Amazon Puts Off Merchant Fulfillment Fee Hikes Until June

Amazon is postponing its logistics fee increase to help accommodate businesses affected by the pandemic, a company letter from Amazon Worldwide Consumer CEO Jeff Wilke stated.

Wilke wrote that the eCommerce giant will continue to take on the extra costs without increasing fees until June 1, 2021.

“We are doing this because we want to provide stability and support for you during what will likely remain a challenging winter as vaccine distribution gets underway,” Wilke said in the letter.

The letter also highlighted what Wilke called the massive costs Amazon has incurred over the past nine months, including “more than $10 billion” in pandemic-related operating costs. That included increasing the floor space for fulfillments and logistics by 50 percent, hiring 400,000 people for “the biggest peacetime workforce ramp-up by any company in history,” and spending over $2.5 billion on pay incentives and bonuses.

Wilke wrote that while other companies have “passed along costs through surcharges and fee changes in 2020, [Amazon has] absorbed over $5 billion of those costs on your behalf.” He said Amazon plans to invest “billions more” as the pandemic continues into the new year.

Despite Wilke’s words, Amazon sellers have reported longer delays than usual when shipping items during the holiday season, PYMNTS reported. There were chatrooms in which half a dozen sellers and consultants reported that shipments that were supposed to take just a day or two to arrive at the buyer’s door were now taking a week or longer.

According to one seller, Amazon seemed to be prioritizing the most high-volume items for its own delivery system, with merchants left to handle their own order fulfillment on the less-popular items. This is essentially the position adopted by the eCommerce giant early in the pandemic as people were mass-buying specific items like toilet paper, hand sanitizer and masks. But the company notably didn’t issue any such warning about prioritizing items this time.