Amazon is going to adjust its fulfillment fee structure to provide more transparency to sellers by creating separate fees for specific capabilities.
Beginning Jan. 15, 2024, the company will specify different fees for sending products into its fulfillment network and for shipping products out of its network, according to a Tuesday (Dec. 5) Amazon blog post.
“We are excited to provide sellers with more transparency and more control over their fulfillment costs,” Dharmesh Mehta, vice president of worldwide selling partner services at Amazon, said in the post. “On average, this year’s fee changes are significantly less than those announced by other major fulfillment services, and many sellers will see a decrease in the average fees paid to Amazon per unit sold.”
Amazon expects that retailers will see an average increase of 15 cents in fees per unit sold, according to the post. That is “significantly less” than the increases announced by other logistics providers and the fees remain 70% lower than the two-day shipping methods offered by others, the post said.
By creating separate fees for these services, Amazon can more closely align the fees with the underlying costs and provide sellers with more choice in using those services, per the post. For example, sellers can select which aspects of fulfillment they want Amazon to take on and which they want to do themselves.
The fee structure also allows Amazon to create incentives for sellers to use its network more efficiently and share the cost savings, the post said.
“We continue to work closely with our selling partners to give them the information they need to make more informed decisions and take more direct actions to further drive up unit growth and drive down costs, and we look forward to further supporting our selling partner community in 2024,” Mehta said in the post.
It was reported in September that Amazon is shifting its focus toward providing services to online merchants rather than solely selling products directly.
In addition, the company has surpassed UPS to become America’s largest delivery business. Amazon overtook UPS in the number of packages delivered to consumers in the U.S. in 2022 and has led FedEx since 2020.