Jim Armitage: Stop moaning, Amazon traders, you can always find another marketplace
Jim Armitage is the City editor of The Independent and London Evening Standard group of newspapers. He has been a reporter and editor for more than 20 years and was recently shortlisted for the Press Gazette financial journalist of the year and The Society of Editors financial journalist of the year awards. He contributes news, investigative reports and comment to the Independent titles plus a daily column in the Evening Standard.
Saturday 30 March 2013
I know it's fashionable to bash Amazon. I dislike its super-low tax bill as much as the next guy. But the storm over its fee hike for traders selling their wares through Amazon's marketplace is overblown.
The company which revolutionised how we shop is upping its percentage take on such sales in many countries. Commissions in France for sellers of music, videos and games are going up from 10 per cent to 15 per cent, some German fees are being hiked from 7 per cent to 10 per cent, and UK car parts sales are rising from 12 per cent to 15 per cent.
Understandably, businesses retailing through Amazon are cross. The company had already hacked them off by taking two to three weeks to pass on money from sales to the traders. And now this.
But here's a suggestion for those firms. Sell your stuff somewhere else. What makes the internet such an exciting place is that there is so much choice. These grumblers, some of whom are even calling for governments to step in, should move to eBay, Rakuten and others. An exodus would quickly make Amazon change its mind. And so much traffic comes from price comparators and search engines anyway, I'm sure the fact that Amazon is the platform selling the merchandise is fairly irrelevant to most shoppers.
Bigger sellers could generate easy PR from telling their loyal customers they're ditching Amazon to keep their prices down.
Meanwhile, Amazon's perceived "rip-off fees" will alert new entrepreneurs to the market as well – part of the reason that Jeff Bezos launched Amazon in the 1990s was in response to what he saw as overblown profit margins at traditional booksellers. Big companies are waiting in the wings to take on Amazon's marketplace too – Walmart and Tesco are dipping their toe in the third-party-sellers water with their mighty websites already.
On the other hand, if sellers feel that Amazon's service levels, branding and reach make the extra fee still worthwhile, they should take it on the chin. It's called capitalism: businesses will charge what people will pay.
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