In an effort to ensure customers and merchants get the best possible service, Amazon recently implemented a policy change affecting those who ship their own products. Merchants and vendors that want to use Amazon’s fulfillment services must now pay a penalty if they choose to ship items on their own.
The new policy, which went into effect in October 2019, applies to merchants that ship within the U.S. and U.K. and is designed to discourage sellers from cutting corners and delivering goods that don’t meet Amazon’s standards.
At its core, the penalty is intended to create a level playing field for everyone and to encourage merchants to use Amazon’s Fulfillment by Amazon (FBA) service. Under FBA, merchants pay a fee to Amazon and in return get access to Amazon’s logistics, customer service, and shipping networks. FBA also provides other advantages such as access to Amazon Prime customers, who get two-day shipping on eligible orders, as well as additional ad spending when sellers opt to use Amazon Advertising Services.
Under the new policy, merchants that choose to forgo FBA can still send their own products, but they will be heavily penalized for doing so. Merchants will now be charged an additional fee on each item they ship on their own, and the fee will be different based on their individual selling plan.
For merchant fulfilled items on the Professional plan, the maximum penalty is $.15 per item, while FBA items pay only $.11 per item. This difference may seem small, but when multiplied by thousands of orders it adds up quickly. On top of that, anxious sellers may be further inclined to avoid Amazon’s costly fees by shipping on their own.
The end result is that Amazon is attempting to force more merchants and vendors to use FBA, which could potentially be beneficial for sellers and customers in the long run.
The new penalty should not be seen as a ploy to increase profits for Amazon, but rather an attempt to level the playing field and ensure that all merchants and vendors shipping items are doing so in a way that meets Amazon’s standards. This will guarantee that customers are getting the quality service they expect from Amazon, as well as maintain fairness among sellers who are shipping items both on their own and through Amazon’s FBA service.
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