Amazon’s dynamic pricing is wreaking havoc on school budgets

School districts are paying extra for essential supplies thanks to dynamic, unpredictable pricing on Amazon, which on average costs them 17% more, according to a report from the Amazon Institute. Institute for Local Self-Reliance (Elser). Unlike the contracts that schools and local governments traditionally have with local suppliers, who will offer the best prices, Amazon Business does not guarantee fixed prices, resulting in significant price fluctuations.

For example, the report states that an employee in Boulder, Colorado, purchased a 12-pack of Sharpie markers for $8.99, while an employee at nearby Denver Public Schools was charged $28.63 for the same product on the same day. ILSR cites similar fluctuations in prices for Crayola markers, Kleenex wipes, Expo dry erase markers, Elmer’s school glue, and more.

ILSR takes issue with Amazon’s lack of transparency about how these price changes are calculated by its algorithm, and what results in different prices for different buyers. However, it seems that the more an item is in demand, the greater the price fluctuations. “Among the 100 most requested products, the highest prices charged by Amazon were, on average, 136 percent higher than the lowest prices,” ILSR found.

As the report notes, Amazon Business has also reduced competition for these essential school and office supplies, cutting the number of independent suppliers from 1,300 to 900 over the past decade. A price comparison of commonly purchased school supplies found that the independent supplier was able to beat Amazon prices for 68 percent of products.

Separate study Published last month It found that Amazon offers prices 14 percent lower on average than 23 other leading U.S. retailers. However, in the case of state and local governments, this does not necessarily reflect lower prices that could have been negotiated with local independent suppliers, such as deep discounts, especially compared to peak prices from Amazon’s dynamic pricing.