Amazon sellers are held to a number of specific rules for listing products, such as refraining from selling counterfeit items, following Amazon’s return and refund guarantees, and more.
One rule sellers on Amazon are held to is the Fair Pricing Policy. But what is this policy, and how does it work? If you’d like to find out, keep reading this article to see what I learned!
Amazon Fair Pricing Policy
The Amazon Marketplace states that its Fair Pricing Policy requires sellers to list their products at reasonable prices. If sellers list their products significantly higher than similar items on Amazon, charge an outrageous amount for shipping, or mislead customers with the actual price, their products could be removed, or their selling privileges could be suspended.
If you’d like to learn more about Amazon’s full Fair Price Policy, the guidelines for fair pricing, and what happens when sellers don’t follow these rules, keep reading this article for useful facts and tips!
What Is Amazon’s Fair Pricing Policy?
Amazon’s Fair Price Policy states that all Amazon sellers are required to price their products fairly and according to base prices from similar products found on Amazon.com.
Amazon’s goal is to provide lower prices to customers, meaning that all sellers are required to set prices according to what Amazon deems fair and not what the sellers would prefer to price their products at.
If sellers price their products too high, set an unreasonable shipping cost, or deceive customers about the actual cost of a product, they are in violation of the Fair Price Policy and run the risk of being suspended from selling privileges.
What are the Guidelines for Amazon’s Fair Price Policy?
Amazon’s Fair Price Policy is based on Amazon’s goal to provide customers with the largest selection at the lowest price and requires that all their sellers practice pricing that customers can trust.
Pricing practices that go against customer trust are as follows:
- Placing a reference price on a listing that misleads customers about the actual cost
- Pricing goods or services significantly higher than other similar listings on Amazon
- Selling multiple units of a product per more than a single unit of the same item
- Setting an excessive shipping fee on a product that is not in line with public carrier rates
Amazon regularly monitors the pricing of products on the Amazon Marketplace. Therefore, if sellers have listings that fall in line with even one of the above violations, Amazon may remove their product from their seller page.
Additionally, if sellers continue to practice such pricing with their products, Amazon may remove their privilege to sell altogether.
What Happens If Sellers Don’t Follow Amazon’s Fair Price Policy?
When sellers fail to practice responsible pricing in accordance with the Fair Price Policy, Amazon will take one or more of the following measures:
- Remove the Buy Box (the orange “Buy Now” button featured on product pages)
- Remove the offer from Amazon’s product pages
- Suspend shipping options
- Suspend or terminate selling privileges from the seller
Sellers should also note that Amazon is not required to inform them of an infraction of this nature, meaning sellers may not find out about their product being removed or their privileges being suspended until they next log in to their account.
Does Amazon’s Fair Price Policy Require Price Matching?
Because Amazon has implemented its Price Policy and is monitoring pricing regularly, it is not considered essential for Amazon sellers to price match their listings with other websites.
However, Amazon does require their sellers to keep competitive rates, which is most easily achieved by regularly monitoring the prices of websites that sell similar products to those being listed by Amazon sellers.
Therefore, while it’s not a requirement to price match items with other websites, sellers are encouraged to keep up to date with companies that are selling similar items for a lower price in order to alleviate the risk of losing customers to those brands.
Which Marketplaces Does Amazon Monitor for Fair Pricing?
When Amazon monitors price brackets for their products, they specifically price check against the following companies:
- Walmart
- Target
- Alibaba
- eBay
- Chewy.com
In addition to these websites, Amazon will also price match against a number of larger companies. However, their full list is currently not available to the public.
Therefore, sellers who are listing similar items sold through these above-mentioned companies are encouraged to price check their products against Walmart, Target, and other mentioned stores, as these serve as Amazon’s biggest competition.
However, when sellers adjust their prices based on price matching, they should be careful to
follow the guidelines listed in the Fair Price Policy.
If Sellers charge too low or too high for their products and shipping costs, they run the risk of being removed from Amazon as a seller and having to relocate their business to another platform.
To find out more, you can also read our posts on why Amazon prices change, Amazon’s price mistake policy, and if Amazon does price adjustments.
