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How does the Amazon store work and what is the relationship with its sellers?

 

Amazon has a complex sales system through which it markets products from sellers and also, under the same umbrella, its own. It is one of the ecommerce operators that handles the largest volume of vendor data and the Commission believes that it may have used it to compete with its smaller suppliers.

How does the Amazon sales system work?
Amazon divides its store into two parts. On the one hand, there is the retail business, where it buys products from third parties and sells them under its brand name. On the other is the marketplace. Here companies market their products directly but through the ecommerce giant’s website. In this case, companies can choose to use Amazon’s logistics or their own.
What business does the investigation affect?
It affects the sellers of the marketplace. Brussels believes it used their sales data to better position its own brands. Industry sources explain that this is a practice that distributors do. Â «It is as if Carrefour or Mercadona, for example, detect that Gallina Blanca’s ready-to-eat noodles are being sold a lot and decide to market the same product under their own brand,” they illustrate.
How many companies sell on Amazon?
There are more than 150,000 European companies selling through its stores. In Spain there are 9,000, the majority of which are SMEs that sell on the marketplace. Some buy products from a wholesaler and resell them through Amazon. Others sell their own items. For example, Apple computers are sold, as they are also sold on the El Corte Inglà website or in technology stores.
Does Amazon have its own brands?
Yes. In fashion, pet food, children’s clothing, footwear … Also in basic products. Amazon buys the product from a supplier and markets it under their brand names.
What type of contracts are negotiated with the sellers?
They depend on this business relationship. In retail, for example, Amazon buys two million T-shirts from a supplier and sells them under its brand name. This contract is different from the one with a brand that sells its shirts through the marketplace. It also depends on whether the company also uses Amazon’s logistics services or, on the contrary, takes care of the delivery.
What percentage of sales does each business represent?
Only 1% of all Amazon global sales correspond to its brand products, while more than half of the products sold through Amazon are from the marketplace part.
What data does Amazon have access to?
It manages the transactions of thousands of companies, so you have access to millions of data of these sales. These sources explain that  «any chain can know how many units of yogurt of a brand have been sold, for example, but the difference is that the volume of data that Amazon manages is much greater”.

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