Amazon is pushing people towards Fulfilled by Amazon. It makes sense as a marketplace, providing a more consistent experience. However when they compete in that marketplace, it means they're charging you to get data to outcompete you (via FBA fees). It also means that if they do enter that market, they're double dipping. They're taking away your revenue stream for their own profit, while simultaneously increasing what they charge you because it's harder to get your inventory out of Amazon's warehouses via selling it. They can also almost always outcompete you, because they don't have to pay the marketplace fees (they get the service at cost). They can also use the money they make from marketplace fees to undercut you, selling their competing product at a loss (but net zero after you pay your fees) until you get off the marketplace. Amazon also has a perverse incentive to not sell your goods because they don't have to pay for them, so they're totally okay if they can ensure that no one buys your product.
Costco has to buy the goods they sell. If it's on a shelf, Costco wants it to sell. If they don't want something to sell, they stop buying it/carrying it. They can't make any money by buying a competitor's product and letting it sit in a warehouse.
The incentive structure for Amazon is bad for everyone else. Their ideal profit scenario is to have warehouses full of other companies' stuff that never sells, and to sell an Amazon branded alternative to each consumer with demand. Costco's ideal profit scenario is to never buy third party products and only sell Kirkland goods (assuming demand stays the same). Amazon needs to pick one; they're either a marketplace, where their ideal profit scenario is to sell literally anything they have without preference, or they're a retailer and their ideal profit scenario is like Costco.
Costco has to buy the goods they sell. If it's on a shelf, Costco wants it to sell. If they don't want something to sell, they stop buying it/carrying it. They can't make any money by buying a competitor's product and letting it sit in a warehouse.
The incentive structure for Amazon is bad for everyone else. Their ideal profit scenario is to have warehouses full of other companies' stuff that never sells, and to sell an Amazon branded alternative to each consumer with demand. Costco's ideal profit scenario is to never buy third party products and only sell Kirkland goods (assuming demand stays the same). Amazon needs to pick one; they're either a marketplace, where their ideal profit scenario is to sell literally anything they have without preference, or they're a retailer and their ideal profit scenario is like Costco.