The Amazon Monopoly

by Mar 22, 20215 comments

Warning:  This is a rant!

There are millions of books on Amazon.com and hundreds of thousands of authors who earn their living—theoretically—from this market-dominant company. The mechanics of how this works for an author may not be obvious to the general public.  Here is an insider’s view.

Many people buy Amazon Prime paying $119 for free shipping, so Amazon is cash-positive from the get-go. How does Amazon ship for free? Answer: authors pay for the shipping. Here’s the math:

My book, “The Spark, the Flame, and the Torch”, has a cover price of $24.95. From time to time, Amazon arbitrarily decides to sell the book on their website for $14.00, making them look like a discount hero. Amazon—arbitrarily again—decides that they will discount the list price by 55%, so they pay me $6.30. The responsibility for shipping the book to Amazon is mine, so I pay $3 for an envelope, $13 for postage, and perhaps another $5 for creating an invoice, financing the accounts receivable and the cost of auto and gas getting to the post office. Gross income to me: $6.30; total cost to me of $21; so I lose $14.70 on every sale of a $24.95 book (and we sell hundreds of books each year!).

 

I have 22 books in print, an equal number of CDs and Videos, and similar losses occur on every item because of Amazon’s rapacious price-gouging and offloading of costs to authors and other vendors. To add insult to injury, if Amazon cannot locate a confirmation that I sent confirming that I have shipped the book within a window of 48 hours, they cancel the order altogether and don’t pay me anything, even though I’ve already shipped the book(s).

Last year Amazon increased—arbitrarily, again—the price of my $24.95 book to $50—for months.  Since Amazon obscures the finding of phone numbers, emails or contact points for vendors who wish to reach them, I struggled to contact the company for 4 months during which time sales nosedived because hardly anyone purchased at these inflated prices. Eventually, I succeeded in getting an email response letting me know that “they were working on it”. However, no change occurred until—arbitrarily again, and after many months of lost sales—Amazon decided to restore the price to the correct one.

So, I have arbitrarily increased the price of my books on Amazon by $10 to help offset the losses. It’s an unsustainable business model, but I think it’s time for all authors to take a stand. Of course, Amazon has a lot of power—to lose the Amazon sales channel is painful for me, but I’d rather sell less books through a profitable channel than tons of books on which I lose money on every single sale.  What do you think? If you are an author like me, what would you do? Is it time to start a movement? @boycottamazon

If you wish to support my work, all my books and other products and services are available here: www.secretan.com/estore.

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I sent an early draft of the post above in an email to Jeff Bezos, the founder and CEO of Amazon, and this is the reply I received the next day, in which they don’t address my concerns, but try to get me to publish through their own publishing house!!

My name is Albert Rosberg with Amazon Author Central – Executive Customer Relations, Jeff Bezos received your email and I’m reaching on his behalf. If you’re a Seller with Amazon please visit https://sellercentral.amazon.com/ for better assistance with your Seller Account. Also consider publishing your paperback books by using KDP, for more information visit KDP Jumpstart guide, check: https://kdp.amazon.com/en_US/help/topic/G202187740.

Best regards,

Albert Rosberg.

Executive Customer Relations

Amazon Author Central

http://author.amazon.com

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