Shopping At Amazon Could Be Hazardous For Your Local Merchants

Mail-order stores are now aggressively at war with traditional brick and mortar stores.

Widespread access to the Internet and advances in shopping cart software have made it possible for online merchants to be quite profitable selling products with extremely thin margins.  This phenomenon along with the downturn in the economy has made it extremely difficult for local merchants to compete with the sometime predatory practices of the online sellers. American Express should be commended for its recent campaign to encourage spending at local retailers with its “Saturday Small Business campaign.”

One company is working especially hard to drive a nail in the coffin of the local merchant: Amazon.  Last week Amazon released a program that encourages shoppers to check out prices at local stores and report the prices to Amazon using a special smart phone app, “Price Check”.  The following is an excerpt from Amazon's site for the app:

“Share in-store prices – With every in-store price you share, you help ensure our prices remain competitive for our customers.”

For “assisting” Amazon, the app promises you a discount of 5%, up to $5, if you purchase the item from them rather then from the store you are shopping in.  On Thursday, Senator Olympia Snowe of Maine, the top Republican on the Small Business Committee, joined the fray. “Incentivizing consumers to spy on local shops is a bridge too far,” she said. 

I agree and would willingly pay an extra three bucks to support a local store in my neighborhood. For example, on my shopping list is an HP wireless printer which Amazon sells for $59.99 and Staples in Branford sells for the same price. I could save sales tax and a whopping $3.00 off the purchase price if I buy it online from Amazon.  But I prefer to forgo the three bucks and purchase from Staples who employees dozens of residents in the community. And I will happily throw in the additional $3.60 in tax to support the state of Connecticut.

So think twice before you click to send your hard money to Amazon.