Rising Fuel Prices: Amazon Increases Shipping Fees
Amazon has announced in a new press release that it will increase prices for FBA shipping fees effective May 12, 2022 again. After prices for local and pan-European shipping were already increased by an average of 6% in March 2022, this is now the second significant price increase within this calendar year.
Impact of the Ukraine War
As the main reason for the price adjustment, Amazon cites significant cost increases in the storage and shipping process for FBA, caused by record-high fuel prices since the beginning of the war situation in Ukraine and a rising inflation rate.
So Amazon writes:
In 2022, we expected a return to normalcy as COVID-19 restrictions were relaxed worldwide. However, fuel prices and inflation have brought new challenges. It is still unclear whether these inflationary costs will rise or fall or how long they will persist. Instead of a permanent fee change, we will levy a fuel and inflation surcharge for the first time.
Through the fuel and inflation surcharge set by Amazon, the current fees for Fulfillment by Amazon per unit are increased by an additional 4.3%. According to the current status, the following countries are affected: Germany, France, Italy, Spain, and the United Kingdom. For merchants in Germany, this means an average increase in shipping fees of 0.13 € per unit. The price surcharge only applies to sellers who use the Fulfillment by Amazon service for storing and shipping their products.
It should be mentioned that the surcharge is only levied on shipping fees. Other "Fulfillment by Amazon" fees such as service fees for remission and disposal are not affected by this change.
New Prices Effective May 12, 2022
If you sell in Germany and the weight and dimension class for your product is defined as, for example, a standard package with 1.90 kg, the total fee for FBA shipping effective May 12, 2022 is calculated as follows:
Shipping fee as of March 2022: 5.10 €
Surcharge: 5.10 € x 4.3% = 0.22 €
Total fee: 5.32 €
We have summarized the current price list for Fulfillment by Amazon for you:
Ongoing Price Increases Cause Criticism
Due to the continuous fee increases by Amazon, sellers are repeatedly exposed to strong price pressure and will most likely have to recalculate their prices to maintain profitability.
Amazon itself justifies the measures through significant cost increases in the logistics sector, which have been absorbed as best as possible to minimize the impact on trading partners and comments on this:
When increasing fees, we were careful to address ongoing costs and ensure that our fees remain competitive compared to fees from other service providers.
At the same time, Amazon announces that it will accommodate affected merchants with discount measures and promotional campaigns:
We know that fee changes affect your business. Our teams work daily to ensure that Fulfillment by Amazon continues to be an excellent performance offering for premium shipping and delivery service. For this reason, we recently announced fee reductions and promotional campaigns as well as additional incentives for the program for new items in the Fulfillment by Amazon assortment.
We have summarized the mentioned discount campaigns for you:
Discount on European Shipping Network Fees (EU to United Kingdom and Vice Versa)
To support merchants after Brexit in selling between the EU and the United Kingdom, Amazon offers a discount of 20% on European shipping fees from the EU to the UK and vice versa in the period from March 31, 2022 to March 31, 2023.
5% Discount on Sales for New Items in Assortment
Effective March 1, 2022, Amazon grants sellers who complete brand registration a monthly discount of 5% for sales of eligible ASINs that are new in the Fulfillment by Amazon assortment.
- For eligible oversized items, the discount applies for up to 90 days for up to 30 units per parent ASIN.
- For eligible standard-size items, the discount applies for up to 90 days for up to 50 units per parent ASIN.
- For eligible items in the clothing, shoes, and bags categories, the discount applies for up to 120 days for up to 100 units per parent ASIN.
Discount Campaign for Amazon Transport Partner Program
To reduce the costs for shipping products to Amazon logistics centers, Amazon is introducing a discount of 50% on the Amazon Transport Partner Program from April 12, 2022 to April 12, 2023. This discount applies to domestic shipments to logistics centers in Germany, France, Italy, and Spain.
Discount Campaign for Selling Fees on Clothing, Shoes, and Handbags
Amazon has extended the discount campaign for products in the categories: clothing, shoes, and handbags until March 31, 2023. Here, the percentage selling fee is reduced from 15% to 7% for the portion of the total selling price over 45 €. This campaign applies to both Fulfillment by Amazon and Prime by Seller.
You can find more information about prices and discounts in the help section of Seller Central.
Conclusion
The current development of fees on Amazon remains uncertain due to the critical situation of the global economy. So it remains difficult to assess when and whether Amazon will lower the fees for Fulfillment by Amazon again. Although Amazon accommodates merchants through some discount campaigns, the bitter aftertaste remains that these only affect a fraction of all FBA sellers.
