eBay Australia ban Arbitrage and Fufilment by Amazon

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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.

32 Responses

  1. 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?

  2. 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.

  3. 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!!!

  4. 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.

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

  6. 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.

  7. 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.

  8. 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.

  9. 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.

  10. 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 🙂

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