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eBay Australia ban Arbitrage and Fufilment by Amazon

By Chris Dawson March 6, 2018 - 4:51 pm

eBay have taken the drastic step in Australia to ban fulfilment by third party retailers specifically citing Amazon as a company that they don’t want fulfilling Amazon parcels.

Here in the UK, I’ve frequently made a purchase on eBay just for it to arrive in Amazon packaging when the seller has put their stock into fulfilment. I’ve even been sitting in reception at eBay’s London HQ and seen parcels arriving in Amazon’s branded packaging. This is something eBay are obviously keen to nip in the bud in Australia.

eBay Australia ban Amazon FBA

eBay Australia have said that they are banning all third party fulfilment when it could be “confusing for eBay customers”. It’s not just Amazon, but it’s surely no coincidence that the edict comes out just as FBA becomes available in Australia?

 

Allowed

You may use a third party to fulfil eBay orders on your behalf, when authorised by eBay or when:

  • You are clearly identified as the seller on all packing slips and invoices, and
  • You ensure the safe fulfilment of the item within the terms stated in your listing, and
  • They do not fall within the “Not allowed” section below.

Not allowed

You may not use a third party provider to fulfil eBay orders on your behalf, when:

  • The third party is another retailer or marketplace, such as Amazon. This includes third parties that are owned, directly or indirectly, by another retailer or marketplace; and
  • The order is being fulfilled from within Australia.

– eBay Australia

eBay Australia ban Arbitrage

While this is clearly aimed at banning using Amazon as a fulfilment service, there is an additional hidden implication in the new eBay Australia policy – effectively banning arbitrage.

Arbitrage is when a trader spots a product on one site at a low enough offer price that they can buy it and resell on another site at profit. Often this will involve buying from a retailer or marketplace to sell on eBay. The problem is that the arbitrager often arranges a direct shipment from the retailer to the eBay customer which has a number of unwelcome effects: The consumer receives a package from an unknown retailer and the retailer could get support or returns requests from a customer they’ve never heard from… and if the retailer sells on marketplaces, if the product isn’t exactly as described and received on time this can include negative feedback and reputational damage.

It is of course totally unfair for a marketplace trader to have their reputation damaged because an arbitrage trader couldn’t cut and paste or has software which is less than optimal, but this happens on a surprisingly regular basis.

Often, these arbitrage traders won’t even reside in the countries where they trade and so avoid all local taxes and duties on the products they ‘sell’. Tax authorities around the world don’t like them and frankly marketplaces take a very dim view of arbitrage too.

eBay Australia’s new rules would appear to ban arbitrage, it will be interesting to see if this and the ban on FBA rolls out to eBay countries around the world.

  • james
    3 months ago

    lol, think ebay may have failed there.
    are amazon and amazon logistics (legally) the same entity?
    if not, amazon logistics don’t retail, so i don’t think you can do much about it.

    i imagine ozzy law is a fair bit different to ours, but i doubt that kind of thing would fly over here, it’s very counter-competitive. doubly so since you’re excluding a “rival” from carrying out work you don’t provide yourself – i found the whole “no third party” terminology tickling, since the second party has no interest in offering delivery service, ebay australia’s official position appears to be “deliver everything yourself by hand”.

    also, i’ve seen Royal Mail licensed products here, not many, but they exist. therefore RM techincally retails.
    so if Ozzy Mail (or whatever they’re called) have licensed products too, say they sell pencil sharpeners in a post office? then you could be kicked off ebay oz for using the national postal service?

    • Sam
      3 months ago

      Even if they’re not the same entity, they’re owned by them so the clause covers it:
      “This includes third parties that are owned, directly or indirectly, by another retailer or marketplace; and”

  • Kevin
    3 months ago

    It makes sense to ban arbitrage by ebay. If a person buys something on eBay and it then gets delivered by Amazon with Amazon logo,s all over the packaging. Then the next time that person wants to buy something they also checkout Amazon as well as eBay and find that the same goods on Amazon are cheaper. That person then starts buying from Amazon and not ebay.

    Arbitrage damages eBay in the long run not Amazon.

    • Tom
      3 months ago

      Not true. I’ve had many times where someone has purchased an item, received it and then turned around and purchased another one. I think if you provide good service within EBay’s policies they should fuggetaboutit.

  • Stuart
    3 months ago

    When are they going to ban Arbitrage in the UK? This is a real problem in the UK for us including a seller who keeps buying from us on Amazon then saying it hasn’t arrived!!!

  • DS george
    3 months ago

    2 JELIOUSE idiot live a comment Arbitrage is legal.The costumer dont care from where they will get,the iteam.I am selling on Amazon and eBay.And when i have a sell on ebay i use Amazon service becouse is free and fast.Have a look the rating of DS on ebay.This is kind of service.If eBay want to stop it ok.Do it DS made eBay rich of stock.How mych profit do you think an DS make not much.Ebay is making money with hight Tax.At last is not DS fault that the people are leazy to serch on internet DS save your time.Arbitrage start since 2005-2007 now is 2018 the costumer of Ebay and Amazon Grow up gess why.

    • 3 months ago

      Some people specifically avoid buying on Amazon for a variety of reasons. If someone buys it from Ebay they have a reasonable expectation that the goods are going to be supplied by the seller and not fulfilled through a 3rd party.

      I have seen instances on book sellers where they have received negative feedback as the goods have arrived in Amazon packaging. It doesn’t personally bother me as I would check both Ebay and Amazon before buying and if the seller wants to sell at a loss rather that risk unfulfilling an order, that is up to them.

    • alan paterson
      3 months ago

      @ DS George

      many customers would simply not buy if they realised that the seller was drop shipping or if they realised the principles of drop shipping. What you are doing is not increasing ebay revenue or profits – the customer would simply buy off another seller who has invested in carrying the stock. Drop Shipping weakens the platform and will soon be out lawed altogether in every country. For a stable platform sellers must invest in their own stock.

    • 3 months ago

      @DS george

      I think some of the big DS sellers are making a lot of money with 100,000+ listings and 5,000+ sales a month

      @alan paterson

      The funny thing is, this has been going on for years and neither eBay or Amazon have done anything about it.

      They both profit.

      Yes, you are correct, they may have purchased off another eBay seller but the DS sells at a higher price increasing the revenue eBay earn, not on a few items but potentially 100,000+ items a month

      Many of the DS sellers are happy to pay to sponsor their over priced listings, to the extra benefit of eBay.

    • BABYLOU-007
      3 months ago

      @George True
      IN THE UK if you buy from LITTLEWOODS or ARGOS EVEN JOHN LEWIS STORES ANYTHING FURNITURE PHONES ,TV ,WHATEVER IN THE UNITED KINGDOM… THEY TELL YOU IN THEIR EMAILS DELIVERY FROM DIRECT FROM THEIR SUPPLIERS ….. WE DO NOT CARE…… CLIENTS LIKE THE WEBSITE AND SERVICES AND EVEN THE SUPPLIER SOMETIME DELIVER ONE ITEM THEN FORGOT ONE ITEM….. IT IS OK YOU GET A REFUND FROM THE WEBSITE YOU BOUGHT FROM ……..
      THE SUPPLIER MAY BE SHOP DIRECT WHO SUPPLY ALL THESE BIG CORPORATIONS WHICH ARE ON ” EBAY ” NOW AS FAR AS WE KNOW AND HAVE SPACE TO STORE FURNITURE… FOR EXAMPLE THEY MAKE BILLIONS THESE WEBSITE ONLINE SHOPPING COMPANIES…. SENDING DIRECT FROM SUPPLIERS BILLIONS OF GOODS FOR YEARS Name of the suppliers on the cardboard BOX . THE CLIENT WANTS THE PRODUCT AND LIKE THE WEBSITE AND SERVICES THAT’S IT … FULL STOP

      EBAY will have to Sack Littlewoods.com and Argos.com in the UK ….. 🙂

    • northumbrian
      3 months ago

      @babylou
      imagine the irriatation if you bought from john lewis then delivered by Argos in argos packaging
      when you checked argos was substantioly cheaper

    • northumbrian
      3 months ago

      in the past due to lazyness or conveniance we have ordered from ebay and the package has been delivered by amazon in amazon packaging when checked on amazon it is cheaper
      it makes you feel a bit stupid and slightly conned
      perfectly legal but just not kosha

    • 3 months ago

      @northumbrian

      How have you been conned?

      I am presuming your laziness did not stretch to just buying the first seller eBay showed you, so if you choose the cheapest option then that is what you got.

      You can often find items cheaper by searching the web and on the sellers own web site.

      The seller offered you the convenience of not having to look elsewhere.

    • northumbrian
      3 months ago

      @TYLER
      your just simply a pillock
      looking for an argument

    • 3 months ago

      @northumbrian

      Looks like it is you that was the “pillock” and got “conned” (according to you) as you should have shopped around.

      However, due to your laziness or the fact that it was inconvenient do so, you did not bother.

      As I said, “The seller offered you the convenience of not having to look elsewhere.” or paying more for it from another seller on eBay.

      How is that “looking for an argument” when there isn’t one.

    • northumbrian
      3 months ago

      🖕

    • 3 months ago

      @northumbrian

      People of lower intelligence tend to have an emotional response to just about every stimulus, and every subject or task is fraught with a fever of caveman-level emotion.

    • northumbrian
      3 months ago

      sanctimonious prick

    • 3 months ago

      @northumbrian

      Maybe we can discuss things when you are in a better frame of mind.

  • timi
    3 months ago

    well i have just started drop shipping
    and i am making more then what i was doing before.

    • alan paterson
      3 months ago

      @ timi yes – but i think you have completely missed my point. I didn’t say there wasn’t any money in it……..i said it weakens the platform.

      From a certain point of view drop shippers are selfish.

  • 3 months ago

    I’m very glad to see this and I hope it is implemented in the UK soon.
    Any seller of branded product on Amazon knows that arbitrage is a nightmare.
    We have to spend a lot of time removing unauthorised sellers from eBay as the risk is that because of these sellers actions our products will get bad reviews, and also of course they are ripping off our customers!
    The main problem is returns on Amazon – many eBay buyers get the package, realise its from Amazon not eBay, google it & find out they could have got it much cheaper. So they then return the product to Amazon. This effects our seller metrics massively, and could in a worst case scenario end up getting our account suspended or stopped completely.

    • PaulT
      3 months ago

      @ davet – that’s silly, an order placed on ebay ( no matter the fulfilment method ) cannot be be returned to Amazon. Maybe they can return to you and place the order on Amazon later (if cheaper there), that’s another thing. The solution is quite simple, have your prices aligned on AZ vs Ebay and you don’t care where are they buying from.

      Back to eBay, I trully believe that what they try to do is illegal. They have no right to tell me how to fulfill my orders. As long as I do my job well and without delays the package can be branded with Trump gold logo if I want and eBay have no say in this.

      eBay is not doing fulfilments so seems very patronising to tell another business how to do their business while they take the cut anyway. Give us a break eBay and solve your own HUGE problems that you have !

    • alan paterson
      3 months ago

      @PaulT – They have every right. It is after all there platform.

  • SAM
    3 months ago

    This happens all the time on eBay. We have never done it ourselves. Once we had to send one of our own FBA units to a customer on eBay to replace a lost one that is it.

    We once looked into getting Amazon to send all our other orders as we were so fed up of RMG , but we looked at the dropshippers FB on eBay however, we were like NUPE.
    It is tempting sometimes not having to buy stock up front must admit, Amazon do sell some things at silly prices to get people in. It must be a lot of work for pennies however they normally limit you to 1 or 2 units.
    Anyway it does not do anything for eBay but drive people to Amazon, but short term profits is what ebay look at.

  • eBetsy
    3 months ago

    It infuriates me to buy something on eBay and have it arrive as a “gift” purchased via Amazon Prime and “drop-shipped” by Amazon. It’s not a gift — I paid for that item — and sending it that way is a violation of Amazon Prime’s Terms of Service, which specifically state that buying for resale is not permitted. Receiving an item thusly sourced offends me, because it makes me unwillingly complicit in the seller’s lack of integrity.

    There are sellers on ebay.com who sell dozens of different products this way. Ask them a question about the item, and they can’t answer because they’ve never even seen the packaged product in real life, let alone opened it up to see what’s included or how it works. That’s frustrating at best, but it’s the overall sleaziness of the business model that I dislike and don’t wish to enable.

    I very seldom leave anything but positive feedback, but these transactions earn a neutral comment calling out the illegal sourcing along with 3 stars for shipping DSRs, because it’s not the seller who’s doing the shipping.

    • mw
      3 months ago

      You could, of course, send it back free of charge to Amazon.

    • 3 months ago

      When you say “There are sellers on ebay.com who sell dozens of different products this way”, you don’t mean like elenor-liam who has 136,935 listings, selling items like:

      Midland Water-Proof Protective Case for XTC-100/200/280/285 Action Camera for £35.08 that you can buy on Amazon for £23.77

      On the plus side they have had 1500+ good feedback in the last month and 26,800 in the past year with a 99.4%, so many happy customers, as we all know, not everybody leaves feedback.

      A neutral comment and 3 stars for shipping, why not a negative feedback and 1 star?

  • DR
    3 months ago

    Its just part of business…buy low sell higher…its none of ebays business where the seller buys the item from and if the customer is happy what does it matter. If they get annoyed that they paid more than on Amazon, then more fool them for not shopping around in the first place.

    • BABYLOU-007
      3 months ago

      @DR True…. these people selling on ebay may work harder deliver in the end… billions of orders often low prices….. EBAY make Billions out of AMAZON DROP SHIPPING and DROP SHIPPER the seller is very courageous and the one who work hard , people don’t care they want the product bought on ebay they have PAYPAL credit ……. pay after delivery ect ….. or buy on Amazon…. whatever this cardboard box go straight to the BIN .

      SEE THIS EBAY :
      THE RULER who signed THIS EBAY new law and decree is AMAZON’s Double Agent and receiving multi millions dollars COMISSION FEES when the plan will be
      Completed.

      Hope leads to Despair, and Turns into Suppository

      As a result, if a generic suppository were to be launched, it could have a SIGNIFICANT multi million $$$ DOLLARS negative impact on sales…..

      Best wish to you 🙂

  • BABYLOU-007
    3 months ago

    NEW THRILL
    Dear EBAY , OPERATION TOSSAWAY :
    Thinking that a new course of action is better, when it is only different. THAT’s like deciding that it is better to jump into a SWAMP than into a BOG. The WISE… jumps into neither

    As you know an earthquake occurs whenever a fault in the earth shifts suddenly . The slidding of an unsettled section beneath the surface jolts everything above . An earthquake is caused by a false foundation

    When you don’t understand… YOUR ANGER… understand that you don’t understand and stop right there. don’t impulsively reach into agitated memory for easy answers, for that makes things hard. That is like ASKING A SHARK to guide you out of the ocean . refuse exciting but misleading solutions and patiently wait for a NEW MESSAGE… WHICH WILL COME. NOTHING SUPPLIES BETTER DIRECTIONS THAN ENDURED UNCERTAINTY . Try it

    Best wish to you 🙂

  • Robert C
    3 months ago

    How would this policy be enforced?

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