Customer obsession and commitment to operational excellence are two of Amazon’s four guiding principles. And one of the ways Amazon tries to live by these principles is through empowering its sellers with various facilities and services.
But the company charges a small fee for these services. And it continues to revise this fee to maintain its legacy of facilitating its selling partners with the best tools and utmost support so they can continue working together toward meeting customer expectations and maintaining operational excellence.
In this blog, we are sharing some critical updates that Amazon has announced to its US referral and FBA fees for 2023. Knowing these changes may help you optimize your pricing strategies more effectively. So, read till the end.
Important Changes in Amazon Referral and FBA Fees
Amazon has released a handful of updates to its US referral fee and FBA charges before we move into next year. This is so the company could recover its costs and serve its selling partners and customers in the best of ways.
Here are the latest updates to Amazon fees that you need to be aware of:
Change in Referral Fee of Certain Product Categories
Amazon charges a referral fee every time you make a sale on the platform. This referral fee is a percentage of the product’s price and ranges from 8% to 15% of the price for most categories.
The referral fee remains unchanged with this year’s updates. However, Amazon has removed a bunch of product categories, including:
The company has adjusted these products within other categories. This re-categorization will lead to changes in the referral fee of the recategorized products, which may be higher or lower depending on the new category they have moved in.
Adjustment of Fuel and Inflation Surcharge in FBA Fees
Amazon introduced a Fuel and Inflation surcharge earlier this year to offset the rising costs of logistics. With this announcement, FBA started charging a 5% surcharge to third-party sellers who use FBA services.
This increase was meant to be temporary. But with this year’s announcements, Amazon has revealed that it would remove the Fuel and Inflation “surcharge” and adjust the cost within the new FBA fees.
Amazon FBA Fee Updates
Besides the Fuel and Inflation adjustments, there have been some other updates to the FBA fees. Amazon has attributed these updates to their aim of driving efficient use of the FBA storage and ensuring better capacity for sellers who use their space more efficiently.
These changes are as listed below:
The company has increased the FBA outbound fee rate by $0.22. They will also introduce finer weight categories so that the shipping costs can better align with the fulfillment fees.
For Apparel products, Amazon will use the greater of the two units: weight or dimensional weight for all large standard-sized products. This change will go into effect on February 16, 2023.
Amazon has reduced returns processing fee rates for customer-returned products in the Apparel and Shoes category by an average of $0.20 per return.
The company has also introduced changes to the monthly off-peak storage fees for standard-sized products by $0.04/cubic foot and by $0.03/cubic foot for oversized products. Amazon is also increasing Peak storage fees for their non-sortable network by $0.20/cubic foot. The fees for the sortable network remain the same.
Amazon has also announced it will introduce a surcharge for sellers with excess inventory stored in the fulfillment centers. The “excess” will be determined based on the seller’s recent weekly sales. This change is set to go into effect on April 1, 2023.
Amazon will also increase the surcharges applied to inventory that has been in the storage for 271 to 365 days. They are also planning to introduce an “aged inventory” surcharge on products stored between 180-270 days. This will apply to all categories except Apparel, Shoes, Bags, Jewelry, and Watches and will go into effect for April 15, 2023 aged inventory assessment date.
Amazon will also increase its removal and disposal charges. The liquidation fee will remain unchanged.
You can find out more updates on FBA fee updates here:
US FBA New Selection Program Fee Updates
FBA New Selection Program offers free storage, free removals, and free return processing to new-to-FBA ASINs for a limited period of time. Amazon is reducing the fee for this program and increasing the sales rebate from 5% to 10%.
Besides increasing rebates, the company will also increase the number of units eligible for the program and extend the eligibility period for some benefits within the program.
You can learn more about the changes in the FBA New Selection program here:
FBA Small and Light Fee Changes
FBA Small and Light allows sellers to benefit from reduced fulfillment costs on qualified items. Previously, any item in the price range of $10 or less would qualify for this program.
Through the most recent update, Amazon has announced it will allow sellers to register products costing $12 or less in the Small and Light program.
This change will increase the number of qualifying products and allow sellers to enjoy reduced fulfillment charges on more ASINs.
You can find out more details about changes in the FBA Small and Light fess here:
Amazon charges its sellers a fee for its services and revises this fee regularly to maintain the high level of its facilities while managing its own costs.
As we move into 2023, the ecommerce (and logistics) mammoth has once again revised its fee, and we have discussed the important updates above.
If you think Amazon’s FBA services are getting too expensive, the company claims that its FBA fees are still 30% less expensive than the standard shipping methods offered by some other “major” third-party logistics companies. These fees are also 70% cheaper than other “two-day” shipping options, according to Amazon.
The changes mentioned above will take effect on January 17, 2023, unless stated otherwise.
At Accrue, we help sellers like you grow their business on a number of marketplaces like Amazon and Walmart. Our ecommerce strategists will help you with implementing the best strategies designed to foster positive growth and generate profitable results. Consult with our marketplace expert now to discuss your marketplace growth plans for 2023!