Amazon’s Price Parity: Warnings, Suspensions and Reinstatements

August 7, 2012

Marketplaces ChannelAdvisor By ChannelAdvisor

Price is an important factor for customers, and Amazon work hard to ensure that customers do not find a better price on any other platform, for the very same SKU and from the very same seller. For this reason, Amazon is very strict on Price Parity, and as they are reviewing this at the moment, if you are selling on Amazon, make sure you understand this requirement.

Amazon
What is Price Parity?

If you are already selling on Amazon, you have agreed to Amazon’s Price Parity terms. Amazon’s definition of this, according to Amazon’s Services Europe Business Solutions Agreement is listed below;

S-4. Parity with Your Sales Channels

Subject to this Section S-4, you are free to determine which of Your Products you wish to list for sale on a particular Amazon Site. You will maintain parity between the products you offer through Your Sales Channels and the products you list on the a particular Amazon Site by ensuring that at the applicable Selling on Amazon Launch Date and thereafter: (a) the Purchase Price and every other term of offer and/or sale of Your Product (including associated shipping and handling charges, Shipment Information, any “low price” guarantee, rebate or discount, any free or discounted products or other benefit available as a result of purchasing one or more other products, and terms of applicable return and refund policies listed on such Amazon Site) is at least as favourable to users of such Amazon Site as the most favourable terms upon which a product is offered and/or sold via Your Sales Channels (excluding consideration of Excluded Offers); (b) customer service for Your Products listed on such Amazon Site is at least as responsive and available and offers at least the same level of support as the most favourable customer services offered in connection with any of Your Sales Channels (provided that any such customer service will at all times be conducted in a timely, professional and courteous manner) (this requirement does not apply to customer service for payment-related issues on Your Transactions, which we will provide); and (c) the Content, product information and other information under Section S-1.1 regarding Your Products listed on such Amazon Site that you provide to us is of at least the same level of quality as the highest quality information displayed or used in Your Sales Channels. If you become aware of any non-compliance with (a) above, you will promptly compensate adversely affected customers by making appropriate refunds to them in accordance with Section S-2.2. For Amazon-Fulfilled Products, we acknowledge that if the shipping and handling charges associated with the sale and delivery of any of Your Products listed for sale on such Amazon Site are included in (and not separately stated) the purchase price listed for Your Product on such Amazon Site (collectively a “Shipping Inclusive Purchase Price”), then the parity obligation in (a) above will be satisfied if the Shipping Inclusive Purchase Price and each other term of offer and/or sale for the product on the particular Amazon Site are at least as favourable to users of such Amazon Site as the purchase price and each other term of offer and/or sale for the product (including any and all separately stated shipping and handling charges) pursuant to which the product is offered and/or sold via any of your sales channels other than the particular Amazon Site.

Source: Seller Central Help: Configure Account Settings: Reference: Policies and Agreements: Amazon Services Europe Business Solutions Agreement.

Buy BoxWhat happens if I’m not maintaining Price Parity?

Amazon is monitoring Price Parity on a country by country basis. If you do not maintain Price Parity, Amazon can contact you at any time to warn you. They can also suspend your account and block your payments at any time; and they won’t hesitate in doing so, irrespective of how successful you are on their platform. Please note your account will be noted as well, with a potential impact across other countries if you sell globally.

It should be noted that some retailers also registered to an additional Selection Parity agreement. If you have any doubt about what your agreement is, you should contact Amazon’s Seller support from your SellerCentral interface straight away to ensure you are compliant.

What happens if I’m suspended?

We strongly recommend to maintain Price Parity all the time. If you are suspended, the first thing to do is to fix any Price Parity issues: not only on SKUs spotted by Amazon, but for your whole inventory. Then you need to apply for reinstatement:

  • Ensure that all of the “final prices” on your website and/or on eBay are now all the same as Amazon’s prices
  • Please use this wording: “final prices” (prices including associated shipping and handling charges, delivery information, any low price guarantee, rebate or discount, any free or discounted products or other benefit available)

If you plan to fix Price Parity in the days or weeks to come, you won’t be reinstated until Price Parity is fully functional. Remember that Amazon will be checking your Price Parity compliance on a regularly basis if you’re reinstated.

Suspension email from Amazon:

Greetings from Amazon,

We are writing to let you know that we have suspended your selling privileges and placed a temporary hold on any funds in your Amazon seller account.
As stated in our earlier warnings, we ask that sellers do not charge customers higher prices on Amazon than they charge elsewhere through their other online sales channels. This is critical to preserve fairness for Amazon customers.
It has come to our attention that some of your listings, such as those listed below still donot abide by this policy.


For more information, please refer to Section S-4 (“Parity with your Sales Channels”) of the Amazon Services Business Solutions Agreement, available in the Policies and Agreements section of seller Help.

We encourage you to take appropriate steps to resolve any pending orders.

Before we can consider reinstating your selling privileges, you must provide us with a detailed plan to ensure compliance with our policies.  We will then review your plan and determine whether to reinstate your privileges.


For information on creating and submitting your plan of action, search for “Appeals for Suspended or Blocked Accounts” in seller Help.


We look forward to hearing from you.

Regards,

Seller Performance Team

Example listing:
Example ASIN: XXX
ASIN Title: XXX
Date: XXX
Total price on Amazon.co.uk: £XXX (inclusive of VAT)
Total price on XXX: £XXX (inclusive of VAT)

Amazon is taking Price Parity very seriously, so check that you are compliant today, and remember that if you have any doubts about your agreement, you should contact Amazon by replying to the suspension email, or by clicking on the button ‘Contact Seller Support’ at the bottom of the SellerCentral homepage.

Blog post by David Le Roux, Key Account Manager, ChannelAdvisor.