Amazon brand gating is Amazon’s practice of putting financial restrictions in place in an effort to limit the number of counterfeit goods sold on the marketplace. It can be a major hassle for merchants, but RepricerExpress understands your pain, so this post is about what brand gating is and how to deal with it.
Brand Gating in Further Detail
There are countless articles that poke fun at knock-off products with funny names that are almost exact replicas of the originals. Those products never specifically say they’re the original, but c’mon — S&M’s are clearly M&M’s, Joens Danhse Tenderness Whiskey is Jack Daniels, and WiWi is Nintendo Wii.
But what about brands that keep the original name but are not the original? We’re talking about things like bootleg DVDs and imitation purses with the real names, like Fendi purses for $100. These are the brands Amazon is trying to gate, or restrict, the selling of.
And the restrictions Amazon’s putting in place are quite rigid. To continue selling that brand, you have to:
- Pay a non-refundable fee of up to $1,500 USD to get your brand approved to keep selling on Amazon,
- Include a letter from the manufacturer saying you’re okayed to sell their items, and
- Send Amazon three separate/different purchase invoices for products from that manufacturer or distributor.
Why is Amazon Doing This?
Well, there are two different ways of looking at this. Amazon’s official party line is that they want their buyers to shop for items they know won’t be illegitimate or counterfeit. It’s also a way for them to ward off problems before they even become problems. If they don’t do some form of brand gating, then Amazon could potentially turn into a Wild West black market where anything can be sold.
But the non-refundable fee also tells us that Amazon’s trying to profit from this, too. After all, $1,500 USD per brand isn’t exactly chump change, and can mean a huge hit for the smaller fish in the pond. Surely there’s got to be a way to gate brands without putting even more money in Amazon’s coffers…?
Who’ll be Most Affected by Amazon’s Latest Brand Gating Efforts
As briefly mentioned above, medium-to-small sellers might have a hard time coming up with up to $1,500 USD per brand to keep selling it on their site. But third-party sellers, which make up almost half of all Amazon’s sellers, will receive a huge dent to their budgets for the next little while until they can recoup that fee in sales.
But hey, there’s a bit of good news amid all this doom and gloom! If you were toddling along happily, selling Brand X before this round of brand gating came along, you don’t have to pay the fee. The fee only applies to new sellers of brands Amazon’s marked on their hot list.
Related: Amazon Restricted Categories
What Your Actions Should be Moving Forward
If you got an email from Amazon regarding certain brands you sell but not others, don’t necessarily assume those brands are safe. They may not be, as this is a huge project for Amazon and they’re tackling it in chunks.
You’ll also want to avoid using loopholes to get out of brand gating, like marking items as ‘used’ or ‘collectible’ if they’re actually new, bundling restricted items with non-restricted items or not including the brand name. It’s not a matter of if, but when, Amazon will get around to you and the consequences will likely be harsher than if you just complied the first time around.
If you’ve crossed all your t’s and dotted all your i’s, then go ahead and keep selling your (gated) brands. Just make sure you bring RepricerExpress along for the ride so we can handle all the tedious bits for you so you have time to focus on yourself and your business. And when you sign up today, you get the first 15 days free!