When Target launched “Lilly Pulitzer for Target” on April 19, the retail chain’s website was overwhelmed with traffic, while shoppers were disappointed that the collection of 250 items of apparel, shoes and accessories quickly sold out online and in stores.
The retailer later found that eBay and Amazon resellers might be to blame, according to EcommerceBytes, and has reportedly handed down a directive banning resales.
On an independent website that serves as a gathering place for Target’s employees, a new directive was discussed that reportedly came from corporate on May 12.
“We no longer accept reseller tax exempt IDs and we are no longer to sell them to known resellers or those with lots of discounts,” read one poster. “The issue is, Target sells that stuff at a loss to get guests in the store to buy other stuff. Instead of a guest coming and buying an Ipad at a loss and then buying another $75 worth of clothing or whatever, we end up with a loss leader that isn’t leading to any other sales.”
Target is the latest retailer to crack down on resellers who use retail stores to source inventory, after facing criticism over its handling of the designer collaboration.
Resellers, who listed the special branded items for sale on e-commerce sites at high markups received much backlash when the original hashtag #LillyforTarget transformed into #LillyforeBay and #LillyGate2015.
The company is also banning resellers from shopping on its websites.
One EcommerceBytes reader, who spent over $100,000 at Target during the past year, told the site Target cancelled his latest online order. When he called the company, “they told me that they are no longer selling to resellers and the fact that I have ordered a very large amount did not matter,” he told Ecommerce Bytes. A customer service representative told him to read Target terms and conditions online.
Target.com Terms and Conditions section includes a paragraph addressing resellers:
LIMITATIONS ON QUANTITY
Target does not offer additional discounts on large orders of a single item or on large orders of many individual items. In addition, we reserve the right to limit quantities on orders placed by the same account, on orders placed by the same credit card, and on orders that use the same billing or shipping address. We will notify you if such limits are applied. Target reserves the right to prohibit purchases of any merchandise to resellers. Resellers are defined as a company or an individual that purchases goods with the intention of selling them rather than using them.
Two months ago, a similar problem with resellers was reported at fellow retail chain store, Kohl’s.