Want To Sell Big Name-Brand Products Through Amazon? There’s A Fee For That

Image courtesy of Louis Abate

It’s no secret that online marketplaces like Amazon have a problem with third-party sellers offering counterfeit copies of name-brand products. The company’s latest effort to cut off the stream of fakes involves charging a fee to sellers who want to include certain big-name brands in their stores.

CNBC reports that Amazon began rolling out a new process, dubbed “brand gating,” last week, requiring some sellers to pay a one-time nonrefundable fee for each top brand they sell.

The fees, which can be as much as $1,500 per brand, are intended to weed out sellers who are either selling fakes or illicitly obtained products from brands like Nike, Adidas, and Hasbro.

These sellers must also show invoices from the manufacturers or distributors of the brands they want to sell to demonstrate that they have purchased a certain number of items within the last 90 days.

By putting up these paperwork and financial roadblocks, Amazon is trying to weed out those sellers who are unwilling to prove they are not selling knockoffs.

“We want customers to be able to shop with confidence on Amazon,” Erik Fairleigh, spokesman for the company, said. “For certain products and categories, Amazon requires additional performance checks, other qualification requirements, and fees.”

While Amazon hasn’t released a list of brands covered by the new fee policy, some merchants tell CNBC they have received notice of varying fees for certain products.

For example, some third-party sellers are being asked to pay $1,500 to sell Nike, Adidas, and Asics shoes, while others have been charged $1,000 for products from Hasbro, Lego, and Pokemon, CNBC reports.

Sellers say the new policy will cut into their bottom line, and could put others out of business by slowing eliminating retail arbitrage — where businesses shop liquidation, closeout, and other promotions at retailers for goods to sell online.

One merchant tells CNBC that he will no longer be able to sell thousands of Samsung products because he can’t provide proof they came from a manufacturer or distributor. Additionally, he was informed of a $1,000 fee to sell the Samsung goods.

Amazon’s plan to fight counterfeiters will cost legit sellers a ton [CNBC]