[jonhohle]

I worked on Prime and Delivery Experience until 2013 and commingling was considered relatively taboo due to the destruction of customer trust that would likely result. It was an obvious optimization. There was already an issue with return fraud and resellers listing fraudulent items that weren’t commingled under the same product listing. I was pretty shocked when it launched after I left.

It turned out pretty much the way we figured it would.

[bombcar]

Commingling really only makes sense in a weird world where Amazon is the final retailer for various distributors selling the same exact product in which case why doesn’t Amazon cut out the middle men and buy it directly?

Commingling ten distributors sets of Energizer batteries makes sense, but not as much sense as just buying direct from Energizer. They don’t lack the volume.

[jonhohle]

Amazon doesn’t just fulfill Amazon.com orders. Anyone can send inventory to Amazon and use them for fulfillment on their own e-commerce platform. The distributors don’t know Amazon is going to be fulfilling orders from several of their retailers.

Even on Amazon, it’s not uncommon to find several new listings for an item fulfilled by Amazon from different sellers (including Amazon). That’s beneficial for Amazon because they don’t need to own all of the inventory and the sellers get a listing with good reputation to leverage if Amazon goes out of stock. In the perfect scenario everyone wins - Amazon makes money, the seller makes money, and the product is still available to the customer. You get all that without commingling, but with it, you also save physical storage volume.

[ajkjk]

FBA gives them an economy of scale that you can't get with just internal staff--every retail inventory requires account managers and oversight, whereas with FBA you just set up a platform and let the economy sort itself out (while skimming your cut). It is not that different from Apple's app store being a better business model than commissioning all the apps themselves. Anyway the distribution world is much messier than you might think. Allowing everybody to individually optimize whatever they way (say, finding a cheap wholesaler and then reselling via FBA) is hugely advantageous for them. Although I would guess that in the last decade the efficiencies have largely been exploited now.

also, you're probably aware of all the made-up brands which sell like, thousands of versions of staples like HDMI cables on Amazon... all of that exists because FBA made it possible for people to start random business in consumer goods, basically by (my understanding) using Alibaba to find manufacturers and FBA to find customers and connecting the two. It's all exhausting now because the fake brands have crowded out the real ones, but for a long time that was what the economy becoming more efficient looked like (at least in one sense... maybe not the sort of efficiency that actually benefits the customer, though, since in practice a lot of the gains were found by capitalizing on Amazon's reputation to sell cheap stuff for more than it was worth).

[bruckie]

> Energizer batteries

I see the point you are trying to make, but Energizer batteries are a bad exemplar for it. Even if all of the batteries are the exact same SKU, some of them may be 10 years old and some of them may be fresh from the factory. I've had this happen with several (perishable) products from Amazon.

[bombcar]

That's an entirely separate but related issue - stock rotation has to be managed, and commingling (in theory) helps alleviate the issue. Removing it means that you may find quite old product sold alongside brand new.

(I suspect but have not proven that Walmart actually rotates UPCs/SKUs on identical product so they can remainder it out).

[SoftTalker]

In fact I can say that any time I've bought a battery on Amazon I've received a very old one that didn't last very long, if it worked at all.

[foobarian]

Wow, lots of insiders contributing lore in this article's comments. I appreciate you all!