I work with dozens of businesses in North Carolina and nationwide that successfully sell products online through Amazon and Walmart.com. I’m deeply concerned for my clients and the more than 20,000 Amazon sellers based in North Carolina because the Federal Trade Commission’s (FTC) misguided lawsuit against Amazon is the ultimate Big Government blunder.

Amazon revolutionized e-commerce with the introduction of Prime and free two-day shipping. Then it made Prime available to third-party sellers and offered Fulfillment-by-Amazon (FBA), powering free two-day delivery for small creators and brands so they can reach millions of customers and compete against big brands, chain stores, and even Amazon.

But now the FTC wants to disrupt Amazon, specifically FBA, advertising, and other systems that help small businesses succeed. If the FTC succeeds, it could significantly change how Amazon operates and jeopardize the marketplace that works well for so many small sellers. 

I’ve spent the last decade helping small and mid-sized e-commerce businesses, and I see every day how Amazon elevates small sellers and provides unprecedented value and opportunity. We help sellers decide which warehouse and delivery services to use, and how to optimize pricing, advertising, data, and inventory. Amazon is not perfect, but every day sellers freely choose to work with Amazon because its combination of reach, data, and services is unmatched by any other retail, distribution, or marketplace option.

I hope and would expect that Big Government would not try to overturn the free market that supports millions of small businesses unless there was glaring evidence of abuse. But even after years of investigating, the FTC still doesn’t understand how Amazon’s marketplace works for small sellers. For example, the FTC believes that Amazon punishes sellers by burying their listings if they do not use Amazon’s warehouse and delivery services or advertise on Amazon. This simply doesn’t happen.

It’s impossible for anyone to know precisely how Amazon’s algorithm works, but our experience is that Amazon features products and sellers that have the best combination of low price, fast shipping, great reviews, fewer returns, and strong customer service. That’s a classic win-win for sellers and consumers. Why is the FTC unhappy? 

Let’s start with the basics. Sellers love Amazon because it connects them to hundreds of millions of consumers worldwide. Amazon charges sellers a $39.99 monthly fee and a basic listing fee of 8-15% of a product’s retail price, meaning sellers keep 85% or more of the retail price if they ship their own packages to buyers. This compares favorably to traditional retail, where most sellers’ wholesale payments are only about 50% of the final retail price. Amazon is better for sellers so sellers flock to Amazon. That’s perfect competition — which the government should support.

Sellers I work with typically choose Amazon warehouses and delivery services because they are affordable — usually much cheaper than competing services, especially for two-day delivery that is required to qualify for Prime. Similarly, advertising on Amazon is a choice and frequently a no-brainer because sellers have always been willing to pay to get their products in front of buyers, regardless of where they sell. In-Amazon advertising is the digital equivalent of paying grocery stores for eye-level shelf space or aisle endcaps — it’s a choice that every seller makes based on what is good for their business.

As for the allegation that Amazon dictates how sellers price, it’s simply not true. Amazon does tell sellers when their products are priced lower on other major websites, like Walmart and Target. Sellers know that competitive pricing factors into which sellers Amazon promotes, but it’s always a seller’s choice whether to reduce the Amazon price so it matches lower prices elsewhere. Similarly, Walmart tells its marketplace sellers when they should consider lowering prices to be more competitive. In free markets, more information improves competition.

I understand that the sheer size of companies like Amazon may alarm the FTC, but Amazon’s value to small businesses is second to none. Amazon’s integrated sales, advertising, and fulfillment services allow millions of small businesses to break through to consumers — and succeed. Many of our clients have annual revenue that exceeds $10 million and employ several dozen people. They hope that Walmart catches up to Amazon and that robust competition lowers costs and improves profits. But it’s not the FTC’s job to hobble Amazon and help competitors.

If regulators want to boost competition and help small businesses — and not just throw political punches — they should abandon this misguided lawsuit and find another target. Disrupting a platform that helps thousands of North Carolina small businesses, including dozens that I work with and know well, hurts competition, our economy and is a terrible misuse of taxpayer dollars.