American retail giant Amazon could be working on a new online retail platform that would allow it to better compete with the low-balling Chinese retailers like Temu and Shein, according to a report by The Information.
The outlet reports that it has seen internal Amazon documents originally meant for merchants which mention price caps for Amazon’s proposed new online store.
Amazon low-balls the low-ballers
Those price caps include a R140 limit for jewellery, R160 for bedding, R230 for guitars, and R350 for couches when said items originate from Amazon’s centre in Guangdong, China.
According to The Information’s sources, orders from Amazon’s new platform would incur longer shipping timelines in exchange for a better deal for sellers. If you’re a seller, it might take between nine to eleven days for your item to reach its buyer, but you could see anything from a 40% – 67% difference in shipment fees.
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Currently, Amazon doesn’t enforce price caps for items sold on its online store so most merchants opt to maximise their profits which inflates an item’s price making a direct comparison between it and a similar item sold on Temu’s store unfavourable.
If Amazon moves forward with a new low-cost store, it could sway things in its favour seeing as the relatively new Temu has gained a reputation for selling goods of questionable quality. If Amazon hopes to attract South Africa’s consumer market to its low-cost store over Temu’s, it’ll need to do more than just cap the price of items. Adding more things to buy would be a good place to start, followed by a local Amazon Prime offering.