Third-party sellers who use Amazon's fulfillment services will soon feel the impact of rising inflation and fuel costs.
In a notice posted on the U.S. Amazon Seller Central hub for third-party sellers on Amazon Marketplace, the e-tail giant announced that starting April 28, 2022, a 5% fuel and inflation surcharge will be applied to existing FBA fulfillment fees for Amazon Marketplace participants selling in the U.S. Amazon said the surcharge is subject to change.
For example, beginning April 28, a six-ounce or less small standard item that currently costs $2.92 to fulfill in the U.S. will cost $3.07 with the surcharge. The surcharge will also be factored into extra fulfillment fees for items such as lithium batteries, TVs that are 42 inches or larger, and dangerous goods. The surcharge will be applied based on shipping date, meaning a product ordered before April 28 that is shipped on or after April 28 will have the surcharge applied.
According to Amazon, U.S.-based sellers sold more than 3.8 billion products, or 7,400 products per minute, in Amazon stores during 2021. During the year, the company saysd it and added more than 200,000 new third-party sellers to its U.S. store, up 45% over the previous year, with the number of U.S. sellers who surpassed $1 million in sales growing by nearly 15%.
In an email to CNBC, an Amazon spokesperson said current uncertainties around supply chain costs led the company to levy a temporary surcharge on third-party Amazon Marketplace sellers.
“In 2022, we expected a return to normalcy as COVID-19 restrictions around the world eased, but fuel and inflation have presented further challenges,” the email said. “It is still unclear if these inflationary costs will go up or down, or for how long they will persist, so rather than a permanent fee change, we will be employing a fuel and inflation surcharge for the first time — a mechanism broadly used across supply chain providers.”
Surcharge follows incentives
Despite the upcoming surcharge, Amazon is also trying to actively recruit new third-party sellers to Amazon Marketplace with an arrayof benefits and resources. Among these incentives, new sellers who adopt Fulfillment by Amazon (FBA) hosted fulfillment services can obtain benefits that include $100 in credits for using the Amazon Partnered Carrier program, or $200 in credits for using Amazon Global Logistics for inbound shipping fees; auto-enrollment in FBA New Selection, which provides free monthly storage, liquidations, and return processing for eligible new-to-FBA products; and $200 in promotional clicks for sellers that also adopt Amazon Sponsored Products pay-per-click ads.
Amazon is offering these benefits for new sellers as its chief rival Walmart is also targeting new participants for its own third-party online marketplace. As part of this program, Walmart has extended an introductory incentive for sellers to participate in its low-cost Walmart Fulfillment Services (WFS) fulfillment option. Approved sellers that enroll in WFS and complete the setup process and inbound one item to a Walmart fulfillment center by June 30, 2022, can earn 90 days of free storage and a 10% discount on fulfillment fees.