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by chumali
2514 days ago
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This is a ridiculous argument, Amazon clearly has substantial market power which can be used to reduce the exposure of their suppliers [1] (the loss in exposure means there a significant costs associated with suppliers moving to another platform/store - the very definition of market power). Comparing them to the mom and pop coffee shop is absurd - unlike the coffee shop, there are not hundreds of Amazon competitors that you can sell your product through. You are literally comparing textbook definitions of perfectly competitive markets (e.g. coffee shops - hundreds of competitors and low barriers to entry) to oligopoly markets (e.g. Amazon - very few competitors and high barriers to entry), and somehow reaching the conclusion that they are the same? This is obviously nonsense and goes against the most basic of economic principles. [1] https://www.cnbc.com/2019/03/19/heres-why-retailers-should-b... |
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There are though. Not only major ones like Walmart, eBay, Esty, Target, Craigslist, etc., but the fact that anyone can create their own website and then get customers through price comparison sites by having the most competitive prices. On top of which, brick and mortar retailers can reach the same customers for most products, and there are a zillion of those you can sell through, or a slew of wholesaling companies that will do the retail distribution work for you.
That's assuming you're manufacturing the products; if you are the wholesaler then what did you think your job was? It's to negotiate with lots of retailers to buy through you. "I want Amazon to provide 100% of the value but I still make money and never get cut out" is not a sound business model.
> the loss in exposure means there a significant costs associated with suppliers moving to another platform/store - the very definition of market power
You can set up with eBay in like an hour, probably the same for most others. It would be more if you have a lot of different SKUs, but that implies you're doing more volume and it's still a small fraction of your total costs.