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Marketplace Tech

Amazon is remaking small businesses in its own image, report says

Marketplace Tech

Marketplace

News, Technology

4.51.3K Ratings

🗓️ 26 January 2023

⏱️ 8 minutes

🧾️ Download transcript

Summary

Amazon might seem anathema to small business, but the fact is, third-party sellers account for the majority of the e-commerce giant’s sales. These sellers range from independent artisans and designers to opportunistic resellers of products from big-box stores. A new report from the nonprofit Data & Society examines how Amazon is helping, hurting and generally transforming the small business retail model. Marketplace’s Meghan McCarty Carino spoke with Moira Weigel, the author of the report and a professor at Northeastern University. She described the effect Amazon has on small businesses as a “trickle-down monopoly.”

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Transcript

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0:00.0

An e-commerce giant is remaking small business in its image.

0:06.8

From American public media, this is Marketplace Tech.

0:09.8

I'm Megan McCarty-Karino.

0:11.5

Amazon might seem a nathema to small business, but the fact is, third-party sellers account

0:27.3

for the majority of its sales.

0:29.8

Now that tiny font under the Buy Now button that says sold by and often shows a name,

0:36.1

you don't recognize.

0:37.9

These sellers range from independent artisans and designers to opportunistic resaylers of

0:44.2

products from big box stores.

0:46.6

A new report from the non-profit data and society examines how Amazon is helping, hurting,

0:53.3

and generally transforming the small business retail model.

0:57.0

Author Moira Weigel is a professor at Northeastern University.

1:00.7

She describes the effect as a trickle-down monopoly.

1:04.8

Amazon's market dominance is giving rise to a new kind of small business that is Amazon-native

1:10.9

optimized for Amazon, kind of engineered to succeed on Amazon, but we must acknowledge

1:16.8

like, can scale and bring real opportunities to people, but that remain extremely vulnerable

1:22.7

to Amazon's shifting prerogatives and very much under Amazon's control.

1:29.3

I saw many sort of really literal examples of that in my research, whether it was merchants

1:35.9

who call themselves retail arbitrages, hoarding huge amounts of goods in their homes or

1:41.8

their garages or their cars, sort of turning their daily lives into out miniature fulfillment

1:47.7

centers, or whether it was sellers being encouraged by Amazon training materials or by

1:53.6

other training materials to sell it a loss for a period of time in order to gain market

...

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