Amazon.com is taking serious steps to protect big brands and its own name after a recent surge in counterfeiting on the site. These steps however are expected to hurt legit sellers as well. Amazon is restricting brands that have seen these surges in counterfeit products and you might need to pay $1,000 or even $1,500 just for the right to start selling that specific brand. That’s after providing proof of purchase for those products.
Sellers that want to sell brands like Nike, Adidas, Asics, Star Wars etc. are being told they have to pay a one-time nonrefundable fee of up to $1,500 per brand. That’s after being asked to provide invoices from manufacturers or distributors that show the purchase of 30 items within the last 90 days. To sell brands like Pokemon, Shopkins, Samsung etc. sellers are being charged $1,000. Here’s a list of brands that have been restricted so fare, which corresponding fee for most.
“We want customers to be able to shop with confidence on Amazon,” Erik Fairleigh, an Amazon spokesman, wrote in an e-mail to CNBC. “For certain products and categories, Amazon requires additional performance checks, other qualification requirements, and fees.”
This will make retail arbitrage much harder, especially for sellers that don’t generate large amounts of revenue that would justify such fees. What makes it more difficult is that there’s no published list and new brands might be gated at any time. Paying $1,500 just for the right to sell a brand, means that you have to be sure that your products will sell and you have enough margin and sales to make up that fee and then some. Imagine if you sell many of these newly gated brands.
Seller frustration is palpable. According to a survey published in January from WebRetailer and Feedvisor, 61 percent of Amazon sellers fear being banned.
Oren points out that with this new round of restrictions it seems that if you have sold the brand previously you are not restricted. If that is you, you may have an advantage going forward since it will limit new sellers competing against you.
There doesn’t seem to be anyway around these fees, so i’ll close this post with a reminder to just be careful as usual. Always check if you’re able to sell the products you purchase, even if you have sold them in the past.