Amazon is killing Kansas bookstores and other small businesses. Lawmakers must act

Booksellers should spend their time thinking about books, how best to get them to the right people and how to spark the love of them in their community. Often, that’s what I do at my small business, Lawrence’s Raven Book Store. But just as often I’m thinking about Amazon. Specifically, I’m thinking about how to maneuver my small business to finding success in a retail landscape completely dominated by Jeff Bezos’ empire. It’s not easy, and it’s not my preferred way to spend my day. But Amazon’s might and ruthless business practices make it a necessity.

Amazon controls more than 50% of the U.S. book market and more than 75% of online book sales. This monopoly means Amazon can steer the book market to its will. Amazon’s tiny online thumbnails have changed how book covers are designed. Its dangerous shipping network of underpaid, over-monitored contractor drivers has artificially inflated expectations for shipping speed, leaving those of us without private shipping armies in a lurch. Amazon’s drastic discounting, which often means selling books below cost, has artificially deflated the perceived value of the book.

This is Amazon’s book industry, and it’s wildly difficult for a small bookstore to carve a space to thrive in this landscape. Between 2000 and 2015, the years of Amazon’s meteoric rise, the U.S. lost 108,000 independent retailers. In 2020, the country lost one bookstore per week. At least one of them was here in Kansas. Amazon’s predatory business practices contributed directly to these losses.

Amazon has often claimed that it’s a friend to small businesses, citing its thriving Marketplace platform as an example. Small businesses, this thinking goes, can use Amazon’s infrastructure to sell their wares online easily. Yet Marketplace sellers pay an average fee of 30% on every transaction. Bookstores make about 40% of the cover price of every book, so selling on Amazon would leave us just 10% of the book’s price to pay rent, employees, utilities, benefits and anything else. Add to that the fact that Amazon is constantly trying to drive down the price of books, and there’s one final result of Amazon’s game: less money for independent bookstores and booksellers.

Amazon is stacking the deck against small businesses in another way: Not only does it provide the Marketplace platform for people to sell things on — it also competes on the platform. Amazon is competing against the very small businesses it’s claiming to help. It’s even been caught stealing ideas from small businesses to create competing products. By providing the platform and competing on it, Amazon is acting as both ref and player. It’s fundamentally unfair, and it should be illegal.

The legal framework that would be useful in addressing Amazon’s practices — antitrust laws such as the Sherman Act — have for decades been interpreted in a way that allows Amazon to do essentially whatever it wants. In the case of Amazon, when predatory pricing appears to benefit consumers in the short term, no harm is perceived to have occurred. Because Amazon is lowering prices, the logic goes, it’s allowed to get away with anything. This approach ignores harms to communities, workers and small businesses in the industries that Amazon is “disrupting.”

Currently, there are real attempts happening at the federal level to spur antitrust reform and fix this outdated interpretation of antitrust law. To help level the playing field, Congress is considering new Big Tech anti-monopoly legislation aimed at breaking the stronghold Amazon and Google enjoy at our expense. For small businesses to thrive, even survive, we need lawmakers to act.

If legislators choose to ignore what is happening in our communities, the future costs to undo the harm will be enormous. If our elected leaders truly care about protecting independent entrepreneurs and small businesses like mine, they need to act now.