Amazon global store just replaced several domestic re sellers for some best selling skus I was planning to compete with – what to do now?

I found a niche, low volume business that manufacturers products outside the US but not in low cost manufacturing country and wholesales about 100 ish skus into the US across about 15 different US based amazon resellers and a few larger online retailers. Its very niche, but, in aggregate across a number of skus its an opportunity I’m interested in competing with.

I had planned to compete with this business but manufacturer the products in the US to save International shipping / importing and my research and qutoes to date has indicated this can be done competitively. I’ve been ramping up doing product design the last 4 months or to get this off the ground with a number of initial skus, occasionally doing Amazon data pulls to see what sales volumes were doing and keep tabs on the opportunity and cross check what products I should launch with.

I checked again today and found something surprising. 5-6 out of the top selling 20 products from this company have switched from a US based reseller to ‘Amazon Global Store COUNTRY’ in the country where these are currently manufactured and shipping to the US internationally from this country.

These 5-6 products are now for sale at a 30% – 34% discount than they’re normal consistent retail price when they were under a domestic reseller. Its a sale price, and it might go back to retail, but… I’m a bit worried since Amazon seems to be the only company now selling the top performing skus and they also seem to be the only seller offering a big discount. The other resellers do, very occasionally, offer some temporary discounts but it always bounces back to the normal retail price in a short amount of time which I would have to assume is tied to a wholesale agreement with the manufactuer.

This 30 + % difference reflected in these 5-6 items is an absolute margin killer for my model and something I don’t think I can compete with anymore. The discounted prices could be temporary, but, knowing the seller has changed to Amazon and is no longer a low volume domestic reseller I’m a bit worried about the viability of this opportunity at large and wondering if Amazon is going to make a play to be the sole seller of these products on their platform which might make competing impossible for me.

It seems a bit curious that its only currently 5-6 products from the very top sales volume as well. Everything below that is smaller volume and appears to still be sold by the domestic reseller and rarely – if ever – goes on sale. It might mean that amazon is testing the waters of this product and if successful might buy out all or at least a lot more of their total set of skus. Perhaps they will continue down the product line, perhaps not. But this was a bit of a surprise to me and kind of a big disappointment since there has been an enormous amount of effort that has gone into this project so far over the last 4+ months.

I guess I have to wait a bit, watch, and see but I am actually getting really really close to placing a significant order with domestic manufacturer for my first 10 skus to sell online and I feel like its possible amazon is just going to canabilize the entire opportunity since they can ‘afford’ to order more units and undercut every other reseller likely only making a few dollars per unit, but owning the entire category and have it be a profitable enterprise for them – now I’m unclear if I should continue the project, if I should watch and see, or if this is a bad sign for what I was trying to accomplish since amazon store was not involved at all in this before a month ago.

Anyone have experience, input, or advice on this?