LA Law Group

Covid-19 was ground breaking in many categories on Amazon, and as a result some Amazon sellers found their accounts shut down (Amazon Accounts Suspended for violating the Fair Pricing Policy) with this vague notice:

“We have suspended your selling privileges for violation of Amazon Marketplace Fair Pricing Policy and Seller Code of Conduct.”

This did not come with a warning – not even a clue about what triggered the account suspensions, leaving honest, hard working sellers scrambling to figure out what went wrong.

The Fair Pricing Policy is usually invoked by Amazon.com to restrict single listings when, for instance, a multi-pack is priced higher per unit than individual units. Although there are a lot of other ways to violate the Fair Pricing Policy, generally they don’t usually result in account suspensions…and what does that policy have to do with Covid-19? A lesser-known part of the Fair Pricing Policy prohibits:

“Setting a price on a product that is significantly higher than recent prices on or off Amazon.”

The facts are that any natural disaster can get you in trouble: If you sell anything considered an “emergency supply” that might be in high demand during a storm or other crisis, you may get caught in the Fair Pricing Policy trap.

“Emergencies supplies” can be many things, including batteries, bottled water, first aid kits, duct tape, generators, lanterns, or even toilet paper and shelf-stable food. Just like in brick-and-mortar stores, on Amazon, these products can experience sudden price spikes as customers and businesses seek to quickly increase their stock in anticipation of the shortages.

For sellers who use automatic repricers – if they don’t set reasonable maximum prices, they can unintentionally end up following the rising prices on these listings. If sellers did not set a maximum price within their repricer, there was no upper limit to how high the price could go. Without knowing it, these sellers were price-gouging Covid-19 victims.

Many of the states within the United States have laws making it illegal for anyone to engage in price-gouging. Knowing that consumers mostly turn to online marketplaces for everything, law enforcement in these states now monitor Amazon for violations of their laws, leading to Amazon Suspension for Fair Pricing Policy. Under these laws, it makes little difference if the price-gouging was intentional or the result of an honest mistake.

The Fair Pricing Policy is a trap for unwary sellers as we have seen many Amazon Suspension for Fair Pricing Policy – especially high-volume sellers who must automate repricing. All sellers who have anything that might be construed as an “emergency supply” should abide by these Best Practices:

• Be attentive to natural disasters or weather events occur or are predicted’
• Periodically monitor inventory of emergency supplies;
• Pay close attention to fair pricing and potential fulfillment and/or delivery problems such as carrier delays;
• Respond quickly to all customer questions or complaints;
• If you use a automatic repricer, activate “maximum price” in their repricer program;
  • Do not allow prices to exceed 10% of MSRP.
• Reply promptly, accurately, and thoroughly to all Policy Notices and Warnings from Amazon.
  • This may be your only chance to avoid account suspension.
  • If you’re not sure what to say, get professional help.

We have been successful in helping restore the selling privileges for many Amazon sellers without much delay. If your selling privileges are at stake, you should have a professional write your Amazon appeal and plan of action.

If you are having an issue w/ Amazon, contact us for a free consultation.