US Sellers - Amazon Price Parity

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Max Meadows, VA United States
Jax Music Supply
Kudos: 2,480
Joined: May 25, 2009
US Sellers - Amazon Price Parity
6 Nov 2016
For those sellers in the US that sell on Amazon, how much do you all worry about Amazon's price parity clause in their Terms of Service? According to their TOS, you are supposed to keep your prices on Amazon equal or less to everywhere else you sell. Of course, Amazon's fees are higher than everywhere else I sell. How do you all handle this situation?
Philippines Philippines
Yeongwonhi
Kudos: 88
Joined: Oct 13, 2016
Re: US Sellers - Amazon Price Parity
17 Nov 2016
Was wondering if anybody else gotten their way around to this?
Max Meadows, VA United States
Jax Music Supply
Kudos: 2,480
Joined: May 25, 2009
Re: US Sellers - Amazon Price Parity
17 Nov 2016
@Yeongwonhi

I match my prices across all markets I sell in but I have not had anybody else seem to worry about it everywhere I have asked. Apparently it is not strictly enforced at this point.
Herts, England - Not specified -
Andy
Kudos: 12,509
Joined: Jan 1, 2001
Re: US Sellers - Amazon Price Parity
17 Nov 2016
I asked Chris McCabe who is ex-Amazon and works with a lot of sellers and he said:

Yes, sellers must maintain the same pricing on amazon as they have on their own web sites. Sellers tend to rat each other out for this and check each other's sites a lot, so they send in a report, Amazon checks it, sends a warning if it's correct.
So maybe Amazon aren't very proactive about policing it themselves, but they act on it if told.

[Last edited: 17 Nov 2016]
Andy Geldman, Web Retailer
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Nottingham United Kingdom
Bigian13
Kudos: 3,204
Joined: Feb 21, 2014
Re: US Sellers - Amazon Price Parity
30 Nov 2016
When we started selling on Amazon several years ago we were approached by Amazon.com to sell on that platform. When I asked about the pricing parity issue I was told that it was strictly enforced and that if we fell foul of this rule we would be removed from all of Amazon.

Needless to say we do not sell on Amazon.com.
E-commerce , love it or hate it, that's why we are here
Max Meadows, VA United States
Jax Music Supply
Kudos: 2,480
Joined: May 25, 2009
Re: US Sellers - Amazon Price Parity
30 Nov 2016
@Bigian13

Well, you are in the UK and it has been deemed illegal there as I recall. So you should be ok to sell now, if you so choose.
Nottingham United Kingdom
Bigian13
Kudos: 3,204
Joined: Feb 21, 2014
Re: US Sellers - Amazon Price Parity
8 Dec 2016
@Jax Music Supply

According to a discussion in the last seven days with our contact at Amazon, if we want to sell on Amazon.com we still have to maintain the price parity.

As the products / service / contract are covered by US law, EU regulations regarding parity would not be applicable.

If there are any other UK / EU sellers that could pass comment or advice it would be appreciated.
E-commerce , love it or hate it, that's why we are here
Max Meadows, VA United States
Jax Music Supply
Kudos: 2,480
Joined: May 25, 2009
Re: US Sellers - Amazon Price Parity
8 Dec 2016
@Bigian13

I personally think it could be illegal in the US but I haven't seen any court cases on it. This may be why they haven't forced the issue whole hardheartedly. A case could be made that by forcing "most favored" pricing to third party merchants, it causes a barrier to entry for lower price marketplaces due to their dominance in the online retail space. Even then, most parties would be reluctant to take that on. It would have to be a Federal case (by the nature of the law in question in the U.S.) would be very expensive. It may even require the DOJ to actually press it, which makes it political and less likely to ever happen.
NYC United States
hoolah
Kudos: 29
Joined: Dec 5, 2016
Re: US Sellers - Amazon Price Parity
8 Dec 2016
@Jax Music Supply

I doubt legality has anything to do with it, but enforceability of the clause might. There are a few courts that distinctly do not like these so called "clickwrap" agreements, almost across the board. The federal district court in Nevada, for example, in the Zappos case. The law isn't quite settled, but Amazon would certainly know about the Zappos case - they own them.

As far as it being a part of a contract, I mean, you're given consideration to use their platform, software, some use of their reputation branding and logo to sell in exchange for a myriad of things including this, could it be unconscionable? Who knows? But anyone here up for suing Amazon over it?

I actually wonder how close to the product it needs to be. Sure, you have UPC codes, but you can have, say, two phones that are basically the same but have different UPC codes because of minute differences. How exact does it need to get, can one tiny difference be enough to make them different products and not subject to the rule? What if you only sold red colored USB sticks on Amazon and Pink ones on your website?
Max Meadows, VA United States
Jax Music Supply
Kudos: 2,480
Joined: May 25, 2009
Re: US Sellers - Amazon Price Parity
13 Dec 2016
@hoolah

Two different color is two different product. I disagree about the legality but as long as they are not enforcing strictly, it probably doesn't matter. It is very questionable behavior as it does prop up prices and acts as a barrier to entry if it was enforced.
Nottingham United Kingdom
Bigian13
Kudos: 3,204
Joined: Feb 21, 2014
Re: US Sellers - Amazon Price Parity
14 Dec 2016
@Jax Music Supply

As there was a recent post on this forum regarding price fixing for online sellers in the UK, I thought I would email the government department responsible regarding their thoughts on this. Not quite the same criteria as their original post, but price fixing (in a way) all the same.

Unfortunately, after seven days, they are still to reply. Maybe even the UK Government are scared of Amazon ?
E-commerce , love it or hate it, that's why we are here
Max Meadows, VA United States
Jax Music Supply
Kudos: 2,480
Joined: May 25, 2009
Re: US Sellers - Amazon Price Parity
14 Dec 2016
@Bigian13

No idea. I saw something somewhere awhile back that Amazon had withdrawn the price parity for the EU and UK. I always had price parity and I've stopped selling in the EU now.
United States United States
ScarfKing
Kudos: 403
Joined: Oct 7, 2014
Re: US Sellers - Amazon Price Parity
15 Dec 2016
We try to maintain price parity in the US because it's in the TOS and regardless of the legality of it, if our Amazon operations get shut down while we fight some heroic battle all the way to the Supreme Court, that's not a win for us. I know it was deemed illegal in the EU, where corporations don't quite run the show to the extent that they do here, but in the US, it would take a rival corporation like Ebay or Walmart to challenge it as a restraint of trade issue. Restraint of Trade has not been a winning issue from the small business side for some time, from what I can tell.

Amazon generally holds up their end of the deal so I try to hold up mine. That being said, in the few cases where products might not have been updated to the identical Amazon price (in either direction) we haven't had anyone knocking at our door at midnight asking to see our papers.

Hope that's helpful!
Max Meadows, VA United States
Jax Music Supply
Kudos: 2,480
Joined: May 25, 2009
Re: US Sellers - Amazon Price Parity
15 Dec 2016
@ScarfKing

Yes. It was more of an intellectual discussion. I wrote some software that keeps it equal across all of our sites. There doesn't seem much worry about keeping it equal though. Most sellers do not seem worried about it.
Ireland Ireland
liam.keegan
Kudos: 41
Joined: Jan 4, 2016
Re: US Sellers - Amazon Price Parity
16 Dec 2016
@Jax Music Supply

Many US sellers do have trouble adhering to this policy on Amazon US.

I work for XSellco. To help sellers manage prices efficiently across platforms, we created the Price Replicator feature for our Amazon repricer, XSellco Price Manager.

Our Price Replicator allows you yo automatically replicates your Amazon prices to eBay and webstores including Magento, Shopify and BigCommerce.

This tool helps relieve the headache of having to worry about whether Amazon is watching your prices on your website or other marketplaces.

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