Wal-Mart Passes The Torch And Magnifying Glass To Amazon.com

Does Amazon deserve all of this negativity? Well, like every company that becomes a larger and larger force in the world, it absolutely deserves scrutiny.

Hi gang,


Remember way back like 3 years ago when Wal-Mart was the Evil Empire?  It seems you couldn’t turn a page or click on a website without hearing more news about how terrible Wal-Mart treated their vendors and employees.

Welcome to Press 2.0, where Amazon.com is the new punching bag.

There’s news this morning that Amazon is being sued over their Prime Third Party pricing. The suit makes the claim that third party FBA sellers inflate their prices to compensate for shipping (expert side opinion: um, duh! I have SOOO many stories, particularly from the mouths of eBay people, about free shipping. That’ll be another post) and so Amazon makes a higher fee on the commissions earned from the sale of an FBA item, which in turn contradicts the “free shipping” portion of their Prime program.

You can read the entire story over at Geekwire

That lawsuit comes on the heels of another story making the rounds about the treatment of Amazon workers in their distribution centers.  I can summarize it very briefly for you: it’s bad. TheGuardian.com has a good in depth story about it here .

A dew days ago Salon.com joined the fray by publishing a pretty scathing report titled “Worse than Wal-Mart: Amazon’s sick brutality and secret history of ruthlessly intimidating workers” . Summary: Amazon treats its’ employees badly.

And of course, I would be remiss not to mention my own nightmare story about Amazon, their FBA program, and Warner Bros, which is the most widely read blog I’ve ever done and still generates several e-mails a week from petrified Amazon sellers.  My story remains at the top of the most active posts over at Startupnation.com and can be read here:

Third Party Sellers Need To Rethink The Amazon FBA Program

By the way, I am writing a new post which will update you on this story and answer some frequently asked questions about it.

Even the Wall Street Journal has jumped in, having independently investigated Amazon on several claims of counterfeit and fraudulent items being sold on their site. I was interviewed for that article as well and the reporter had a very good handle on the issues facing Amazon when it comes to policing their own site. You can read that article here

Does Amazon deserve all of this negativity? Well, like every company that becomes a larger and larger force in the world, it absolutely deserves scrutiny. I think it’s fair to question any company on their treatment of employees, customers, and vendors. Every large US company has been held up to the candlelight at one time or other – Microsoft, GE, Apple, Walls Fargo, etc – and Amazon should be no exception.

It baffles me, though, to read the reactions to these reports from people.  As any seller can tell you, FREE shipping does not mean free. Having the lowest price means the lowest margins.  There’s a cost to all of that, knuckleheads.  To excel in some areas, Amazon has to give in other areas. People. Compensation. Benefits. Third Party Seller Services. Etc. Yes, you can get that video game tomorrow or even today

Is Amazon a bad company? Based on what you know about my dealings with them, you’ll be surprised to hear that I don’t think so.  They are an amazingly innovative company with vision that rivals and even surpasses the Mount Olympus of Vision: Apple.

But, like Apple, don’t be surprised when a few cockroaches scurry for cover after you lift up the rug and look under it.


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