Amazon applies its own discounts to third-party sellers

Amazon is gearing up for Thanksgiving and Christmas with a new discount scheme. The online retailer has introduced a new "Discount provided by Amazon" tag, discounting independent merchants' prices -- at its own cost -- by up to 9 percent.

This is the first time Amazon has taken control of third party pricing, and in shouldering the cost itself the company is helping to ensure competitive pricing across the board, keeping customers on the site.

The move sees Amazon effectively price matching the likes of Walmart and other retailers, without requiring merchants to take a hit on their own profits. The new method of discounting was first noticed by the Wall Street Journal.

The paper notes that items that have a price cut applied to them include the text: "This item is sold by a third-party seller. The discount is provided by Amazon. This is a limited time discount."

Discounts appear to be limited to sellers that make use of Amazon's fulfillment service, but sellers have not been notified about the application of price cuts. Merchants are pleased to report: "We are still receiving the same amount of money," showing that the discounts are being paid for by Amazon.

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