Mon Feb 22 2021
Indian shopkeepers accuse Amazon of giving larger sellers preferential treatment
Small, independent shopkeepers in India have banded together and accused Amazon of bending rules that were put in place to protect small traders from being forced out by large e-commerce websites.
CAIT, the Confederation of All India Traders has been urging the Indian Government to ban all local operations of Amazon following on from a report which claimed Amazon had been favouring larger sellers across its platform for years by offering them preferential treatment. The report also claimed Amazon had been using loopholes in the Foreign Direct Investment (FDI) laws that the Indian Government put in place to protect small traders.
The report, created and released by news outlet Reuters is based on internal Amazon documents, including meeting notes, emails, business reports and PowerPoint slides dated all the way back to 2012.
Those documents show that of the more than 400,000 sellers using the platform in India since 2012, about one-third of the revenue generated was done by just 33 sellers.
A further document revealed that in early 2019, just two sellers accounted for 35% of sales revenue on Amazon… with Amazon owning equity stakes in those two businesses.
Those same internal documents from Amazon showed that fee discounts were being given to that small number of traders, with special help even being given to one seller to negotiate a special deal with Apple.
Perhaps worse, the documents also showed a surprising amount of control Amazon wielded in deciding what stock these sellers would hold and sell into the Indian market.
That was in direct contravention of a 2016 ruling by the Indian Government that should have prevented all ecommerce firms from having any kind of control or ownership over a seller’s inventory.
Taken as a whole, the documents released by Reuters clearly show Amazon adjusting its corporate structure every time the Government announced new restrictions on international ecommerce organisations… all of which has led to the vocal and wide spread condemnation of small traders across India.
CAIT, the Confederation of All India Traders, which represents over 80 million Indian retail stores, has described the information contained in the report as “shocking” and should be "sufficient enough to immediately ban operations of Amazon in India".
Amazon has responded to say that the information contained in the report is "unsubstantiated, incomplete and factually incorrect".
We haven't seen the documents and Reuters hasn't shared provenance to confirm veracity- the details are likely supplied with malicious intent to create sensation and discredit us.
Mon Feb 22 2021