Birkenstock chooses to leave Amazon marketplace due to concerns over counterfeiting

According to CNBC, a letter written by David Kahan, Birkenstock’s USA CEO, has declared that the footwear company will cease trading through Amazon directly and through third-party vendors from 1st January 2017. The company has taken this decision after being unsatisfied with the way that Amazon has been dealing with counterfeiters and unauthorised sellers on their site.

In his letter Kahan stated that “the Amazon marketplace, which operates as an ‘open market’, creates an environment where we experience unacceptable business practices which we believe jeopardise our brand”. He also went on to say that even with the help of Amazon they have been unable to sufficiently police these illegal activities.

Kahan also stated that in response to his many suggestions of how the situation could be improved, Amazon has proposed that the footwear company should only sell goods to them directly and to break off their agreements with other retail partners.

The CEO has admitted that by taking this action, counterfeit goods may continue to be available on Amazon but it will be clear for consumers that any goods with the Birkenstock branding on the site are not genuine and they will not associate them with the company.

Counterfeit goods pose a threat to a company's reputation and revenue and are particularly numerous in the fashion industry. By owning a trademark your company would have trademark rights and would be able to enforce these rights on any company that infringed on your brand. However, in this instance, as Birkenstock are selling their goods through an online marketplace, it is the latter who has control over which sellers are allowed to be on their site.

Birkenstock's decision to leave the online marketplace may encourage Amazon to increase their anti-counterfeiting policing and action as they may be at risk of losing other big brands.

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