Executive Briefings

Amazon Combats Thieves, 'Barely Legal' Resellers Using Its Site

In trying to be the world's largest e-tailer by offering almost anything, Amazon has attracted a dedicated group of thieves and resellers trying to slip through the holes in Amazon's bureaucracy.

Amazon is now making a good-faith effort to thwart those selling unauthorized goods, just as it tried to attack deceptive product reviews.

Amazon's new approach is to insist on proof of purchase from select manufacturers and distributors before allowing sellers to list those products on Amazon, as well as asking for fees as high as $1,500. Amazon subsequently clarified the rule to only apply to new merchants.

It's important to stress that these rules are designed to thwart two very different situations, one legal (albeit barely) and the other illegal. The illegal efforts are people selling cheap imitations and labeling them with the names of big brands. The barely legal approaches are folk that purchase merchandise from eBay or even from small retailers directly and then mark up the price and sell the goods on Amazon. Indeed, some resellers have gotten quite brazen about it, with the resellers using the manufacturer's own shipping operations against them.

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Amazon is now making a good-faith effort to thwart those selling unauthorized goods, just as it tried to attack deceptive product reviews.

Amazon's new approach is to insist on proof of purchase from select manufacturers and distributors before allowing sellers to list those products on Amazon, as well as asking for fees as high as $1,500. Amazon subsequently clarified the rule to only apply to new merchants.

It's important to stress that these rules are designed to thwart two very different situations, one legal (albeit barely) and the other illegal. The illegal efforts are people selling cheap imitations and labeling them with the names of big brands. The barely legal approaches are folk that purchase merchandise from eBay or even from small retailers directly and then mark up the price and sell the goods on Amazon. Indeed, some resellers have gotten quite brazen about it, with the resellers using the manufacturer's own shipping operations against them.

Read Full Article