Amazon marketplace sellers - price cutting?

[olimits7]

Hi,

I was taking a look at some "brand new" products being sold on Amazon Marketplace, and then compared these product prices to some of the large retailer prices like Best Buy, Target, WalMart, etc...

I noticed the Amazon Marketplace sellers price-cutting by such large margins compared to these large retailers that I don't understand:

- One, how they can make a profit selling for such a low price?
- Two, how they can get a lower wholesale price than the large retailers to be able to sell at these low prices and make a profit?

I would think that these large retailers would be able to get the best product prices out there from wholesalers/distributors due to them buying in such large volume.

Just doesn't make sense to me...

olimits7

[dpd1]

They may very well NOT be making a profit. The couple times I have dealt with marketplace sellers, they didn't seem to have it together very well. Some people are very poor accountants. They may not have a clue what they are really making. Either that, or they could sometimes be selling stuff they got dirt cheap from a liquidation sale that some other failed biz had.

[bwnbwn]

They also could be selling rejects with minor damage.

[rtroxel]

Maybe Amazon wants to attract more visitors to their site by offering a few items below cost. If you buy them, maybe you'll buy other things from Amazon, too.

Maybe Amazon thinks that if they sell enough volume, they'll make a profit.

Just my 2 cents :)

- Roy

PS: The commissions on those items will be ridiculously low, so the Amazon Associates won't be making anything.

[olimits7]

My guess its the old merchandise falling off the truck trick...hahaha!

[purplecape]

olimits7, it could also be bait-and-switch--they take the order, say "oops it's out of stock," and offer something else.

rtroxel, this isn't a case of Amazon itself selling at below cost--this is marketplace sellers (though Amazon DOES sell Kindle editions of best-sellers at below cost, due to the terms they have with the big publishers).