Amazon very often competes directly with sellers on the Marketplace, and often undercuts them on price.
There are products they sell below the purchase cost, sometimes below manufacturing cost. You can't compete with that unless you have piles of money to burn.
They sell at a loss until they shake everyone loose from a product, then dominate all sales of that products on the Marketplace, raising prices to profitability when they feel like it.
Don't forget they get all product sales information and statistics from every seller on the Marketplace - basically all the market research necessary to pick only "winner" products to sell. Then, when they feel like it, they require sellers to produce original invoices proving purchase of the items. These invoices conveniently contain all necessary information for Amazon to start buying the items directly themselves so that they can sell the item at a loss until you can't compete anymore, leaving Amazon as the sole source for the product.
Wanna be part of Vendor Central - selling directly to Amazon? They dictate the pricing and strong-arm you into selling exclusively to them in many cases. There is no negotiation - there is no adjusting pricing based on quantity ordered. And as much as people might want to think Amazon just buys enough quantity to get what they want - they don't. They just tell you what it will be.
> or exclude competition to that extent?
They can ban you from their Marketplace (the largest consumer Marketplace in the world) at will, with little to zero recourse on your part, via an opaque "Seller Performance" team that only responds to email, sometimes, and provides vague responses to what policies you might have broken.
That is, if you somehow get the eye of the Seller Performance team upon you. The reasons they go after certain sellers and leave others alone are as mysterious as the team behind the decisions.