Amazon seller says $4.5 million business lost account

Bed Scrunchie founder Jack Nekhala said in a Business Insider article published Oct. 12 that Amazon.com deactivated the company's seller account after it made about $4.5 million in 2024.

The Oct. 12 report shows the platform's pull even for sellers in conflict with it: Nekhala estimates Amazon still accounts for 70% to 80% of sales through a reseller, with the product listed at $49.99.

Nekhala told Business Insider that Amazon's decision came before the 2024 holiday period, after the company had relied on the marketplace as its largest sales route. The founders said they disputed Amazon allegations involving patent infringement and review-policy violations.

"Once the collapse happened through Amazon, it basically collapsed the entire business," Nekhala told Business Insider for its So Expensive video series.

The account closure did not end the brand's presence on Amazon. Nekhala and co-founder Michael Nusinkis now sell Bed Scrunchie to a third-party distributor, which keeps the product listed on the marketplace.

That arrangement leaves the founders dependent on a platform they say harmed their company. Nekhala told Business Insider he still buys from Amazon two to three times a week, sometimes placing multiple orders in one day.

"I do not shop there because I have forgiven what happened. I shop there because Amazon has made itself so convenient and embedded in everyday life that even people who feel harmed by it continue to depend on it," Nekhala said.

The founders described the same consumer behavior in their own advertising. Before the account was deactivated, they ran a national television infomercial offering Bed Scrunchie directly for $39.99, while the item sold on Amazon for $44.95.

Nekhala said Amazon sales rose when the infomercial aired, suggesting viewers used the ad to discover the product but completed purchases on Amazon. Business Insider cited a recent survey of U.S. and European shoppers in which 75% said they bought from Amazon at least monthly.

Nusinkis framed that reliance as a product of design rather than price alone. "They remove all the friction," he said. "I think you just have this muscle memory.

I need to buy something — Amazon."

The pricing issue also links the Bed Scrunchie dispute to a broader regulatory fight. Nekhala said the company would prefer to sell for less on its own website, but believes lower prices elsewhere can hurt a product's visibility or placement on Amazon.

California's attorney general has sued Amazon over a related allegation: that the company pressures brands and third-party sellers to raise prices at rival retailers so Amazon is not undercut. The allegations in that lawsuit have not been resolved in the supplied material.

Amazon told Business Insider its pricing approach is meant to keep customers from overpaying and to preserve trust by comparing prices with other reputable retailers. If an item is cheaper elsewhere, Amazon said it may decline to feature that offer prominently, though it remains available for purchase.

Amazon also told Business Insider that California's case relies on a small set of emails taken out of context and that the challenged practices are standard retail negotiations intended to deliver "low prices, vast selection, and unmatched convenience" for customers.

For investors and regulators, the Bed Scrunchie account illustrates the same tension at the center of Amazon's marketplace model: independent sellers can gain access to vast demand, but may remain exposed to platform enforcement, pricing rules and changes in visibility.

Source: Business Insider article and video-series interview, Oct. 12, 2026