Across the United States, many school districts are finding themselves unexpectedly overspending on the most basic classroom necessities because of erratic and opaque price shifts on Amazon’s business platform. According to a recent analysis conducted by the Institute for Local Self-Reliance (ILSR), these institutions are paying, on average, about seventeen percent more for routine educational supplies than they would otherwise need to. This price disparity arises from the dynamic pricing model that Amazon employs—an algorithmic system in which prices fluctuate constantly depending on factors that remain largely undisclosed to the buyer. While such models may be commonplace in consumer e‑commerce, they are profoundly destabilizing in public procurement contexts, where predictable pricing and budget certainty are essential.
Traditionally, school systems, as well as municipal and regional governments, rely on negotiated contracts with local suppliers. Under these arrangements, vendors compete through transparent bidding processes designed to secure the most economical and consistent rates. Once contracts are signed, those rates remain fixed for the duration of the agreement, enabling financial officers and purchasing managers to create reliable budgets. In contrast, Amazon Business offers none of these assurances. Prices are subject to change at any moment, without any guarantee of consistency even within a single day, resulting in extraordinary disparities between what different institutions pay for the exact same products.
To illustrate, the ILSR report recounts an incident in Colorado: an employee of the City of Boulder purchased a twelve‑pack of Sharpie markers for just $8.99, yet another buyer, working for Denver Public Schools only a short distance away, was charged an astonishing $28.63 for the identical item on the very same day. The organization observed comparable variations in prices for other everyday supplies such as Crayola markers, Kleenex tissues, Expo dry‑erase markers, and Elmer’s school glue—items that form the backbone of classroom activities nationwide. These discrepancies underscore not only the arbitrary nature of dynamic pricing but also the degree to which it undermines fair and equitable purchasing across public institutions.
ILSR raises substantial concerns regarding Amazon’s lack of transparency about how its internal pricing algorithms operate. The company offers no clear explanation of what specific triggers cause prices to rise or fall for different customers, leaving procurement professionals in a state of uncertainty. The data further suggest that the more frequently a given item is purchased, the more dramatic these price oscillations become. In fact, among the one hundred most commonly ordered supplies, Amazon’s highest recorded prices were, on average, one hundred and thirty‑six percent higher than its lowest prices for the same items—a range so vast that responsible budgeting becomes almost impossible.
Beyond the immediate impact on school budgets, the report also highlights a troubling long‑term consequence: a noticeable decline in market competition. Over the past decade, the number of independent suppliers serving schools and local governments has fallen sharply, from roughly 1,300 to only about 900. This contraction suggests that Amazon Business’s growing dominance is steadily eroding the diversity of the supply market. Moreover, a systematic price comparison of frequently purchased school items revealed that independent, locally based suppliers were able to outperform Amazon’s pricing on approximately sixty‑eight percent of products examined—evidence that competitive, community‑scale alternatives could deliver substantial savings if given equitable opportunity.
Adding further context, a separate research study released the previous month concluded that Amazon generally offers prices around fourteen percent lower than those of twenty‑three other major U.S. retailers when looking at consumer‑facing markets overall. However, this generalized finding fails to capture the nuanced reality facing public entities such as schools, cities, and states, where comparative procurement processes and bulk purchasing agreements often yield far better deals than retail averages would suggest. When dynamic pricing reaches its highest peaks, the supposed savings Amazon advertises can evaporate entirely, leaving schools paying significantly more than they would under negotiated contracts with independent suppliers.
Taken together, ILSR’s findings paint a complex portrait of a marketplace where convenience and reach come at the expense of fiscal stability and local economic vitality. For educators and administrators already confronting tight funding constraints, the unpredictability of Amazon’s pricing not only drains limited resources but also diminishes trust in digital procurement systems. The report therefore serves as both a warning and a call to action: if public institutions hope to preserve accountability, transparency, and cost efficiency, they may need to reconsider how—and from whom—they source the simple materials upon which classrooms depend every day.
Sourse: https://www.theverge.com/news/838491/amazon-dynamic-pricing-school-supplies-islr
