Amazon Cuts Third-Party Sellers’ Prices – at its Own Expense

In a bold move that it hopes will help it face competition this holiday season, Amazon is offering discounts on third-party seller items – and eats the cost. Items bearing the mention ‘Discount provided by Amazon’ show a reduced price for buyers, but third-seller parties are still getting the full amount for their sales. What’s surprising is that Amazon doesn’t seem to have informed its third-party sellers of this new feature, and it isn’t clear how the retail giant is selecting discounted items, either.

One such reseller noted on Amazon’s forum that “I do not know if this is new or if I just never noticed it before”, while another wonders “How does Amazon decide which 3ed [sic] party sellers to provide discount to, how do we get Discount provided by Amazon?” and a third adds “Perhaps Amazon is identifying items that it wants to corner the market on, so is hastening the depletion of 3P seller inventory? That, or a well-fed chimp in Amazon’s operations center picks a name out of a hat.”, which goes to show that Amazon has somewhat surprised – if not confused – at least some of its resellers. According to Engadget, “The discounts are less than 10 percent, and appear to only be applied for sellers that use Amazon’s fulfillment service”.

Amazon’s description of its new feature is explained as such:

This item is sold by a third-party seller. The discount is provided by Amazon.
This is a limited time discount.
Discount does not apply to digital content.
Discount good while supplies last or until withdrawn by Amazon.
Shipping charges and taxes may apply to pre-discounted prices.
Amazon reserves the right to modify or cancel the discount at any time.
If any of the products or content related to this discount are returned, your refund will equal the amount you paid for the product or content, subject to applicable refund policies.

Most resellers seem happy with the new features, but a few aren’t big fans – especially those third-party sellers that arrangements with other retailers that requires them to keep consistent prices on products sold on Amazon and elsewhere. Thankfully for those resellers, Amazon gives the option to opt out of ‘Discount provided by Amazon’ if they so wish.