Bloomberg reports that Amazon is rolling out a new policy in 2017 to support brands trying to shut down counterfeit sellers on the platform.
The regulations will target third-party sellers on the site, entities that Amazon cannot easily guarantee the quality of under existing policies yet often partners with under the ?EU?Fulfillment by Amazon?EU? (FAB) setup. Items from third-party merchants account for almost 40% of all paid goods on the site. It is unclear how many of these sellers, about 2 million in total, traffic in counterfeits. Their main advantage for Amazon is that they help it ?EU?expand its inventory more quickly and with less upfront cost than Amazon could do on its own.?EU?
Amazon also has been stepping up lawsuits against both counterfeit sellers and fake product reviewers. The company has spent millions and hired new people to keep up with the deluge of forgeries, which will remain an ongoing battle for the company as it tries to retain retailer trust and attract both new sellers and ones who?EU?ve left over past problems.
The centerpiece of the new policy is a brand registry that will require all sellers to prove they have permission from that brand to resell its goods. The new policy will be based on an existing one being tried out for toys, ICT, and apparel. According to internetretailer.com, ?EU?Sellers who list products from select brands must pay up to a [one-time, nonrefundable] $1,500 fee,?EU? and ?EU?must provide three purchase invoices from the manufacturer or distributor and a letter from the manufacturer authorizing the retailer to sell its products.?EU?
Brands Voted with Their Feet
That policy followed a decision by a major footwear brand, Birkenstock, to ban all sales on the platform. Although most major retailers — most retailers, period — are willing to endure the potential revenue losses, these can be…