Merchants have long complained of being arbitrarily booted off the web site and struggling to get reinstated.
(Bloomberg) — Amazon.com Inc. says it will stop summarily suspending online sellers, a peace offering to small- and medium-size businesses that have long complained of being booted off the site arbitrarily.
Under a new initiative, called “Account Health Assurance,” Amazon staff will work with merchants one-on-one to resolve any issues without resorting to suspensions, the company said. The program went live in the US and Canada on Wednesday and will later expand to other countries.
Some 2 million merchants are responsible for more than half of the goods Amazon sells. But for years, these sellers have lived with the fear that they could be abruptly suspended, sometimes after being falsely accused by a shopper or competitor of selling counterfeit products. Many appealed their suspensions but found themselves passed from one Amazon team to another with no resolution. Meanwhile, their web stores were shuttered, with merchandise piling up unsold.
In 2020, Bloomberg chronicled the experience of a Los Angeles clothing retailer who was kicked off the site for allegedly selling fakes, which he denied. Amazon declined his appeal and destroyed what he said was $1.5 million of inventory. Such stories were at the heart of a House Judiciary Committee report concluding that big technology companies were abusing their power over smaller partners.
Amazon merchants have limited recourse because they waive their right to a day in court by agreeing to resolve disputes via binding arbitration, a pricey and time-consuming process. So an entire cottage industry has sprung up to help sellers get reinstated. There was even an effort to sell insurance to replace lost income after a suspension. But some merchants simply give up and abandon their Amazon accounts.
Dharmesh Mehta, Amazon’s vice president of selling partner services, said seller suspensions are rare but that the fear of them can weigh on merchants who should otherwise be focused on shoppers, especially during the busy holiday season.
“That can create a level of anxiety or fears,” he said. “So this is really about how do we create greater peace of mind.”
Amazon remains the dominant online marketplace in the US but is contending with stepped-up competition from established retailers such as Walmart Inc. and newer companies like Shopify Inc. The Seattle-based company is also grappling with slowing sales as consumers revert to their pre-pandemic shopping habits and curb their spending amid the loftiest inflation in four decades. Seeking to cut costs, the company has plans to ax about 10,000 corporate jobs, according to people familiar with the situation, and has slowed the opening of warehouses.
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