Amazon Has Been Conning School Districts out of Millions

Amazon Business is billed as a convenient one-stop shop for schools. Reality is more expensive.

https://prospect.org/2025/12/17/amazon-conning-school-districts-out-of-millions/



For over two decades now, Amazon has been seen as a one-stop shop to buy virtually anything, and get it delivered in no time flat. It’s been estimated that the platform has over 310 million active users, and just in the U.S. during 2023, sold over 4.5 billion items. Amazon claims to be guided by four principles: “customer obsession rather than competitor focus, passion for invention, commitment to operational excellence, and long-term thinking.” Certainly there is a very large quantity of retail items for sale on the platform, even if their quality or identity may be questionable. But in another much more obscure part of the business, Amazon’s supposed obsession with its customers and “commitment to operational excellence” falls flat.

Amazon Business, an operation under the umbrella of Amazon’s services, has grown as a popular procurement tool for businesses and organizations over the past few years. It’s marketed as an experience akin to that of Amazon.com, allowing users to find, compare, and easily purchase a wide variety of products needed by businesses. In reality, cities, counties, and school districts have been overcharged for such items to the tune of millions of dollars.

An investigative report from the Institute for Local Self-Reliance (ILSR) demonstrates that Amazon Business has been building a monopoly on selling office products, cleaning supplies, and classroom materials. By claiming to offer better deals and quicker service than that of small and midsized businesses, Amazon Business has secured contracts with organizations that have long typically worked with local suppliers. School districts in particular account for 70 percent of local government spending with Amazon, creating unique consequences for officials, educators, and students.



It's not unusual for Amazon to do business with the federal government, but its integration into contracting with local agencies has seen an uptick. Most city and county governments work with small-to-medium-sized businesses for their needs, through a process of competitive bidding. It’s fairly straightforward: When an organization (such as a school district) needs a large amount of goods, it sends out a request for vendors to submit business proposals. Potential suppliers then place bids that are evaluated for factors such as price, quality, and risk. Finally, a contract is awarded to the vendor that meets the criteria the respective organization requires, and both entities enter into a “fixed-price contract.” Competitive bidding holds independent suppliers to high standards, and ensures that public contracts benefit both parties.

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