'We’re Not a Sweatshop’: Amazon’s Ramaswami Lakshman on Autonomy of Sellers on Marketplace

Amazon is not a sweatshop where suggestions and recommendations are binding to sellers or they are financially or operationally dependent on the marketplace, says Ramaswami Lakshman, Director, Emerging Markets, FBA, Amazon, as he argues that sellers, including MSMEs, retain autonomy over operations and scale on the marketplace platform.

Gatekeeping?

This autonomy, he tells FE Aspire in an interaction, comes from the modular nature of Amazon’s seller ecosystem, where businesses can opt into individual services such as payments, logistics, or fulfillment without having to sign on for the entire suite. 

The company, which has over 1.6 million sellers on its platform, had eliminated referral fees or seller fees in April this year on more than 1.2 crore products priced below Rs 300 across more than 135 categories on its e-commerce platform. Referral fee, starting at 2 per cent, is a commission Amazon takes from sellers for every product sold via its platform.

“Amazon is not like one monolithic business where you get in and then the only way to sell is through Amazon.com or .in. We have also made these brands independent by letting them choose whatever service of Amazon they want to partner with,” he says.

In a landscape where digital commerce infrastructure can both empower and overwhelm, Lakshman underscores Amazon’s position as an enabler and not a gatekeeper. While the company’s Fulfillment by Amazon (FBA) model -- an all-in-one solution for storage, packing, shipping, delivery, and customer support -- helps MSMEs reach national and global markets, he insists this does not amount to structural reliance. Instead, he says, sellers use the platform’s logistics or visibility offerings based on need, not compulsion.

The model, however, does introduce a dynamic where visibility and reach are closely tied to familiarity with the platform’s internal tools, such as forecasting demand, optimising listings, or understanding returns policies. Lakshman acknowledges this gap but says Amazon’s response lies in education, not enforcement. Programs like Seller University and onboarding support are intended to level the playing field for first-time or less digitally savvy entrepreneurs.

“We’re not forcing sellers to do any particular thing. But we do show them what the opportunity is because if we don’t show what the opportunity is, then sellers don’t have even an idea of what they can sell or how to participate in this marketplace,” he says. In his view, Amazon’s role is to surface customer demand trends and logistical forecasts, allowing sellers to calibrate their response.

Ahead of this year’s Prime Day on July 8-11, the company had announced the launch of five new fulfilment centres for faster delivery of orders. The announcement was part of Amazon’s plan to invest over $233 million in India in 2025.

Complexities in scaling up

While Amazon’s infrastructure can be a lever for national discoverability, particularly for enterprises in small cities, Lakshman argues that this discoverability often becomes a stepping stone to wider retail success, not a crutch. “You would see a lot of brands out there which started as D2C brands on Amazon first, but now they even have retail stores. They have got that recognition through Amazon and then they have leveraged that recognition to go out and build larger brands and more successful businesses out of that,” he says.

Still, challenges persist, especially in enabling sellers to operate beyond state boundaries. GST registration hurdles, inventory placement rules, and the complexity of national logistics networks often prevent MSMEs from scaling beyond their immediate geography. Lakshman points to Amazon’s warehousing and cross-docking support as a response to this, but concedes that for small businesses juggling every part of their operation alone, infrastructure remains a significant bottleneck.

“The more operators you throw into the game, small businesses struggle. They are a one-man operation usually. Whereas, big brands, if you see, there’ll be a logistics department, there’ll be an inventory planning department and all of that. So they’ll take care of these parts separately,” he notes. In that sense, he positions Amazon’s modular services as back-end muscle that MSMEs can plug into without being structurally bound by it.

Ultimately, the company’s model, according to Lakshman, is built on enabling sellers’ own threshold for growth. Now, whether sellers choose to scale gradually, maintain niche operations, or step away entirely, the autonomy to decide remains with them -- a model that, if sustained, could redefine what independence means in a platform economy.