Why do sellers do this on Amazon

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Laguna Hills, CA United States
ktmventures
Kudos: 48
Joined: Nov 6, 2014
Why do sellers do this on Amazon
23 Jun 2017
I've noticed that sellers will send in products to Amazon for FBA but, they are competing against Amazon and their prices are significantly Higher.

For Example
ASIN #B003TN6FSG
Amazon has this item for $14.99 (one time purchase)

Yet 2 other sellers have for sale FBA
1 @ $22.00
1 @ 23.04

My assumption and and my findings are that Amazon always gets the buy box.

So, what is the motivation of these sellers to drop in products when they aren't going to get any sales? Unless Amazon happens to run out. Why are they doing this?

If i have a product that there is no one selling FBA. Amazon does sell yet my price is not competitive. So, my question is, is there any wisdom to our dropping in a product for FBA?
Supplier
United States United States
FeedStation
Kudos: 86
Joined: May 5, 2017
Re: Why do sellers do this on Amazon
27 Jun 2017
@ktmventures Sellers are free to set pricing (within limits, which shouldn't violate MAP pricing, above a certain variance the item will be flagged in Seller Central, etc.).

The answer to your question about FBA is: it depends.

The example you cite (B003TN6FSG) is a packaged good. Most packaged goods have a limited shelf life, which matters when dealing with FBA.

It typically comes down to how tightly you control your supply chain. If you're selling something that flies off the shelf, and you have solid control over the pipeline, then FBA may make sense.

On the other hand, if you're trying to sell via FBA, and the items just sit on the shelf, then you'll end up having to pay return shipping when Amazon returns the inventory to you.

There's no answer that fits 100% of the time. Where FBA is concerned, you'll have to make a strategic/judgement call that fits with your goals.

[Last edited: 27 Jun 2017]
Nottingham United Kingdom
Bigian13
Kudos: 3,092
Joined: Feb 21, 2014
Re: Why do sellers do this on Amazon
28 Jun 2017
@ktmventures

The seller at $22 only has one in stock, and the other seller has 9, both strange quantities to send in to Amazon.

It could be that the other sellers that are selling via FBA are actually using Amazon to despatch the items for sales from other channels. I know a number of sellers that do this as it saves them from having to warehouse and despatch the items themselves.

Also, based on my experience, Amazon do not always get the Buy Box. We compete against them on a number of products across Europe and beat them to the Buy Box regularly even though they are sometimes cheaper.
E-commerce , love it or hate it, that's why we are here

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