Tesco forced to lower prices as its Amazon alter-ego Oakwood

Tesco forced to lower prices as its Amazon alter-ego Oakwood

Tesco has been revealed as the origin of a myriad of goods that are sold on Amazon under the name of 'Oakwood Distribution'. Surprisingly, the British (offline) market leader has been forced to sell on Amazon under the prices of their own website, as the Financial Mail found out.

Oakwood (forced to be?) cheaper than Tesco itself

Oakwood mainly sells DVDs and computer games, often with significant price reductions compared to the official Tesco web shop. The Financial Mail added examples of the DVD of The Social Network, sold for £4.89 via Oakwood, but a full £7 at Tesco – 43% more than at Amazon.

 

It is ironic that Tesco, often criticised for “squeezing suppliers like a lemon” in order to offer the lowest possible prices, now is squeezed itself for lower prices: it seems that Amazon prohibits its third-party sellers to sell their products cheaper anywhere else – even on their own web shop.

 

Misleading the consumers - again?

The news immediately provoked an outcry from Tescopoly, a pressure group without much love for the British market leader. “This would appear to be another example of Tesco trying to sell more to consumers who think they are getting an independent choice.” He points out that this has happened before with the One Stop chain of convenience stores. 

 

Tesco responded with the statement that “It is public knowledge that Oakwood is part of Tesco.” The retailer also stated that it is just Tesco's policy to sell excess stock “competitively through third-party marketplaces” and that still, many consumers chose to buy directly from Tesco.  Amazon, having published very disappointing company results last week, points out that consumers can always check the data of sellers using the new button “Detailed Seller Information”.
 

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