Amazon recently announced 2019 changes to its US FBA storage, fulfillment, and referral fees, and unlike the 2018 fee changes, most of these changes will be welcome news to sellers. These fee changes take effect mid-February, 2019. Read on for details about the changes and how they will impact your business.
On February 15, 2019, Amazon will implement three main changes to FBA storage fees:
1. Monthly inventory storage fees for most product types will remain the same as in 2018.
But, beginning with the April, 2019, charges for March monthly storage, Amazon will charge separate, higher storage fees for dangerous goods that contain flammable or pressurized aerosols, due to the higher costs to safely receive, transfer, and store these volatile items. See Amazon’s dangerous goods identification guide for more information.
2. FBA long-term storage fees (LTSF) for products that have been stored in US fulfillment centers for 181 to 365 days are being eliminated, beginning with the February 15, 2019, inventory cleanup. LTSF will continue to be assessed monthly for inventory that has been in fulfillment centers for more than 365 days.
3. Minimum per-unit long-term storage fees were introduced in August, 2018 for items stored in fulfillment centers over 365 days. Beginning with the February 15, 2019 monthly assessment, the minimum per-unit LTSF will be reduced from $0.50 per unit to $0.15 per unit. The greater of the standard per-cubic-foot LTSF or the per-unit LTSF will apply.
Amazon has a separate LTSF fee structure for inventory in the FBA Small and Light program. Refer to the FBA Small and Light help page for details.
Amazon is adjusting US FBA fulfillment fees beginning on February 19, 2019.
Standard and Oversized Items
Fees for small and large standard size items with shipping weights of 10 oz. or fewer will not change. Fees for standard size items with shipping weights over 10 oz. will increase to stay aligned with current fulfillment and transportation costs.
A new 2-inch minimum height and width will be used to calculate dimensional billing weight for all oversize item tiers, reflecting current packaging costs.
As with storage fees, separate fulfillment fees will be charged for items containing lithium ion batteries, as well as dangerous goods containing flammable or pressurized aerosols. See Amazon’s dangerous goods identification guide for more information.
Small and Light
Amazon has a separate fulfillment fee structure for inventory in the FBA Small and Light program. Refer to the FBA Small and Light help page for details.
Subscribe and Save
The Subscribe & Save fee structure is being simplified and will take effect in September, 2019. For new items added to the program, sellers will be able to fund flat 5% or 10% discounts.
Effective February 19, 2019, Amazon will make the following Referral Fee changes:
Lower Per-Item Minimum Fee
The per-item minimum fee, in all categories where the fee applies, will be reduced.
Lower Referral Fee Percentages
Referral fee percentages for the US and CA marketplaces will be lowered for the following categories:
Referral fees for other categories will remain at the current rates.
For fee details, see the Selling on Amazon Fee Schedule help page.
Most of the 2019 fee changes are great news for sellers because by lowering their costs, they can be more competitive and profitable. The LTSF fee reduction and changes, in particular, are a welcome relief to those who struggled under the August, 2018 increases.
However welcome, these changes don’t mean you can now send piles of inventory back to Amazon without a thought. Despite their constant growth, Amazon continues to have limited space in their fulfillment centers and is tracking seller inventory performance using the Inventory Performance Index (IPI). The IPI tracks and scores sellers on their Excess inventory, Sell-through, Stranded inventory and In-stock inventory rates. Sellers with IPI scores above 350 will have unlimited storage, but sellers with scores below 350 will have inventory storage limits imposed, will be unable to send in additional inventory if they exceed the storage limits (until level drop below the limits), and will be assessed overage fees at $10 per cubic foot over the storage limit. Amazon will assess your inventory storage, based on your IPI, six weeks before the start of each quarter, and any limits imposed will apply for the following quarter. See Amazon’s Guide to healthy inventory management for tips and tools to help you achieve and maintain a healthy IPI.
Amazon continues to innovate and provide new tools for sellers to better grow and manage their FBA inventory. Utilizing these tools will result in smarter inventory management, saving you time and stress, and helping you build a more profitable Amazon business.
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