Amazon to raise fees for marketplace sellers

By Anna Jordan on Small Business UK - Advice and Ideas for UK Small Businesses and SMEs

Amazon is adding an extra fee for some of its sellers from 12 May.

The extra charge applies to sellers who use the Fulfilment by Amazon service (FBA) to store stock in its warehouses and use its supply chain and shipping network. The fee hike will add an average cost of 10p per product. Retail analysts expect FBA sellers to pass this cost rise on to customers.

>See also: As predicted, Amazon passes on 2% sales tax onto small businesses

The company said that from May its British operation would be adding a “fuel and inflation surcharge” of 4.3 per cent of fulfilment fees for Amazon Marketplace sellers. FBA fees are normally increased on an annual basis but the extra charge is in response to inflation. Andy Jassy, Amazon’s global chief executive said that it was due to the pandemic and the ongoing war in Ukraine.

Cost increases are going through even though Amazon’s profits trebled during the pandemic. It also comes at a time of rapidly rising costs and a household budget squeeze.

The fee will be imposed in many countries around the world. It will be introduced on the same day as France, Germany, Italy and Spain – though it might not be permanent. A letter to FBA users in the UK said: “It’s still unclear if these inflationary costs will go up or down or for how long they will persist. Rather than a permanent fee change, we will be employing a fuel and inflation surcharge for the first time.” A similar fee rise of five per cent was implemented in the US earlier this month.

Amazon said that since the start of the pandemic, it had invested heavily in its operations in Europe, adding 250 fulfilment centres, sorting centres, regional air hubs and delivery stations.

Earlier this month Etsy sellers went on strike in protest against a seller fee rise, the star seller programme and a lack of action against resellers.

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