Amazon fees have increased again! Sellers: The increase is outrageous

The much-anticipated peak season surge in orders has not yet arrived, but the platform fees have already increased, allowing sellers to feel the atmosphere of the peak season.

Amazon previously announced that it will start charging peak season delivery fees starting October 15, and the policy will take effect on Sunday. Sellers generally face a $0.2-0.5 increase in shipping costs, with larger items seeing a bigger increase, and sellers' profits are once again squeezed.

In addition to delivery fees, peak season storage fees have also been charged since this month, and they have increased significantly compared to last year. The continuous increase in various costs has forced sellers to start calculating carefully, hoping to maintain a safe profit line, but advertising is necessary and prices are difficult to raise. "It's difficult to do business on Amazon" has become a topic of constant discussion among sellers at home and abroad.

Peak season delivery fees are here, and sellers’ costs are rising again

After the weekend, the sellers who opened the backend found that Amazon had started charging peak season delivery fees, and the costs skyrocketed. They were immediately unable to remain calm:

"I really want to curse this policy. The delivery fees of all stores are ridiculously high."

"Some prices have really risen to an outrageous level, which has really upset me. I'm requesting a re-measurement..."

"It increased by 0.6. I'm going to open a case to retest it. It increased a lot."

"It's hard to make any money in the first place, and everything is more expensive during the peak season."

According to the policy released by Amazon, Amazon will charge holiday sales peak season delivery fees from October 15 to January 14, 2024, and the charges have now been implemented.

Compared with the non-peak sales season, the peak season delivery fee for each item has increased significantly, with small standard sizes increasing by US$0.2 per item, large standard sizes increasing by US$0.3-0.5 per item, small large items increasing by US$1 per item, and medium large items increasing by US$2.5 per item.

This is an unwarranted increase in costs. Sellers analyzed that the price increases for each segment are roughly as follows: small standard size increased by 5% to 6%, large standard size increased by 5.5% to 8%, small large items increased by 10.3%, medium large items increased by 13.1%, etc. Large large items and special large items have a higher base cost and the smallest increase, but each item has also increased by US$2.5.

It is worth noting that for all large standard-sized items and large items (except special large items), Amazon will use the larger value of the product weight or volume weight to calculate its shipping weight. Because of the collection of peak season delivery fees, some sellers have sadly discovered that the delivery fee that they tried every means to reduce from more than 6 points to more than 3 points by changing the packaging a few days ago has now become more than 6 points.

Does this charge apply to orders placed before October 15? Amazon explains that the delivery fee is calculated and charged when the shipment leaves the fulfillment center. Therefore, if the product is ordered before October 15 but shipped on or after that date, it will also be charged according to the peak season delivery fee standard.

However, the holiday peak season delivery fee does not apply to products with a price of less than $10 . These products pay the Amazon logistics fee for low-priced products. Compared with the FBA standard rate, the Amazon logistics fee for low-priced products is $0.77 lower, and the cost advantage of low-priced products is magnified again during the peak season.

In addition to the peak season delivery fees, Amazon's peak season storage fees also began to rise this month. Compared with last year, from October 1 to December, the peak season monthly storage fee for large items increased from US$1.2 per cubic foot to US$1.4, an increase of US$0.2. Sellers will feel this wave of fee increases in the October storage fees collected in November. At the same time, the peak season storage fee for standard-sized items remains unchanged from last year at US$2.4 per cubic foot.

Sellers on the platform can't help but sigh. After working on Amazon for so many years, what they hear most is that FBA delivery fees have increased again, CPC has increased again, and the price of some competitor's products has increased again. A series of expenses are rising, but profits remain unchanged.

Judging from the situation, this is not like a peak season for sellers, but more like a peak season for Amazon.

" The storage fee has nearly tripled, and the delivery fee is also frighteningly high, but our sales price and peak season orders have not increased at all. Amazon makes money directly from the sellers' profits and makes a lot of money. In the next few months, we need to speed up store turnover and ship goods rationally. If we ship too much, Amazon will eat up all the gross profit. " The sellers feel under great pressure.

Some sellers hope that their peers can raise prices together, otherwise they will be working for Amazon all year round. It is reasonable to absorb the rising costs by raising prices, but in the words of sellers, if no one buys the product even if the price is reduced, the price cannot be raised at all, so they can only continue to roll up and grit their teeth to continue to lose money.

Amazon faces rising costs , making operations more difficult

Amazon dominates the online retail industry in the United States, covering more than 40% of online shopping, and about two-thirds of American adults subscribe to the Amazon Prime service. The platform also has one of the largest delivery systems in the United States, which can provide timely delivery services.

This huge market is very attractive to sellers. Therefore, the share of Chinese sellers on Amazon has been increasing over the years, and "Made in China, sold on Amazon" has become the norm. A large number of American merchants also sell online through Amazon.

But more and more people believe that Amazon is no longer as difficult as it used to be.

When newbies ask whether Amazon and FBA are suitable for investment, some overseas sellers advise against it, citing high advertising costs as an important reason.

“Even if you have great images, titles, descriptions, etc., you still need to use PPC, and that’s the problem. If you don’t use PPC, no one will see your products. If you use it, then you will see sales, but you will also most likely lose money. Just a few clicks on the main keywords can make you lose a lot of money, and long-tail keywords are not worth trying,” said one of the sellers.

He gave an example, if a seller sells a product for £30 and makes a profit of £10, 33% profit sounds good, but don't forget that you pay about £2 per click for the main keyword, and after 5 clicks, your profit is gone. Even if you sell a product every 6 clicks, you will lose £2 for each sale.

This is heartbreaking. A few years ago, the platform advertising bids were not high, but as competition on Amazon has become increasingly fierce, advertising costs such as keywords have piled up a huge cost.

Seller @跨跨老张 believes that in an era of stock competition, traffic costs will inevitably rise. For sellers who have experienced the bonus period in the past, this is a mean reversion, but for new sellers it is tantamount to a sea of ​​blood.

The cost increase has indeed made Amazon's operation more difficult. But in fact, it is not just this year. For sellers without technical barriers and capital advantages, every year will be a challenge. Another factor that cannot be ignored is that Amazon's own products are also dividing the market. They have advantages such as operating costs and low prices. Amazon has become one of many sellers, and has squeezed some sellers out of this platform.