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E-commerce

Businesses livid as software glitch causes their stock to sell for a penny on Amazon

By
Geoffrey Smith
Geoffrey Smith
By
Geoffrey Smith
Geoffrey Smith
December 15, 2014, 6:18 AM ET

There’s more to being a successful retailer than keeping your buyers happy.

U.K. businesses that sell via Amazon.com’s (AMZN) local site are up in arms over a software glitch late Friday that led to their items being sold for as little as a penny. Some ended up out of pocket to the tune of up to $30,000.

The incident was down to a problem with a software tool developed by Derry-based RepricerExpress, which allows businesses to offer their goods on Amazon.co.uk.

The software automatically changes prices for the items on sale to guarantee that they stay competitive, but in this instance, it generated a self-reinforcing loop in which goods were automatically re-priced down to a penny.

One user complained on an Amazon bulletin board that stock worth $15,000 had been sold in this fashion within 40 minutes.

“Being they are not based in the US (sic) It takes away lots of options for us to recoup our loses,” the user wrote. “Last night I had to explain to my wife and 3, 4 and 5 year old that we could not take our trip to Disney in February.”

City AM cited one fancy dress company owner as saying her company had lost over $30,000 overnight.

Amazon said it was unable to cancel orders that had been dispatched and charged to customers, but another user on the bulletin board noted that it had been able to cancel those that weren’t slated for urgent shipping.

Repricer Express chief executive Brendan Doherty said on the company’s website he was “truly sorry for the distress this has caused our customers,” and said Amazon had reassured him that sellers’ accounts wouldn’t be penalized as a result.

It wasn’t clear what degree of compensation would be available to the businesses that had suffered. RepricerExpress didn’t respond immediately to a request for comment from Fortune.

About the Author
By Geoffrey Smith
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