Fulfillment By Amazon Fee Changes
Amazon recently announced they will be adjusting their rates for the Fulfillment by Amazon (FBA) service in the U.S. to reflect the changing costs of fulfillment, transportation, storage, and customer service.
Below is a summary of the fee changes:
Fulfillment Fees: Effective February 18, 2016, they will increase their Pick & Pack and Weight Handling fees for most products’ sizes and weights.
Monthly Inventory Storage Fee: Effective March 1, 2016, the monthly fee for inventory storage will increase for Standard-Size and Oversize units. This change will first be reflected in April 2016 charges for storage that occurs in March 2016.
Pro-Tip: Fees for Order Handling, Zero-Fee Fulfillment, Long-Term Storage, and FBA Prep Services are not affected by this change and will continue to apply where applicable. Multi-Channel Fulfillment fees will not change at this time.
Sellers can view their estimated Fulfillment Fees using the:
- FBA Revenue Calculator
- Fee Preview under Manage Inventory (sign-in required)
- Fee Preview report (sign-in required)
FBA Fee Changes
“This happened last year, as well. It does look like it will have a greater impact for those sellers with large and oversize products,” Pat Petriello, Director, Amazon Sales Acceleration Program at CPC Strategy said.
“The takeaway from our side is that it’s just going to get more and more difficult for resellers with slim margins to make FBA work from a financial standpoint on Amazon.”
It’s only the weight handling fee which has seen a significant bump. Overall fulfillment fees, on average, will increase 10% to 20% in the categories where the fees have increased.
How will these changes impact Returns Processing Fees?
The Returns Processing Fee applies to customer-returned products sold on Amazon.com in categories for which Amazon offers free return shipping, including Clothing, Watches, Jewelry, Shoes, Handbags, Sunglasses, and Luggage.
The Returns Processing Fee is equivalent to the sum of all applicable Fulfillment Fees. Therefore, for products with free customer returns, the Returns Processing Fee will increase on February 18, 2016.
The Returns Processing Fee is charged when the product is returned. For items shipped to the customer before February 18, 2016, but returned on or after February 18, 2016, the Returns Processing Fee charged is based on the fee schedules that took effect on February 18, 2016.
Pro-Tip: The Returns Processing Fee is not charged in situations when Amazon accepts a return more than 30 days after the stated return window (the reason for the return is one for which Amazon takes responsibility).
Below is a comparison of the fee schedules before and after the announced fee changes:
Fulfillment Fees for Standard-Size products
The following fee schedule shows the prior and current FBA fees for Small Standard-Size and Large Standard-Size products sold on Amazon.com. This applies to domestic and international orders.
Fulfillment Fees for Oversize products
The following fee schedule shows the prior and current FBA fees for Oversize products on Amazon.com. Oversize shipping is only available for domestic orders.
Monthly Inventory Storage Fees
The following fee schedule shows Monthly Inventory Storage Fees prior to March 1, 2016, and after. This change will first be reflected in April 2016 charges for storage that occurs in March 2016.
The following examples are presented by Amazon to illustrate the upcoming changes in fees for orders.
These examples include Fulfillment Fees and fees for a sample month of inventory storage, but do not include fees for other services, such as FBA Prep Services.
Note that the images below are provided only as examples of the general product type; fees for the specific products pictured may vary.
For more on how the 2016 FBA fee increase, email [email protected]