with broad wording in terms of selling and
> broad buy box elligibilities, but I bet this huge of
> a change along with the timing, when the hard numbers
> come out, could be considered some sort of breach of
> contract or something along those lines. Court
> systems usually seem to find a way to right a wrong
> for people who have obviously been treated unfairly
> by big companies, so I think that will have to be the
> next step to consider as it sure looks like Amazon is
> not attempting to work with us sellers on this at all.

The below is nextgen_gamer's response to the above posting:

They are toast if there is any shred of evidence this was planned over a long period of time. It could be they were planning on implementing this 3-6 months ago but chose to wait until the last minute to inform sellers. Why? Because if they told us in June everyone would have boycotted Amazon and FBA. Hell, the FBA team would have lost millions in storage fees alone. I have faith Amazon will do the right thing and at the very least do something about FBA storage fees. It is the least they can do for pulling this financially brain-dead, selfish, malicious, back-stabbing move during the peak buying season.
« Last Edit: December 05, 2009, 03:03:06 PM by SouthernJewel.com »
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Donna

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #5 on: December 05, 2009, 01:48:56 PM »
Holy  :053:o Did eBay buy out Amazon while I was sleeping?!?!? This looks like one of their stupid moves that hoses sellers.

I think Donna is right, if Amazon had announced this before now, they would have lost out big time with sellers pulling out. But it will backfire on them. Most sellers have already had some experience with diversifying their selling options because of eBay experience. They will minimize their losses and MOVE ON. And they won't be very forgiving with the timing as it was.

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #6 on: December 05, 2009, 02:47:45 PM »
Quote
Amazon sure has put us bigtime FBA'ers that buy things just under retail in a real spot here....Sure seems unfair

OK, children, repeat the Ten Commandments of Internet Selling after me:

1. þayEnemy is not your friend.

2. ebaY makes money whether you do or not.

3. Amazon (or any other retailer) is not in business to provide you a place to compete with them.

4. None of the above are your business partners; any profit you make using their services is an accidental byproduct of them making money.

5. Target, Mall-wart, Oui-ß-Toys-N-Crap, Haulmark, etc are not wholesalers.

6. You're not doing the manufacturers any favors by grabbing all their popular products off the shelf and offering them for sale at multiples of the MSRP.

7. Buying at retail for resale isn't the best business plan.

8. Layaway is a convenience for retail shoppers.  It's not intended to provide you with a guaranteed inventory without requiring any investment.

9. Thrift stores are there to help the poor and generate revenue, not act as a permanent wholesale source for wannabe dealers.

10. If you're paying for residental phone, cable, and Internet connections, don't expect them to perform to business class levels.

NB - I'm not saying any of the above shouldn't be done, and in fact, do some of them myself.  But if something goes wrong when you use a nickle for a fuse, it ain't the nickle's fault.
Check out the Bigg Elf's Toy Stash -- http://toystash.ecrater.com

And our Garrett metal detectors -- http://metaldetectors.ecrater.com

Southern Jewel

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #7 on: December 05, 2009, 03:02:09 PM »
Holy  :053:o Did eBay buy out Amazon while I was sleeping?!?!? This looks like one of their stupid moves that hoses sellers.

I think Donna is right, if Amazon had announced this before now, they would have lost out big time with sellers pulling out. But it will backfire on them. Most sellers have already had some experience with diversifying their selling options because of eBay experience. They will minimize their losses and MOVE ON. And they won't be very forgiving with the timing as it was.
Sweet Suze...Nope those weren't my words. I'll italicize the quoted from nextgen_gamer. Posted it in a flash...sorry for any misinterpretation.
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Donna

ICToys.com

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #8 on: December 05, 2009, 03:08:26 PM »
next_gen IS right.

Amazon spent the last 6 months bombarding 3d party merchants via email, practically begging them to send inventory, lots of inventory, into the Amazon FBA program.   They often solicited specific skus - some of which now have the buy button suppressed.

Whether or not one approves of this business model, feels it is legitimate, whatever . . . Amazon has spent the last 2.5 years actively seeking merchants who follow it and the last six months actively encouraging them to stock up on this inventory and ship it to them for their FBA program.

It IS Amazon's playground and they are welcome to make any rules they wish (subject to federal anti trust laws, of course).   But they also need to be prepared to defend their actions in the lawsuits that are sure to be coming from merchants who believe that Amazon has broken their contracts and/or acted in bad faith.

Southern Jewel

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #9 on: December 05, 2009, 03:19:38 PM »
I don't know bout anybody else, but I can attest to being strongly recruited for the FBA program this past year.

Even into the past several days, I'm still getting emails to attend online meetings to discuss FBA or phone calls where I can discuss my qualms.

I found an article earlier today back in 2007 predicting this could and probably would happen eventually to third party merchants.

<sigh>

Amazon is housing and charging top dollar to alot of merchants for FBA who signed contracts with them.
 
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planetsuze

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #10 on: December 05, 2009, 04:28:26 PM »
Sweet Suze...Nope those weren't my words. I'll italicize the quoted from nextgen_gamer. Posted it in a flash...sorry for any misinterpretation.
oops, sorry - I thought that was from you. Then I think Next_Gen is right!  :h0035

I have no problem with eBay or Amazon or whatever venue making rules to sell by. What I have an issue with is them changing the rules constantly with little to no notice. And in this case, after luring them in for months to send items to FBA and at the height of the Q4 season. Now it is costing sellers money to have their inventory sitting at AMZ while their chances of selling the items are now very low. And it will cost them $$$ to get their inventory back, right? I don't blame FBA sellers one bit if they feel betrayed and ticked off.


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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #11 on: December 05, 2009, 06:01:52 PM »
Now it is costing sellers money to have their inventory sitting at AMZ while their chances of selling the items are now very low. And it will cost them $$$ to get their inventory back, right? I don't blame FBA sellers one bit if they feel betrayed and ticked off.


Yes, to get their inventory sent back to them will cost additional funds.
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Donna

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #12 on: December 05, 2009, 07:51:33 PM »
I enjoyed the heck out of this post:

Quote
Dear eBay,

We thought long and hard about finding you the perfect gift this year.

We decided to give you something that you had in the past… just because we fondly recall how much you enjoyed having it back then. It’s “market share”!

We hope you enjoy! Merry Christmas!

Love,

Amazon

 :0240

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Re: Amazon Makes Major Changes to 3d Party Merchant Program on 12.2.09
« Reply #13 on: December 11, 2009, 04:55:51 PM »
I noticed this mostly on items where the going rate was significantly above retail and wondered if that had something to do with it. But I'm seeing it more and more and other than the marked up stuff trend, I can't figure it out. I'm pretty confident it's the reason some things I have listed haven't sold yet.

  

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