Source: The Verge
Amazon is set to allow its merchants use its fulfilment services via ‘Buy With Prime’ to sell goods to customers directly. While buying from them while using the programme, customers will get access to Prime benefits such as free shipping, free returns and fast deliveries. This new feature will begin with Fulfilment by Amazon, continuing to expand throughout the year to more merchants. Merchants who already have a website established, can continue using it for the same needs.
This new policy could go on to loosen the retail giant’s grip on other online merchants. For a while now, the company has been under significant antitrust perusal over its power in the online market. Many claims that Amazon.com Inc gives itself the advantage over third party seller by using their data to create its own brand of products. However, the retail giant denies these claims leading to the merchants questioning the need of this program.
Amazon has been working on this programme for a while now, along with making its consumer-oriented strategy a suitable place for merchants to start their website. On the other hand, the success of this move relies on the success of their new strategy.
The benefits of this new programme:
One of the most significant benefits of this new move is that the company has built an expansive supply chain as a support to its online store, currently offering it as a service. Moreover, selling on their platform has added benefits, with merchants starting their websites to sell on them. But it is crucial for small businesses to consider the costs involved in this initiative.
Other benefits of selling on the platform is sellers getting the opportunity to compete with more sellers for the ‘Buy Box,’ which allows fierce competition. Many merchants are often seen offering the same product, Amazon’s job would be to choose the one with the highest score in the Buy Box. Algorithmic repricing is what causes this phenomenon, increasing competition among sellers. This indicates the presence of many sellers for popular commodities in the Buy Box.
Additionally, having a store in on Amazon often aids sellers build a customer base, leading to customers directing to their shops while looking for something. One of the most crucial qualities of these system is customer reviews which often affects websites of the merchants.
