Amazon Suspensions: How to Avoid Price Gouging

Last updated on June 5th, 2023

Written by Himanshi Raj

Thousands of Amazon suspensions flooded March 2020. Why? According to a Bloomberg report, more than 3,900 selling accounts in the U.S. were suspended for pricing gouging amid the COVID-19 pandemic. It only means one thing: Amazon will not hesitate to kick out sellers who violate its fair pricing policies. 

Since the outbreak of the pandemic, there has been a high demand for toilet paper, bleach wipes, hand sanitizer, canned goods, meat, and other essential products. Amazon sellers saw this as an opportunity to boost profit, but others went overboard when they resorted to price gouging.

This article will discuss what price gouging suspension is on Amazon and how you can avoid it.

What is price gouging suspension on Amazon?

There are several types of Amazon suspensions, one of which is violating fair pricing policy, also known as price gouging. 

The online retail giant has been on the hotbed of controversy because of overpricing claims since the pandemic started. Even though they have been aggressive towards "bad actors" in the marketplace since March, the cruel practice is still present as of September 2020.

Public Citizen, a consumer rights group, called out Amazon and accused them that they went against their fair pricing policy between the months of May and August, the Verge reports. It includes essential items sold by third-party sellers and products listed as "sold by Amazon."

If this is the current situation in the marketplace, it would be better to steer clear from this violation than face irreversible consequences, such as Amazon suspensions.

It is a different world out there when it comes to price gouging in Amazon. They have their own rules, which are seemingly different from the Emergency State Law. Amazon's policy doesn't only cover essential items but all items offered in its marketplace. In short, it can overrule legal ordinances.

The price gouging rule is not only implemented during a pandemic. Account reviews and policy violation checks are rampant during Easter, Prime Day, holidays, and other unique shopping events.

Even an Amazon suspension expert would advise you not to mess with the Amazon rule,.

What are the policies that cover price gouging?

Here are the three policies related to overpricing that you must keep in mind:

Minimum and Maximum Price Validation

When you want to reprice an SKU, your minimum price "must be greater than the minimum referral fees for the product's category." While the maximum price "must be less than six times the ASIN's recent sales price or $200.00, whichever is higher."

Amazon Marketplace Fair Pricing Policy

Amazon is obsessed with being Earth's most customer-centric company. That is why they see to it that they offer items at the lowest price possible. However, they ensure that no one is abusing it; hence, accounts in question could face Amazon suspensions.

In the Amazon Marketplace Fair Pricing Policy, you will be suspended or terminated when you set a reference price on a product. They also consider excessive shipping fees as bad practice. So, better consult an Amazon suspension expert to prevent this from happening.

Selling Policies and Seller Code of Conduct

It is one of the pages in the policies, agreements, and guidelines that you must read before selling on Amazon. This page enumerates the reasons for Amazon suspensions. They also reiterated on this page that you should not attempt to increase the product's price after an order is made. It is considered one of the unfair activities on Amazon.

How to avoid price gouging

Although there are ways to ask for Amazon suspension help, getting a suspension email will create a dent on your account health, or worse, terminate your selling privileges. Below are the ways to protect yourself from future Amazon suspensions:

1. Avoid overpricing essential items, or any product for that matter.
2. Always monitor your prices because Amazon's bots are frequently on the lookout for products with a sudden price increase.
3. Don't use automatic repricing software, and if you do, make sure it has been set up with a maximum price.
4. Ensure that your bundled products are priced reasonably.
5. It is advisable to set a fixed price for shipping costs.
6. Don't increase your MSRP (Manufacturer's Suggested Retail Price) to make it look like a discount.
7. Don't switch to price gouging just because your competitors are weak.
8. Don't be tempted to overprice simply because others are doing it also.
9. Don't set an excessive shipping fee after an order is made.
10. Don't set a price that is higher than the previous prices offered on or off Amazon.

In closing

As you may have noticed, we didn't discuss anything about reinstating an account or filing an Amazon suspension appeal. It is because the title is not  "Your Guide to Amazon Suspensions/" We highly discourage such price gouging practice. We are here to help you from being bombarded with Amazon suspensions by all means. For starters, you may follow the rules above to remain in the good graces of Amazon. Don't let yourself become another statistic and always abide by the rules to continue selling on the largest online marketplace on Earth.

Are you dealing with Amazon suspensions? Seller Interactive has a team of Amazon suspension experts willing to help you get reinstated in no time. Please email us at [email protected] or [email protected] today.