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Birkenstock Leaves Amazon Over Counterfeit Concerns

Amazon is having a counterfeit problem, and Birkenstock wants out.

In a memo sent to thousands of its retail partners on July 5 and obtained by CNBC, Birkenstock announced it will no longer supply its products to Amazon in the U.S. starting Jan. 1, nor will it authorize Amazon’s third-party merchants to sell on the site.

“The Amazon marketplace, which operates as an ‘open market,’ creates an environment where we experience unacceptable business practices which we believe jeopardize our brand,” Birkenstock USA CEO David Kahan wrote in the memo. “Policing this activity internally and in partnership with has proven impossible.”

The 240-year-old German footwear company has been particularly hard-hit by counterfeiters. One Chinese shop on the site sells Birkenstock’s signature Arizona sandal for $79.99, or $20 below market value. It is an example indicative of a larger ongoing problem at Amazon, which has struggled to control a flood of counterfeits on its website, a problem that has only grown larger as Chinese merchants have started selling on the site in recent years.

Birkenstock will now encourage customers to only purchase products from authorized retailers, with Kahan writing, “we will be vigilant in handling any retail partners who choose not to comply after January 1, 2017.”