For those sports nutrition CPG brands that think Amazon is the devil (another article on this topic soon!), things are quickly changing with your relationship with 3rd-party sellers (3P sellers) on Amazon. Amazon is playing tough with 3P sellers by enforcing protections on a growing list of brands.
Amazon, presumably is motivated by brands eager to crack down on unauthorized sales. They have been getting more aggressive about requesting brand approval fees for “gated” or “restricted” products and brands last week according to its 3P sellers’ discussion groups. It has not issued a list of products or categories affected by the brand-gating, so sellers are finding out this information only as they complete an application.
If you’re a brand selling on Amazon, you should go to your Seller Account to complete your Brand Registry. Why? It seems that if you have Brand Registry, Amazon is no longer allowing Third Party/Unauthorized Sellers to sell on your listings unless they ask for permission or do business directly with you. In some categories or larger customers, some 3P sellers now must pay anywhere from $1,000 to $5,000 in nonrefundable fees for approval to sell items from brands such as Nike. I don’t see the sports nutrition category being that strict because of the lower sales volume unless its something like Optimum Nutrition.
Amazon’s reasons for this move are many: “Some companies may have exclusive agreements with Amazon or another seller. Some brands are counterfeited so heavily that they require sellers to obtain their goods directly through the manufacturer, and you will need to be approved by them as an authorized reseller before you can list their items.”
If anything this is something all brands that sell of Amazon should look at if you are concerned about 3P sellers ruining your price integrity (even though its not their faults…again this will be covered in another article!).