Amazon raises third-party fees for holidays amid rising costs – National

Amazon is again charging third-party providers — this time adding a holiday fee for merchants who use the company’s fulfillment services to pack and ship items to customers.

From Oct. 15 to Jan. 14, sellers will be charged an average fee of $0.35 per item sold through Amazon’s fulfillment services in the U.S. and Canada, according to a statement released by the company sent to dealers on Tuesday.

It is the second fee hike imposed on merchants by the online retail giant this year. In April, the company added a “fuel and inflation” surcharge of 5 percent to offset rising gas costs and inflation, which is near its highest level in four decades.

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To use Amazon’s fulfillment services, merchants already have to pay a fee that varies based on an item’s size, weight, or category.

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In the notice sent on Tuesday, Amazon noted that the holiday season increases fulfillment and logistics costs due to the volume of shipments being transported. The company said it had previously absorbed those cost increases. But seasonal spending has now reached “new heights,” it said.

“Our distributors are incredibly important to us, and we didn’t take this decision lightly,” the company said.

CNBC was the first to report the fee increase.

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Price adjustments for holidays are nothing new to Amazon. Last week, the US Postal Service announced that it had filed a notice instituting a temporary price increase to cover additional handling costs during the holiday season.

But at Amazon, seller fees — and their repeated hikes — are controversial because the company controls a large slice of the e-commerce market. Critics argue that the company’s excessive fees could potentially lock merchants out of its marketplace.

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“Companies with monopoly power tend to raise prices, and we see that here,” said Stacy Mitchell, Amazon critic and co-director of the anti-monopoly group Institute for Local Self-Reliance. “Amazon’s dominance of the online market means small businesses have little choice but to pay.”

Last month, Amazon’s chief financial officer, Brian Olsavsky, said during a media briefing that third-party sellers accounted for 57% of total units sold on Amazon in the three months ended June 30, the highest in the company’s history.

The Seattle-based company’s second-quarter earnings report also showed that total revenue Amazon collects from third-party sellers rose 13% year over year, while revenue from its own-retail operations fell 4%.

© 2022 The Canadian Press Amazon raises third-party fees for holidays amid rising costs – National


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