Amazon is telling third-party sellers on its platform that they can't buy ad space to promote products that aren't earning Amazon a profit:
It is reevaluating how it sells unprofitable items. Such products, which Amazonto as"CRaP" — short for"can't realize a profit" — are often items such as bottled beverages or snacks that sell at low prices and tend to be expensive to ship.
The e-tailer is pushing its suppliers to become third-party sellers on its marketplace. Amazon has canceled orders from thousands of wholesalers it previously worked with, insteadthese vendors to sell directly to consumers on the Amazon marketplace. While the company didn't specify a motivation for making this change, it is reportedly more profitable for Amazon to assist a company in selling straight to customers than it is for the e-tailer to purchase and resell products.
These moves may help Amazon achieve the greater profitability it seeks, but they may also draw ire from sellers and lawmakers.on Amazon for sales, they are not in a good position to resist changes to marketplace policy that the e-tailer makes. But if enough sellers start feeling agitated, or as if the new policies are unfair, they might start experimenting with selling on other marketplaces like eBay or Walmart in earnest to lower their reliance on Amazon.
Lawmakers:An even more serious problem could come in the form of antitrust legislation. US Senator Elizabeth Warren, who is running for President in 2020, has already expressedabout Amazon's power and suggested that Congress should pass a law preventing large companies from owning a marketplace and selling on it simultaneously.
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