Amazon.com Inc. (Nasdaq: AMZN) will raise its seller fees in the fall and early winter to counteract inflationary pressures during the holiday season.
The Seattle tech giant told third-party sellers in an email this week that those who use Fulfillment by Amazon.com Inc. (Nasdaq: AMZN) and pay Amazon.com Inc. (Nasdaq: AMZN) to handle packaging and shipping would be charged a "holiday peak fulfillment fee" of 35 cents per item sold from Oct. 15 to Jan. 14 in the U.S. or Canada.
Amazon.com Inc. (Nasdaq: AMZN) said in the email, "Our selling partners are significant to us, and this was a difficult choice for us to make." "Because of the high number of packages sent around the holidays, costs for fulfillment and logistics go up across the board."
Amazon.com Inc. (Nasdaq: AMZN) said in the email that it usually covers the cost increases during the holidays, but "seasonal expenses are reaching new heights."
Most of the time, Amazon.com Inc. (Nasdaq: AMZN)'s best sales quarter is the fourth fiscal quarter, when most of the seller fees are in place. This is major because of the busy holiday season, but a second Prime Day sales event is planned for October, which could help this year.
Last year, Amazon.com Inc. (Nasdaq: AMZN)'s first quarter sales were $137.6 billion, but logistics costs cut into profits.
Third-party sellers are becoming more and more important to the e-commerce giant. During the Covid-19 pandemic, the company talked about how well small businesses did on its platform. In a report from last year, the company said that about 60% of its retail sales were due to third-party sellers.
Amazon.com Inc. (Nasdaq: AMZN) said in the email that the FBA continues to provide a very high level of service to customers and an excellent value for sellers. Amazon.com Inc. (Nasdaq: AMZN)'s fulfillment fees during this busy time are projected to still be on average 30% cheaper than those of other major third-party logistics providers for slower standard shipping methods and 70% cheaper than comparable two-day shipping options."
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