Amazon May Have a Counterfeit Problem | Hacker News Reader

Amazon May Have a Counterfeit Problem

theatlantic.com

34 pointscfadvan11 comments

One major facet of this issue The Atlantic missed in this article is that of commingling. The article repeatedly talks about Amazon's claims to take counterfeiting seriously, and how they're often just a platform for other sellers, but a critical part of maintaining that normally is that a brand has a 1:1 relationship between what it sells and what a buyer gets. But for the free default Amazon commingles FBA (and apparently their own stock too now) based purely on claimed SKU. That means someone can sell their own legitimate product that they put into Amazon's system themselves, through their own store brand or "Sold by Amazon", and then Amazon will go ahead and ship a counterfeit someone else put into the system. I believe it's possible for sellers to avoid that if they perform additional labeling and pay Amazon a fee per unit, but naturally the vast majority go with the default (and Amazon doesn't seem to give buyers any clear labeling/search options to prefer non-commingled sellers either, it couldn't just be B2B to be a significant aid to the reputation problem).

This to me is one of the clearest, black & white indications that no Amazon is not taking this seriously enough. Commingling is purely on them, they do it to ease their own logistics and in turn improve their own profits. They shouldn't be able to claim to be merely at direct linking platform but then act as an aggregator. Merchants shouldn't need to go to any extra work or need to pay extra money for this either (though I recognize Amazon might have to raise FBA pricing if they can't stealth optimize it or pay extra for verification or some such), they should be able to send items into Amazon's system properly packaged and have Amazon automatically take care of ensuring if a customer buys from them they get one of their specific packages only.

My mom's business sells a lot on Amazon. Her stuff is in the brand registry. She does not sell at wholesale, yet has competitors that sell products with her branding and labeling for less than she sells it. Amazon rarely cooperates with her reports of counterfeiting, saying dumbass stuff like "prove it". This, coming from Amazon's legal team, who seems to fail at understanding the fundamental economic rule of "buy low, sell high".

Have you ordered the counterfeit products, inspected them, and reported them as counterfeit? There are many ways to tackle this problem and there are many people who abuse it on many sides.

Amazon has messed up the operations for a lot of companies so usually the burden is on you to fix whatever the problem is. For example, I currently have a problem where Amazon has virtually given me $10,000+ of product that I never sent in and even after months of contact, trying to get them to acknowledge their error and take back the inventory is like pulling teeth... That's my problem, the bigger nightmare is for companies that now need to document and tighten down on their entire supply chain for unauthorized vendors... .

I haven't had to deal with any counterfeiters yet but look up Cynthia Stine's Egrowth Partners or Ed Rosenberg. They deal with this type of stuff everyday. There's probably free advice floating around too. Best place to ask in my opinion are the Amazon seller Facebook groups. Seller Tradecraft and FBA private label high rollers might be a good resource.

Thanks for the tips, I’ll pass them along.

She has gone through purchasing the counterfeits with varying levels of success. One time, she got one of the cockroaches kicked off her ASIN then the next day a brand new company appears on the same item. Other times she got them to stop.

They could still do per-seller labels even with co-mingling... At least then they'd have a better chance of finding/removing sellers of counterfeit goods... they won't even do that.

Any good Amazon seller knows to never commingle because it's really not worth the risk... Unless your brand/listing is gated and you are tightly controlling your supply chain and selling to only a few authorized resellers, you shouldn't commingle, otherwise you risk being suspended for someone else's mistakes or misdeeds.

There are people who are lazy or cheap and don't want to pay the 10 cents to label their items with their Amazon sku. They take the risk. There are also other sellers who intentionally commingle because they sell grey-market items, things they did not buy through authorized sales channels, liquidations/fell off a truck stuff.

On the other hand, in my experience, Amazon is actually fantastic at catching counterfeits because they are maniacal about positive customer experience and they do not care about sellers. They have bots and as soon as counterfeit/inauthentic/hazmat is triggered, they'll trace it back to the seller, and the seller will be investigated, caught, and potentially banned from selling on Amazon. Even if it's commingled, you can dig and find the bad actors, because everything is meticulously logged. Amazon errs on safety so they will shut down a seller from selling and hold their inventory hostage while they investigate, and their investigation can take weeks. Amazon is proactive, so many good sellers, even me, have some of our inventory frozen while Amazon goes through these checks. Amazon will ask for invoices, check them by following up with the company, and if they are not good enough for a Amazon's standards you will either be warned or banned.

If you wanted to sell counterfeits on Amazon you will get caught, your account will be banned, and your IP addresses will be logged, and any time you try to open a new account, it will be automatically rejected if you reuse the same information - ip address, banking info, credit cards, physical address, legal entity. If you are not caught in the beginning but are caught later, you will be banned as well as any other accounts you might have simultaneously opened.

What some companies consider counterfeit, Amazon probably considers as companies who can't manage their own business and lock down their supply chain.

"May" have a problem, they do have a counterfeit problem.

Maybe I buy a disproportionate amount of electronic components from Amazon (or used to), but I'd spend way more time trying to figure out if a particular product was counterfeit or not. I also spent a lot of time returning crap that was (it's super frustrating to receive a part for a project only to discover it's a completely not functional replica). I canceled my Amazon Prime membership a few weeks ago, and plan to rely on Digikey + local electronics stores from now on.

I’m really tired of tech giants claiming they’re just platforms when it’s convenientm for them. Twitter, Google, and Facebook claim they’re not publishers, just platforms. Meanwhile they’re acting like both. Amazon isn’t engaged in commerce, it’s just a platform, but again is very much both. It seems that some regulations on this kind of “platform” is inevitable, and probably overdue.

The degree to which companies on the internet thrive through aggressive doublespeak is frustrating beyond belief.

I’m pretty sure that Google, Facebook, Twitter et al., stick to acting as platforms because they are relying on years of legal precedents which protects them from liability of any abuse carried out by users.

If however they start curating content or being especially controlling then they risk being classed as a normal publisher, and as such liable to additional regulations or damages based on actions of their users and/partners.

This is why Facebook is in a bind about “fake news” being shared on their network. If they remove it then they will be accused of not being an impartial platform. So instead, at best, they have to algorithmically cross reference posts with other reliable content sources to “flag” to the user that the shared article “may” be inaccurate. Unless that post contains a bit of naked flesh, it ain’t being taken down.

They seem to manage keeping counterfeit chromecasts off their site just fine.

Aside: what about their kindle/fire lines? Are there counterfeits of their own items?

It would be VERY easy for Amazon to put per/seller labels on all (or at least most) packages, so that they could filter out specific sellers, even with the mingled stock.

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