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Amazon Seller News

Amazon Seller News: Seller Facts, Blackout Dates, New COO Requirements, Banned HTML, and More…

In this Amazon Seller News update, we’ll be covering:

  1. Empowering Small Businesses: Understanding the UK Procurement Act
  2. Amazon’s Latest Moves: MYCE Tool Closure, Sustainability Accelerator, and Mexico Expansion
  3. UPDATED: AI in eCommerce: Trends Redefining Shopping Experiences
  4. Unpacking the Latest Amazon Tools
  5. UPDATED: Amazon Aggregators: Comments and Concerns
  6. Leverage the Latest Amazon Features and Metrics
  7. UPDATED: Amazon Faces Backlash for Alleged Abusive Practices
  8. 2024 Insights: Online Consumer Trends You Can’t Ignore for Effective Marketing
  9. Amazon Cracks Down on Suspicious Reviews from Bad Actors, Sellers Express Mixed Reactions
  10. Roundup Post: Amazon Seller Tools Update and New Product Safety Requirements
  11. UPDATED: Logistics Showdown: UPS and Amazon Battle for Supremacy
  12. Preparing for Change: Higher Fees on the Horizon for UK/EU FBA Sellers in 2024
  13. Major eComm Players Making Big Changes to Take on Amazon
  14. Brace for Higher FBA Fees in 2024
  15. UPDATED: Battle for Last-Mile Logistics Heats Up as Amazon Expands Same-Day Delivery Network
  16. Register for Amazon Seller Wallet By November 30 to Unlock Cost Savings
  17. Updated: Bid for a Higher Inventory Limit with FBA Capacity Manager
  18. Shop Socially: Amazon and Meta Team Up for One-Click Social Commerce
  19. 4 Updates to Amazon Seller-Fulfilled Prime
  20. Updated: New Amazon Features, Updates and Requirements
  21. New Security Issues Leave Many Sellers Vulnerable to Cyberattacks
  22. The Covert Amazon Program That Could Be Costing You Thousands
  23. FTC Proposes a New Rule to Rein In Fake Reviews
  24. How FTC’s Historic Monopoly Case vs. Amazon Might Impact Sellers
  25. Amazon and Flexport Vie for End-to-End Logistics Supremacy
  26. UPDATED: 60-Minute Amazon Drone Delivery is Now a Reality
  27. UPDATED: Amazon Wants to Take a Bigger Chunk Out of Seller Profits with 2 New Fees
  28. Roundup: Upcoming Amazon Changes and Features
  29. Amazon Tries to Increase Revenue from Existing Shoppers
  30. UPDATED: Amazon Faces Tougher Scrutiny Under EU’s Digital Services Act (DSA)
  31. UPDATED: Shopify Looking to Integrate with Amazon Buy With Prime
  32. Updates to Amazon Return, Refund, and Reimbursement Policy
  33. Amazon is Testing A New Way to Show Product Reviews
  34. Amazon Delays Delivery Date Based Reserve Policy for Some UK Sellers After Backlash
  35. Amazon Working to Bring USPS Ground Advantage to its Buy Shipping Service
  36. Amazon Feature Updates: 3 New Seller Tools and Product Recall Reporting Page
  37. UPDATED: UPS Workers Ready to Repeat 1997 Mass Walkout Over Pay, Work Conditions
  38. Amazon Offers New Fulfillment Fee Discounts on Select ASINs
  39. Sellers Cry Foul Following Amazon’s Decision to End FBA Small and Light
  40. Aggregator Shakeups and Shifts in Strategy
  41. UPDATED: Amazon Taps into $100B Retail Media Market, Invests in New & Cutting-Edge Ad Platforms
  42. FTC Lawsuit Alleges Amazon of Tricking and Trapping Customers into Recurring Prime Subscriptions
  43. Clash of the Titans: Walmart and Amazon Battle for Dominance Intensifies
  44. 4 Major Changes Coming to Amazon
  45. Amazon Delivery Drones Off to a Rocky Start
  46. Shein Moves Into the US Market, But May Struggle to Recruit 3P Sellers
  47. A Purge Could Be Coming for Fake Reviews on Amazon
  48. 25% Growth Rate: Euro B2B Opportunities Expand on Amazon
  49. UPDATED: Amazon Hopes to Restore Consumer Confidence with $1.2B Anti-Counterfeit Initiative
  50. Amazon Announces Further Cuts Amid Economic Uncertainty
  51. Amazon Attempts to Close Loopholes with New Shipping Policy
  52. Updated: Are You Prepared for the Updated Amazon Returns and Refunds Policy?
  53. Updated: Amazon UK Workers to Launch Historic Strike in Early 2023
  54. Amazon Highlights ‘Frequently Returned’ Products You Should Think Twice Before Buying
  55. Amazon Braces for Slowing eComm Growth in 2023
  56. Boost Sales with These New Amazon Seller Tools
  57. Amazon Fees Changes for UK & EU Multi-Channel Fulfillment Orders
  58. Foreign Amazon Sellers Are Closing the Competitive Gap with ChatGPT
  59. Shopify Acquires Deliverr and Takes Aim at Amazon’s Buy with Prime
  60. Amazon Warehouse Automation Increases Concerns over Job Loss and Product Selection Inaccuracy
  61. The Latest Update to Amazon’s Automate Pricing Features
  62. Walmart Launches B2B eCommerce Site to Rival Amazon and Shopify
  63. Prepare for These 6 Major Changes to 2023 Amazon UK & EU FBA Fees
  64. Amazon Automatic Aging Inventory Removal Starts April 15
  65. Amazon Tweaks Logistics Strategy to Streamline Operations
  66. Amazon Makes Play Toward Offering Prime for Non-Amazon Orders
  67. Shipping FBA Inventory from China to UK with SEND: What Could Possibly Go Wrong?
  68. Sellers Feel the Squeeze After Amazon Announces US MCF Fee Hike
  69. Walmart Launches New Ways to Find and Buy Products
  70. 4 New Amazon Seller Tools to Accelerate Business Growth
  71. Amazon Will Pay Customers $2 per Month to Track Their Ad Data
  72. Updated: EU Advised by NGOs to Refuse Amazon’s Flawed Proposal for Antitrust Settlement
  73. Amazon Announces Unbranded Packaging for MCF Orders
  74. Amazon Storage Limit Manager: Would You Pay for Extra Storage Space?
  75. Updated: Bad Actors Book Multiple Inbound Amazon Delivery Dates to Create Scarcity
  76. Is Amazon Prepared for the Holiday Rush?
  77. Amazon Hikes FBA Fees Again: What This Means for Your Business
  78. TikTok Gears Up for US Market Entry
  79. eComm Players Dial Up Rivalry Ahead of the Holiday Season
  80. Amazon UK At Risk for Box Shortages During BFCM
  81. Updated: Amazon Enters the 3PL Space with New Amazon Warehousing & Distribution Program
  82. What Amazon’s New Merchant Cash Advance Program is Going to Cost You
  83. Amazon to Shut Down Appario Amid Allegations of Circumventing Indian Law
  84. UPS Braces for Holiday Delivery Surge in December
  85. Should You Be Selling on These New Sales Channels?
  86. New Ad Strategies for Winning the Holiday Season
  87. Amazon Unveils New Affordable Shopping Hub Just in Time for Holidays
  88. Amazon to Hold Prime Early Access Sale on October 11-12
  89. Non-Amazon Sellers Are Now Stealing Your Ad Space
  90. Amazon To Increase UK Multi-Channel Fulfillment Fees By November 12th
  91. Amazon Now Allowing Email Marketing Campaigns to Repeat Customers
  92. Financial Win for FBA Sellers in PA Court
  93. Boost Conversions with Amazon’s New A/B Testing Features
  94. Amazon FBA Deadlines for Sending In Q4 Inventory
  95. Software Updates For September 2022
  96. Gloves Off: Shopify Warns Sellers Against Amazon Buy With Prime
  97. Amazon Brings Back Restock Limits to Prepare for the Holiday Rush
  98. New Amazon Badges Increase Discoverability and Allow for Values-Based Buying
  99. Royal Mail Strikes to Disrupt Mail and Deliveries Across UK
  100. Amazon’s New Holiday Surcharge Takes Another Bite Out of Seller Profits
  101. Amazon Attribution Update Makes for a More Effective Sales Tool
  102. Software Updates For August 2022
  103. Amazon Releases Inventory Ledger to Streamline Inventory Data Reports
  104. Updated: Amazon Suspension Risk For The Uninsured
  105. Amazon Plans to Hold 2nd Prime Day in October
  106. UPS Shipping Limits for Amazon Threaten to Delay Holiday Deliveries
  107. Shopify Shares Down By 14% After Laying Off 10% of Their Employees
  108. SoStocked Joins the Carbon6 Family Shortening the Timeline to Future Innovations
  109. Shopify Introduces YouTube Shopping Integration to Compete in Live Commerce
  110. Amazon Continues to Dominate B2B While Shopify Plays Catch-Up
  111. Freight Disruption at Port of Oakland as California Truckers Protest AB5
  112. Amazon Reduces Their Private Label Catalog Amid Mounting Regulatory Pressure
  113. Discounts on EU/UK Amazon Partner Carrier Fees
  114. Amazon Intros New Hack to Find High-Demand, No-Competition B2B Products
  115. Software Updates For July 2022
  116. Amazon’s Recent Ban on Mylar Bags and Other Potentially At Risk Products
  117. Reduce Losses Due to INR Scams with Amazon’s Signature Confirmation
  118. Amazon Implements Size Normalization to Ensure Consistency Across Detail Pages
  119. Why Amazon Wants You to Lobby Congress: What Is S.2992?
  120. New EPR Compliance Obligations for Amazon Germany Begin July 1st
  121. Software Updates For June 2022
  122. Amazon Adjusts Fees For Remote Fulfillment With FBA
  123. Amazon Removal Order Fees Get More Expensive
  124. Amazon Implements Surcharge on Aged Inventory Starting May 15th
  125. Software Updates For May 2022
  126. Amazon Updates Their Age-Restricted Bladed Products List
  127. New Product Dimension Attributes for 255 Product Types
  128. New Shipping and Storage Changes Coming to Amazon
  129. Amazon Hits US & EU Sellers With Fuel And Inflation Surcharge
  130. Software Updates For April 2022
  131. Emerging Amazon Marketplaces: UAE and Saudi Arabia
  132. Free Amazon Master Carton Calculator Tool To Optimize Your Packaging
  133. Amazon and EIT Climate-KIC Offer Financial Boost to Sustainable Startups
  134. Qualify for Rebates and Free Liquidations with the Updated FBA New Selection Program
  135. New Dimensional Weight Fees Placing Further Strain on Profit Margins
  136. Amazon Closing Shipping Loopholes May Wreak Chaos for Some Sellers
  137. Amazon Removes “Tons” of Supplement Offers Due to Non-Compliance with New Product Requirements
  138. UPDATED: Claim Reimbursement for Losses Caused by Amazon
  139. UK Launches Export Support Service to Help Businesses Sell Goods Abroad
  140. Three SoStocked Software Deals For New Years (Now Thru January 7, 2021)
  141. Important Update To Restock Limits And IPI Threshold
  142. Use Amazon’s Delivery Promise Tool To Monitor Your FBM Performance
  143. Amazon Storage Limit Updates
  144. New And Improved Amazon HTML Editor + HTML Converter Tool
  145. Send Holiday-Themed Emails To Amazon Followers Through December
  146. Borrow Up To 100K With The Amazon Community Lending Pilot Program
  147. Amazon Has Worked To Smooth Out Climate Pledge Certification
  148. Updated: Amazon Compliance Reference Tool To Ensure Products Meet Requirements
  149. Distribute Your Inventory Across Multiple FCs At No Extra Cost
  150. Beta Amazon Upstream Storage Program Eliminates Restock Limits
  151. Amazon Hikes Referral And FBA Fees For 2022
  152. Amazon Updates Program Policies
  153. Amazon Increases FBA Capacity and Restock Limits
  154. Amazon Launches New Dashboard for Returns Performance
  155. The End Of Rebates, Two-Steps URLs, & Other Search Rank Manipulation
  156. New Carrier Tracking Requirements & Improving OOS Listing Discoverability
  157. Amazon Releases Free Product Research Tool Named ‘Product Opportunity Explorer’
  158. New Documentation for Supplements Required to Avoid Listing Removal
  159. Amazon Inventory Deadlines For Q4
  160. Delivery Time Accuracy With New Amazon Shipping Settings Automation Tool
  161. China’s Widespread Power Cuts Further Strain Global Supply Chain
  162. New Changes To Removal Of Aged Inventory
  163. Amazon Egypt Now Open For Business
  164. Why Have Amazon Sellers Suffered a Significant Drop in Restock Limits?
  165. SoStocked Prices Increasing After Friday, September 17th, 2021
  166. Amazon Search Shadowban For Products That Violate Title Guidelines
  167. Your Amazon Posts Can Now Appear On Your Product Detail Pages
  168. Amazon Grade And Resell Program Rolled Out To Reduce FBA Waste
  169. Amazon Overhauls Its A-to-z Guarantee Policies To Streamline Damages Claims
  170. Now Factor Restock Limits Into Forecasts
  171. Streamline Shipments With “Send To Amazon”
  172. Changes To Amazon Professional Selling Plan Fees
  173. Automated Amazon Stranded Inventory Removal
  174. Typhoon Wreaks Supply Chain Havoc On China’s Eastern Coast
  175. Country Of Origin Now Required For Amazon Products
  176. Prevent Customer Complaints By Putting Seals On Consumables
  177. New Amazon Brand Referral Bonus Program For Amazon Sellers
  178. Four New Certifications Could Qualify You For Climate Pledge Friendly Badge
  179. Amazon IPI (Inventory Performance Index) Update
  180. Potentially Lower Fulfillment Fees Spells Good News For Amazon Sellers
  181. Big News: Sellers Can (Again) Contact Customers About Bad Reviews
  182. Amazon’s APRL Scheme Leaves Sour Taste In Sellers’ Mouths
  183. Blackout Dates: China’s Dragon Boat Festival
  184. Amazon Global Program: Sell Worldwide With No Added Fees
  185. Set a Faster Default Handling Time
  186. Amazon Product Description HTML
  187. Amazon Prime Day 2021 Check-In Dates
  188. Amazon 2021 MCF Fees and Features
  189. 2021 Amazon Restock Limits Update
  190. CBP Announces New Customs Requirements For Low-Value Shipments
  191. Five Seller Facts from Bezos’ Final Shareholder Letter as Amazon CEO
  192. All ASINs Now Require Melting Temperature Attribute
  193. RIP Early Review Program
  194. VAT Services Even When Outside EU
  195. Unsuitable Inventory Policy
  196. Amazon’s New Automated Pricing Tool
  197. A/B Testing Product Images Available
  198. New Shipping Data Requirements
  199. Amazon “Review Commenting” Updates
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Empowering Small Businesses: Understanding the UK Procurement Act

With the introduction of the UK Procurement Act, a new era of opportunity has emerged for small and medium-sized enterprises (SMEs) businesses in the UK. Let’s delve into what the UK Procurement Act entails, and the significant implications and benefits it offers for SMEs across the country. This effort demonstrates Britain’s commitment to strengthening this business segment.

Defining the UK Procurement Act

The UK Procurement Act, enacted in 2023, is a comprehensive legislative framework designed to govern the procurement process within the public sector. It sets out the rules and regulations that public sector organizations must follow when purchasing goods, services, or works. The Act aims to promote transparency, fairness, and value for money in public procurement, while also encouraging competition and supporting SME participation. The defined guidelines of the act are, in part, meant to funnel more public sector dollars into SMEs rather than only large corporations.  

Implications for SMEs

Leveling the Playing Field

One of the primary implications of the UK Procurement Act for SMEs is the leveling of the procurement playing field. Historically, SMEs have faced barriers to entry, such as complex contract bidding processes and requirements that favor larger companies. The Act introduces measures to simplify procedures and reduce bureaucracy.

Streamlined processes can save time and resources, making it more feasible for SMEs to engage in public procurement opportunities or compete on a more equal footing with larger corporations.

In a related move, Amazon Business UK has recently introduced a new feature called “Prefer Small and Medium Enterprises,” empowering business clients to make tailored purchases from SMEs. This functionality allows procurement specialists to pinpoint sellers with fewer than 250 employees and revenue below €50 million while sourcing supplies through Amazon B2B.

Enhanced Access to Opportunities

By promoting transparency and competition, the UK Procurement Act creates greater visibility and accessibility to public sector contracts for SMEs. Public sector organizations are encouraged to publish contract opportunities in a clear and accessible manner, allowing SMEs to identify and pursue suitable contracts more effectively. Additionally, the Act prohibits unfair practices such as bid rigging and discrimination, further opening up opportunities for SMEs to participate in public procurement processes.

Stimulated Growth and Innovation

Engaging in public sector contracts can drive growth and innovation within SMEs. The Act encourages public sector organizations to consider factors beyond price when evaluating bids, such as social value and innovation. This incentivizes SMEs to differentiate themselves through innovative solutions, driving creativity and competitiveness in the market.

Long-Term Sustainability

Securing public sector contracts can contribute to the long-term sustainability of SMEs. Public sector contracts often provide a stable source of income, offering SMEs greater financial security and resilience, especially during economic downturns or market fluctuations.

Empowering SMEs through Procurement Reform

The UK Procurement Act represents a significant milestone in public procurement reform, with far-reaching implications and benefits for SMEs in the UK. By fostering transparency, competition, and fairness, the Act opens up new opportunities for SMEs to participate in public sector contracts, driving growth, innovation, and long-term sustainability. Amazon’s new PreferSMEs feature may be a sign that Amazon seeks to snag more of public sector dollars through its representation of SME eCommerce brands.

Related: EU B2B Opportunities Expand on Amazon, 11 Powerful B2B Email Templates that Win Customers

Amazon’s Latest Moves: MYCE Tool Closure, Sustainability Accelerator, and Mexico Expansion

Amazon Update! Let’s go!

First up, the Manage Your Customer Engagement (MYCE) tool for brands has been discontinued. What should you do now and next?

Brand owners with early-stage EU businesses can join the Amazon Sustainability Accelerator program, offering valuable opportunities for growth and sustainability initiatives.

For Amazon Business sellers: Amazon Business launches in Mexico, making it the 10th country where this service is available.

New UK feature! “Prefer Small and Medium Enterprises,” has also been launched, enabling business customers to specifically support SMEs.

Dive in below.

1. Amazon Discontinues Manage Your Customer Engagement (MYCE) Tool

MYCE for brands has been discontinued as of February 16, 2024. Amazon has determined that the tool did not consistently meet its standards for quality and value delivery to both sellers and customers. Amazon only made this announcement 2 weeks ago, 3 weeks after it stopped delivering campaigns.

Amazon points to alternative tools like Brand Tailored Promotions and Brand Customer Reviews to assist in fostering brand loyalty by offering customized discounts and addressing important customer feedback. If you want to preserve your MYCE data, campaign metrics will remain accessible on the dashboard until April 30, 2024.

What Sellers Say

There are mixed reactions among sellers. Some express cynicism, highlighting Amazon’s policy that buyers are considered Amazon’s customers rather than the sellers’. Another seller sarcastically mocks the notion of Amazon effectively addressing critical customer feedback. 

However, there are also those who acknowledge the tool’s limited effectiveness but express curiosity about potential innovative marketing solutions Amazon may introduce to enhance sales organically, indicating a willingness to adapt to changes. 

2. Accelerate Your Startup’s Growth with Amazon’s Sustainability Program

EU/UK sellers can now apply for the Amazon Sustainability Accelerator program, designed to empower entrepreneurs in scaling their sustainable businesses.

In partnership with EIT Climate-KIC and Founders Intelligence, this year’s program is open to climate-tech startups in the following areas:

  • Consumer Products: Early-stage startups offering sustainable physical consumer products that are either recently launched or nearing market introduction.
  • Circular Economy: Startups developing solutions aimed at prolonging product lifespans through reverse logistics, user-accessible repair capabilities, and similar innovations.
  • Energy in Buildings: Startups dedicated to supporting building decarbonization efforts through the utilization of AI and advanced materials.
  • Packaging: Startups specializing in packaging materials, closed-loop reusable systems technology, and related areas.

Program Features

  • £20,000 in grants and credits
  • 10-week program
  • Expert mentorship
  • Immerse yourself in workshops, bootcamps, and insights from industry experts
  • Access the program virtually from the EU Economic Area, UK, or Switzerland, with in-person options available.
  • Events and community
  • Free account management

With a focus on skill development and environmental impact, the Accelerator has already aided over numerous startups, offering grants, credits, and assisting in sales growth and fundraising efforts.

Applications for the inaugural cohort, concentrating on the circular economy, energy efficiency in buildings, and packaging, must be submitted by April 5th, 2024. Accepted candidates will be revealed in the spring. The deadline for the subsequent cohort, emphasizing consumer products, is July 31st, 2024, and successful applicants will be announced in the fall.

Startups in the UK, Spain, Germany, Italy, France, and the Netherlands can apply online starting today.

3. Amazon Business Now in Mexico

Amazon Business has extended its reach to Mexico, marking its latest global expansion. This move positions Mexico as the tenth country where Amazon Business operates, alongside established markets like Germany, Canada, and the US. This newly unveiled B2B marketplace is tailored to address the sourcing requirements of businesses of all sizes.

What to Expect

  • Offering selection and convenience: Amazon Business extends the same product selection and convenience enjoyed by customers on Amazon to Mexico’s B2B space.
  • High brand discoverability: Business customers quickly find deals, business-only pricing, and quantity discounts.
  • Designed to suit various business needs: Its tailored features accommodate businesses of all sizes, encompassing business-only pricing for eligible selections, multi-user accounts for streamlined purchasing, and dedicated support for your unique business needs. 

In a press statement, Pedro Huerta, country manager for Amazon Mexico, mentioned that Amazon Mexico currently hosts nearly 18,000 domestic sellers, predominantly consisting of small and medium-sized businesses, accounting for 99% of the total. These businesses collectively offer over 3 million listed products, contributing significantly to job creation with approximately 57,000 direct and indirect employment opportunities.

“We are thrilled to expand our North American reach and offer the comprehensive sourcing support of Amazon Business to the 5 million small and medium-sized businesses based in Mexico,” said Huerta.

According to PYMNTS, this move is part of Amazon’s ongoing effort to “help SMBs move from the process of ordering business products to a procurement mindset.”

Amazon aims to facilitate an efficient procurement process by making it easy for customers to find and purchase goods in the correct form sizes and packs, diversifying payment options, and introducing credit and installment plans.

4. New Tool Facilitating Large Customer Purchases from SMEs

Amazon Business UK has introduced a new feature called “Prefer Small and Medium Enterprises,” designed to facilitate targeted purchases from SMEs selling on the platform. This feature allows procurement professionals to easily identify sellers with fewer than 250 employees and revenue below €50 million when sourcing supplies on Amazon Business.

SMEs play a vital role in the economy, contributing significantly to employment in various sectors. However, many SME owners struggle to scale their businesses online. 

Research conducted by Amazon Business indicates a growing trend among business customers in the UK, who have increased spending with SME selling partners by over 60% year-over-year. This highlights the strategic importance of supporting SMEs for larger organizations.

In addition, recently passed legislation is pushing for increased spending with SMEs. The UK government has enacted new procurement laws mandating public bodies to prioritize SMEs in their procurement procedures. This legislation intends to facilitate SMEs in securing a larger portion of the annual £300 billion expenditure.

By leveraging Amazon Business, SMEs, ranging from regional suppliers to family-owned businesses, gain increased visibility and access to multinational companies. This enhanced exposure improves their chances of securing larger orders and driving business growth.

Related: EU B2B Opportunities Expand on Amazon

Unpacking the Latest Amazon Tools

Amazon has just dropped a new set of tools and compliance updates. Here is a roundup of what’s new.

If you sell in the UK, be sure your products comply with the latest Extended Producer Responsibility (EPR) obligations for packaged goods in the UK. This could me additional fees or cost and non-compliance may result in listing suspension so be sure you understand exactly what is needed. Amazon has also launched a new “Pay on Behalf” program to make compliance smoother for sellers.

Navigate the complexities of Multi-Channel Fulfillment (MCF) integration with a new Amazon tool to ensure that you find the right fulfillment solution for your business needs. 

On the marketing front, Amazon has implemented new coupon pricing requirements for both UK and US sellers to thwart coupon practices that may not be truly beneficial to customers.

Read on to learn more about what this means for you and your business. 

1. New EPR Obligations for Packaged Goods in the UK and Pay on Behalf Service

Amazon has introduced revisions to its EPR guidelines, impacting sellers involved in the trade of packaged goods or empty packaging within the United Kingdom. This adjustment mirrors the environmental regulations of the UK, seeking to enhance the accountability of producers regarding the entire life cycle of their products, with a specific focus on waste management and recycling practices.

New EPR Requirements Explained

The new EPR obligations require businesses involved in producing, supplying, or importing packaged goods to bear the responsibility for the post-consumer phase of their products. This includes guaranteeing the collection, recycling, and environmentally friendly disposal of packaging.

Your obligations under the Extended Producer Responsibility (EPR) regulations are contingent on the size classification of your organization, determined by specific criteria outlined below:

  • Business type: Individual business, subsidiary, or group based in the UK 
  • Annual turnover of £1 to  £2 million for small businesses and over £2 million for large businesses
  • Used or supplied the following amount of packaging in a year:
    • More than 25 tons of packaging for small businesses
    • More than 50 tons of packaging for large businesses
  • Involved in any of the following packaging activities: supplying packaged goods to the UK under their own brand, packaging goods without branding when supplied, importing packaging products into the UK, selling products through online marketplaces like Amazon UK, and renting or leasing reusable packaging. Additionally, businesses involved in supplying empty packaging are also considered covered by these regulations.

For both UK sellers and sellers operating outside the country, Amazon has introduced a “Pay on Behalf” service, streamlining compliance with these regulations. Through this service, Amazon will report sales data to the relevant agency and handle eco-contributions for these sales using a Producer Responsibility Organization (PRO) chosen by Amazon.

Important: Starting April 1, 2024, Amazon retains the authority to apply eco-contributions to your account, mirroring the contributions made to ensure your sales align with the EPR requirements for third-party sellers in the United Kingdom. This measure guarantees the compliance of your products for sale on Amazon.co.uk. More details can be found at the EPR services on Amazon Pay on Behalf page. Non-compliance may result in Amazon removing your listings from the UK marketplace.

For producers based in the UK, visit EPR Requirements: United Kingdom to access comprehensive details on ensuring compliance.

2. Easily Choose the Right MCF Integration Solution for Your Business

With its new MCF Integration Selection Tool, Amazon provides a diverse range of over 100 integration options. These include “Built by Amazon” apps, third-party apps, inventory and order management solutions, and custom APIs. 

Running an ecommerce business involves managing complex operations across various functions such as product development, operations, finance, and marketing. Outsourcing logistics to a third-party logistics (3PL) provider can alleviate the challenges associated with ecommerce.

Leveraging the 3PL’s expertise and infrastructure helps optimize end-to-end logistics operations, including order fulfillment and inventory management. Partnering with a 3PL offers benefits like access to state-of-the-art integrations, connecting ecommerce sales channels with 3PL and back-end systems, allowing for automated order fulfillment and various business advantages.

That’s also why selecting an ecommerce integration is a significant decision, requiring a thorough evaluation of available options to identify the solution that aligns best with your business requirements.

With the newly introduced MCF Integration Selection Tool, Amazon seeks to offer a convenient way to identify the most suitable integration for your business. Leverage this tool to find apps you can use to automate your shipping process for orders outside of Amazon, enabling you to save time and provide your customers with an excellent shopping experience across various sales channels.

3. New Coupon Pricing Requirements

Amazon is implementing a new guideline concerning coupon pricing to ensure customers genuinely benefit from coupon offers. Starting March 12th for US sellers and March 18th for UK sellers, products must possess a sales history to qualify for a coupon, and the promotional price must be lower than either the “was price” or the most recent lowest price. In addition, coupons are still required to have a discount percentage between 5% and 50% off. 

This measure is aimed at enhancing the value of coupon promotions for customers and to deter sellers from employing deceptive pricing tactics to present false discounts, a practice that goes against FTC rules.

Manipulating previous prices poses a significant challenge within ecommerce marketplaces, with Amazon having encountered past class action lawsuits accusing false advertising linked to fake strikethrough pricing on Prime Exclusive discounts.

As Amazon’s rolls out policies to combat deceptive pricing tactics, some sellers express apprehension that the algorithmic standards, especially during events like Prime Day with special limited deals, might compel them into a competitive downward pricing spiral. The 

concern stems from the potential impact on legitimate sellers who fear being pushed toward a “race to the bottom” pricing scenario.

Others criticized the lack of sufficient notice provided by Amazon about the coupon pricing update, indicating frustration and dissatisfaction among sellers. However, a few sellers acknowledged the potential benefits of the new policy in curbing scams and deceptive practices related to fake discounts on the platform. Overall, the general tone appears largely critical, with sellers questioning the impact on their pricing strategies and the platform’s effectiveness in addressing fraudulent activities.

Overall, as Amazon continues to operate in the face of government regulations, we can expect to see more changes to policies and guidelines in line with the various laws, rulings and investigations within this global landscape.

Related: Amazon Faces Backlash for Alleged Abusive Practices, How FTC’s Historic Monopoly Case vs. Amazon Might Impact Sellers, FTC Lawsuit Alleges Amazon of Tricking and Trapping Customers into Recurring Prime Subscriptions

UPDATED: Amazon Aggregators: Comments and Concerns

Amazon Aggregators Comments And Concerns

UPDATE 02/28/2024: Thrasio, one of the biggest Amazon aggregators, has finally taken the step of filing for Chapter 11 bankruptcy protection in a New Jersey court. 

When a company files for Chapter 11 bankruptcy, it seeks court-supervised restructuring to alleviate financial distress while continuing its operations. This type of bankruptcy is commonly used by businesses looking to address overwhelming debt, negotiate with creditors, and develop a plan to emerge as a financially viable entity.

What happens next?

The Massachusetts-based company is embarking on a path of financial restructuring, seeking the court’s oversight to implement an agreement with its financial stakeholders. Based on a press release dated February 28th, outcomes that may occur for Thrasio in Chapter 11 include:

  • Continued Operations: Unlike Chapter 7 bankruptcy, which often leads to liquidation, Chapter 11 allows the to continue its operations, including “providing customers with the amazing products they have come to expect from Thrasio’s brands, paying vendors and suppliers for goods and services provided on or after the filing date, partnering with sellers to elevate brands and position them for growth, and paying employee cash compensation and providing benefits as normal.” Existing management may also continue to run the business as a debtor in possession, making day-to-day decisions.
  • Development of a Reorganization Plan: The company, with the assistance of financial advisors, legal counsel, and sometimes a bankruptcy trustee, develops a comprehensive reorganization plan. This plan outlines how the company intends to address its financial challenges, including how it will treat each class of financial stakeholders.
  • Negotiation with Creditors: The company engages in negotiations with its creditors to gain their approval for the reorganization plan. This may involve discussions about debt repayment terms, interest rates, and other financial arrangements.
  • Debt Repayment: The company repays its creditors according to the terms outlined in the reorganization plan. This may involve partial repayment of debts, extended payment periods, or other negotiated arrangements. According to Thrasio, the Restructuring Support Agreement (RSA), encompassing the majority of its revolving credit facility lenders (81%) and term loan lenders (88%), is poised to eliminate a significant portion of the company’s existing debt, amounting to approximately $495 million. Additionally, under the agreement, all interest payments in the initial year following the emergence from Chapter 11 will be deferred.
  • Monitoring and Compliance: The company continues to operate under the oversight of the court and may be required to report regularly on its financial progress. Compliance with the terms of the reorganization plan is crucial to maintaining the company’s financial stability.

In tandem with this move, Thrasio has successfully secured an emergency capital of $90 million from undisclosed existing lenders.

The Amazon aggregator giant also said that the $90 million capital “is expected to provide sufficient liquidity to support the Company throughout this process and beyond. In particular, the financing will enable the continued operation of Thrasio’s brands, support ongoing business operations and provide the Company with access to new capital upon emergence from Chapter 11 to support go-forward business operations.”

Rebuilding with New Financing or End of an Era?

With a history of raising over $3 billion in a combination of equity and debt to drive its consolidation strategy, Thrasio’s entry into bankruptcy protection stands out as one of the major instances reflecting the challenges currently faced by high-growth ecommerce and tech companies.

Top 100 Amazon seller, Aaron Cordovez, took to X to share his piece on the matter:

“Thrasio files for Bankruptcy. It’s no longer a rumor. This is the end of an era of Amazon aggregators that come from the Venture world,” suggesting that a new business model could emerge from Thrasio’s collapse. For example, the downfall could give rise to search funds (vs. venture capital-backed aggs) as potential buyers for Amazon businesses.

The search fund model involves an individual or group of entrepreneurs raising funds to finance the search and acquisition process. Once a suitable business is identified, the searcher takes on the role of CEO or manager to grow and improve the acquired business. In contrast, venture capital involves firms managing pooled funds from various investors. These firms invest in a portfolio of startups and high-growth companies across different industries, including ecommerce.

Cordovez also left a comment on TechCrunch’s article about Thrasio’s bankruptcy stating “Thrasio showed the world the business model, but failed to execute it properly. Why rack up so many expenses on teams that don’t know ecommerce?”

Despite the disappointment, there is a subtle note of optimism expressed in the rest of his comment. Cordovez suggests that acquisitions remain a viable option for growth when executed correctly, and declares his active engagement in buying brands within the same space, indicating a belief that success is achievable with the right approach.

“Acquisitions are still a great option for growth when done right. We are actively buying brands in the space. It can be done.”

The sentiment, shared by others within the community, reflects a recognition of Thrasio’s role in shaping the industry, coupled with a critique of its execution and a belief in the continued potential for success in Amazon aggregators when approached strategically.

In sum, the bankruptcy filing marks a strategic pivot for Thrasio as it navigates the complexities of its financial landscape, aiming to emerge stronger and more resilient to “be better equipped to support our brands, scale our infrastructure and enable future opportunities,” CEO Greg Greeley said in a statement.
Related: Amazon Aggregator Shakeups and Shifts in Strategy

Thinking of selling your Amazon business? 🤔

Whether you’re starting a new venture or feel like your business has a higher potential for growth with greater resources, Amazon brand aggregators may be able to help you move forward by acquiring, scaling, and expanding your business.

The good news is that Amazon sellers planning to exit their business have about 100 active Amazon aggregators to choose from.

⚠️ The not-so-good news? They have to sift through almost 100 companies to see who might be a good fit to sell their business to.

Some of these companies have seen massive growth and continue to thrive, while others are facing challenges from lawsuits to funding

Choosing the right aggregator is critical not only to your business’s continuous operations but also to your income. After all, depending on your deal structure, your earnings may depend on how well the aggregator has scaled and run your business. 🚀

If you have an earnout over time based on performance, you want to make sure the aggregator you sell to can deliver, or even that they will still be around by the time your earnout date arrives. 

So let’s check in on how some of these Amazon Aggregators have been fairing in recent times. 

Choppy Waters

Perch

Perch is one of the leading Amazon aggregators that has shown a lot of promise since its early days. The company reached a unicorn status after achieving a 10-figure valuation just one and a half years after it was founded in November 2019. After acquiring more than 80 brands (including Web Deals Direct for upwards of $100 million last year) and expanding its business internationally, the company has made headlines again, but for the wrong reason.

Freya Pratty, a reporter for the European publication, Sifted, wrote in an article published last month that the company is facing a lawsuit.

Perch acquired the business of Gutter Games, Inc. but another company named That’s What She Said, Inc. claims it already had a contract with Gutter Games before Perch acquired it. As a result, Perch and Gutter Games are facing a lawsuit for breach of contract.

As Perch has achieved an enviable level of success in the competitive eCommerce aggregator industry, these types of lawsuits are bound to happen, but it’s something to be aware of when considering your options.

Simply put, Amazon sellers should make sure legal battles such as this that plague some aggregators could have an impact on the company as a whole, something which may impact a seller’s second exit, where they receive their final earnout money.  

Perch remains silent on this issue.

Seller X

Like Perch, Seller X is another aggregator that has reached a significant level of success in a short span of time. After launching in September 2020, the company added more than 40 brands to its portfolio within one year and has raised over $750 million in funding.

But after allegedly committing a breach of contract, the company is now facing a lawsuit.

According to an article written by Melissa Daniels and published in Modern Retail last month, the aggregator bought Regal Games’ Chalk City and agreed to pay Regal Games $900,000 one year after its purchase, except when the sales of the product fell to over 15%.

The lawsuit filed by Regal Games claims that Seller X intentionally avoided performing its obligations – such as exploring new markets, investing in ads, and having enough stock of the products on hand – so when the sales of Chalk City dipped to over 15% (which they did), the aggregator would not be bound to pay Regal Games the $900k.

There has been no court ruling in this case to substantiate these claims so we will have to see how this case develops, but it should open sellers’ eyes to the fact that they should be structuring their deals and working with aggregators that will best secure their earnouts.

Seller X said it is ready to defend itself in court.

Telos Brands

Unlike Perch and Seller X, Telos Brands is not facing any legal battles. But they have recently been reporting less-than-stellar financial performance.

Among all the Amazon aggregators, Telos Brands has one of the lowest amounts of capital raised at only $2.1 million. The fact that they raised this capital last September 2021 could be cause for even more concern about this company’s financial status. 

Funding for aggregators is dwindling this year. Hopefully, it hasn’t fully dried up for Telos Brands but time will tell.

Smoother Sailing 

While multiple aggregators are losing steam, some are still holding strong. 

Acquco

Founded in 2020 by two former Amazon employees and an investment expert, Acquco is one of the youngest and fastest-growing Amazon aggregator companies on this list. 

The company buys leading Amazon brands and, using its proprietary technology, data, algorithms, and Amazon expertise, grows and scales them so they will become household brands. 

Despite it being a young player in the field, Acquco has shown an impressive financial and operational performance so far: it generated a revenue of over $420 million for the year 2021, amassed more than $450 million in funding, grew its team of seven to more than 250 worldwide, and acquired 40 brands to date. The company also launched its own in-house tech and analytics divisions earlier this year, emphasizing its highly measured and strategic approach to identifying, valuing, acquiring, and managing brands.

Aside from these figures, the company takes pride in its seller-friendly approach throughout the process. Their thorough and transparent due diligence, flexible deal structures, legal assistance, dedicated support team, and streamlined processes give Amazon sellers a convenient, efficient, and hassle-free way to exit their business confidently in as little as 23 days (on average).

Last but not the least, Acquco’s brands have purportedly, up to tripled their growth after acquisition. If you’re looking for an aggregator with a proven track record in growing businesses, this company may be the one for you.

Benitago

Benitago was founded by two Computer Science majors and Amazon sellers in 2016. The company has raised $380 million in funding to date.

This aggregator targets businesses with annual revenues of $3 million and innovative products that other aggregators may not be interested in. 

They have an excellent record of growing Amazon FBA businesses, with more than 20 products in their portfolio having more than $250,000 in sales and achieving Best Seller Rank Improvement Trailing Twelve Months (TTM) 12 times. They also helped scale more than 300 products from over 15 categories such as beauty, electronics, health, maternity, orthopedic, and pet supplies. 

Benitago’s acquisition process involves just three steps: business evaluation; intensive business data analysis; contract drafting and payout. This is perfect for sellers who want a short and fast exit from their Amazon FBA business.

The company also used to offer qualified Amazon sellers an Aggregator Offer Match Guarantee where they matched the amount offered by another aggregator for your business and give you an extra $250,000 if you sell it to Benitago. 

In terms of post-acquisition performance, their brands show a 30% year-on-year growth rate, so there’s a high chance your business will also grow under their management. 

Elevate Brands

Founded towards the end of 2016, Elevate Brands has emerged as another leader in the Amazon aggregator world. 

The company buys FBA businesses based in North America, Europe, and the UK, preferably those that hold patents and those from the groceries, pets, and supplements categories. They have acquired over 25 brands and generated more than $500 million in funding to date.

What sets Elevate Brands apart is their focus on the relationships they build with Amazon sellers, founded on the fact that they started out as Amazon sellers themselves. Their relationship-first strategy seems to be working well, as their pet brands show a 57% growth in sales, and their grocery brands show a whopping 1556% growth in ad sales

Their world-class mergers & acquisitions (M&A) team ensures sellers will also have an easy and seamless exit from their businesses in less than 30 days. 

Merama

With headquarters in Mexico City, Merama positioned itself as the aggregator for Latin American brands looking to scale and grow to be $1B businesses. The company is valued at $1.2B and has raised $445 million in funding.

Their strategy is very different from the other aggregators, however: instead of buying many brands at a time, Merama will invest in only a few leaders in their respective categories and work at scaling and growing them exponentially. They currently have more than 20 brands in their portfolio. 

Another thing that separates them from other aggregators is their Future Exit Option. Instead of buying your entire business from you, Merama will initially invest and become a strategic partner of your business, taking a significant stake but not owning 100% of it. Together, they will help you grow it to become a $1B business by providing you access to non-dilutive capital and human resources, then give you options to exit your business three to five years later.

Latin American sellers who want to stay hands-on in growing their businesses will find Merama’s strategic partnership approach ideal. Apart from their solid financial backing and proven track record in growing Latam brands, they also promote inclusivity as their brands come from a wide range of product categories.

Razor Group

Berlin-based Razor Group was founded in 2020.

A major player in the Amazon aggregator industry, Razor Group has raised more than $1B in funding from leading investors, manages over 200 brands, and has evaluated over a million FBA businesses from their five offices in Europe, Asia, and North America.

The company has a fair, fast, and forward-thinking approach in how they evaluate businesses. They’re interested in businesses with products that have high product quality and great reviews, low complexity, robust growth, promising potential, and sales ranging from $1 to $15 million. Their acquisition process has only three phases and takes only a few weeks from evaluation to closing, which is ideal for sellers in a rush to sell their business. 

In summary, the stressor is to know who you are getting into bed with when you sell your company. It is important to look at not just the numbers but also the track record and future prospects for the aggregator you may essentially be going into business with. That is essentially what you are doing when you are selling your business with an earnout on the back end. 

Knowing more about the aggregators you are in talks with towards your exit will help you to narrow down your decision to make the right choice for your business. 💯

Leverage the Latest Amazon Features and Metrics

Amazon is rolling out key features to enhance the seller and customer experience. We will dive into these features and what you need to know and can expect from them. 

Highlights include the Build Your Brand page which introduces new metrics to empower sellers with insights to strengthen their brand strategies, instant replacements for seller-fulfilled returns and a dedicated page for recalls and product safety alerts in EU customer accounts.

We also touch on the new Ships in Product Packaging program for fee savings and increased sustainability and the Premium Navigation Carousel offering a smoother customer browsing experience.

Read on as we take a deeper dive into these new features!

1. ‘Your Recalls and Product Safety Alerts’ Page for EU Customers

Amazon has introduced a new feature enabling customers to access product recall and safety details for items bought through its online platform. While Amazon already notifies customers about recalls and safety alerts, the website now includes a dedicated page for customers to conveniently check these updates in one location.

When an alert is issued, customers will receive an email containing information and a link to the ‘Your Recalls and Product Safety Alerts’ page on their account. This page provides additional details, including options for refunds, returns, or repairs. This service aims to streamline the recall awareness process for Amazon customers, eliminating the need to rely on external websites for such information. The feature is now accessible to users across Europe.

What does this mean?
By directly notifying consumers on product safety recalls and alerts, Amazon aims to offer improved protection, potentially minimizing instances of injuries attributed to unsafe products that sneakily make their way to the EU marketplace through Amazon.

Related: Recalls and Product Safety Alerts Page for US Customers

2. New Metrics on the Build Your Brand Page

Explore four (4) new metrics for evaluating your brand’s performance on Amazon, including:

  • Branded Search Ratio: This refers to the proportion of searches that include a specific brand’s name compared to overall searches related to a particular product or category. This metric helps brand owners understand the frequency with which shoppers specifically search for their brand when looking for a particular type of product. A higher Brand Search Ratio indicates that the brand is more top-of-mind for customers in that product category, reflecting strong brand recognition and engagement. Brands can use this metric to assess their visibility and popularity within Amazon’s marketplace.
  • Star Rating: This metric reflects the average rating given to a product by customers who have purchased and reviewed it. The rating is typically displayed as a set of stars (ranging from one to five), with a higher number of stars indicating a better overall customer satisfaction. It serves as a quick visual representation of a product’s popularity and quality based on the experiences of previous buyers.

Related: Amazon is Testing a New Way to Show Product Reviews, Amazon Cracks Down on Suspicious Reviews from Bad Actors, FTC Proposes a New Rule to Rein in Fake Reviews

  • Brand Conversion Rate: This metric refers to the percentage of visitors who not only view a brand’s product but also make a purchase. It’s a crucial metric in assessing the effectiveness of a brand’s presence and the ability to convert potential customers into actual buyers. A higher Brand Conversion Rate indicates that a brand is successful in turning product visibility into actual sales, reflecting positively on its marketing strategies, product quality, and overall appeal to customers.

Related: How to Improve CTR & CVR

  • Repeat Customer Ratio: A metric that calculates the percentage of customers who make repeated purchases from a brand over a specific period. It provides insights into customer loyalty and the ability of a brand to retain its customer base. A higher Repeat Customer Ratio indicates that a significant portion of customers is returning to make additional purchases, highlighting brand loyalty and satisfaction. This metric is valuable for businesses seeking to understand and enhance their customer retention strategies.

Related: Amazon Now Allowing Email Marketing Campaigns to Repeat Customers

Leverage these metrics to:

  • Gauge the effectiveness of your sales funnel strategies and observe how customers interact with your brand across their journey.
  • Evaluate the significance of shopping engagements (e.g., purchases, live streaming, ad click-throughs, and newsletter subscriptions) by analyzing sales over a 12-month period.
  • Fine-tune your organic marketing and advertising strategies within Amazon to connect with a broader audience and fortify your brand.
  • Keep a close eye on your performance in relation to your product category and competitors at each phase of the buying process.

Access detailed insights by visiting the Build Your Brand page within your Amazon Seller Central account.

Related: The Power of Comprehensive Amazon Brand Strategy: Insights & Examples, How to Use Amazon Attribution to Measure the Impact of Your Marketing Campaigns

3. Instant Replacements for Seller-Fulfilled Returns

Effective February 12, 2024, customers now have the option to initiate an immediate replacement for items dispatched through the Prepaid Return Label program. In cases where they receive a damaged, defective, or incorrect item, they may choose an instant replacement for free.

How it Works

  • Customers must send back the original item within 30 days of receiving the replacement. Failure to do so makes you, the seller, eligible for automatic reimbursement.
  • If the buyer returns an original item in a used, damaged, or disparate condition from what was initially dispatched, you can file a SAFE-T Claim to initiate a reimbursement.

This change ensures that customers follow a standardized process when returning products, applicable across all of Amazon’s fulfillment options.

Related: Claim Reimbursement for Losses Caused by Amazon, How to Fix Amazon Unfulfillable Inventory, Maximize Gains and Minimize Hassle with Amazon Reimbursement Services

What Sellers Say

Sellers, as per the comments, have various concerns and criticisms about this new policy. These include:

  • Loss of Control: Sellers express frustration about Amazon taking control of return and replacement processes, believing they are better equipped to handle these aspects of their business.
  • Abuse of Returns: Some are concerned that this policy may lead to increased abuse of returns, with customers potentially requesting replacements without valid reasons, leading to financial losses for the sellers.
  • Impact on Order Defect Rate (ODR): Many question whether this new policy will affect their ODR, potentially causing issues for their metrics and overall performance on the platform.
  • Logistical Challenges: Sellers highlight the logistical challenges and delays associated with waiting for returned items, impacting the time it takes for orders to clear and for sellers to receive reimbursement.
  • Unavailable Replacements: There are concerns about the possibility of replacements not being available. If a replacement is not in stock, it could create challenges for sellers, impacting their ability to fulfill orders. For example, those who sell artisanal/handcraft and rare book products may find it difficult to provide instant replacements.
  • Risk of Fraud: Many express concerns about the potential for fraudulent claims, as the instant replacement system may make it easier for customers to exploit the process and keep both the original and replacement items.
  • Inconsistent Safe-T Claims Process: Sellers criticize the SAFE-T claims process, mentioning denials for high-valued items and claiming it lacks consistency. They argue that having the opportunity to handle customer service directly could prevent such issues.
  • Impact on Small Businesses: Some sellers believe that these changes disproportionately affect smaller sellers who may find it challenging to absorb the financial impact of (multiple) instant replacements. 
  • Lack of Opt-Out Option: Sellers request the ability to opt-out of this policy, emphasizing the importance of having control over their own return and replacement procedures.
  • Poor Communication: Some feel that Amazon’s communication and implementation of new policies are lacking. They express frustration about not being adequately informed or given sufficient time to adapt to changes.

Overall, sellers seem to be critical of Amazon’s instant replacements policy, citing concerns about potential abuse, loss of control, and increased complexities in handling returns and replacements.

Related: Maximize Gains and Minimize Hassle with Amazon Reimbursement Services, Tips to Improve Customer Experience and Reduce Returns

4. Lower FBA Fulfillment Fees with Ships in Product Packaging

Launched February 5, 2024, the Ships in Product Packaging (SIPP) program, formerly known as the Ship In Own Container (SIOC), is Amazon’s latest custom-branded packaging solution for FBA sellers.

With this program, FBA sellers now have the freedom to ship products in their existing packaging without any additional materials added by Amazon, hence, the cheaper FBA fulfillment rates for SIPP-certified packages.

Eligible sellers may be entitled to a fulfillment fee discount ranging from $0.04 to $1.32, depending on item size and weight. In addition, by minimizing packaging materials, Amazon will be able to optimize truck space, thereby reducing the number of trucks needed, ultimately lowering carbon emissions.

Pros and Cons

The launch of Amazon’s SIPP program has elicited a range of sentiments among sellers. Let’s explore the general sentiments and some of the highlighted pros and cons as expressed by sellers in the news announcement’s comments section.

Pros

  • Cost Savings: potential for reduced FBA fulfillment fees
  • Customization: ability to customize branding and packaging for a more personalized customer experience.
  • Enrollment Control: convenience of being able to enroll and unenroll products at their discretion.

Cons

  • Packaging Concerns: Numerous sellers express concerns about packaging integrity, citing instances where the packaging may be damaged during shipping, potentially impacting the product.
  • Auto-Enrollment Issues: Sellers report instances of auto-enrollment for their entire FBA inventory without explicit consent, leading to frustration.
  • Perceived Inadequate Discount: Some sellers believe that the offered discount is not substantial enough to justify the effort and costs associated with complying with SIPP requirements.

In sum, the sentiment seems mixed, with sellers appreciating the potential cost savings but raising valid concerns about the practical implications and the program’s impact on packaging integrity.

For more details about the program and to enroll your products, visit the SIPP enrollment page.

Related: How to Choose the Right Amazon Master Carton Size and Type, Pallet Calculator to Optimize Load Capacity

5. Redesigned Premium Navigation Carousel

Amazon unveils an upgraded version of the Premium Navigation Carousel module within the A+ Content Manager, providing sellers with an enhanced platform to showcase their products through immersive media and enriched descriptions. This ensures listings are not only more visually engaging but also offer improved clarity to potential customers.

The enhanced module boasts upgraded features, such as “clickable tabs that are highlighted in a translucent overlay on the product visuals.”

This design facilitates smooth navigation and thorough exploration of product details. In the mobile interface, customers can effortlessly swipe horizontally on the image or engage with the redesigned tabs for an intuitive browsing experience. Desktop users, too, benefit from consistent and user-friendly navigation by utilizing the revamped tabs or arrows within the carousel. 

Optimization Opportunity for Sellers

By harnessing the capabilities of this upgraded navigation carousel, brands stand to elevate the visibility and visual appeal of their listings. Here’s a breakdown of the new feature’s advantages:

  • Improved Means of Showcasing Products: Present your products in a visually captivating and informative manner. This entails spotlighting diverse use cases and features, serving not only to capture customer attention but also to effectively communicate your unique selling points. 
  • Strategic Upselling Opportunities: The redesigned carousel opens avenues for sellers to maximize revenue by strategically featuring higher-value products. This allows for the artful placement of complementary items or upgrades, enticing customers to delve into additional product offerings.
  • Seamless User Experience: The updated module comes equipped with intuitive navigation features, ensuring a smooth and engaging shopping experience across various devices. This heightened usability is poised to elevate customer satisfaction, translating into increased conversion rates for sellers.

This redesign is an effort by Amazon to enrich the customers’ overall shopping journey. By embracing these latest updates and leveraging the advanced features, sellers can carve out a distinctive brand image, boost sales, and maintain a competitive edge on Amazon.

Go to the Premium A+ Module Guide for more details or visit A+ Content Manager to get started.

Related: 5 Best Amazon Listing Optimization Tips to Prevent Account Suspension, 5 Top Strategies for a Winning Amazon Product Launch

UPDATED: Amazon Faces Backlash for Alleged Abusive Practices

Amazon Faces Backlash for Alleged Abusive Practices

UPDATE 02/15/2024: In recent legal battles, Amazon finds itself entangled in two separate class-action lawsuits, both shedding light on alleged deceptive practices that have drawn the ire of consumers.

The first lawsuit, filed by California residents Jeffrey Taylor and Robert Selway, accuses Amazon of utilizing an algorithm to favor pricier products, impacting search results and the coveted “Buy Box.” Simultaneously, the second lawsuit revolves around a significant change to the Prime Video service, where the retail giant introduced ads and charged an additional fee for an ad-free experience.

Algorithm Favoring Pricier Goods

Filed in the US District Court in Western Washington, the first lawsuit accuses Amazon of violating WA state law by utilizing an algorithm to intentionally promote costlier items in its “Buy Box.” The proposed class action suit claims that Amazon’s algorithm prioritizes more expensive products over relevant items with lower prices and faster delivery times. 

The suit also claims that Amazon used its algorithm to boost sales of costlier goods sold by participants in its Fulfillment by Amazon (FBA) network, which includes third-party sellers. Additionally, the lawsuit alleges that Amazon shoppers overwhelmingly choose the company’s product recommendations, even if they are not the lowest-priced options.

As a result, “consumers routinely overpay for items that are available at lower prices from other sellers on Amazon—not because consumers don’t care about price, or because they’re making informed purchasing decisions, but because Amazon has chosen to display the offers for which it will earn the highest fees,” the complaint said.

This case follows a similar thread to the Federal Trade Commission’s (FTC) lawsuit filed five (5) months earlier in the same federal district court. The agency accused Amazon of employing anticompetitive and unfair strategies to maintain a monopoly, including preventing rivals and sellers from lowering prices and stifling innovation.

The potential financial liabilities Amazon may face remain uncertain, but could be substantial. Approximately 80% of the retailer’s customer base, amounting to 300 million subscribers, is believed to be from the US, and these customers are claimed to have overpaid on the majority of their purchases for the past seven years. In 2023, Amazon’s US sales surpassed $574 billion.

Related: Amazon Faces Tougher Scrutiny Under EU’s Digital Services Act

Prime Video Changes Lawsuit

In January, Amazon implemented a significant change to its Prime Video service by introducing ads and offering customers the option to remove them for an extra $2.99 a month on top of their regular subscription fee.

The class-action lawsuit, filed in California on February 9, claims that this change was deceptive and unfair, violating state consumer protection laws. The case argues that Amazon falsely advertised its Prime Video service as “commercial-free” for years to induce consumers to purchase its Prime subscription.

By introducing ads and requiring an additional fee for an ad-free experience, the plaintiffs argue that Amazon breached Washington’s Consumer Protection Law and California’s Unfair Competition Law, which prohibits “unlawful, unfair, or fraudulent” business practices.

Adding to the controversy, Amazon has reportedly removed Dolby Atmos and Dolby Vision from Prime Video. Now, access to these features comes at an additional cost of $2.99/month for users opting to eliminate ads. 

The lawsuit seeks $5 million in damages, restitution, and an injunction preventing Amazon from engaging in similar alleged behavior in the future.

Final Thoughts

These dual lawsuits mark another chapter in Amazon’s legal battles, reflecting the increasing scrutiny faced by the tech giant. As consumers and regulators alike raise concerns over anticompetitive practices and deceptive changes to services, Amazon finds itself in the crosshairs of legal challenges that could reshape its business practices and potentially impact the broader eCommerce landscape.
The outcomes of these lawsuits will be closely watched, as they may set important precedents in the ongoing debate over the responsibilities and accountability of major tech companies.

UPDATE 07/26/2023: A win for UK sellers! 🇬🇧💪

Amazon on Wednesday offered concessions to the UK Competition and Markets Authority (CMA) to settle an open antitrust probe.

In 2022, an investigation was launched by the CMA against Amazon, with claims asserting that the retail giant was engaging in practices that exploited its dominant market position, particularly concerning its marketplace operations.

The focal points of the British regulator’s inquiry revolve around three key aspects.

  • The questionable methods employed by Amazon to gather and utilize data from third-party sellers, and whether the company uses this intel to gain unfair competitive advantage in deciding what products to sell (for its own brands, for example) and how to set prices.
  • The investigation also centers on scrutinizing how the eligibility criteria for selling under the Prime label are established. Prime offers certain benefits, such as free and fast delivery, that are only available to Prime members, putting non-Prime users at a disadvantage.
  • Amazon’s “secretive and self-preferencing” process for selecting products in the “Buy Box.” The company uses a set of (undisclosed) criteria to determine which products are granted the coveted position of being the first choice in the “Buy Box.” For customers, this box holds prime real estate on product pages, offering convenient “Buy Now” or “Add to Basket” options exclusively from a particular seller, which could be Amazon itself.

To address these concerns, Amazon has offered to:

  • Restrict its use of data concerning marketplace sellers. By doing so, the retail giant aims to prevent any unfair advantage for its own retail business over other sellers within its marketplace.
  • Treat all products equally when Amazon decides which ones will be featured in the Buy Box. This proposal, if accepted, will grant sellers a fair opportunity to have their product offers prominently showcased in the coveted box, even when contending with Amazon’s own product offerings.
  • Allow sellers to directly negotiate their preferred shipping rates with Prime delivery service providers so that they can offer affordable delivery fees to customers.
  • Together with CMA, appoint an independent trustee to conduct regular compliance monitoring

The CMA is currently engaging in a consultation process regarding Amazon’s offers, prior to reaching a final decision on their acceptance. If accepted, Amazon would dodge yet another big antitrust case in Europe.

In December 2022, Amazon reached a final deal with the European Commission over similar antitrust investigations into its use of seller data, Buy Box algorithm, and eligibility criteria for Prime, thereby avoiding a fine of up to 10% of its total revenue.

Amazon may have survived these EU antitrust cases unscathed, but a bigger threat looms over its US eCommerce operations with the Federal Trade Commission (FTC) finalizing a lawsuit that could break up the company. See report below.

UPDATE 06/29/2023: Amazon could soon face a major antitrust lawsuit as the Federal Trade Commission (FTC) inches closer to taking action. 🥊

FTC chair Lina Khan and her team of investigators have dedicated months to finalizing a complaint against the dominant eCommerce firm. The complaint alleges that Amazon manipulates its influence by favoring third-party sellers who utilize its logistics services while penalizing those who opt not to, as reported by Bloomberg.

The agency is also currently conducting an inquiry into an algorithm responsible for selecting brands to feature in the highly sought-after “Buy Box” on Amazon.com. This means that if there are multiple offers on the same listing, one seller’s offer is given priority over others, allowing consumers to effortlessly add to cart in a single click, streamlining their shopping experience.

The anticipated antitrust lawsuit is similar to a 2020 report presented by a subcommittee within the US House, in which Khan was listed as a team member. These allegations also align with a concurrent antitrust lawsuit in Europe, accusing Amazon of granting preferential treatment to sellers utilizing its fulfillment services and leveraging sellers’ sales data to bolster its own retail operations.

In the event that the Commission successfully provides evidence of Amazon engaging in deliberate market manipulation within an industry where it possesses monopolistic influence, it opens the possibility for advocating for the company’s dissolution or restructuring. This stance also indicates Khan’s reluctance to accept concessions from Amazon – something that the company did to resolve the EU antitrust case.

Amazon reportedly reached a settlement where they agreed to modify their Buy Box practices and impose limitations on the utilization of data obtained from 3rd-party sellers on their online EU marketplaces.

However, when it comes to the US market, Khan has expressed clear opposition to adopting similar compromises. During her testimony to a Senate committee last year, she firmly stated that the FTC would strongly oppose and disapprove of such legal remedies.

This forthcoming lawsuit is not the first encounter between the FTC and Amazon.

Over the past couple months, the agency has initiated three distinct and unrelated cases against the eComm giant.

Amazon Braces for the Massive Antitrust Case

When Khan took over the FTC in 2021, she initiated a new approach to the agency’s antitrust probe of Amazon. She actively contributed to formulating key interrogative points for the investigative team, personally selected John Newman as co-lead investigator, and re-interviewed nearly 30 individuals employed by the retail giant.

Khan’s stringent stance and handling of the Commission earned her the ire of Amazon, accusing her of showing bias, and thus must recuse herself from the case. Amazon also tried to derail antitrust investigations by allegedly launching an offensive against the tech-focused antitrust legislation proposed by Congress, a source told Bloomberg.

In 2022, Amazon and other big tech firms invested $20 million in lobbying efforts, alongside initiating an ad campaign and mobilizing sellers in the home states of lawmakers to publicly resist the proposed bills.

Aside from criticisms, Amazon has also poached former FTC employees to gain intel, the NY Post reported.

According to informed sources, the former FTC officials who left the organization to pursue opportunities at Amazon have been greatly influenced by Khan’s distinctive managerial style.

Khan’s leadership approach has generated discontent among FTC employees, with certain staff members characterizing the 34-year-old chair as an authoritative figure with a management style that is deemed “tyrannical” and “abusive” according to the above referenced article.

“If people are displeased with leadership, it makes you more inclined to listen to offers,” former FTC chair William Kovacic told the NY Post.

While the ex-FTC employees are prohibited from working on the case, they can share insights into “key players, who is making decisions, the mood of the agency, prevailing attitude of enforcement, overall sense of how stretched an agency is in using resources, and many people they can deploy on a given matter,” Kovacic said.

All of this shows Amazon’s profound concern regarding the challenges posed by the FTC. The anticipated antitrust case accusing Amazon of playing favorites, in particular, holds the potential to have significant ramifications for the company. The outcome of this legal battle has the power to change the eCommerce landscape moving forward.

Amazon is under fire for allegedly copying top sellers for its private label business, manipulating the Buy Box algorithm, and price fixing. 🔥

Using Seller Data to Copy Products

Mounting evidence from investigative reports suggests that Amazon has deliberately utilized third-party seller data, such as sales velocity and customer information, to launch competing products and then rigged search results in their favor. 

In 2020, Wall Street Journal released a report detailing how some Amazon private label employees used data about independent sellers to create knockoffs despite it being both an antitrust and company policy violation. 

Amazon reps have denied these accusations. Former Amazon CEO Jeff Bezos himself told Congress in 2020 that the company forbids its employees from using exploitative practices to boost its private label business.

However, in March 2021, Peak Design company founder & CEO Peter Dering called out Amazon for releasing an imitation of its most popular product, the Everyday Sling Bag. 

In an interview, Dering told CNBC that Amazon “copied the general shape, they copied the access points, they copied the charcoal color, and they copied the trapezoidal logo badge. But none of the fine details that make it a Peak Design bag were things that they could port over because those things take a lot more effort and cost.” 🤦‍♀️

To poke fun at Amazon’s copycat ways, Peak Design posted a video that went viral and was even featured on John Oliver’s Last Week Tonight. The brand’s supporters bombed the knockoff version with negative reviews, forcing Amazon to have it removed from its private label catalog.

Another evidence that could prove Amazon’s anticompetitive behavior is its alleged covert strategy for its Indian marketplace in 2016. 

Published in October 2021, a report from Reuters shows that in India, creating copycats and manipulating search results to put the tech giant’s in-house products at the top were part of a clandestine strategy called the “Solimo” project, which was reviewed by two Amazon execs – Diego Piacentini and Russell Grandinetti – in 2016.

Based on the internal documents examined by Reuters, part of the Solimo strategy was to “use information from Amazon.in to develop products and then leverage the Amazon.in platform to market these products to customers.” The company also reportedly teamed up with the manufacturers of the products targeted for imitation to ensure their quality.

However, Amazon has again denied these claims saying that they are “factually incorrect and unsubstantiated” as Reuters was unable to provide a copy of the internal documents in question. 🤔

Amazon may continue to deny the allegations shown in these reports, but in recent years, more and more independent sellers have come forward to expose the company’s abusive practices. More on that in the next section.

Manipulating the Search Algorithm

According to a report from The Markup, a non-profit newsroom, Amazon places its own products and brands exclusively selling on the platform ahead of third-party sellers, even those with higher sales and customer ratings. 😦

For instance, a coffee grinder seller shared that after Amazon introduced a competing product from AmazonBasics and another from an exclusive brand, the products ranked high on search right away.

He believes that the products rank well because they’re an Amazon brand.

Amazon has long denied that it is giving preference to its own products over independent sellers on its retail site.

“We display search results based on relevance to the customer’s search query, irrespective of whether such products have private brands offered by sellers or not,” Amazon said.

However, the findings in Markup’s report seem to contradict this statement.

Apparently, the researchers could easily tell whether a product was an in-house or exclusive brand because in 7 out of every 10 cases, Amazon would place it first on the search results page.

“These listings are not visibly marked as ‘Sponsored’ and they are part of a grid that Amazon identifies as search results in the site’s source code. We only analyzed products in that grid, ignoring modules that are strictly for advertising.” The Markup explained.

So, it doesn’t matter if you’re a top seller with excellent customer ratings. When predicting the first spot, being an Amazon private label brand or exclusive brand influenced search ranking more than customer reviews or star ratings.

Unfortunately, Amazon making cheaper versions of the best-selling products from sellers and giving higher priority to them can hurt businesses, especially the little guys.

It demolishes the level playing field. And by Amazon eating into your market share, your sales may go down, which has a direct impact on your ranking and your business as a whole.

Price Fixing

Price fixing is an anticompetitive behavior where competitors agree to lower, maintain, or increase prices, thereby taking away the opportunity to compete freely in the market and to fix your price levels based on supply and demand.

On September 14, 2022, California filed a lawsuit against Amazon for forcing sellers and suppliers into inflating their prices. Those who fail to comply (e.g., sellers who opt to offer lower prices elsewhere online) may get penalized.

This has resulted in consumers paying for overpriced products for years, the state claims.

Filed by California state Attorney General Rob Bonta, the lawsuit aims to stop Amazon from “bending the market to its will at the expense of California consumers, small business owners and a fair and competitive economy.”

As usual, Amazon has denied any antitrust violation and claimed that a similar case in the District of Columbia was junked and that Bonta has got it all wrong.

“Sellers set their own prices for the products they offer in our store,” an Amazon spokesperson said in a statement.

“Like any store we reserve the right not to highlight offers to customers that are not priced competitively.”

California isn’t the only one that’s currently suing Amazon over price fixing, though.

In the UK, Amazon also faces a class-action suit to put a stop to its “secretive and self-preferencing” Buy Box algorithm, which the company uses to boost its own products (and sales).

Similar to the California case, this has made customers pay more by hiding better deals.

Seeking $1 billion in damages, the lawsuit will be filed by Hausfeld & Co by October 31st at the Competition Appeal Tribunal.

Sellers and Industry Groups Band Together to Fight Amazon

Many sellers and industry groups like Online Merchant Guild (OMG) have been organizing to launch antitrust probes into Amazon.

For instance, OMG recently won a sales tax lawsuit against Amazon in Pennsylvania court, thereby prohibiting the state and its marketplace facilitator, which in this case is Amazon, from collecting sales tax nexus that online remote sellers supposedly owe from previous years.

Meanwhile, since 2019, a group of sellers led by SmartScout CEO & Founder Scott Needham has been communicating their needs to the Justice Department and the Federal Trade Commission.

In a statement to Business Insider, Needham said: “We’re a group of sellers or kind of a movement,” 

“We are trying to unify the voice and just make sure that us who contribute to the Amazon marketplace are listened to as well.”

That may come true if the US antitrust bill, S.2992, is passed into law.

Amazon has also reportedly reduced its private label catalog due to poor sales and possibly to appease antitrust regulators. The company has also offered concessions to halt two EU antitrust probes, recent moves that could set more pro-seller changes in motion. 🚀

Amazon Cracks Down on Suspicious Reviews from Bad Actors, Sellers Express Mixed Reactions

In a recent move to enhance the integrity of its review system, Amazon appears to have initiated an automated process to remove product reviews from buyers who have been found to violate the platform’s customer review policy

Below is an email screenshot shared by a seller on social media. Several other sellers confirmed that they had also received similar messages from Amazon. The email stated that Amazon took action to remove product reviews from bad actors.

Sellers previously reported receiving such notifications back in October 2023, as seen on this YouTube channel hosted by My Amazon Guy. Another related report came out in December on the popular forum site, Sellers Ask Sellers. Interestingly, in May 2023, Amazon quietly removed hundreds of thousands of reviews from some of its own Amazon Basics listings, a move that at that time suggested that a purge could be coming soon for fake reviews. Five months later, the Federal Trade Commission (FTC) proposed a rule on fake reviews. If enacted into law, it will give the courts the authority to impose a hefty fine of up to $50,000 per violation on non-compliant individuals and possibly, eComm platforms themselves.

Aside from minimizing regulatory risk, Amazon’s recent move also aims to protect sellers from unfair practices, such as buyer extortion and fake reviews. However, this development has sparked diverse reactions among sellers who have received notifications regarding the removal of reviews associated with rule-breaking buyers.

In the comments section of this YouTube video, one seller expressed optimism, stating, “I hope they are working on cleaning up bad buyers. All they need to do is complain and get the right customer rep, and their account will be reinstated.” This seller highlights a longstanding concern among Amazon sellers about the potential misuse of customer service channels by buyers with malicious intent.

Another seller raised the issue of buyer extortion, stating, “Buyers know that feedback and reviews are important for a brand owner. All they need to do is leave a bad review/feedback, and most likely, they will get a refund. Some will even reach out and contact you, stating they will leave a bad review if they don’t get a refund or discount.” This practice of leveraging reviews for personal gain has been a challenge for honest sellers (and customers) on the platform.

While some sellers welcome Amazon’s efforts to remove bogus reviews and address buyer misconduct, there are concerns about the potential for errors in the automated process.

One seller commented, “It’s helpful until Amazon AI makes a mistake like they always do and tags your buyer account with nefarious reviews, leading to the suspension of your seller account.”

The lack of transparency in the removal process also raises concerns. Another seller from lamented, “I have received this as well. Unfortunately, we aren’t told what the review was.” This lack of information leaves sellers in the dark about the specific issues leading to the removal of reviews, making it challenging for them to address any potential underlying problems.

Despite the challenges, some sellers view the crackdown positively. One seller remarked, “It’s a warning to let sellers know that they’re becoming more aware of fake reviews and taking action. It’s generally good news. Sure – we want fake reviews removed from our listings and more so – bad sellers’ listings.”

As Amazon continues to refine its review removal process, sellers are hopeful that these measures will contribute to a fairer and more trustworthy online marketplace. However, the platform must balance its efforts to combat misuse with transparency and accuracy to ensure a positive experience for both sellers and customers.

Related: A Purge Could be Coming for Fake Reviews on Amazon

Roundup Post: Amazon Seller Tools Update and New Product Safety Requirements

Interesting updates are on the horizon for Amazon sellers. From a new line of credit offering from Amazon Lending and SellersFi to enhanced seller dashboard features, Amazon has released a range of tools to support the online selling journey.

Amazon Lending and SellersFi Line of Credit Solution

Qualified US sellers now have the opportunity to seek a line of credit (LOC) through SellersFi to support and expand their businesses.

Formerly known as SellersFunding, SellersFi is a global financial tech firm that provides financial solutions tailored for ecommerce entrepreneurs. Beyond providing funding and payment solutions, analytics and business insurance, SellersFi also offers services that were traditionally exclusive to banks, such as term loans.

Amazon Lending x SellersFi LOC Solution Features

  • Credit Limit: Qualified sellers have the chance to request a credit line with a maximum limit of up to $10 million. This substantial funding is designed to facilitate business expansion, new product launches, additional ad efforts, and assist with effective inventory management.
  • Flexible Repayment Terms: Acknowledging the diverse requirements of various businesses, the credit line offers customizable repayment terms. This adaptability allows you to align your financial commitments with specific business cycles and cash flow needs.
  • Interest-Only Period: To better accommodate the fluctuating cash flow patterns of sellers, SellersFi features an option for an interest-only period (the borrower’s only required to pay the interest on the borrowed amount during the specified interest-only timeframe). This choice alleviates the initial repayment burden, providing you with additional flexibility to foster growth.

Is LOC for You?

Of course, it goes without saying that only you have the ability to determine what financial funding is best for your business but here are some things to consider. 

This financing option proves particularly advantageous for ecomm businesses grappling with unpredictable cash flow. In situations where funds are not readily available, such as when ordering in advance for peak periods like Q4, the risk of stockouts and missed sales opportunities arise. Given the frequent occurrence of cash flow challenges in the ecommerce landscape, having a revolving credit facility becomes invaluable, offering on-demand access to funds during emergencies.

In addition, LOCs serve as an excellent solution for sellers with brief operating histories or less-than-ideal credit standings. Typically provided by non-bank financing entities, often referred to as fintech lenders, these LOCs present a streamlined solution for online application processes and securing working capital. However, they may come with interest rates significantly higher than traditional banks.

Currently, SellersFi is accessible to sellers operating on Amazon’s US platform. Sellers can assess their eligibility and submit applications directly through Amazon Lending.

Related: 5 Amazon Inventory Financing Options for Sellers

Update Your Listings with Supported Document Types by Feb 26

Starting from January 29, 2024, sellers seeking to upload product documentation to Amazon product detail pages will encounter restrictions. Amazon has announced this measure as part of its initiative to standardize product listings, streamlining the process for customers to access information about products. As a result, specific document types will no longer be supported by the platform.

“From January 29, 2024, you won’t be able to upload or edit the following unsupported document types on your product detail pages: 2D CAD, 3D CAD, Application Guide, Brochure, Comparison Chart, Compatibility Guide, FAQ, Size Guide, Specification Sheet, and Product Documentation.”

While existing unsupported document types will remain visible on product detail pages, Amazon has clarified that as of February 26, 2024, these document types will be removed both from product detail pages and Seller Central.

To quickly adapt to this change, sellers are advised to either transfer information from unsupported document types to the product description or re-upload content using a supported document type. As an illustration, Amazon suggests moving an “Application Guide” to a “User Guide” to ensure compliance with the updated guidelines.
For additional details and a complete list of supported document types, visit the About Product Documents page.

EU General Product Safety Regulation (GPSR) Update

Prepare for the impending GPSR update if you are an Amazon seller in the EU and Northern Ireland, as it is poised to enforce substantial requirements for a new requirement being introduced December 13, 2024.
Amazon, through an official communication on Seller Central, has highlighted the significance of this regulation for sellers dealing with most non-food consumer products. The GPSR update aims to elevate product safety standards and strengthen consumer protection in the market.

What to Expect

  1. Meet the current labeling and traceability requirements: Non-food products are required to adhere to prevailing labeling and traceability standards to ensure straightforward recognition and compliance with safety regulations.
  2. Assign a Responsible Person: A Responsible Person serves as your Northern Ireland/EU compliance representative for each product to manage regulatory adherence and act as a designated contact.
  3. Implement a comprehensive product labeling system: Products are required to display the contact details of the Responsible Person, manufacturer, and, if relevant, the importer. Additionally, the labeling should include information such as the product’s type, batch, or serial number. 
  4. Label products with safety information and warnings: Provide product safety information and warnings in the language corresponding to the country of sale, ensuring thorough communication with consumers.
  5. Display complete product label and safety information in online listings: Showcase the details of the Responsible Person, including their information, the manufacturer’s name, and contact details. Additionally, a product image and other identification details should be included. And as previously mentioned, include warning and safety information in the language corresponding to the country where the product is being sold.

What Some Sellers Have to Say

The sentiments expressed in the announcement post revolve around concerns and challenges faced by sellers on Amazon due to the implementation of the GPSR update in the EU and Northern Ireland, set for December 2024. Many are apprehensive about the practicality of the new regulations, especially regarding the need to update listings with responsible person information, safety details, and images.

Sellers express worries about the potential difficulties in updating listings, particularly for those who source products from manufacturers or wholesalers. Questions are raised about the manufacturer’s role in “labeling the products in the way which it will need to be labeled” and the implications if they fail to do so. 

In addition, there’s a shared concern about the potential impact on sales, especially if listings are not updated in time, and questions about the possibility of selling non-compliant products in the UK. Some sellers suggest that Amazon should introduce an option to remove or block listings for Northern Ireland if they don’t meet the new regulations.

Overall, the sentiment reflects a mix of uncertainty, frustration, and a call for clearer guidance and support from Amazon.

To ensure a seamless transition, Amazon encourages sellers to promptly address the initial four requirements. Additional guidance on fulfilling requirement #5 will be released by Amazon in Q1 of 2024, assisting sellers in updating their online listings and achieving full compliance.
For a more in-depth understanding and detailed guidance, visit the GPSR page on Seller Central.

Related: Unlocking European Ecommerce: A Comprehensive Guide to Global Ecommerce for US Sellers

New UK FBA Returns Dashboard Features

Amazon recently unveiled enhancements to its UK FBA Returns dashboard, introducing features aimed at offering you more detailed insights into customer return trends.

These updates are designed to help you gain a comprehensive understanding of “return grading results, refunded products and products that have been returned to Amazon warehouses,” enabling you to make informed decisions and refine your manufacturing, sales and reverse logistics strategies.

The newest FBA Returns dashboard update includes the following additions:

  • Identification of Frequently Returned Products: You now have the ability to pinpoint products that are returned most frequently. This feature assists in addressing specific items that may require attention in terms of quality, accuracy in description, or meeting customer expectations.
  • Detailed Return Reasons: Understanding the reasons behind product returns is crucial. The dashboard now provides detailed insights into the primary reasons for returns, allowing you to stop recurring issues.
  • Insights Breakdown by Product: Insights are now available at the product level, offering a granular view of return patterns for individual items. This facilitates targeted strategies to reduce returns on a per-product basis.
  • Customizable Reports: Generate customizable reports focusing on return trends, providing flexibility to concentrate on specific areas of interest or concern tailored to your unique needs.

This update represents a huge stride in Amazon’s commitment to enhancing the seller experience by providing reporting tools and data. Sellers leveraging these new returns dashboard features can better understand return trends, contributing to more effective management and optimization of their Amazon businesses.
To access these features, go to the FBA Returns dashboard on Amazon Seller Central.

Related: Tips to Improve Customer Experience and Reduce Returns

Identify Demand for Your Products in EU and Japan with this New Dashboard

Planning to expand in EU and Japan marketplaces? 

Amazon recently rolled out a new addition to its Marketplace Product Guidance tool — the Similar Products Dashboard. This tool empowers sellers by providing vital product insights, aimed at helping them understand and capitalize on product demand within the European and Japanese markets.

Compare Product Prices

Compare the prices of up to five similar products to gain competitive edge in crafting effective pricing strategies. This feature proves especially advantageous for sellers seeking to align their pricing with top competitors in Europe and Japan.

Moreover, the dashboard delivers invaluable data insights concerning sales and performance trends. These insights play a crucial role in granting sellers a good understanding of the market landscape, making swift and informed decision-making possible.

Reach International Customers

An additional noteworthy aspect of this update is the introduction of the Similar ASINs dashboard. This feature provides a concise overview of potential offers, greatly assisting sellers in expanding their global selling endeavors.

Overall, the dashboard can be a useful tool for sellers aspiring to broaden their influence and thrive in the global marketplace. Visit Similar ASINs Dashboard within Seller Central to explore the dashboard’s features. Alternatively, you can go to Marketplace Product Guidance or more details.

Check Subscribe and Save Eligibility for Your FBA Products

Amazon has introduced a new self-service feature that allows FBA sellers to instantly check the eligibility of their products for Subscribe & Save. This feature eliminates the need for sellers to contact support, streamlining the process for quick and efficient eligibility verification.

The new feature operates around the clock, providing sellers with 24/7 access to check the eligibility status of their FBA products at any time, offering convenience and autonomy in managing their Subscribe & Save offerings.

To utilize this self-service feature, sign in to Amazon Subscribe & Save > navigate to the “Check Subscribe & Save eligibility for FBA products” section > Enter the relevant product details and receive confirmation of the eligibility status within seconds.

Set a Window to Auto-Approve Buyer Cancellation Requests

You now have the capability to establish a specified time frame within which buyers can autonomously cancel their seller-fulfilled orders without requiring your intervention.

To illustrate, if a two-hour Buyer Auto-Cancellation Window is configured and a buyer decides to cancel their order within this timeframe, Amazon’s system will automatically cancel the order without requiring you to manually process the cancellation request within the designated window.

Conversely, if the cancellation request is initiated after the predefined time window elapses, the buyer must then formally submit a manual approval request, which you can then review and approve.

Note that once an order has been confirmed as “shipped” by the seller, buyers lose the option to cancel the order on their own.

Crucially, cancellations initiated by buyers within the configured Auto-Cancellation Window do not contribute to your order cancellation rate metric. This new feature aims to streamline the cancellation process for both sellers and buyers, enhancing efficiency and reducing the manual workload for sellers.

It May Not Be for Everyone

While the new feature minimizes the need for manual processing of cancellation requests, some sellers in this forum site express skepticism and caution regarding the use of this feature.

One seller voices strong opposition, stating they would never use such features, expressing concern about canceled orders, emphasizing the potential trouble it could cause. The seller illustrates a scenario where they might immediately ship orders within the cancelation window. It would not be possible then to inputting tracking numbers for shipped orders that may now be canceled without the seller’s knowledge. This could result in orders disappearing from the seller’s queue, leading to potential confusion and frustration.

The comments collectively convey apprehension about the unintended consequences of the Buyer Auto-Cancellation Window feature. Concerns revolve around the potential impact on order processing, tracking, and overall seller experience.

While some sellers express openness to the concept, others emphasize the need for caution, especially for those who do not use Amazon Buy Shipping and may face challenges in tracking and managing canceled orders effectively.

To learn more about this new functionality, go to the Cancellations FAQ section or access the General shipping settings within your Amazon Seller Central account. 

Related:4 Updates to Seller-Fulfilled Prime, New Amazon Features, Updates, and Requirements, Upcoming Amazon Changes and Features

UPDATED: Logistics Showdown: UPS and Amazon Battle for Supremacy

Update 01/14/2024: FedEx has just entered the end-to-end logistics arms race with its own ecommerce platform, fdx

In a corporate news post dated January 14th, the legacy carrier revealed plans for a groundbreaking ecomm platform set to debut this fall. This “data-driven commerce platform” promises comprehensive ecommerce solutions, empowering online sellers to seamlessly handle shipments, customer sales, fulfillment, and returns.

What is a Data-Driven Commerce Platform?

FedEx’s recent announcement is brimming with marketing jargon, emphasizing terms like “data-driven” and offering an “end-to-end ecommerce solution for businesses of all sizes.”

In ecommerce, data-driven management simply means using the data collected by a company to improve customer relationships. In FedEx’s case, participating sellers can leverage the carrier’s extensive logistics network and “insights from moving 15 million packages per day” to make smarter supply chain decisions (e.g., provide accurate parcel delivery dates, more cost-effective shipping routes), thereby allowing them to build stronger connections with customers.

While the announcement lacks specifics on how it plans to compete with Amazon, FedEx highlighted the utilization of its services like ShopRunner, acquired by FedEx in 2020, to enable sellers  to connect with customers, display estimated delivery times, manage shopping carts, track packages, assess the carbon emissions impact, and handle returns.

More importantly, FedEx emphasized that its focus is not on entering the marketplace business to serve consumers directly, but rather to provide sellers with digital capabilities they need to enhance their customers’ shopping experience.

What does this mean for Amazon? More competition.

This strategic move intensifies FedEx’s ongoing competition with Amazon, which saw the company opting not to renew a 2019 contract for the said rival. Amazon reciprocated by briefly barring Prime deliveries via FedEx during the holidays, citing performance issues. 

FedEx and UPS have both faced challenges from Amazon, with the ecomm giant surpassing them in US home package deliveries in 2022. This shift occurred shortly after Amazon developed an extensive logistics network utilizing third-party contractors. See report below.

Shared Opinions on FedEx’s Strategic Move

In the comments section of The Verge’s post on the topic, readers express a mix of skepticism and frustration regarding FedEx’s venture into e-commerce to compete with Amazon.

Complaints about the carrier’s past experiences, such as difficulties with returns and delivery mishaps, raise doubts about its end-to-end logistics capability. Some believe that FedEx’s sometimes inconvenient handling of certain packages may hinder its competitiveness, contrasting it with UPS. 

Others, however, welcome the prospect of increased competition for Amazon, hoping it will lead to improved service quality and customer experiences. A recurring theme is the need for reliable and customer-focused services, with varying opinions on whether FedEx can effectively challenge Amazon in the ecommerce arena.
As of this writing, fdx is presently undergoing a private preview, with an anticipated broader launch scheduled for the fall of 2024. Sellers interested in participating can express their interest through a registration form. Additionally, the company did not specify any brands currently involved in the pilot program.

The logistics industry, valued at $1.5 trillion, has traditionally been dominated by a select few major players such as USPS, FedEx, and UPS. However, over these last few years, Amazon has emerged as the frontrunner, surpassing both UPS and FedEx in parcel volume for 2022.

What was once dismissed as a legitimate threat by FedEx CEO Fred Smith has not only solidified its dominance but has also set new records, delivering an astounding number of packages across the United States.

This marked a pivotal moment in the ongoing competition for parcel delivery supremacy in the the country. UPS in particular, far from conceding defeat, is gearing up for a formidable counterattack, unveiling strategic initiatives to regain its foothold in the rapidly changing logistics arena.

Amazon’s Rise

The ascent of Amazon is nothing short of extraordinary, considering that as recently as 2014, it held no stake in the US parcel delivery market. The company relied entirely on legacy carriers such as FedEx and UPS for its delivery needs.

In the years that followed, Amazon made multi-billion dollar investments in constructing a massive fulfillment and logistics infrastructure, including warehouses, trucks, planes, and an extensive fleet of delivery drivers. By bolstering its in-house shipping capabilities, Amazon gradually diverted its business from reliance on other carriers.

The divergence in strategies became even more apparent when FedEx severed ties with Amazon in 2019. This move allowed FedEx to concentrate on optimizing its operations and enhancing profitability.

In 2022, UPS put shipping limits on Amazon to put more focus on B2B deliveries as eCommerce growth slowed down, allowing the eCommerce titan to win more marketshare.

Over the last three years, Amazon’s share of deliveries has steadily increased. From holding zero stake in the logistics market in 2014, the company grew to grab 21% market share in 2021, closely trailing UPS at 24% and surpassing FedEx at 16%. USPS, meanwhile, maintained its dominance with 38%.

Amazon’s rise led to a reshaping of the delivery service hierarchy, albeit with USPS still the top player, delivering packages for the three logistics giants.

Presently, the retailer continues to transform shipping from a mere cost center into a revenue-generating asset by extending its logistics empire as a service to non-Amazon eCommerce businesses.

Amazon’s Record-Breaking Delivery Numbers

Before Thanksgiving this year, Amazon had already achieved a remarkable feat by delivering more than 4.8 billion packages in the country. According to documents reviewed by The Wall Street Journal (WSJ), the company’s internal projections anticipate reaching a staggering 5.9 billion deliveries by the end of 2023.

To put this into perspective, Amazon shipped 5.2 billion packages in the previous year, underscoring the significant growth and efficiency of its delivery network.

As can be recalled, Amazon recently reached its fastest Prime delivery speeds ever, which Doug Herrington, the CEO of Worldwide Amazon Stores, attributes to the strategic overhaul of the retailer’s fulfillment model.

Herrington highlights the pivotal shift from a national fulfillment network to a more regionalized model as a key factor in this achievement. Amazon now operates its delivery network from 8 regions covering seperate geographical areas. Approximately 76% of all US orders now are fulfilled from the region in which the order originated. These strategically located facilities are stocked with a diverse array of products, facilitating prompt delivery to nearby locations while maintaining the ability to dispatch items efficiently to transfer between regions based on location demand.

Beyond the structural changes, Amazon has implemented a series of enhancements to its last-mile delivery process. This includes:

By shortening the distances certain products need to travel and making improvements to the Partnered Carrier program, Amazon has not only achieved ultrafast delivery but has also managed to curtail transportation costs, further solidifying its commitment to efficient and cost-effective logistics solutions.

Related: Amazon Enters the 3PL Space with Amazon Warehousing and Distribution

Comparative Analysis with UPS and FedEx

For context, UPS has acknowledged that its domestic volume for the current year is unlikely to surpass the 5.3 billion packages delivered in the previous year. This total includes packages delivered to customers through collaboration with the postal service. In the first nine months of 2022, UPS handled approximately 3.4 billion parcels domestically.

FedEx, on the other hand, reported that its domestic Express and Ground parcel volume reached around 3.05 billion for the fiscal year ending May 31, 2023. While FedEx and UPS have consistently downplayed the importance of engaging in a volume race, and have instead put more focus on delivering more profitable parcels, Amazon’s ascent to the top cannot be ignored.

UPS Counters Amazon’s Dominance with Bold Moves

The battle for supremacy in the logistics arena has reached new heights, with UPS actively positioning itself to dethrone Amazon.

Beefing Up its Returns Network

The legacy carrier recently acquired Happy Returns, a reverse logistics company, thereby adding over 10,000 box-free locations to its US returns footprint, one of the keys to building a robust logistics business.

Why it matters?

  • Shoppers seek returns that are simple, convenient, and free of hassle, often influencing their buying choices based on a store’s return policy. Consumer reseach reveals that 87% of online shoppers deemed free returns as a crucial factor in their purchasing decisions, ranking it as the most preferred return option. Notably, over 30% of the respondents acknowledged their likelihood of abandoning a brand due to the absence of convenient return methods. Additionally, 70% of individuals engaging in online shopping expressed willingness to pay more for convenient returns experience and that brand loyalty increases with the offering of more eco-friendly and sustainable processing.
  • With merchandise returns approximating 8.5% of overall retail sales in 2023, UPS aims to address the rising costs for retailers by optimizing return processes and minimizing environmental impact.

The acquisition also allows UPS to compete with Amazon’s evolving return policies, emphasizing the importance of easy returns for increased shopper loyalty.

In a blog post, Happy Returns outlined its plans to amplify and expedite its returns process through a strategic collaboration with UPS. The company highlighted the appeal of UPS’s substantial capacity and operational efficiency, emphasizing that while UPS manages millions of packages daily, Happy Returns processes a comparable volume in just one month.

In addition, UPS’s expertise in box-free, in-person drop-offs through a third-party network with prominent brands and its utilization of automation at its package sorting facility in Louisville, Kentucky, adds an additional layer of advantage to this partnership.

Happy Returns, now part of UPS, offers a convenient solution for retailers and consumers, leveraging over 5,200 UPS neighborhood store locations for returns processing, providing a hassle-free experience.

Offering a Major Pay Bump

In August 2023, UPS reached a landmark five-year agreement with the Teamsters Union, heralded as a ‘new benchmark in the labor movement.’

The agreement between the legacy carrier and the Union resulted in salary increases for all 340,000 package handlers and delivery drivers within the supply chain company. Full-time drivers are now earning approximately $170,000 annually in pay and benefits.

Every UPS union worker is slated to receive a $2.75 per hour salary increase this year, followed by incremental wage raises totaling $7.50 per hour over the next five years. These adjustments will elevate UPS’s average top rate for its unionized full-time drivers to $49 per hour, establishing them as the highest-paid delivery drivers in the United States.

This development brought positive news for UPS drivers, and predictably some Amazon Delivery Service Partner (DSP) drivers are now contemplating a potential shift to UPS, given these recent improvements in compensation.

The hiring website for Amazon’s DSP program outlines that drivers under this program can anticipate a workload of 40 hours per week, comprehensive benefits, competitive compensation, and access to a vehicle, among various other offerings.

Two drivers, in conversation with Business Insider, indicated that their hourly wages now stand at approximately $18 following recent pay raises, a stark contrast to UPS’s $49/hour rate for full timers.

“I think it puts Amazon in this situation where they’re going to have to decide if they want to keep quality drivers or not,” a delivery driver told the news outlet.

Suppose DSP drivers start shifting over to UPS, the legacy carrier will likely gain a competitive edge (vs. Amazon) in growing their labor force toward handling increased shipment volumes, enhancing efficiency, and potentially offering more diversified and flexible services. For example, some vehicles may be optimized for last-mile delivery in metropolitan areas, while others may be designed for long-haul transportation.

The larger fleet allows UPS to optimize routes, improve reliability during peak periods, and strengthen its market share and competitive positioning. This advantage may lead to strategic pricing, increased brand trust, and a broader geographic reach, influencing the dynamics of the logistics and package delivery market.

Looking Ahead

Amazon’s reported figures encompass only packages that the company handles entirely from start to finish. In contrast, UPS includes packages they give to the postal service for the final leg of delivery in their volume calculations. This distinction emphasizes Amazon’s end-to-end control and streamlined logistics process.

But according to JP Morgan analyst, Brian Ossenbeck, despite the company’s dominance in last-mile delivery, it has not managed to replicate the expansive global coverage or the complementary aspects of operations exhibited by both UPS and FedEx.

Ossenbeck emphasizes this distinction, stating, “Amazon excels in the one-way network, efficiently delivering goods at accelerated speeds, but it lacks the equivalent level of pick-up and delivery coverage found in its counterparts.”

Nevertheless, Amazon’s surpassing of UPS and FedEx in parcel volume for 2023 signifies not only a milestone for the company but also a transformative moment in the competitive landscape of the last-mile logistics industry. The eCommerce giant’s relentless pursuit of excellence and innovation has propelled it to the forefront, cementing its position as the country’s premier delivery service.

Related: Amazon and Flexport Vie for End-to-End Logistics Supremacy, Battle for Last-Mile Logistics Heats Up as Amazon Expands Same-Day Delivery Network

Preparing for Change: Higher Fees on the Horizon for UK/EU FBA Sellers in 2024

Amazon just announced the upcoming fee changes for UK and EU sellers. In many places, the announcement cited increased cost of improved, faster shipping service to customers as the reason for the fee increases. It was also stated that these 2024 fee changes were designed to reduce “our collective costs.”

While there are some fee reductions in fulfillment, there are others that, in many places for many sellers, will more than offset any savings provided. 

Sellers in the comments section of the announcement post expressed frustration and concern about Amazon’s latest round of price hikes. Many mention the impact on their businesses, including the previous loss of Small & Light, being forced use of Amazon Buy Shipping, and increased Royal Mail prices, leading to decreased profitability.

Some sellers are considering diversifying their sales channels due to these challenges, while others criticize Amazon’s customer expectations and support quality despite implementing a yearly increase in fees. Overall, sentiments reflect dissatisfaction and a sense of financial strain caused by the fee changes and evolving policies.

2024 EU FBA Fee Changes at a Glance

  • While many FBA fulfillment fees are increasing in many countries and across the European Fulfillment Network, domestic fulfillment fees in Germany, France, Italy and Spain will not change.
  • Seller return, disposal and liquidation fees to undergo a major changes beginning February 5, 2024. Local return-to-seller fees will increase and most cross-border returns will do the same with the exception of a couple of lower tiers.
  • Amazon introduces a new returns processing fees for high-return-rate products without addressing within the policy any accountability for fraudulent customer returns or Amazon-at-fault returns. Effective October 1, 2024.
  • The monthly storage fees for peak and non-peak periods will increase on average by 10% starting March 1, 2024.
  • On February 15th, the aged inventory surcharge to increase by over 100% for most tiers.
  • On June 1, 2024, Amazon will implement new fee tiers for the storage utilization surcharge, extending its application to Professional sellers exceeding a storage utilization ratio of 22 weeks.
  • There is no “inbound placement fee” similar to what US sellers have experienced.
  • It appears that the low-level inventory fee is only relevant to pan-EU inventory.

FBA Fee Changes: The Yearly Seller Squeeze

The FBA fees remain steady in Germany, France, Italy, and Spain. Yet, in the UK, the Netherlands, Sweden, Poland, and Belgium, the domestic fees will experience a per unit shipped increase, ranging from:

  • £0.08 to £0.09 for Standard Envelope
  • £0.2 to  £0.23 for Small Parcel
  • £0.19 to £0.35 for Standard Parcel
  • £0.26 to £0.48 (+ £0.01 per increase kg) for Standard Oversize
  • £0.54 to £0.72 (+ £0.01 per increase kg) for Large Oversize

Meanwhile, rates remain unchanged for Small Envelope and Special Oversize. Moreover, 

the Remote Fulfillment fee for shipments from France, Germany, Italy, and Spain to the UK will be lowered, whereas the fees for the EU Fulfillment Network and Remote Fulfillment from the UK to the EU will remain the same.

However, all of the EU fulfillment fees, come with caveats that you will want to be aware of in the footnotes of each rate table, including Amazon reserving the right to make fee adjustments within the EU network when foreign exchange rates change. 

Refer to the rate table for details on these adjustments.

Pan-EU Low-Level Inventory Fee

Commencing April 1, 2024, a low-inventory cost coverage fee will be imposed on standard-size products fulfilled through the Pan-European FBA (Pan-EU) program when inventory units fall below 28 days relative to shipped units in Germany, France, Italy, and Spain. 

As explained in our 2024 US FBA Fee Changes blog post, the low-level inventory fee is a fulfillment charge tied to the total days of supply at FBA, distinct from a storage fee. It is incurred only upon selling your inventory, triggered upon the fulfillment of the penalized units. The fee ranges from €0.06 to €0.54 per unit.

According to Amazon, the low level inventory fee is charged only when both the long-term (last 90 days) and short-term (last 30 days) historical days of supply are less than 28 days; otherwise, sellers won’t face this fee. For instance, if your product’s short-term historical days of supply surpass 28 days while the long-term historical days of supply is below 28 days, the low-inventory fee will not be applicable.

The following sellers are also exempted from this fee:

  • Professional sellers who are new to Pan-EU (for the first 365 days after the first Pan-EU active date).
  • Seller-FNSKUs that are new to Pan-EU (for the first 180 days after the first Pan-EU active date).
  • Pan-EU seller-FNSKUs with less than five weekly units sold across Pan-EU stores in Germany, France, Italy and Spain.

To avoid or minimize the impact of this fee, enhancing the accuracy of your demand forecasts to prevent low inventory levels will be crucial. You may also want to consider adjusting advertising or pricing temporarily to navigate potential surges that can lead to stockouts or low-inventory fees.

Go to FBA Inventory to keep an eye on your historical days of supply.

Monthly Storage Fee Changes

Effective March 1, 2024, there will be an increase in monthly storage fees for oversize products and clothing, shoes, and bags from January to September. Additionally, monthly storage fees for all products, except dangerous goods, will increase from October to December.

Amazon will also introduce new fee tiers to storage utlization surcharge on June 1, 2024. From having 3 fee tiers (below 26 weeks, 26-39 weeks, and 39 weeks), professional sellers may now be charged a fee if their utilization ratio falls between 22-52+ weeks of total catalog-wide volume. 

Meeting the criteria for the surcharge means it will be added to your base monthly storage fee, leading to an increase in total storage costs. 

This surcharge is based on the daily average volume, meaning the total amount of storage space that your FBA inventory occupies in FBA. As this is not on a per SKU basis, only sellers with very low volume or very high stagnant inventory will likely face this fee.

January-September Storage Utilization Surcharge

October-December Storage Utilization Surcharge

FBA Aged Inventory Surcharge

Another fee that’s tied to your storage is the aged inventory surcharge, which is set to increase by a little over 100% on February 15, 2024. This fee applies to inventory that has been stored over 270 days at FBA.

Pro tip: Check out our Attack of the Fee Stack white paper to learn how to minimize or avoid these storage-related fee increases.

FBA Return to Seller, Disposal and Liquidation Order Fees

Starting on February 5, 2024, seller return fees will get more expensive by around 40%.

Return to Seller Fees

Disposal Order Fees

Liquidation Processing Fees

This fee is on top of Amazon’s 15% liquidations referral fee, which is calculated based on the item’s gross recovery value, while the liquidation processing fee is based on the item’s size and weight.

Related: 5 Best Options to Quickly Liquidate Amazon Inventory

Pan-EU FBA Oversize Eligibility Updates

Effective July 1, 2024, Amazon will revise the Pan-EU FBA surcharge eligibility for oversize products.

This surcharge is currently applied to the local fulfilment rates for the fulfilment of all oversize items via the Pan-EU program. Luckily, it could be waived in France, Italy and Spain if the eligible inbound destination is the same as the country of sale. Germany used to be exempt from this fee but will now see oversize surcharges if inbounding into a country different than the country of sale. 

Failure to inbound Pan-EU inventory in the eligible sales country may prompt Amazon to distribute your units among EU fulfillment centers or fulfill remotely from enabled countries, incurring higher operational costs and slower delivery speed.

According to Amazon, eligibility will be based on “a new metric called the historical inbound-sales quantity.” It’s defined as the difference in the historical inbound receive quantity and the historical sales quantity for a given seller-FNSKU in a Pan-EU store. For a given store, the surcharge will apply to Pan-EU shipped units that are sold in the following week, only if the long-term (last 150 days) and short-term (last 30 days) historical inbound-sales quantity is less than zero.”

Sample calculation below:

If both the long-term and short-term historical inbound-sales quantity of the product sent in France are below zero, you will likely incur the Pan-EU oversize surcharge.

Pan-EU store: FranceSize tier: Large oversizeShipping weight: ≤ 9.76 kg
Historical inbound-sales quantityHistorical inbound-sales quantity: < 0Long-term historical inbound-sales quantity: < 0Short-term historical inbound-sales quantity: < 0
Total fulfilment feesStandard FBA fulfilment fee: €20.60 per unit (standard rate for the size tier and shipping weight)
Pan-EU surcharge for oversize items: €2.96 per unit (rate for < 0 historical inbound-sales quantity)
Total new FBA fulfilment fees: €20.60 per unit + €2.96 per unit = €23.56 per unit

To mitigate or eliminate the Pan-EU surcharge for a product with a historical inbound-sales quantity below zero, Amazon recommends adjusting your inbound destination. This may help to adjust the long or short-term quantity to a positive, so that the Pan-EU surcharge won’t apply. 

Other Upcoming Changes

  • Returns Processing Fee. On October 1, 2024, a returns processing fee, ranging from £1.71 (small envelope) to £36.87 (special oversize) per unit, will be imposed for high-return-rate products across all categories, excluding clothing and shoes. (Clothing and shoes returns processing fees will apply for each unit returned as usual.) This fee aims to manage operational costs and minimize waste, and is applicable only to products exceeding a specified return rate threshold within each category.

    The return rate assess the monthly fees based on the number of shipped units per product within that month compared to the number of returned products within that month and the subsequent two months. For example, October fees will be assess by reviewing returns in October, November and December.

    The initial charge is scheduled between December 7th and 15th, 2024. In October, you will be able to go to FBA Customer Returns dashboard to review your product’s return rate. Given the effective date of this fee change, sellers will have Q1-3 to optimize their product catalog to reduce returns liabilities. However, rate thresholds will not be revealed until August 1, 2024 and the dashboard won’t be available until October 1st.
  • FBA New Selection Program Changes. Set to take effect on March 1, 2024, Amazon will continue to offer up to 10% rebate on sales of eligible brand-registered parent products that are new to FBA. The retailer will also provide sellers with eligible oversize products with rebate benefits on up to 50 units (previously 30 units) per parent product. A lower IPI score for eligibility will also soon apply, from 400 down to just 300.
  • Lower FBA Fees for Ships in Product Packaging (formerly Ships in Own Container). Items approved for this program will enjoy reduced FBA fees automatically. Amazon may certify products if their packaging aligns with program guidelines, or items can be enrolled when packaging is adjusted to meet these criteria. Click here to view the updated rates.

Final Thoughts

In light of this announcement, sellers are urged to strategize and optimize for these shifts to maintain profitability amid changing policies.

While all of these fees add more complexity to an already labyrinthine web of FBA expenses, if you look a little deeper, you will see the need for continued focus on storage and shipping optimization as Amazon takes a more laser targetted approach to cost offsets. Rather than higher fulfillment costs across the board for all products and sellers, brands are beginning to be hit with fees based on more complex inventory behaviors.

Navigating through new fees and price hikes demands heightened attention to inventory management. From Low-Inventory-Level fees to expanded Storage Utilization Surcharges, balancing understocking and overstocking in FBA becomes even more crucial to avoid incurring added costs. Precise insights into sell-through rates and demand are essential for optimizing costs amidst these FBA adjustments.

Major eComm Players Making Big Changes to Take on Amazon

Update 12/12/2023: Amazon is opening an innovation hub in Shenzhen, China’s Silicon Valley, to help Chinese sellers reach global customers, and simultaneously thwart the rise of eComm challengers Temu, Shein, and TikTok Shop in the US.

Establishing a Foothold in China’s Silicon Valley as Rivals Gain Momentum

During the Amazon Global Selling Seller Conference held in Shenzhen on Tuesday, Amazon revealed the inauguration of its inaugural Asia-Pacific innovation center in Qianhai, marking a significant milestone as the company’s first-ever tech hub globally.

The center will serve as a hub for Amazon Global Selling’s industrial organizations, third-party service providers, supply chain experts, and suppliers to help sellers in the region “build brands, promote products and digitalize operations,” essentially taking aim at the third-party seller marketplace of Shein and Temu.

During the conference, AGS conducted a comprehensive review of the progress and accomplishments of Chinese sellers on Amazon over the past year. Additionally, it unveiled its strategic roadmap for 2024, comprising five key business strategies, along with the introduction of an array of new tools and enhancements to seller services.

As part of its expansion initiative, AGS announced the establishment of five regional centers strategically located in East China, South China, West China, North China, and Central China. 

Adding Brazil to its roster of destinations for Chinese sellers, Amazon intensifies its presence in Latin America, sparking heightened competition. Shein, a fast fashion giant, designated Brazil as its manufacturing and export hub for the region in April. Concurrently, Temu, an emerging online shopping platform under Pinduoduo, established its footprint in the country in June.

Amazon is also taking it a step further by making Supply Chain by Amazon, the company’s automated suite of supply chain solutions, accessible to Chinese sellers.

Fueling the Rise in Power of Chinese Amazon Sellers

These strategic moves align with Amazon’s recognition of the expanding potential within the “Made in China, sold on Amazon” market.

In the period leading up to the end of September, the eComm giant witnessed a surge of over 20% in the number of items sold by Chinese sellers, with a nearly 30% increase in the number of Chinese sellers achieving revenue of US$10 million.

Moreover, Marketplace Pulse reports that nearly 49% of the top Amazon sales are from China compared to 32% two years ago.

This influx of emerging Chinese sellers is steadily gaining traction as Chinese sellers have increased their market share of Amazon GMV by 8% over the last 5 years from 20.4% in 2019 to 28.4% in 2023.

Apart from the detrimental impact of increasing competition on US sellers, the growing presence of Chinese brands exacerbates the prevalence of counterfeit goods on the platform, and potentially, subject even more honest sellers to abusive practices by bad actors.
What’s even more concerning is that counterfeiting has the potential to erode buyer confidence in the marketplace’s product authenticity over time. Overall, this trend serves as a compelling wake-up call for American brands, urging them to proactively establish and maintain their presence on Amazon, increasing the necessity to scale faster and more efficiently.

Amazon is facing tougher competition from retail rival Walmart and the rapidly spreading popularity of Chinese online shopping apps Temu, TikTok and Shein.

Dubbed Amazon challengers, these companies have reportedly been accelerating their efforts to grow their ecommerce marketplace by providing third-party sellers with extensive resources to sell and deliver products to customers.

Walmart, for example, just reached 100,000 active sellers and continues to increase its market share by building automated small warehouses within its legacy stores, beefing up its advertising business, and announcing new pro-seller programs, just in time for the holidays. 

On August 30, America’s largest retailer hosted its first seller summit, unveiling marketplace expansion plans and an array of tools designed to streamline the selling experience for sellers on its platform. These include:

  • Extending the company’s marketplace presence to Chile, marking its first venture beyond the borders of North America. 
  • Adding more brand shops available on its website, offering sellers the opportunity to craft unique digital storefronts that showcase their standout products.
  • Waiving peak season storage fees for sellers who manage to store their holiday inventory in Walmart’s facilities before October 1st. 

Aside from revamping its fulfillment services, Walmart is also actively exploring metaverse opportunities that seamlessly bridge the gap between ecommerce and its physical stores.

To illustrate, customers now have the option to purchase identical items for their physical homes as they would for their virtual houses within the House Flip mobile game. In this game, players can engage in home renovations and virtual property sales. In addition, shoppers can acquire virtual clothing items inspired by Walmart’s fashion brand, Scoop, within Zepeto, a mobile virtual universe enabling players to craft and personalize their avatars. 

Sellers who see the benefit in these new initiatives would be smart enough to stock up more inventory within Walmart, which could then help the company to finally encroach upon terrain (logistics) once dominated by Amazon.

Increasing customer interest in Temu and Shein

Recent data from Consumer Edge (CE) shows a rising trend of shared customers between Amazon and these emerging Chinese online stores.

This growing interest coincides with Temu and Shein’s expansion in the US market, which began in 2022. The rapid growth can also be attributed to their “low prices, not fast shipping” offerings. The Wall Street Journal (WSJ) reports that inflation-fatigued American consumers are becoming more patient, willing to wait for their purchases if they offer significant savings. 

In fact, over the last three months, 5% of Amazon’s customer base ventured into Temu for a purchase, while 4% opted for Shein, according to CE. Interestingly, those who frequently shop on Amazon exhibited a greater inclination to explore these new entrants. This suggests that people with a penchant for online shopping are more likely to diversify their shopping experiences. In addition, more than 6% of consumers who engaged in over 20 transactions on Amazon in the past three months also chose to make purchases from Temu and Shein.

Shein’s recent efforts are aimed at fast-fashion customers, specifically Gen-Zs. The company just released new collections from its Designer Incubator program, which guides fashion designers through the end-to-end supply chain process, from product development to manufacturing to marketing to logistics.

The fast-fashion store also recently announced its partnership with Forever 21. Under the terms of the arrangement, Shein may eventually establish in-store boutiques within Forever 21 locations, while Forever 21’s clothing line could also become available for purchase on Shein’s online platform.

Meanwhile, Temu has reportedly muscled out Target and Shein in web traffic, but the company “has got a long way to go to catch up to Amazon,” as per Comscore, the eComm giant still holds the top stop by a wide margin, and might stay that way for a while.

Within Amazon’s leadership, discussions are ongoing about the possibility of enhancing the visibility and accessibility of bargain deals on the platform in response to the rapidly increasing customer interest in Temu and Shein.

TikTok braces for battle with Amazon and Walmart

The social media giant has officially entered the US eComm space in September of this year following the launch of its own marketplace platform, TikTok Shop

As part of its expansion strategy, the company introduces new site functionalities, including a dedicated shop section on the home screen, interactive live video shopping, affiliate programs tailored for content creators, and shoppable ads.

TikTok uses Shopify to offer eComm solutions to sellers and facilitates seamless integration with Feedonomics (listing management system) WooCommerce (eComm plugin for WordPress), Salesforce Commerce Cloud, BigCommerce, and Magento. 

When it comes to customer service, TikTok links up with Zendesk, Gorgias, and 1440. Additionally, for print-on-demand merchandise, it partners with Printful, Printify, and NovaTomato. And to gather reviews, TikTok collaborates with Yotpo. Lastly, TikTok ensures efficient shipping through WeeBee, Flowspace, and Easyship.

Based on internal documents reviewed by Bloomberg, the social commerce app is also reportedly strategizing to provide huge holiday season discounts that are set to kick off as early as October. The company hopes that these holiday deals “can attract consumers to its newly launched marketplace as it aims to compete with Amazon and Walmart.”

However, while TikTok may appear armed and ready for its eComm showdown with Amazon, its efforts to establish itself as a shopping hub are already facing difficulties that could hinder success.

Industry insiders told Fortune that the abundant number of inferior products on Tiktok Shop, coupled with the company’s stance on customer data handling, is causing potential partners (sellers, influencers, or marketers) to hesitate.

During Fortune’s initial exploration of the marketplace, the product assortment appears to be heavily leaning towards the lower price range, with the first seven items featured were made in China and priced below $20.

For marketers and influencers seeking to maintain a premium brand image and avoid associating with subpar products and counterfeits, this might serve as a deterrent. 

To address this issue, TikTok is “working on onboarding some really great (American) partners that they have shared. So I think we’ll continue to see [Shop] get better and better,” said Haley Galler, head of talent at Shine, an influencer management company.

TikTok’s “overly complex” onboarding process and inaccessible customer data are also turning off some brands.

In an interview with Fortune, Ann McFerran, CEO and founder of cosmetics company Glamnetic, said that TikTok refuses to give her shop access to customer data. 

“They’re going to start generating actual revenue and taking credit card information from all these users, [but] not sharing it with the actual brands,” McFerran said.

The absence of data access could pose major challenges for sellers looking to build relationships with their customers. Moreover, the collection of private information, such as credit card details and mailing addresses, by a China-owned company, might introduce additional complexities.

TikTok is already in the crosshairs of US lawmakers amid concerns that the China-owned app could potentially compromise the privacy of American users. However, the company has maintained that it does not share protected data of US users with the Chinese government.

Who should Amazon be most concerned about?

Walmart remains as the top eCommerce rival, with its fast-growing fulfillment network, expanding marketplace features, and booming ad business. The retailer is essentially taking a page out of Amazon’s playbook, but with seemingly more seller-friendly initiatives, i.e., waiving peak season storage fees.

TikTok is a noteworthy contender, especially due to its popularity among younger shoppers and live streaming capabilities. However, the marketplace is currently littered with cheap buys and knockoffs that brands may not want to associate themselves with. If customers wanted goods from China, they could simply opt to stick with Temu and Shein.

Overall, these emerging China-based shopping apps still have a lot of potential to play a major role in Americans looking for an easier way to buy goods at bargain prices. But whether these stores can consistently meet customer delivery expectations is still up for debate. 

It’s likely that 10 to 20 years down the road, we’ll reflect on one of these eComm players as  now a colossal company, despite falling short compared to Amazon in 2023. This prospect bodes well for both sellers and consumers.

Brace for Higher FBA Fees in 2024

Amazon has just dropped a bombshell announcement – the eCommerce giant is implementing its most significant FBA fee changes to date. Strap in, as we unravel the layers of this fee adjustment puzzle, dissecting how each update may impact your margins. 

2024 FBA Fee Changes at a Glance

In a corporate blog post dated December 5, 2023, Dharmesh Mehta, Vice President, Worldwide Selling Partner Services, said Amazon is implementing the following referral and FBA fee changes in 2024:

  • Commencing on March 1, 2024, an inventory placement fee will be imposed on each item shipped into FBA, ranging from $0.21 to $0.68 per unit for standard size items and $2.16 to $6.00 for oversize items.
  • Effective April 15, 2024, Amazon is reducing FBA fees for most items, notwithstanding the introduction of the new placement fees which will actually create a net increase overall.
  • Starting April 1, 2024, FBA sellers will be subject to low-inventory-level fees for standard size items that have less than 28 days of inventory. So, apart from incurring overage fees for excess inventory at Amazon, sellers will also have to pay a fee if their inventory stored at FBA falls below a certain threshold.
  • Effective January 15, 2024, Amazon is implementing a reduction in referral fees for apparel products with prices below $20.
  • Amazon seems to be replacing the “Oversize” size tiers by rebranding them “Large Bulky-size”.

Inbound Inventory Placement Fee

Applicable to both standard and large bulky-sized items, this fee covers the cost of transporting  your shipments from an initial receiving center to several fulfillment centers (FCs) across the country. Bringing inventory closer to urban centers allows Amazon to provide faster delivery speeds at a lower outbound transportation cost. 

While this change may benefit Amazon and customers, it could increase seller inbound fees significantly. Then again, it may be that in some instances, only needing to ship to one single location rather than multiple could make up for the fee in actual shipping cost savings.

When shipping inventory to a single location, expect to pay $0.21 to $0.68 per unit fee for standard size and $2.16 to $6.00 for large bulky products. The impact of this fee adjustment could be extremely rough on sellers who are already facing major profit erosion due to all of the FBA fee increases made earlier this year.

Note: Amazon is replacing Inventory Placement Service (IPS) with this new inbounding program on March 1, 2024, essentially subjecting most sellers to additional shipping costs instead of giving them the option to sign up for a paid service like IPS.

Standard Size Placement Fee Rates (starting March 1, 2024)

SizeWeightPremium FBA Inbound Placement Service Fee (send to a single location)Discounted FBA Inbound Placement Service (Send to multiple locations)
Small standardMax 15x12x0.75 inches16 oz or less$0.21-$0.30Receive up to 100% discount based on number of shipments and inbound locations.
Large standardMax 18x14x8 inches12 oz or less$0.23-$0.34
12+ oz to 1.5 lb$0.27-$0.41
1.5+ lb to 3 lb$0.32-$0.49
3+ lb to 20 lb$0.42-$0.68

Large Bulky Size Placement Fee Rates (starting March 1, 2024)

SizeWeightPremium FBA Inbound Placement Service Fee (send to a single location)Discounted FBA Inbound Placement Service (Send to multiple locations)
Large Bulky Size
Max 59x33x3 inches
5 lb or less$2.16 to $2.67Receive up to 100% discount based on number of shipments and inbound locations.
5+ lb to 12 lb$2.55 to $3.15
12+ lb to 28 lb$3.19 to $3.95
28+ lb to 42 lb$4.13 to $5.11
42+ to 50 lb$4.85 to $6.00

These charges apply when sending shipments to a single FC. Those who want to send their products to multiple inbound FCs themselves may opt for Amazon’s discounted inventory placement service for a reduced fee or no fee, depending on the number of shipments, current inventory levels at FBA, and target inbound locations.

Pro tip: When creating a shipping plan, compare the total cost of sending in 3 shipments (i.e., Texas, California, and Florida) versus the cost of 1 shipment to see which is more profitable for your business. Your account will then be charged a fee 45 days after receipt of your inventory by Amazon.

Alternatively, you may sign up for Amazon Warehousing and Distribution (AWD), the retailer’s low-cost upstream bulk storage solution, to completely avoid these inbound placement service fees. However, do so cautiously, as sellers have shared mixed reviews on this service, with some having quite a bit of trouble with lost inventory and difficulty transferring stock to non-Amazon locations.

If you’re mostly shipping oversized items, consider using Amazon Global Logistics to save on costs. This move makes one wonder whether the new inbounding program is just another tactic employed by Amazon to strong-arm sellers into putting all their eggs in one fulfillment network, or, conversely, to push sellers to take on the burden of distribution themselves.

Related: The Covert Amazon Program that could be Costing You Thousands

Lower FBA Fulfillment Fees

Shifting from a national fulfillment model to 8 interconnected regional fulfillment networks has a few benefits, one of which is lower outbound transit cost – savings that Amazon can pass on to sellers (which are unfortunately offset by the inventory placement fee introduction).

Effective April 15, 2024, Amazon will decrease FBA fees for standard-sized products by $0.20 per unit and for Large Bulky-sized products by $0.61 per unit on average.

For some sellers, these fee decreases barely make a dent in offsetting the impact of the newly introduced receiving fees. In that case, be sure to take advantage of any ongoing fulfillment fee discount promo or conduct an inventory profit audit to minimize profit loss and stay ahead of fees.

See the updated FBA Fulfillment Fee Rates here.

Low-Level Inventory Fee

In Mehta’s announcement on December 5th, he explained that the new fee for standard-sized items “applies if you carry consistently low levels of inventory relative to unit sales, as this inhibits our ability to distribute products across our network, degrading delivery speeds and increasing our shipping costs. Sellers can avoid this fee by maintaining more than four weeks of inventory relative to sales. These fees will apply starting April 1, 2024.”

Let’s make it very clear that this is a fulfillment fee related to total days of supply at FBA. It is not a storage fee. This means that you will only be charged when you sell the stock. This fee kicks in upon fulfillment of the units being penalized.

The introduction of Low-Level Inventory Fee seems directly linked to Amazon’s decision to restructure FBA. Instead of maintaining a nationwide fulfillment network, the company has transitioned to operating eight regional networks, each functioning independently to enhance delivery speed. 

However, Jassy’s shareholder letter regarding this shift overlooked addressing the repercussions for sellers utilizing FBA for inventory storage and fulfillment. Consequently, it remains uncertain whether sellers will need to divide inbound shipments more frequently. What is evident now is that they will bear the cost of decentralizing the network, with the specifics yet to be clarified.

“Maintaining sufficient inventory levels also enables us to place inventory closer to customers across our network, reducing costs to fulfill orders. In cases where you have low inventory levels, this drives transportation costs higher, and we will introduce fees to align with these underlying costs. Where your actions reduce our costs of fulfillment by maintaining healthy inventory levels, you will see lower fees for these items.”

Simply put, maintaining less than four weeks of inventory in FBA will result in higher costs for sellers—specifically, charges ranging between $0.32 – $1.11 per unit.

The implementation of the new low-inventory fee requires sellers to have increased visibility into their inventory so that they can quickly get rid of unprofitable products and keep their best sellers in stock. Some sellers might even be tempted to temporarily reduce advertising efforts or increase pricing to circumvent low-inventory fees in case of unforeseen surges in demand, potentially averting a low stock period or reducing the number of units sold and subject to this added fulfillment cost. The new low-inventory fee makes forecasting inventory demand with razor-sharp accuracy and efficient inventory management more important than ever.

Here’s a glimmer of positive development. To help you maintain sufficient inventory levels, Amazon will reduce the non-peak monthly storage fees for standard-size products by an average of $0.09 per cubic foot, from an average of $0.87 per cubic foot to $0.78 per cubic foot, from January-September. Monthly storage fees for non-standard-sizes will remain the same, however. This update will apply on April 1, 2024.

Additional Changes

Amazon is implementing further changes, which encompass:

  • A reduction in referral fees for apparel products
  • The introduction of a fulfillment fee discount for eligible items enrolled in the Ships in Product Packaging (SIPP) program
  • Expansion of “returns processing fees” to all categories for products with elevated return rates (while the existing returns processing fees for apparel and shoes will maintain their current average rates).
  • The implementation of new rates and benefits for Supply Chain by Amazon, an end-to-end solution to swiftly move your inventory from suppliers to customers globally.
  • Update to the fees for Amazon Global Logistics, Partnered Carrier Program, and Amazon Warehousing & Distribution.
  • Annual updates to Storage Utilization Surcharge, Removal, Disposal, Aged Inventory, Prep, and Inbound Defect fees.

In sum, Amazon routinely implements annual fee hikes, but the intricacy of the latest fee adjustments is unprecedented. Some sellers may have a hard time completely grasping the financial and operational repercussions of these fee hikes, along with the inevitable need for subsequent price adjustments, while others may opt to overlook these fee increases due to their complexity, leading to a gradual decline of profit margins.

Some of the mentioned fee updates have yet to be revealed. We will continue to inform sellers on the changes as they roll out and will update our Amazon Fee Stack white paper accordingly. There, we will be doing a deep dive into all of these fees and providing more insights into how each of them work and their potential impact on sellers. 

Related: Minimize the Impact of FBA Fee Increases on Your Margins, Restore Profitability in Your Business, Amazon FBA Calculator to Optimize FBA Size Tier Fees

UPDATED: Battle for Last-Mile Logistics Heats Up as Amazon Expands Same-Day Delivery Network

Battle for Last-Mile Logistics Heats Up as Amazon Expands Same-Day Delivery Network

UPDATE 11/24/2023: In a strategic move to fortify its last-mile delivery capabilities, Walmart is set to roll out 40 additional parcel delivery stations by the end of 2023, revolutionizing the online shopping experience for customers. 

In a blog post, Walmart US SVP of Transportation and Delivery, Jennifer McKeehan, notes that these stations are designed not only to allow customers to place online orders for a broader range of products with next-day delivery but also to streamline the order distribution process for employees within stores.

McKeehan emphasized the retailer’s commitment to expanding this capability to more locations in the coming year, aligning with Walmart’s overarching mission to serve customers with unparalleled speed, accuracy, and reliability. The introduction of these parcel delivery stations is poised to play a pivotal role in building density (deliver more parcels per route) within the last-mile delivery process, ultimately driving down costs associated with reaching American customers.

Efforts to enhance density are part of Walmart’s broader strategy to compete with industry giant Amazon, particularly in the realm of fulfillment operations.

Walmart CEO Doug McMillon highlighted significant progress during a recent Q3 earnings call, citing a 15% reduction in store-to-home delivery costs. McMillon attributed this success to ongoing initiatives focused on “densifying the last mile.”

Walmart’s Spark Driver network is a key player in achieving this density, facilitating more deliveries from nearby stores while also extending its services to other retailers through Walmart GoLocal.

Over the last 12 months, Walmart has raised the percentage of online orders fulfilled by stores by 800 basis points (1 basis point = 0.01%), while the GoLocal platform approaches a milestone of 12 million deliveries. Crucially, the retailer is managing to reduce last-mile costs without compromising on speed.

McMillon revealed the company’s commitment to trimming same-day delivery times for over 80% of its stores, with some locations achieving speeds as remarkable as 30 minutes – a testament to Walmart’s dedication to delivering an unparalleled combination of efficiency and ultrafast delivery speed in the fiercely competitive eCommerce landscape.

UPDATE 08/25/2023: Amazon has relaunched a shipping service that it temporarily suspended during the initial phases of the COVID-19 pandemic. This move intensifies the ongoing last-mile battle involving Amazon, legacy carriers UPS and FedEx, and even major retailers Walmart and Target that are venturing further into the realm of ultrafast delivery.

What is Amazon Shipping?

Amazon Shipping offers ground delivery services from pickup to delivery for FBM sellers. This means the service will be available to items sold on Amazon.com and other online sales channels.

According to Amazon, it’s “working closely with USPS” to deliver packages in 2 to 5 days within the contiguous US. As can be recalled, the company recently announced its ongoing efforts to integrate USPS Ground Advantage (GA) with Buy Shipping, a label service where sellers can conveniently buy shipping labels for various carriers and track shipments.

Purchasing USPS GA labels through Buy Shipping can potentially help sellers save money (with Amazon’s pre-negotiated rates) and cut down ground delivery times from 8 to less than 5 days.

The relaunch also came after Amazon hit its “fastest Prime delivery speeds ever” and subsequently announced its plans to expand the number of same-day delivery facilities over the next few years.

Through the revival of Amazon Shipping and same-day site expansion plans, the retailer positioned itself to seize greater control of the delivery window, and thus offer 1 to 2-day delivery for Prime and up to 5 days for non-Prime shoppers and sellers, rivaling UPS (which has 24% of the US shipping market) and FedEx (16%).

All of this may be part of a larger effort to attract more non-Amazon sellers to its growing fulfillment network while providing existing FBM sellers with a streamlined shipping solution for their shipments. And to an extent, this holistic approach also allows Amazon to reduce its dependence on UPS, which already placed shipping limits on the company last year.
Related: Amazon Wants to Take a Bigger Chunk Out of Seller Profits with 2 New Fees

UPDATE 08/01/2023: It looks like Amazon is succeeding in trying to make same-day delivery the new norm. 🏆

In 2019, the retailer started working on free one-day Prime day shipping. Four years later, it finally achieved its “fastest Prime delivery speeds ever.”

During the first half of 2023, Amazon has delivered over 1.8 billion items to its US Prime members within the same or the subsequent day. That’s nearly a fourfold increase compared to what the retailer achieved over the same time period in 2019, said Doug Herrington, CEO of Worldwide Amazon Stores.

Herrington says that part of this remarkable feat is down to the restructuring of Amazon’s fulfillment model: moving from a national fulfillment network to a regionalized network model. 

Approximately 76% of US orders came from their eight interconnected regional warehouses. Each of these regional warehouses has a vast selection of items to accommodate immediate delivery of customer orders in nearby areas while still being able to ship products to distant locations when necessary.

Aside from restructuring, Amazon has also streamlined its last-mile delivery process by taking same-day sites closer to bigger cities and recruiting local small businesses in rural areas as delivery partners. This way, certain products have even shorter distances to travel, allowing Amazon to offer ultrafast delivery while reducing transportation costs.

Per Herrington, “millions” of items are available for same-day delivery across 90 major US cities, with more set to follow.

To build on this initial success, Amazon plans to open more same-day sites in the next few years. 

According to Herrington, Amazon’s same-day facilities “are designed for speed with smaller footprints, streamlined conveyors, and picking directly to pack stations.”

And while these hybrid warehouses are smaller than your typical million-square-foot Amazon fulfillment centers (FCs), they are filled with products that customers regularly buy.

As a result, it only takes Amazon associates 11 minutes to pick, pack, and ship customers’ orders in same-day sites, which is “more than an hour faster than traditional fulfillment centers.”

Amazon doubling down on its same-day network expansion plans only means Prime orders will come faster (e.g., from several hours down to just two hours) to customers in the near future. If living close to drone delivery centers, it may even be possible to get certain items (under 5 lbs) delivered within 30 minutes

While this bodes well for both customers and sellers, top retailers like Target and Walmart boasting their own fulfillment network will be sensing escalating competition as their battle for last-mile dominance with Amazon rages on.

UPDATE 07/13/2023: A few weeks after Walmart introduced its new order fulfillment network, Amazon announced they’re seeking 2,500 small US businesses to join Amazon Hub Delivery. This new local delivery service appears to be another piece of the puzzle in the company’s last-mile network.

In February, the retailer opened several same-day delivery sites across major cities in the country. A couple of months later, CEO Andy Jassy confirmed Amazon has overhauled its logistics operations from a national fulfillment service model to a regionalized model to speed up deliveries and lower costs.

To improve delivery efficiency in their target regions, Amazon is currently recruiting small businesses such as dry cleaners, coffee shops, salons, flower shops, gas stations, fashion boutiques, grocery stores, and auto service centers, among others. These businesses have a profound knowledge of local roadways and neighborhoods, making them a great addition to Amazon’s existing network of third-party couriers and contractors.

Amazon aims to recruit 2,500 businesses in 23 states, specifically rural areas, by the end of 2023 and in a later phase, expand the deliveries to bigger cities like NYC, Seattle, Boston, and LA.

How Amazon Hub Delivery works

  • Delivery partners will receive Amazon packages each day.
  • Delivery partners will have the flexibility to make deliveries when they’re available. 
  • Finally, get paid for every package delivered.

Amazon is looking for partners who can deliver 20 to 50 packages every day. The exact compensation details have not been disclosed, but small business owners have the potential to earn an annual income of up to $27,000 through Amazon’s new local delivery service.

Based on a delivery partner’s projections, a company that manages to deliver an average of 50 packages per day could potentially earn around $2.50 for each package delivered. However, this amount may not be good enough for some businesses that take several hours to meet their delivery commitments. 

For instance, vehicles are likely to endure significant wear and tear from driving on rough roads for up to 5 hours per day, requiring tire replacements frequently. And as more nearby businesses participate in the program, the volume of daily packages may decrease, impacting a business’s earnings adversely. Interested delivery partners should take their availability, assigned route (traffic and road conditions), and operating costs into careful consideration before joining the program.

It may be a good fit for businesses that have gaps in their normal delivery schedule. In that case, making Amazon deliveries may be a good way to subsidize income and maximize employee productivity. 

It will be interesting to see how this program develops but it is a smart idea to leverage under-utilized, available resources much in the way Uber and Airbnb have done.

UPDATE 06/13/2023: Walmart may have figured out how to beat Amazon and Target in the last-mile eCommerce department – building automated compact warehouses within its physical stores. 

In April 2021, Walmart announced a new order fulfillment network called Market Fulfillment Center (MFC). It is a small warehouse “built within, or added to, a store” and equipped with an automated item retrieval system called Alphabot.

Robots retrieve the products from within the warehouse and then bring them to a sorting station manned by an associate. The associate then collects and prepares the sorted items for courier delivery or customer pickup.

Presently, Walmart customers expect free 2-day delivery when shopping online. The implementation of MFCs is set to revolutionize the company’s daily order fulfillment speed and capacity.

According to the retailer, Alphabot can retrieve items 10x faster than a person, which can make the whole fulfillment process span only a few minutes, commencing from the time the order is submitted to the point at which it becomes available for the customer or delivery driver to collect. 

Once deployed nationwide, MFCs, combined with a robust drone delivery system that’s currently available in 7 states and a growing driver program, could potentially put Walmart’s last-mile service on par with, if not better, than Amazon’s 1 to 2-day delivery promise. 

But that is still a few years down the line, as out of 3,561 Walmart supercenters in the US, only two have an MFC built within them so far. The company piloted the program in 2019 in Salem, New Hampshire and four years later, opened its first official MFC in its Bentonville supercenter store in Arkansas. 

This gives Amazon a lot of time to catch up or get ahead of Walmart’s MFCs, unless they continue to cut costs, which could delay such progress.

Overall, retail giants doubling down on their same-day expansion plans is good news for customers, as this could mean faster delivery times or more accessible pickup locations in the near future.

For sellers, this presents a better opportunity for them to explore Walmart as an additional sales and distribution channel, especially if the sellers’ goal is to reach grocery shoppers.

UPDATE 05/20/2023: In a bid to compete with Amazon, John Mulligan, Target Executive Vice President and COO, unveiled an innovative strategy to optimize their delivery operations.

With a focus on enhancing capacity and streamlining routes, Target is embarking on a significant expansion of larger delivery vehicles in locations where their sortation centers operate.

According to Mulligan, when it comes to routes that were previously covered by smaller vehicles, the utilization of SUVs and minivans allows for the delivery of more than twice the number of packages.

However, the real game-changer lies in Target’s “high-capacity vans,” which have the ability to cater to almost five times the number of packages (vs. sedans). The effectiveness of these larger vehicles has been put to the test by the company, which has been experimenting with high-capacity van routes at their Dallas and Minneapolis sortation centers.

“Over the past year, across all of our markets served by our sortation centers, we have shifted more routes to larger passenger vehicles and early results have been positive,” Mulligan told analysts.

These high-capacity vans accounted for 65% of Target’s last-mile deliveries in Q1 2023 compared to zero during the same quarter in 2022.

“This resulted in meaningful cost savings for our last mile delivery program overall,” Mulligan said.

Other Initiatives to Handle Greater Parcel Volume 

In 2022, Target delivered a staggering 26 million packages through their sortation centers. As they stride forward into this new year, their goals soar even higher as they set their sights on nearly doubling this monumental figure.

To make that happen, the retailer is working on a standardized and expedited approach to load its vans, which “enables package containerization and easy identification of the correct packages at delivery.”

By streamlining the loading process, Target not only simplifies the daily tasks of its drivers but also empowers them to move a greater number of packages in and out of the sortation centers without compromising safety.

As a result, this significantly enhances the company’s last-mile delivery capacity.

Expanding Next-Day Delivery Coverage with More Sortation Centers

In February, Target announced it’s constructing six additional sorting centers across strategic locations to expand its next-day delivery capabilities.

Currently, the company has nine sortation hubs in Texas, Chicago, Minnesota, and Pennsylvania. These hubs collect packages from local stores and prepare them for delivery to customers by Shipt drivers or third-party couriers. 

To optimize the delivery capabilities of its existing sortation centers, Target is adding extension facilities to its logistics network. It recently opened one in Smyrna, Georgia in an attempt to serve its other sortation center in Atlanta.

This way, eComm orders that end up outside of the Atlanta sortation hub can be moved to the Smyrna extension facility. Couriers can then pick up those packages in Smyrna and deliver them to neighborhoods in the area.

With these high-capacity vans and new sortation hubs, Target can now reach and provide new markets with a delivery service that could, it hopes, eventually begin to challenge Amazon.

UPDATE 04/14/2023: In a shareholder letter published April 13th, CEO Andy Jassy confirms Amazon has recently completed a shift from a national fulfillment service model to a regionalized model to lower costs and provide lightning-fast deliveries.

“Last year, we started rearchitecting our inventory placement strategy and leveraging our larger fulfillment center footprint to move from a national fulfillment network to a regionalized network model,” Jassy explained.

“We made significant internal changes (e.g. placement and logistics software, processes, physical operations) to create eight interconnected regions in smaller geographic areas. Each of these regions has broad, relevant selection to operate in a largely self-sufficient way, while still being able to ship nationally when necessary.”

As you may already know, under its previous national distribution model, Amazon would sometimes have to ship an ordered product from far-off locations if a local fulfillment center didn’t have it in stock. Not only did this increase costs for the company, but it also resulted in longer delivery times for customers. 

Now, with its regionalized fulfillment model in place (combined with automated warehouse systems), Amazon is all set to take its next-day and same-day delivery services to new heights. 

“Shorter travel distances mean lower cost to serve, less impact on the environment, and customers getting their orders faster,” Jassy said.

Presently, the retail giant is capable of handling 600,000 same-day deliveries in 90 metropolitan areas. The company also aims to bring its ultrafast delivery service to places beyond larger cities by investing in more rural areas, such as Omaha and Sioux Falls.

Amazon may yet again redefine last-mile expectations as it aims to expand its same-day delivery footprint from 45 to 150 facilities over the next few years. New sites have reportedly opened in Los Angeles, San Francisco, and Phoenix, which can prep and handle hundreds of thousands of popular items for immediate delivery.

The company also announced it will allocate $200 million to driver safety across its logistics network in 2023, showing its continued commitment to getting last-mile right.

With expanded last-mile capabilities across the US, more customers will have the option to get their orders delivered within hours instead of days – a direct shot at the express delivery services of retail rivals Target and Walmart and delivery firms UPS and FedEx. This could also mean improved delivery times during the holiday season.

Per Wall Street Journal, Kansas City-based customer Kristin Whitehair first saw the ultrafast delivery option in February when browsing through electric toothbrush heads, which she needed urgently. She placed an order in the morning and received it in the evening, an experience similar to in-store shopping where customers can pick, pay and bring an item home within the same day.

Customers may no longer need to look at other retailers for faster delivery. However, this also means the pressure is on Amazon to consistently meet ever-evolving customer expectations, especially once its drone delivery service, which could potentially cut down delivery times from several hours to just under 60 minutes, is deployed at scale.

Although last-mile service is considered as the most expensive part of the logistics process, Amazon said they are not increasing prices for this fast-shipping service delivery. Though rates will, they claim, remain the same as when first introduced a few years ago, the Same-Day service is not always free and can range from free to 2.99 per order for Prime members and up to 9.99 per order non-Prime.

The cost of providing services such as this may, in part, be offset by the company’s recent Prime membership fee increase. In 2022, Amazon raised the cost of an annual Prime subscription from $119 to $139, an increase large enough for some members to call it quits. Therefore, if they were to announce another fee hike in 2023, it might give members who have stuck it out a more solid reason to finally jump ship and turn to Walmart or Target, which Amazon is desperately trying to avoid after suffering a huge decline in eCommerce sales for the fourth time in the last five quarters.

Amazon has already implemented a series of cost-cutting measures, such as shutting down old logistics centers, subleasing unused warehouse and jet cargo space, and laying off 18,000 employees. The company also launched fulfillment-as-a-service programs such as Buy with Prime and Amazon Warehousing and Distribution (AWD) to boost growth and increased warehouse automation to reduce inefficiencies.

Trends that Drive the Need for Ultrafast Delivery

Amid all the cost-cutting efforts and a looming recession, why is Amazon still pouring money into its logistics and transportation network?

  • Preference for speed and convenience. Based on a McKinsey survey, 28% of respondents cited speed and price as two of the most important delivery features, while alternative delivery locations (parcel lockers or in-store pickup) and flexibility of delivery time come in second and third respectively. When people talk about speed and price, they mean free one to two-day shipping, which has generally become the norm. But that is slowly changing with the advent of same-day delivery, thanks to the pandemic forcing home-bound customers to shop for urgently-needed essentials online. Additionally, a 2021 Digital Commerce 360 report shows 68% of consumers consider fast shipping as a deciding factor when shopping online, while 36% have checked out of a store and selected same-day delivery as an option, indicating a growing demand for faster delivery.
  • Customers’ willingness to pay a premium for same-day, within-hours delivery service. As mentioned earlier, last-mile delivery is not cheap. 53% of overall transportation spend goes to last-mile, so understandably, eComm companies offer this service at a premium. Fortunately, 88% of consumers are willing to pay extra dollars for same-day delivery.
  • Same-day delivery could be a lucrative source of revenue. The US market for this delivery option is expected to triple in size by 2024. In 2019, same-day delivery market was worth $5.87 billion and is expected to grow to $15.6 billion by next year.
  • Increasing competition. Target recently announced it will invest $100 million to add more sortation facilities into its supply chain to speed up and reduce the cost of delivering online orders. Meanwhile, Shopify launched its own fulfillment-as-a-service program, Shop Promise, which offers next-day and two-day, taking on Amazon Buy with Prime. Lastly, Walmart revealed plans to expand its Private Fleet Development Program, which launched last year, to improve delivery capabilities for sellers.

With retail giants all vying for the top spot – as the go-to same-day delivery service provider – Amazon needs to consistently invest in its last-mile service to ensure truckers can deliver orders faster than Target, Shopify, and Walmart to have an edge on its rivals.

While building 150 same-day sites sounds like a good start, Amazon may need more to be able to fully deploy the program across the entire country. 

“They need volume to make it work,” said Marc Wulfraat, President of MWPVL, a supply chain consulting firm.

More volume also means higher labor and warehouse costs that could drive up Prime membership fees in the future.

Wulfraat predicts retailers will start teaming up with pickup and delivery companies such as DoorDash and Instacart to alleviate the cost of building out their own in-house last-mile network.

Register for Amazon Seller Wallet By November 30 to Unlock Cost Savings

Making or receiving payments in foreign currency often entails fees that can erode your profits. Luckily, there are various strategies to mitigate charges associated with cross-border foreign currency payments, one of which is by signing up for Amazon Seller Wallet (ASW). Receive reduced fees for the first year when you sign up by November 30th.

What is Amazon Seller Wallet?

Introduced in July 2022, Amazon Seller Wallet allows you to store and manage your US store earnings within a single online payment system, giving you control over how much and when to transfer your money to your bank accounts.

You can also conveniently use the funds in your wallet to pay vendors, suppliers, and contractors. Simply add them as recipients to be able to start sending USD payments from your wallet.

Note: Don’t confuse Amazon Seller Wallet with Amazon’s disbursement solution called Currency Converter for Sellers (ACCS)

ACCS automatically converts and deposits your international earnings into your domestic currency, often making it a go-to choice for sellers. 

Seller Wallet, on the other hand, enables you to keep your Amazon payouts in a virtual account and freely convert or transfer the money whenever necessary. Simply put, you get to decide when to initiate money transfers.

ASW Primary Features

  • Enrolling in Amazon Seller Wallet is free with no mandatory minimum amount.
  • No account maintenance fee required.
  • Free US domestic transfers and payments to vendors with a US bank account.
  • Amazon Seller Wallet uses the backend technology that sellers trust to ensuring the safety of their transactions and the security of their information.
  • For a fee, you can make international transfers to your own bank accounts in more than 20 currencies or send payments to USD-denominated bank accounts in Hong Kong. However, Amazon says this fee decreases as your sales grow. See transaction fees below:

ASW Cost Benefits

  • Quickly make international transfers from your wallet. You can now skip transferring your payouts from Amazon to your bank account before settling payments with your business partners. For global sellers, this translates to savings on currency conversion fees and prevents losses when utilizing USD proceeds for USD-based transactions.
  • Heightened control over your money. Without extra cost, conveniently monitor all your store proceeds, bank transfers, and vendor payments in a centralized location.
  • Special sign-up offer. Despite Seller Wallet’s ease of use, it’s important to note that Amazon imposes a fee on the converted amount. In addition to this cost, using ASW exposes you to the uncertainties of fluctuating exchange rates, potentially diminishing your profits. 

As mentioned, you can optimize your financial savings by enrolling in Seller Wallet before November 30, 2023, and unlock exclusive benefits with Amazon’s special sign-up offer. By doing so, you’ll gain access to reduced fees for cross-currency transfers and Hong Kong USD payments for up to a year.

Enjoy lowered fees (e.g., paying only 0.60% vs. 1.5%) for transfers and payments determined by your cross-currency net proceeds – the earnings derived from all of your Amazon stores operating with a currency distinct from your reporting country within the last 12 months.

How to Get Started

  • Check if you’re eligible to sign up for the program.
  • If yes, fill out the registration form and submit the necessary documents.
  • Add your bank accounts and recipients.

Click here to learn more about Seller Wallet.

Updated: Bid for a Higher Inventory Limit with FBA Capacity Manager

SoStocked Bid for a Higher Inventory Limit with FBA Capacity Manager

Update 11/17/2023: In a surprising move, Amazon has reportedly slashed the capacity limits of some sellers without prior notice, leading to potential financial implications and operational challenges.

One seller, who initially had a capacity limit of approximately 800 cubic feet in October, found himself grappling with a sudden reduction to just under 400 cubic feet in November.

The abrupt decrease in capacity caught the seller off guard, leaving him with excess stock that exceeded the new limit. As a consequence, the seller was warned of a hefty overage fee (more on that below) amounting to $1,900.

Upon repeated requests to support having the limit raised back up again, the seller has now seen the capacity increase but is still uncertain as to what will become of the overage fees he may have erroneously incurred during the period of reduced limits.

What’s particularly concerning is that Amazon made this adjustment without providing any advance notice, leaving the seller with little time to address the issue or adjust his inventory planning accordingly.

This is not an isolated incident, as another seller reportedly faced a similar fate. Her stock allowance was cut without warning.

It may be that, with Amazon’s new storage bidding system finally being stress tested now that the Q4 season is instigating a high volume of requests for storage. It may be that sellers are experiencing such anomalies due to the system not being able to properly allocate space within their software algorithms. This is just theoretical but these recent issues certainly point to possible bugs in the system.

If a seller’s limits are lower so that he has more inventory than allotted storage space, the problems that this creates are two-fold. First, he will not be allowed to send anymore inventory into Amazon until he is below the threshold and second, he will incur overage fees until he is under that limit.

Affected sellers will be required to pay these unexpected overage fees by the end of the month, adding financial strain during an already challenging time.

The sudden and drastic capacity limit reductions may also force the impacted sellers to reconsider their strategies and potentially pull some of their stock out of Amazon’s warehouses to avoid or minimize overage fees and or swap the space from lower velocity products to best sellers. This move, however, comes with its own set of challenges, including increased hefty removal fees and stockout risk, which consequently may lead to potential disruptions in deliveries and a negative impact on overall customer experience.

The lack of warning from Amazon, not to mention violation of their own policies, regarding these capacity limit adjustments has sparked frustration and concern among sellers who rely on the platform for their livelihoods. Many sellers depend on the eCommerce giant for fulfillment services, and such sudden changes can have far-reaching consequences on their businesses.

Amazon suddenly dropping capacity limits for some sellers isn’t unheard of, especially during Q4. In 2021, the e-Tailer replaced ASIN-level quantity limits with storage-type level restock limits. 

That change in Amazon’s storage policies resulted in immediate repercussions for some sellers, with a sudden and unanticipated reduction in storage capacity, reaching up to 40% overnight. Announced without prior warning, it left numerous sellers exceeding their newly adjusted limits.

Some sellers received notifications stating that shipments already in transit had been canceled, prompting them to liaise with their providers for return arrangements. A daring few chose to proceed with their shipments despite the cancellations, finding that Amazon accepted these deliveries, while others faced the unfortunate and costly outcome of rejected shipments.

This unexpected shift in storage dynamics has underscored the challenges and uncertainties sellers face on the Amazon platform.

As sellers navigate these challenges, calls for increased communication and fairness in Amazon’s policies are likely to grow louder. The incident spotlights the vulnerability of sellers in Amazon’s eCommerce system, emphasizing the need for the company to strike a balance between their own operational efficiency and the livelihoods of the sellers who contribute to their success.

What you can do

Firstly, if you have experienced unexpected storage charges, it is important to understand exactly what the charges are related to. You may assume charges are due to overages but they may be associated with peak storage fees or aged inventory surcharges. In order to properly understand what you are being charged for, navigate to the Payments Dashboard under Transaction View and search Service Fees for details on the expenses you’ve incurred.

To avoid the risk of reaching your capacity limits overnight and potentially facing stockouts on your best-selling items, it is advisable to review your Restock Inventory report before dispatching shipments. ☠️ Recommendations are adjusted to factor capacity limits which could provide insights into your inventory planning.

If you find yourself grappling with capacity restrictions and are seeking a resolution, one option is to enroll in the Amazon Warehousing & Distribution program, which offers the advantage of no restock limits and lower storage fees of $0.42/unit year round with no peak fee increases.
Alternatively, you can explore my comprehensive guide on minimizing the impact of Amazon fee hikes and enhancing capacity limits for a more detailed and strategic approach to overcoming these restrictions.

Update 11/01/2023: Sellers, be ready for a tighter Amazon capacity restriction in December – we have some helpful tips to help you prepare if you haven’t already!

Quick recap

In FBA storage management, when the need for additional space arises, the most direct and immediate course of action is to engage in a bidding process through Amazon’s FBA Capacity Manager. This capacity management system allows you to request extra storage by specifying the amount you’re willing to pay per cubic foot. Amazon then evaluates these requests and prioritizes them based on the reservation fees offered from highest to lowest.

How much should you bid?

Your bid should align with the how critical your additional storage are to your business (e.g., during Q4 when demand is higher than average) and, just as importantly, your confidence in offsetting the reservation fee with the performance credits earned from increased sales, as discussed below.

Additionally, Amazon expert and 8-figure seller, Jon Derkits, offers a tip that, due to timing, may not be as helpful in these later months of Q4 but should definitely be placed in your back pocket for future sales events like Prime Day. Derkits advises that rather than solely focusing on what you bid, it’s crucial to consider when you bid. You can place bids for additional capacity up to three months in advance, and Amazon reviews capacity requests every three to four days. Starting from the highest bid, Amazon works its way down the list to distribute available capacity.

All sellers granted additional capacity, irrespective of their initial bid, pay the lowest accepted bid. Illustrating an example in his newsletter, Derkits used 10 sellers competing for 1,000 cubic feet of FBA storage space. The top 5 bidders may win the allocation, but they will all pay the lowest accepted offer. 

When is the right time to bid?

As you may know, the demand for storage fluctuates during different times of the year. During Q4 for example, you may need a higher bid to secure additional capacity, and the lowest accepted bid will likely be elevated due to the urgency of other sellers’ storage needs.

This is why bidding early offers another compelling advantage: Amazon’s lowest reservation fee guarantee. This guarantee ensures that if other requests with lower reservation fees for the same period are approved later, your previously granted request will be adjusted to match the lower fee.

Suppose you secure storage in March at $3 per cubic foot based on an auction in January, but a subsequent auction offers the lowest acceptable price of $2.50 per cubic foot for March. In that case, you will only pay $2.50 for your additional March storage.

Therefore, while both are important, the timing of your bid can play a more significant role than the specific amount you bid when it comes to effectively using Amazon’s Capacity Manager for FBA storage management.

Alternatively, if you want to avoid tinkering with the bidding system and, instead, rig the FBA Capacity Limits system in your favor, Derkits suggests “taking aggressive actions in the 7-10 days leading up to  Amazon’s [capacity limits] calculation.”

Note: Amazon announces capacity limits for sellers on a monthly basis, typically during the week that begins on the third Monday of each month. So, if you want to boost your capacity limits for the holidays, now is the best time to do it.

Below are some pro tips for increasing your December capacity limits potentially without paying for extra storage.

  • Increase your MCF orders: One ethical option is to genuinely invest in marketing to create more demand and fulfill more MCF orders. This would reduce your need for additional space.
  • Run deals in these weeks leading up to the big show: Amazon considers the anticipated surge in demand and allocates additional capacity accordingly. Note that you have the flexibility to call off your deal campaigns up to 25 hours in advance to avoid incurring any deal fees. 
  • Exceed your ASIN’s estimated sales forecast: Amazon provides sales forecasts for certain ASINs in the Restock Inventory Dashboard. Amazon then uses your forecast data to calculate your capacity limits. Derkins recommends setting Amazon’s forecast as your “target that you need to exceed if you’re padding your stats.”

It is important to note here that you should be prepared for a worst case scenario if you aren’t able to earn the performance credits needed to cover your reservation fee. Additionally, you should factor overage fees into your planning if you are truly assessing worst case.

Overage fees would apply if you were stuck with a ton of inventory at the end of the month and Amazon reduces your capacity limits below that point. You will incur overage fees that accumulate daily until your inventory capacity falls within the limit. This should also be considered when placing your bids as it could have a big impact on your costs and profits.
Ultimately, the decision on how to boost your December capacity limits is in your hands. For more seller tips, explore our Attack of the Fee Stack white paper to gain comprehensive insights into Amazon’s storage bidding process, a detailed overview of the 2023 fees, their implications, and strategies to minimize or eliminate them, accompanied by explanations and illustrative examples.

Update 03/01/2023: 📢 FBA Capacity Manager is now live!

Amazon has replaced weekly restock limits with a single, monthly storage cap. Sellers who could use some extra space may go to Capacity Manager to place a bid. ⚠️ However, bidding for a higher inventory limit comes with risks that you should be aware of so you can avoid them. 
Lucky for you we’ve updated our “Attack of the Fee Stack” white paper to include an in-depth explanation and examples of Amazon’s storage bidding process, as well as a breakdown of the other 2023 fees and how they work, their impacts, and tips to reduce or eliminate them. 💪

Amazon might have just found another way to monetize its excess warehouse space – sell it to the highest bidder!

Dubbed FBA Capacity Manager, this new capacity management system allows sellers dealing with storage volume constraints and restock limits to bid for additional space.

We went from Amazon implementing inventory limits to ease warehouse congestion during the pandemic to auctioning off storage space to improve FBA revenue amid a looming recession. 🤔 Not only are sellers still getting saddled with capacity limits, they’re also now being pit against each other via storage wars.

This auction-based system is set to take effect March 1st, 2023.

The idea isn’t a new one. Amazon released something called the Storage Limit Manager (SLM) program in February 2022 to help sellers with IPI storage volume restraints. The program was structured in much the same way this FBA Capacity Manager is now laid out. 

Convincing Sellers to Adopt Capacity Manager

Amazon recently made a few inventory changes to be able to simplify capacity management for sellers, and at the same time, to increase early and rapid adoption of Capacity Manager.

Under the new system, Amazon will:

  • Replace weekly restock limits and quarterly storage volume limits with a single monthly capacity limit for each storage type, making capacity monitoring easier. This monthly limit will be set based on several factors, such as IPI score, sales performance, forecasts for your ASINs, shipment lead time, FBA capacity, and marketing plans (e.g., lightning deals). Updates are announced every third week of the month and can be viewed via the Capacity Monitor Dashboard inside Seller Central.
  • Provide you with estimated capacity limits for the next 2-3 months so you can plan in advance, giving you greater predictability and control over your inventory.
  • Provide capacity limits in volume (cubic feet) versus units to give a more accurate representation of your Amazon warehouse usage. This means that you will now have to monitor your capacity in cubic feet rather than units.
  • Let you request for a higher capacity limit. If you need extra storage for the next selling period, you can go to Capacity Manager to place a bid, aka reservation fee, for your desired capacity limit increase (up to 20% of your initial limit or 2,000 cubic feet, whichever is greater). While this will cost you money, you can offset some or 100% of your reservation fee with performance credits. You will earn $0.15 per dollar of sales generated using the additional inventory and use that to lower your fees.

Here’s how performance credit works according to Amazon:

Performance Credit Examples

Why Bidding for a Higher Capacity May Not be a Good Idea

Using Capacity Manager may not be for you if:

  • You already have a lot of unsold products sitting in FBA. Amazon will most likely grant capacity increases to sellers whose goal is to make more room for their top sellers than slow sellers, which makes sense because that’s how sellers will be able to generate more sales for Amazon. In fact, Dharmesh Mehta, Vice President, Amazon Worldwide Selling Partner Services, said it himself: “Our goal is to provide sellers with more control over how much space they can have while limiting unproductive use.” 
  • You have long lead times. Capacity limits may change monthly so it may not be wise to ship your additional inventory directly from China to Amazon as that process will take a few weeks, depending on your shipping method. By the time it arrives, the extra storage might no longer be available. Either use express air shipping or store buffer stock in a 3PL so that you can immediately transfer additional units from there to FBA whenever necessary.
  • You don’t have sufficient funds to bid for extra capacity. Amazon grants requests starting with the highest reservation fee. If you urgently need that additional storage space, you may need to allocate a substantial amount of money and place higher bids to increase your chances of getting approved from weeks to within a few days. Note that Amazon evaluates its FBA capacity every 3 to 4 days and approves pending requests when space is available.
  • You don’t have the capability to sell through your additional inventory ASAP. Not only will you end up paying the remaining balance of your reservation fee, you might also exceed your capacity limit for the following month with those unsold products and therefore, also pay overage fees.

Final Thoughts

If utilized productively, the additional storage may help you to increase sales, which in turn, may also improve your IPI score. Sales performance and IPI score are two of the most crucial metrics that Amazon uses to determine your inventory limits. If increased significantly, you may not need to bid again next month for additional capacity.

That’s the best-case scenario.

⚠️ The worst-case?

You could lose a lot of money to fees and receive a lower IPI score if you’re unable to use the additional storage efficiently. You may also be charged overage fees if your on-hand FBA inventory ends up exceeding your capacity limit for a specific period.

💡 Before using Capacity Manager, consider reviewing the difference between the cost to bid for a storage increase and the cost of shipping smaller orders more frequently. Splitting your FTL/LTL shipments into smaller orders may help you to avoid maxing out your inventory limit quickly so you won’t have to pay for more warehouse space at FBA.

Unless Amazon slashes your limits without prior warning or there’s a sudden surge in demand for your product, you might not need additional capacity regularly, especially during off-peak. So, don’t count out other fulfillment options just yet. 

To cover all your bases, set aside some extra inventory in your warehouse or third party fulfillment center to provide a buffer for your business in case of unforeseen challenges.

Related: Would You Pay for Extra Storage Space?

Shop Socially: Amazon and Meta Team Up for One-Click Social Commerce

In an unprecedented move, Meta teamed up with Amazon to introduce a new feature that allows Facebook and Instagram users to effortlessly fuse their accounts with Amazon, revolutionizing the online shopping experience within their favorite social apps. 

By linking Facebook and Instagram accounts directly to Amazon, the two tech giants have unlocked on-platform purchasing capabilities while enhancing ad targeting through shared data.

According to CNBC’s report on Thursday, November 9, the goal is to keep users engaged within their feeds, eliminating the hassle of switching between apps to shop.

Previously, ads on Facebook and Instagram led users to Amazon’s mobile site, where they’d check out product prices and reviews, then log into their Amazon account to complete the purchase.

Now, with a simple click on an Amazon ad within Facebook or Instagram, US customers are directed to a sleek, condensed Amazon product page, featuring a bold “Buy with Amazon” button. They will also be able to view real-time pricing, Prime eligibility, delivery estimates, and product details without leaving Facebook and IG, Amazon spokesperson Callie Jernigan confirmed in a statement to TechCrunch.

Meta Amazon Tie Up
Source: Marketplace Pulse

Overall, this streamlined approach means fewer friction points in the customer buying journey—a game-changer in the world of eCommerce.

What does this Team Up Mean for Sellers?

The partnership between Meta and Amazon capitalizes on their individual strengths.

Amazon’s intent-based model expands its reach, connecting sellers with potential customers who haven’t actively sought their products on the platform. Meanwhile, Meta’s discovery-based approach delivers targeted ads to users who aren’t actively searching for products to buy. This integration mirrors a successful partnership between Pinterest and Amazon, indicating promising potential for both Meta and Amazon. 

For sellers, this collaboration offers a unique chance to engage a motivated audience effectively. It promises a smooth online shopping journey, bridging the gap between awareness and action. 
Through Amazon’s powerful ad tools and Meta’s expansive user base, brands might experience improved conversion rates and greater returns on ad investment, setting the stage for success in a rapidly evolving digital market.

Related: AI in eCommerce: Trends Redefining Shopping Experiences, Shopify Sellers Can Soon Offer Amazon Buy with Prime to their Customers

4 Updates to Amazon Seller-Fulfilled Prime

In case you missed it, Amazon has recently reopened its Seller-Fulfilled Prime (SFP) program with “new standards in place” which the retail giant stated have been designed to provide sellers with an even better experience and enhanced opportunities, though some sellers do not agree.

What’s New?

1. SFP fee has been removed

As of October 1, the 2% fee for every item sold has been removed from the SFP program after receiving flak from sellers. Per Amazon, the fee was initially intended to cover program development and operational costs, but after consideration, the company has chosen not to implement it to maintain positive sentiment and encourage enrollment.

2. Enrollment is subject to certain requirements

To join the program, you need to pre-qualify for the SFP trial and successfully complete the 30-day trial period, meeting all requirements.

Pre-qualification criteria include:

Criteria to pass the SFP trial and become an enrolled seller:

3. Default SFP order handling time will be reduced to one day

Starting on October 31, 2023, Amazon updated the default handling time for SFP orders. This change will impact how quickly SFP participates are expected to handle and ship orders. Here are the primary details of this update:

  • Default Handling Time Change: The default handling time for SKUs that are typically handled in one day or less will be updated from two days to one day.
  • Improved Accuracy: This update is intended to align handling times more accurately with how quickly sellers usually ship orders. According to Amazon, more than 85% of SFP orders are currently shipped within one day.
  • Account Health Consideration: The new handling time will be based on your handling time history over the past three months “to protect your account health.” SKU-specific settings will also impact the handling time. As you may already know, handling time on Amazon impacts your account health by influencing key performance metrics, including the Late Shipment Rate and Valid Tracking Rate. Inaccurate handling times can also lead to negative customer feedback and reduced Buy Box eligibility. To maintain a healthy seller account, it’s crucial to align your handling time with your actual shipping capabilities and meet customer expectations for timely deliveries.
  • Action Required: If you have products that take longer than one day to handle, you should set a longer SKU-specific handling time in the Manage Inventory section to override the default one-day handling time.
  • Order Handling Capacity: To protect your business from sudden sales spikes, Amazon recommends setting an order handling capacity.

These changes aim to enhance the accuracy of handling times and provide shoppers with more attractive delivery promises while ensuring you can effectively manage your order processing. 

Click here to update your SFP handling time settings.

4. Amazon B2B: Business Hour Delivery Rate for SFP Orders

Amazon has introduced the “business hour delivery rate” metric for SFP orders sent to Amazon Business and Business Prime customers with commercial addresses. This metric calculates the percentage of Amazon Business shipments delivered on the first attempt during business hours within a 30-day period.

You can access this data on the Fulfillment Insights Dashboard, helping you optimize your delivery methods and improve customer satisfaction (e.g., minimize delivery attempts and package theft), though it doesn’t affect program eligibility.

What Sellers Are Saying

While some sellers welcome the newly reopened program and SFP fee removal, others aren’t particularly happy about the tedious program requirements and changes to the default SFP order handling time.

From what we were able to glean from the comments section of the SFP reopening announcement post, various sellers are:

  • Are having trouble enrolling in the SFP trial even though they meet the prequalification criteria.
  • Expressing concerns about the delivery speed requirements, specifically the need for same-day and next-day delivery.
  • Having issues with the program’s metrics not being calculated correctly on the dashboard.
  • Desiring more flexibility in terms of shipping times and cutoff times.
  • Raising questions about the fairness of the new rules and their impact on sellers.
  • Worried about handing their customer service and return processes over to Customer Service by Amazon, which means “Amazon has sole discretion over whether to charge the costs of any returns, refunds, or other adjustments and concessions related to Prime items to the seller’s account.” For instance, Amazon can decide to issue refunds to customers on your behalf, which can impact your profitability, especially if you believe a refund is unjustified.
  • Some sellers are frustrated with the changes and complexities of the SFP program, suggesting a simpler approach to displaying the Prime badge.

Additionally, the changes to the default handling time for SFP orders, reducing it from two days to one day, have also sparked disappointment and apprehension among sellers. They are worried about losing their control over shipping settings (unless they have a lot of time to manually override the default option for each SKU by going to Manage Inventory). They also risk incurring potential penalties for late shipments, especially in cases where unforeseen circumstances like weather delays or labor strikes may affect shipping times.

Some sellers are also concerned about the impact of the update on their ability to offer USPS Ground Advantage shipping, as the new one-day handling time may not align with USPS transit times. Overall, many sellers feel that Amazon’s decision is unnecessary and may lead to more challenges in managing their businesses effectively.

In summary, some sellers appreciate the SFP program’s return, but many others are dealing with uncertainties and complexities surrounding these changes, hoping for more straightforward solutions. For these changes to be announced during the busy Q4 shipping rush makes it all the more daunting for sellers who already face increased challenges during the holidays.

Updated: New Amazon Features, Updates and Requirements

Update 10/20/2023: Amazon has just updated their product listing attribute requirements and several sellers aren’t happy about it.

In an effort to enhance the quality of listings, Amazon’s making some changes to the Add Products and Add Products via Upload tools within Seller Central.

According to the retailer, the inclusion of product attributes can significantly improve the customer shopping experience by facilitating access to vital product information, ultimately aiding shoppers in making well-informed buying decisions.

As you continue to create or modify product listings in the upcoming weeks, you will observe that certain optional attributes will become mandatory, while some required attributes will transition to optional. Additionally, some attributes will be phased out.

Too Much Work

In the comments section of the news announcement, a handful of sellers expressed frustration at Amazon for making such changes a few weeks before the busiest time of year.

“Notice Amazon always pulls this B.S. right before Black Friday? It is effective November 13th! They do this on purpose so many of our listings are suppressed! They compete against us POINT BLANK,” one seller wrote.

Another seller said that the latest change seems unnecessary after updating the attributes in September. The seller is concerned that the new changes may not be universally applicable, potentially complicating the process of adding variations. Additionally, they anticipate technical issues, including glitches and product suppression, as a result of these changes.

Troublingly, one commenter has experienced negative effects of AI-driven attribute selection, leading to irrelevant attributes being assigned to their listings, such as specifying a handle material for a product without a handle. This has resulted in inaccurate product information, and despite seeking assistance from Amazon support, the issues remain unresolved. The seller advocates for more control over listings and the ability to mark certain attributes as not applicable.

According to Amazon, new listings and any modifications to existing ones will not be added into the catalog until all necessary attributes are supplied through the Add Products or Add Products via Upload tools. For current listings, any required attribute changes won’t take effect unless you actively choose to edit them.
To view the updated list of required attributes, go to Updated attributes within the Add Products and Add Products via Upload dashboard.

Amazon constantly announces new seller tools and product listing requirements. Here’s our latest roundup post to keep you updated. 💪

  1. Track your FBA Shipments from China with ShipTrack Carriers

This announcement is for sellers who use non-partnered carriers for their China-to-US shipments, but often encounter difficulty in accurately tracking their inventory, which could be due to poor data provided by their preferred carrier.

Without reliable data providing insights into the location of your inventory, it is hard to anticipate when it will arrive at an Amazon warehouse and get checked-in, turning marketing planning and stockout avoidance into very real challenges. 

To make cargo tracking from China to US easier, Amazon is now offering ShipTrack, a pickup and delivery service that offers access to a selection of company-vetted carriers and a track and trace system. Other product features include a dispatch system, proof of delivery, chain of custody, and last-mile delivery support.

Similar to the Amazon partnered carrier program, ShipTrack automatically generates the carrier and tracking information for you (and Amazon) in Seller Central. That means you may no longer be required to manually submit such information before shipping your goods from China to an Amazon fulfillment center in the US, allowing you to be more efficient in your inventory order process.

In addition, employing ShipTrack’s “reliable tracking information” greatly enhances Amazon’s ability to predict the arrival of your shipment at FBA, thereby refining the accuracy of estimated delivery dates. This elevated level of shipment tracking also empowers you to make smart restocking decisions to minimize overstock fees and mitigate losses due to stockouts.

While this development sounds like excellent news for sellers who source goods in China, it’s not well-received by some of those who make (and sell) their own original products in the US and who are often, the target of China-based counterfeiters.

“Hooray for supporting China shipments into the US. How about Amazon working harder to keep the fake sellers, bad actors off of Amazon permanently? This is where the focus needs to go stop these people from ruining honest sellers brands and accounts,” commented one seller on the news announcement page.

But alas, “the platform makes too many dollars to remove Chinese sellers or products,” another seller said in reply to the above comment.

In fact, by the end of Q4, ShipTrack will be accessible to even more sellers, specifically those who ship goods from China to Japan and Europe.

To learn more about the new cargo tracking service, go to Send to Amazon: ShipTrack.

Related: How to Ship to Amazon FBA and Speed Up Check-in Times, Amazon Hopes to Restore Consumer Confidence with $1.2B Anti-Counterfeit Initiative, FTC Proposes a New Rule to Rein In Fake Reviews

2. Orders Older than 2 Years to be Archived Starting in September

A new file management process has been implemented by Amazon wherein customer orders older than two years will be systematically archived every month.

This move is part of Amazon’s data security measures to protect customers and their personal data from bad actors.

According to Amazon, certain data fields will be removed from the archived orders, such as the buyers’ personal information – names, contact numbers, addresses, and accompanying gift messages. Meanwhile, less-sensitive information like the date of purchase, product name, ASIN, quantity, price, tax, shipping fee, and sales channel used will be retained.

⚠️ Moving forward, if you need personally identifiable customer details to meet accounting or taxation requirements, consider developing a system of regularly downloading order files as older orders are continually being archived.

Go to Archived Orders for more details.

3. New Product Listing Attributes Required for New Listings

Amazon is adding 206 attributes across 199 product categories!

Starting September 12, 2023, providing these new attributes will be required when creating new listings, or else the product will not be added to your product catalog. Amazon believes that adding relevant attributes to your products can help increase sales, as they “make it easier for customers to search for product information that improves their purchase decisions.”

For example, Amazon just added the following attributes for baby bottle products so that shoppers can quickly find and buy the one that suits their specific needs. They can now search baby bottles by age range, item weight, capacity, bottle type, bottle nipple type, color, or dishwasher safety feature and listings containing any relevant details will likely show up on the customers’ search results pages.

Product TypeAttribute Name
BABY_BOTTLEage_range_description
BABY_BOTTLEbottle_nipple_type
BABY_BOTTLEbottle_type
BABY_BOTTLEcapacity
BABY_BOTTLEcolor
BABY_BOTTLEis_dishwasher_safe
BABY_BOTTLEitem_weight

Although not required, updating a listing with new attributes may be ideal to enhance your product’s visibility and discoverability on Amazon. Make sure to follow the steps correctly, e.g., provide all the necessary product information, to avoid listing suppression, which can affect sales and also lead to products getting stranded at FBA, hurting your IPI Score.

For sellers with numerous product listings, this process could be complex and time-consuming, and thus prone to error.

One seller commenting on the news post said, “Stop this new required attributes madness! I just spent the last hour trying to fix Amazon’s required attribute errors for the product I always list. I have been selling on Amazon for years. Every new Amazon update is a mine field for us sellers new and old.”

Amazon recommends visiting Error code explanations to fix listing errors. As usual, sellers are left to fend for themselves when trying to make things work after an update.

A full list of attributes can be found via Amazon’s attributes spreadsheet (instant download).

Related: 3 New Seller Tools and Product Recall Reporting Page, Disable Amazon Returns Evaluation to Minimize Negative Customer Reviews

New Security Issues Leave Many Sellers Vulnerable to Cyberattacks

An urgent security alert issued by Rafelson Law Firm and SellerBasics.com on October 13th highlights a noticeable increase in unauthorized account access incidents.

Rafelson recently noticed a significant uptick in account hacking cases hitting his desk and decided to dig in. His team uncovered some new methods hackers are using on sellers who are inadvertently exposing themselves to risk. 

Based on the law firm’s investigative efforts, the primary tactics that hackers are currently utilizing include:

To take preventive measures as we approach the crucial holiday sales season, follow the below recommendations.

  • Review your Amazon account information. It’s imperative to ensure that your Amazon seller account’s email and phone number remain confidential, and they are not disclosed anywhere, particularly on your business page.
  • Change your password(s). If you feel your account might be at risk or compromised, update your passwords and keep the new ones in a secure location. You might also consider using an authenticator app for added security.
  • Take note of your Seller ID or Merchant ID. Keep a copy of your Merchant ID, aka Seller ID, a unique number that distinguishes your online store and the array of products you offer within the Amazon marketplace. That way, in the event of a hacking incident and you’re locked out of your account, Amazon can use your ID to help you regain access to your account.

What happens if you get hacked?

If your Amazon seller account has fallen victim to hacking, it’s crucial to recognize that the journey to recovery will be time-intensive.

In the event of Amazon identifying potentially fraudulent actions or suspecting unauthorized access to your account, they reserve the right to promptly suspend your account without prior notification. Even if a bad actor has stolen your earnings, it remains your responsibility to initiate the essential steps to fix the issue and file an appeal against Amazon’s account suspension.

At this point, your primary focus should shift away from recovering stolen online sales proceeds and instead concentrate on the pivotal task of regaining control over your business. Consider contacting a lawyer who can evaluate your case and provide expert guidance on the best course of action.

Related: Bad Actors Book Multiple Inbound Amazon Delivery Dates to Create Artificial Scarcity

The Covert Amazon Program That Could Be Costing You Thousands

Amazon is reportedly auto-enrolling some select sellers in its new inbound shipping solution, the FBA Multiple Destinations Program.

In his recent Amazon-focused newsletter, AUKO eCommerce Founder and Amazon expert, Jon Derkits, reveals that the program goes back as far as 2021. Amazon allegedly “opted sellers in to the program, sending easily overlooked emails like the one below to only the Primary User of an account.”

Sellers unwittingly enrolled in the program may suddenly find themselves paying higher shipping fees that they otherwise could have avoided, had Amazon not resorted to yet another sleight of hand move. 

For Derkits, FBA Multiple Destinations is “a program whereby, in exchange for a small break on fulfillment fees, Amazon is going to have you split your inbound FBA shipment into 3 smaller shipments.”

How is this different than Amazon’s standard practice of splitting shipment? The most notable (and costly) impact is to FTL (full truckload) shipment. Derkits noticed his FTL shipments were suddenly being split into multiple LTL (less than truckload) shipment, increasing shipping costs significantly.  

For Amazon, processing smaller shipments may result in lower cross-docking labor and transit costs. But for many sellers, prepping and transferring inventory this way may result in elevated shipping costs, logistical challenges, and a multitude of inconveniences.

Note: Unenrolling from FBA Multiple Destinations program should not be confused with Amazon’s Inventory Placement Service (IPS).

For a substantial fee, IPS involves a 2-step process that allows you to initially send your shipment to just one fulfillment center instead of directly sending it to multiple locations from your warehouse. Once your inventory arrives at the initial receiving center, Amazon will then split it up into several boxes and distribute those boxes across different fulfillment centers as they see fit.

A New Costly Nightmare?

One seller on the Seller Central Forum wrote, “We are preparing products all day long, box them and at the end, we are creating one single shipment going to 1 pretty close destination, and it is simple and easy…

With this new feature, which is going to be implemented all over the board, we are going to have to split at last minute all the inventory in 3, with random quantities, and we are going to pay much more for shipping everyday to 3 destinations. The discount per item is simply ridiculous, at $.05 per item.

For us, it’s a $20 discount per day, for at least $100 increase in shipping costs. Why every single move of Amazon is making things more difficult and more expensive?”

While Amazon may tout a minor savings of just $0.05 cents per small standard unit and $0.09 for large standard, the cumulative expenses incurred by these shipment splits tend to far outweigh any perceived benefits for most sellers.

Derkits himself revealed in his email that staying opted into the program would have cost him $14,401 in additional yearly inbound freight transportation charges.

However, not all sellers miss out on the benefit of FBA Multiple Destinations. In the comments section of this YouTube video, one seller reportedly gained considerable savings through the program.

“If you’re sending volume in my opinion it’s worth it. I sent in 400 units 3 location, usually this would have been $60-$70 this time around I paid $27,” 

Meanwhile, over at Reddit, one seller commented, “We use it, but all our stuff is small so we can ship 5k+ units on a pallet. The three warehouses are in the same region and average $100 per pallet. So at $0.05 Amazon is basically paying us to ship this way.”

That said, when it comes to whether or not the program will save you money long-term, it all boils down to the number of SKUs you have to ship and the distance between your location and Amazon’s designated receiving centers.

It depends on your workflow and circumstances but if it’s going to take you so much time and effort to manually prep and pack different SKUs for multiple shipments going to several fulfillment centers, opting out of FBA Multiple Destinations .

How to Opt Out

As easy as it is to find yourself inadvertently enrolled, unenrolling proves to be quite a challenge.

The program is difficult to find. In fact, if you attempt to search for it in the help center, it will not show up. The only success in locating it has been with a direct link to the program policy.

There is opt out feature within your Seller Central account. The only ways to opt out are by opening a case with Seller Central and then emailing [email protected].
“It took multiple Seller Support (SeSu) cases to get some ground truth, and then multiple emails to get un-enrolled,” Derkits shared. He advises against opening a live chat or phone case, instead opening a case via email. He then lays out the below instructions.

To sum up, FBA Multiple Destinations can be a profit killer for some sellers but a financial benefit to others. It all boils down to crunching the numbers for your business. 

But if you are finding that you suddenly have to split FTL into LTL or that the additional prep and shipping costs of multi-destination shipping is high, opting out may be the best option. Bottom line, now that you know about this “secret” program, you have the ability to make that decision for yourself.

You can read more from Derkits on
this edition of his recurring newsletter and can subscribe for future insights.

Related: Amazon Offers New Fulfillment Fee Discounts on Select ASINs

FTC Proposes a New Rule to Rein In Fake Reviews

Update 10/17/2023: An alliance of cross-industry leaders, including Amazon, is coming together to ensure the integrity of online reviews. 

Coalition for Trusted Reviews

Amazon is collaborating with Booking.com, Expedia Group, Glassdoor, Tripadvisor, and Trustpilot to introduce the first global Coalition for Trusted Reviews. Their goal is to:

  • Establish industry standards for detecting fake reviews
  • Promote best practices in managing online reviews
  • Facilitate the exchange of intelligence concerning deceptive activities by entities involved in the sale of fraudulent reviews
  • Safeguard consumer access to reliable information on their respective platforms

For quite some time, online marketplaces have grappled with the persistent issue of bogus reviews, despite their ongoing attempts to eliminate it.

A significant portion of this problem can be attributed to fake review brokers who, in pursuit of monetary gain, freebies, or various incentives, actively seek fabricated customer reviews via social media and encrypted messaging apps. These brokers engage in both promoting fake positive reviews to enhance business and seller sales and orchestrating negative reviews to detrimentally affect their competitors’ sales and performance.

Hence why, Becky Foley, VP of Trust & Safety at Tripadvisor, has emphasized a dedicated commitment to targeting individuals attempting to sell phony reviews to businesses seeking to artificially boost their star ratings and online reputations. This mission of eradicating such practices takes immediate focus for the coalition.

“These actors often operate outside of jurisdictions with a legal framework to shut down fraudulent activity, making robust cooperation even more important,” she said in a press statement.

The formation of the trusted reviews coalition stems from discussions that emerged during a conference on “Fake Reviews” arranged by Tripadvisor in San Francisco last year. The companies have confirmed their intention to convene once again, with plans to meet early in December at a follow-up conference hosted by Amazon, scheduled to take place in Brussels.

Minimizing Regulatory Risk

While the timing may have nothing to do with FTC’s recent fake reviews rule proposal, it is interesting to see how Amazon’s actions prior to and on the heels of government intervention seem to correlate.

The founding of the coalition could be seen as way of to minimize regulatory risk that the pending rule on fake reviews may cause if passed into law.

Regulatory risk pertains to the potential danger posed by the introduction of new laws, regulations, or amendments to existing ones, which could result in companies falling out of compliance with their obligations. This non-compliance may lead to financial burdens, decreased profitability, business loss, or other detrimental effects on their functions, reputation, or financial performance.

By keeping abreast of evolving legal frameworks, guidelines, and rules while actively monitoring regulatory activities, Amazon can take a proactive approach to assess how emerging changes might introduce new risks or require policy adjustments.

In response, the company can implement measures to minimize these risks, control expenses, and secure ongoing compliance.

On June 30, 2023, the Federal Trade Commission (FTC) published a new proposed “Rule on the Use of Consumer Reviews and Testimonials,” or Part 465, which aims to illegalize certain customer review practices and authorize courts to impose a civil penalty of up to $50,000 per violation.

Factors that Compelled the FTC to Take Action

The success of a product frequently hangs in the balance of online reviews, as retailers and search engines prominently display them. This is done to aid customers in making smart decisions, but recent studies suggest that some of these reviews might be deceptive and misleading.

In fact, unreliable reviews have become so prevalent that 85% of customers believe what they read online is sometimes or often fake or fraudulent

On Amazon.com alone, 42% of 720 million reviews analyzed by Fakespot were deemed fake in 2020. Many of the bogus reviews are the work of AI bots, strategically aimed at manipulating product ratings. Additionally, some third-party sellers have reportedly resorted to unethical practices, such as incentivizing positive reviews through cash payments or free or discounted products.

Even though using shady review tactics is against Amazon’s product review policy, it helps bad actors influence customers to buy their products over competitors, according to this 2022 study.

Conducted in the UK, 10,000 shoppers were presented with five identical products.

During the experiment, certain participants were exposed to fake reviews, inflated star ratings, or a combination of both. The insightful findings revealed that these unreliable testimonies had an impact on consumers’ wallets, causing them to spend an additional $0.12 for every dollar spent.

The study also found that individuals exposed to such deceptive information were six percentage points more likely to end up purchasing a flawed product.

Notably, the influence of star ratings was also brought to light. The paper disclosed that a mere one-star increase in a product’s rating led to a substantial surge in demand, driving it up by 38%.

Lastly, it was revealed that providing people with warnings and educational sources on the topic of review manipulation, though not thoroughly effective, could potentially curtail the adverse effects by 44%.

This study sheds light on the importance of transparent and genuine feedback in the decision-making process of consumers, as fake reviews undercut honest businesses, tarnish brands, erode trust between sellers, customers and platforms, and overall lead to bad shopping experiences – all of which can have emotional and economic repercussions.

As for the efforts marketplace platforms take in policing these reviews, the FTC itself received comments from three individuals dedicated to fighting fake reviews – the Transparency Company, Fake Review Watch, and Fakespot. All three commenters claimed that “the strategies that are currently being used by review platforms are insufficient.”

All this contributed to FTC’s move to take action, in an effort to finally capture a wider swath of malicious customer review practices in the US.

FTC’s Efforts to Address Rampant Fake Reviews

The newly added Part 465 has undergone an extensive development process, as is customary for any federal regulatory body.

In 2019, FTC pursued legal action against a merchant for disseminating deceptive information and engaging in the purchase of counterfeit reviews. Prior to that, the FTC had also addressed the issue of “influencer marketing,” where endorsers failed to disclose their financial ties to products they were promoting.

Now, the agency is poised to implement a comprehensive provision based on rules initially presented in November 2022.

Part 465 is the culmination of years-long research and extensive dialogue with various stakeholders, including businesses, consumers, and advertising trade organizations. 

Interestingly, despite Trustpilot not supporting the rulemaking and certain trade groups urging the FTC against rigorous enforcement on this thriving fake review business, the agency remains resolute in its pursuit.

Product Review Practices Prohibited Under the New Proposed Rule

FTC’s proposed rule would stop businesses or sellers from utilizing the following malicious review and endorsement methods.

  • Fake customer reviews, customer testimonials, or celebrity testimonials. Engaging in the fabrication, production, sale, purchase or solicitation of reviews by a reviewer who meets any of the following criteria is considered a violation.

    The reviewer does not exist. For instance, bad actors using automated buyer accounts or bots to boost positive reviews for their clients and downvote positive reviews for their rivals.

    The reviewer did not use or have any genuine experience with the product, service, or business being reviewed or endorsed. For example, using AI chatbots like ChatGPT to generate fake glowing reviews and then creating multiple dummy accounts to be able to spam a listing with those reviews.

    The reviewer significantly distorts their experience with the product, service, or business being reviewed. Additionally, the rule would also restrict people from acquiring reviews or spreading such testimonials if they were aware, or should have been aware, of their fraudulent or deceptive nature.
  • Honest negative review suppression. Making genuine negative reviews disappear or threatening individuals to prevent or delete their poor feedback is called review suppression. FTC has recently undertaken its first case targeting a company’s deceptive practice of withholding negative reviews, and it has now come to a $4.2 million settlement with Fashion Nova, LLC, a fast-fashion retailer based in California.

    Per FTC, Fashion Nova purportedly integrated a third-party review management system that enabled the company to post specific reviews automatically, while holding back others pending their approval. The fashion retailer allegedly employed this system between 2015 and 2019 to instantly publish favorable four and five-star reviews, while deliberately choosing not to display any of the numerous reviews that rated below four stars. This means Fashion Nova misrepresented the opinions of all customers who contributed feedback on its website.
  • Review hijacking. Businesses would be prohibited from using or repurposing an existing listing or product page (often with excellent reviews), then updating the product’s details with those of a considerably distinct product.

    For example, the Variation Relationship feature on Amazon organizes reviews from diverse product variations into a unified collection. Certain product offerings have multiple options, such as various shapes, sizes, colors, and more. However, Amazon only allows one consolidated set of reviews to cover all these distinct variations. 

    Imagine a selection of 4 different colors of Apple Watch Series 8, each available in aluminum finishes, along with an additional choice of 2 different wrist sizes. Despite these numerous options, customers will provide reviews for the watch as a whole, rather than separately for each variation. This ensures a comprehensive assessment of the product’s overall quality and performance, but certain sellers have found a way to exploit this particular feature.

    Their intention is to artificially inflate the number of reviews for their products. To achieve this, they resort to hijacking unrelated listings and incorporating them as product variations. As a result, the reviews from these stolen listings get merged with the genuine reviews of their own product, leading to a deceptive increase in the product’s overall rating. While these reviews might indeed be authentic and written by real individuals, they were originally intended for a completely different product altogether.
  • Biased reviews from insiders like employees. The forthcoming regulation aims to impose restrictions on corporate execs and managers, preventing them from authoring reviews or testimonials for the products or services offered by their own company, unless they explicitly disclose their affiliations. It also seeks to disallow businesses from promoting testimonials provided by internal personnel without transparently revealing any existing relationships.

    Additionally, the proposed rule will address specific instances where company officers or managers seek reviews from their employees or relatives, and whether the businesses were aware or should have been aware of such connections, to determine whether such solicitations are permissible.
  • Company-controlled review websites. An outright prohibition would be imposed on businesses like Yelp, TrustAdvisor, and Trustpilot aiming to establish or exercise control over websites claiming to offer unbiased viewpoints concerning a specific category of products or services, which coincidentally include their own offerings. 
  • Selling fake social media indicators. For example, businesses that sell or buy fake followers or views to gain prominence or “misrepresent their importance for a commercial purpose.”
  • Incentivized positive or negative reviews. This approach deceives shoppers looking for authentic feedback on a product or service and undercut honest sellers. Amazon itself updated its Community Guidelines to ban this malicious practice in 2016, while making an exception for its Vine program.

Companies Subject to the Proposed Rule on Fake Reviews

The new proposed rule would encompass all businesses, defined broadly as “an individual, partnership, corporation, or any other commercial entity that sells product or services.” 

However, internet service providers like Amazon, Google, Yelp, Tripadvisor, and social media sites where thousands of fake review brokers recruit reviewers may not be directly held accountable, the Washington Post reports.

That’s because Section 230 of the Communications Decency Act states:

“No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.”

Therefore, these companies may opt to assert immunity under Section 230, making it difficult for the Commision to file complaints against them.

Per FTC, “Amazon did not state support for or opposition to the rulemaking.” The retailer already has existing policies and initiatives to combat fake reviews and counterfeiters on its site.

In 2021, Amazon invested over $900 million and employed a dedicated workforce of more than 12,000 individuals in safeguarding its customers and store from fraud and abuse. Notably, in 2022, Amazon proactively put an end to more than 200 million suspected fake reviews.

Amazon also reported the existence of over 16,000 social media groups involved in buying or trading misleading reviews. Consequently, social media sites such as Facebook, Twitter, and Instagram removed groups that had amassed over 11 million members. In response to this issue, Amazon took legal action and filed a lawsuit against more than 10,000 Facebook groups in 2022.

These efforts and FTC’s proposed rule may not be enough to completely wipe fake reviews off of Amazon and other platforms, but they do hold the potential to bring about some much-needed relief.

Related: A Purge Could Be Coming For Fake Reviews on Amazon, Amazon Highlights ‘Frequently Returned’ Products You Should Think Twice Before Buying, Amazon Hopes to Restore Consumer Confidence with $1.2B Anti-Counterfeit Initiative

How FTC’s Historic Monopoly Case vs. Amazon Might Impact Sellers

As recently announced, Amazon faces an upcoming legal showdown against the Federal Trade Commission (FTC) and 17 state attorneys general who sued the company on Tuesday over alleged abusive practices that harm competition, raise prices, and hinder innovation.

Making the Case

The agency takes action against anticompetitive practices as violations of Section 5 of the FTC Act, which prohibits use of “unfair methods of competition” and “unfair or deceptive acts” to acquire or maintain monopoly power.

Monopoly power is a single or a small group of companies’ ability to set higher prices due to little or no competition from other firms. While gaining a sizeable market share through superior product or service, business acumen, or innovation is not illegal in the US, power acquired or maintained by using unreasonable methods is considered a violation.

FTC’s suit against Amazon seeks to punish the eComm giant for wielding “its vast power, size, and control over multiple business units to implement an interrelated and exclusionary course of conduct” and “restore the lost promise of free and fair competition,” FTC Chairperson Lina Khan said in a statement.

By making it extremely difficult for rivals like Shopify and Walmart to compete, Amazon has presumably managed to:

  • Charge high seller fees, which then get passed on to shoppers. Per FTC, Amazon takes roughly $1 out of every $2 of sales from sellers who use its fulfillment network, many of whom are small businesses with razor-thin margins.
  • Strong-arm sellers to use FBA, which offers Prime benefits like fast and free delivery. Otherwise without Prime eligibility, sellers may “disappear from Amazon’s storefront,” or Buy Box, the FTC states. This also forces some sellers to pay more for ads, which further eats into their profits. And as a result, they’ve had to raise their prices to stay profitable.
  • Penalize sellers for offering lower prices on other sales channels like Walmart, eBay, or Shopify. Amazon may remove them from the Buy Box, suppress their offers, suspend the ship option, or worse, restrict their selling privileges. The company does so “to prevent rivals from gaining business by offering shoppers or sellers lower prices.”

Sellers told the Commission that because they rely so much on Amazon (after practically decimating competition), they effectively have no choice but to succumb to the company’s increasing demands.

Amazon’s Antitrust Violations

Below are some of the anticompetitive methods that Amazon allegedly uses to maintain market power illegally.

Multiple “Anti-Discounting” Tactics

The FTC finds that the tech giant employs a series of strategies aimed at stunting competing retailers’ growth through discounted pricing.

For example, Amazon uses advanced web crawlers that actively monitor and scour the internet for potential price drops that could pose a threat to the company’s dominant presence. When a web crawler spots that an item is cheaper on Walmart than a seller’s offer for the same item on Amazon.com, Amazon penalizes that seller.

To avoid punishment, many sellers hike their prices off Amazon, while others never tried to offer discounts in the first place or simply refused to start selling on other channels.

Within the platform, Amazon also uses the same tactic to make it hard for third-party sellers to set their own prices that would allow them compete better with the company’s first-party (1P) retail arm, which accounted for 40% of its total sales in Q2 of 2023.

“Ultimately, this conduct is meant to deter rivals from attempting to compete on price altogether – competition that could bring lower prices to tens of millions of American households.”

Project Nessie

Certain sections of the complaint concerning the retailer’s “anti-discounting” tactics contain extensive redactions, particularly the ones about a secret algorithm named “Project Nessie.”

The complaint alleges, “Amazon’s Project Nessie has already collected over [redacted] from American households.”

Although the exact function of Project Nessie remains elusive, Amazon previously stated in a 2018 blog post that Nessie is “a system used to monitor spikes or trends on Amazon.com.” as well as the name of one of its buildings.

TechCrunch speculates that Amazon could be using Project Nessie to manipulate prices and search results “based on the immense amount of sales data” it has access to. This data may provide insights into the price a customer is willing to pay, which for Amazon, “would be both highly profitable and fit the description of belying the customer-first narrative.” However, this could also price sellers with overvalued products out of the market.

Rigging Search Results

The FTC claims that Amazon manipulated search results to promote its in-house brands by showcasing them within the “expert recommendation” widget.

“Rather than competing to secure recommendations based on quality, Amazon intentionally warped its own algorithms to hide helpful, objective, expert reviews from its shoppers,” the agency explained. 

Amazon search and product pages have also become increasingly filled with ads, overshadowing what used to be a focus on providing pertinent organic search results. According to the agency, the prime real estate in search results now prominently features “Sponsored Brand” and “Sponsored Product” ads, “making relevant products harder to find and less likely to be clicked.”

Abusing the Featured Merchant Algorithm

This algorithm allows Amazon to select one offer to display in its highly coveted Buy Box or “Featured Offer.” Being the Featured Offer can lead to substantial sales, as a large number of purchases on the platform are made using the “Add to Cart” and “Buy Now” buttons in the Buy Box. 

The FTC asserts that Amazon purposely drives customers away from the sellers not featured in the Buy Box by displaying additional offers on the product detail page.

Suppose you’re using a desktop to view an offer from a seller who is not featured in the Buy Box. In that case, you must either click a link that takes you to the “All Offer Display,” or scroll down the page to view “Other Sellers on Amazon,” which conveniently includes a list of offers from sellers selected by Amazon.

Favoring Prime Sellers Over Non-Prime

The case also delves into a significant facet of Amazon’s operations, focusing on its expansive fulfillment network. It scrutinizes how the retailer’s product ranking algorithm exhibits a preference for items that qualify for Prime status, a designation contingent upon utilizing Amazon FBA.

What’s Not Included in the Lawsuit

The suit does not cover Amazon’s potential data exploitation tactics to find out what items it should sell under its own private label brand, allowing them to directly compete with (and undercut) sellers.

Additionally, there are accusations of Amazon engaging in predatory pricing strategies to weaken competitors, potentially leading to their acquisition, and assertions of the retailer wielding significant influence within labor markets to squash unionization activity.

Many of these assertions were documented in a comprehensive 450-page congressional report, co-authored by Lina Khan during her tenure as a House Judiciary Committee staffer before her FTC appointment.

Amazon Strikes Back at FTC

In a press statement dated September 27, David Zaplosky, Amazon’s Senior VP of Global Public Policy and General Counsel, refuted these charges.

Key points from Zaplosky’s response include:

Consumer pricing. Zaplosky argued that Amazon strives to match the low prices of other retailers, both online and offline, for its own products. Third-party sellers independently set their prices on the platform, but Amazon provides tools and education to help them maintain competitive pricing. Amazon does not promote non-competitive prices, but the FTC’s case suggests that this approach leads to higher prices, a view Amazon disputes.

Managed fulfillment and advertising. The FTC lawsuit contends that Amazon forces sellers to use FBA to qualify for Prime sales, which includes product storage, packaging, shipping, returns, and customer service. Zaplosky clarified that FBA is an optional, competitively priced service, and sellers are not compelled to use Amazon’s fulfillment or advertising services for Prime eligibility.

Retail competition. Amazon challenged what it termed as the FTC’s “gross mischaracterization” of the retail industry, emphasizing that over 80% of consumer product purchases occur in physical stores, highlighting the competitive landscape. Zaplosky stressed that consumers have numerous options for shopping, from brick-and-mortar stores to online and hybrid models, fostering price competition and choices for consumers.

Should Sellers Be Worried?

During Khan’s 2022 testimony to a Senate committee, she said that the FTC would not accept any concessions from Amazon to settle the lawsuit, suggesting a possible break up of the company. This means divesting major parts of its business, such as FBA and Amazon Ads, to address the government’s antitrust concerns.

However, Khan told NPR Tuesday that at this point, the complaint is not about breaking up Amazon, but rather the complaint is “focused on establishing liability.”

But if Amazon is liable, a court order seeking to stop the illegal tactics could include “structural relief,” a legal term referring to a potential breakup of the retail giant.

When it does happen, “there will be honest and fair competition in the marketplace and the public will benefit. The public will benefit through lower prices, higher quality, greater selection, more innovation. And both shoppers and sellers will have more opportunity, right?” Khan said.

Structural relief as legal remedy might be enough to put pressure on Amazon to make meaningful changes right now.

Multiple sellers interviewed by Modern Retail shared the sentiment that “one positive thing that could come out of the FTC lawsuit is if it persuades Amazon to make changes to its Buy Box.” 

For many sellers, achieving success on Amazon heavily relies on winning the Buy Box, which they find to be exceedingly challenging. Meanwhile, some sellers perceive certain aspects of the FTC lawsuit, such as attempts to portray Amazon as a monopoly or critiques of its fulfillment service, as exaggerated.

They hold hope that the FTC lawsuit might pave the way for constructive improvements, but there is also concern among them about potential excessive government intervention.
In a Facebook post, Paul Rafelson, seller advocacy lawyer and the most cited resource in the antitrust investigation, provided insights into how the case would likely unfold in the coming years, saying drastic changes are not likely to occur soon.

Such a landmark monopoly case is, as Rafelson puts it, “a Herculean task” and can take years to resolve. A further point highlighted is that the outcome of the lawsuit might also hinge on the 2024 Presidential election’s results. Since the president appoints the FTC chair, a shift in administration could usher in a new leadership at the FTC with a different perspective on the case. The possibility of an amicable resolution between the FTC and Amazon is also mentioned, as previously seen in the recent EU Commission deal

So, sellers should not be worried about losing Amazon as a sales channel, at least not while the case is still in its early stages. It may be best to continue advocating for their “right to a transparent and fair eCommerce platform” to “ensure the platforms play fair and that every seller plays by the same rules (no matter the country they operate from),” Rafelson wrote.

FTC’s latest lawsuit vs. Amazon is part of the ongoing scrutiny of major tech companies under the leadership of Lina Khan.

Amazon has faced increasing regulatory scrutiny, with antitrust concerns dating back to 2019, when the FTC began investigating the company. The agency’s actions are part of a broader conversation about the market power and practices of tech giants, echoing calls from politicians like US Senator Elizabeth Warren to address what she termed as the “monopolies” of companies like Amazon, Google, and Facebook.

Additionally, the FTC is reviewing Amazon’s acquisition of One Medical and its planned purchase of iRobot, highlighting ongoing regulatory attention on the company.

Related: FTC Proposes a New Rule to Rein in Fake Reviews, FTC Lawsuit Alleges Amazon of Tricking and Trapping Customers into Recurring Prime Subscriptions, Why Amazon Wants you to Lobby Congress, AMZ Faces Tougher Scrutiny Under EU’s Digital Services Act

Amazon and Flexport Vie for End-to-End Logistics Supremacy

On September 12, Amazon and Flexport unveiled new offerings designed to assist sellers in seamlessly connecting their global shipping needs with US warehousing and fulfillment services.

However, many sellers have a lingering doubt whether the two logistics giants can really bring together the various supply chain links needed to fulfill their factory-to-porch delivery promise. Hence the age-old question remains, should you put all your eggs in one basket?

With so much potential, the end-to-end (E2E) logistics space is rapidly evolving into an arms race between major players.

Tale of the Tape

Top Service FeaturesSupply Chain by AmazonFlexport Revolution
Factory PickupYesYes
Freight Management (ocean, air, and truckload)YesYes
Storage YesYes
Prep and HandlingYesYes
Integrated Replenishment Transfer from an upstream storage facility (e.g., Amazon Warehousing & Distribution or AWD) directly into FBA or 3PLYes (if auto-restocking is enabled, your inventory is considered “in stock” and buyable when received by AWD. AWD is exempted from capacity limits, allowing you to store as much inventory as you want and conveniently transfer units as needed)Yes (but shipping inventory from a non-AWD facility to FBA may subject you to capacity limits. On the upside, though, this actually prevents you from putting all your stock in Amazon. To minimize stockouts, set aside buffer stock at your supplier or 3PL and transfer units as needed)
Order FulfillmentYesYes
Parcel Delivery to CustomersYes (within 1 to 2 days)Yes (within 1 to 3 days)
Multichannel Distribution Across Physical Stores or Retail PartnersYes (currently in a pilot test, but will be rolled out more broadly later this year)Yes (send inventory directly into FBA, Walmart Fulfillment Services, and 15+ wholesale channels, including Costco, Target, and Nordstrom)
Supply chain financingNo (though Amazon Lending is an option for many sellers and could be utilized toward supply chain.)Yes via Flexport+, a $149/month membership that provides you with improved repayment terms (up to 120 days), faster shipping speeds, and advice from logistics experts. 
PricingTransportation, storage, and fulfillment costs depend on product weight and dimensions. Storage costs can also vary by season.Only pay for the services you use with predictable, all-inclusive pricing. No hidden fees.
Pricing structure for storage is at the pallet/carton level, removing hidden overages and costs.

These recently unveiled E2E supply chain solutions share a common goal and target audience. Both aim to:

  • Help sellers deal with various challenges within their global supply chains by making it easier for them to access tools, resources, and capabilities that were once only available to large companies.
  • Keep sellers’ 3PL warehouses, physical stores, or retail partners in stock so that they can consistently fulfill same-day or next-day deliveries through an efficient multichannel inventory distribution system.

Those closely following the logistics industry note that the launch timing and similarities of Supply Chain by Amazon and Flexport Revolution are far from accidental. This can be attributed to the influential role played by Dave Clark, who previously served as the CEO of Flexport and prior to that held a significant position within Amazon’s operations.

Conventional wisdom suggests that Amazon, owing to its substantial financial resources, expansive warehouse footprint, and dominant eComm presence, possesses the more appealing offers.

However, Flexport, as a freight forwarding company, is staking its claim on its extensive experience in facilitating China-to-US trade as a unique selling point. This could mean access to seasoned freight forwarders, affordable freight rates, better customs clearance support, and faster international shipping speeds, potentially creating a more seamless trans-Pacific trade experience overall.

Additionally, its recent acquisition of the eCommerce fulfillment service, Deliverr, presents them with a seasoned D2C distribution network to facilitate the last mile delivery component.

All things considered, it’s a tough choice between Amazon and Flexport, but this is the kind of rivalry that will benefit sellers in many ways. Both provide an AI-driven platform where you can shop for the best freight rates, create and track shipments, manage inventory transfers (global and domestic), and more from a single dashboard. 

It all probably boils down to who truly has the infrastructure to meet your unique logistics needs, including the ability to provide support during disruptive supply chain events. 

Related: Supply Chain by Amazon, 3PL Logistics Backup for Amazon, Lead Time in Inventory Management for Amazon Sellers, How to Ship to FBA (And Speed Up Check-In Times)

UPDATED: 60-Minute Amazon Drone Delivery is Now a Reality

60-Minute Amazon Drone Delivery is Now a Reality

UPDATE 09/21/2023: The Federal Aviation Administration (FAA) has finally allowed UPS and Zipline to fly commercial drones beyond the visual line of sight (BVLOS) of ground operators, a landmark decision that opens up many opportunities for operators, sellers, and consumers.

What is BVLOS?

BVLOS refers to drone operations conducted beyond the direct visual observation of a spotter manning a designated delivery route. Due to safety concerns involved in flying drones outside the visual range, the FAA has set an extensive process for attaining BVLOS approval, which for months has grounded Amazon’s lofty drone delivery ambitions in the US.

Companies looking to get approved for BVLOS drone delivery must submit detailed documentation of their flight operations, including data on their unmanned aerial vehicles. The aviation rulemaking committee then reviews the application and decides whether to grant approval.

Disruptive Potential of BVLOS in Last-Mile Delivery

With BVLOS approval, UPS and Zipline can now fly delivery drones over longer distances with less manpower.

UPS’s Matternet M2 Drone, for instance, can “carry payloads of up to 2 kilograms (4.4 pounds) over distances of up to 20 kilometers (12.4 miles) over urban and suburban environments.”

Meanwhile, Zipline’s Sparrow drone has been approved by the FAA to make BVLOS deliveries without spotters in Salt Lake City and Bentonville, Arkansas. The drone model is designed to unload packages using a parachute. 

“This exemption from the FAA represents a monumental shift for logistics and equitable access in the U.S. It builds the foundation for Zipline to scale to deliver food, medicine, consumer goods and other supplies to millions of Americans on-demand, and to do so in an environmentally conscious way,” said company COO, Liam O’Connor, in a prepared statement.

The FAA making widespread use of commercial drones a reality could make last-mile deliveries more efficient for everyone in the future.

For logistics companies and sellers, last-mile incurs the highest costs and consumes the most time. But drones offer the potential to automate delivery and improve wait times, thereby alleviating pressure on drivers to meet unrealistic quotas and mitigating the customer dissatisfaction associated with shipping delays.

For consumers, it could widen their options for ultrafast delivery outside of Amazon’s logistics network, potentially making deliveries cheaper.

In sum, with the aviation authority and drone operators pushing for advancement in BVLOS capabilities, drone delivery is poised to become a feasible and cost-efficient logistical solution to common supply chain issues across various sectors.
Related: Battle for Last-Mile Logistics Heats Up as Amazon Expands Same-Day Delivery Network

Prime Air, Amazon’s drone delivery service, has finally arrived in California and Texas. 🚀

According to Ars Technica, the online retail giant started flying 5-pound packages by drones to customers in Lockeford, CA and College Station, TX.

With this service, Amazon hopes to speed-up their last-mile deliveries from 1-2 days to less than an hour, especially at a time when they’re reportedly struggling to meet their 2-day delivery promise.

If successful, drone delivery may help Amazon change customer delivery expectations and potentially disrupt the retail industry (once again), aka the Amazon Effect. Why shop in-store when you can get your items delivered right to your doorstep in less than an hour?

In a statement to KTXL Fox 40, Amazon Air spokesperson, Natalie Banke, said that the company’s goal is to safely introduce its drones to the skies. Banke also mentioned expanding drone deliveries to more cities over time.

9 Years in the Making

Prime Air was first revealed by former Amazon CEO Jeff Bezos in a 60 Minutes interview in 2013. Part of the initial plan was to use Octocopters, drones with 8 motors and propellers, to transport lightweight packages to customers in just 30 minutes.

Bezos had estimated that Octocopters will be available to customers in 4 to 5 years, but several technical challenges extended that lead time to 9 years.

In August 2022, Amazon finally got the greenlight from the Federal Aviation Authority (FAA) to fly delivery drones with a maximum payload of 5 lbs each. The said weight represents 85% of the company’s last-mile shipments. 
Four months later, the eComm giant’s current model, MK27-2 drones, which are reportedly lighter and quieter than Octocopters, started doing deliveries in California and Texas to help measure buyers’ interest in getting their packages flown over and placed safely into their backyards.

Amazon-Air-MK27

“The drone will fly to the designated delivery location, descend to the customer’s backyard, and hover at a safe height,” Amazon said.

“It will then safely release the package and rise back up to altitude.”

When assessing the safety of drone operations, the FAA takes into the consideration user feedback and all types of potential hazards such as:

  • Drones crashing into homes or people
  • Propellers causing injuries to people such as cuts and stabs and hearing problems due to engine or prop noise
  • Hacking concerns. Drones could be used to hack into computer systems.
  • Privacy concerns. Drones can hover over a property or look down into people’s yards.

This is why Amazon continuously develops new tech and redesigns their drones to ensure people feel comfortable receiving packages by unmanned devices.

“While it’s impossible to eliminate all risks from flying, we’re taking a proven aerospace approach to design safety into our system,” Amazon said in a press release dated August 17, 2022.

“Any car you drive is tested—that’s how you know it’s safe. We’re developing our drones in the same way. Just as aircraft manufacturers test their new planes, or automakers test their new vehicles to failure before they go on sale, we test our drones in private and controlled facilities.”

In 2020, the company received a Part 135 Air Carrier Certificate from the FAA. This means Amazon has provided all the required evidence that supports the safety of their drone operations, and thus given permission to “operate as an airline and deliver small packages via drone.”
As of this writing, only Lockeford and College Station residents may sign up for Prime Air. Once signed up, Amazon will then confirm whether they can deliver by drone to the customer’s mailing address. Confirmed orders will also get an estimated delivery time and tracking number.

What’s Next for Prime Air

As Amazon puts it, the MK27-2 drone model is just the beginning. Expect the eComm giant to “constantly redefining, iterating, and experimenting to meaningfully transform the customer experience.”

Amazon also plans to launch its next generation of drones, the MK30, in 2024. Lighter and smaller than the MK27-2, MK30 will have:

  • Increased range
  • Improved temperature tolerance
  • More safety-critical features
  • New capability to fly in light rain

With these improved features, customers may feel even more encouraged to select drone delivery over traditional modes of shipping.

Given its potential, we may also see other retailers and legacy carriers offering drone delivery in the coming years.

In fact, corporate giants like Walmart, Alphabet, Domino’s Pizza, and DHL have already taken the first step.

Bulgarian planemaker, Dronamics, is also slated to become the world’s first “cargo drone airline” in 2023. Dubbed Black Swan, the unmanned aircraft is the size of a delivery van and large enough to carry a 770-pound payload and travel across a 1,550-mile range (e.g., Austin, TX to NYC), essentially covering middle-mile shipments. 

In sum, it’s an exciting time for the logistics industry as drones could be a safer and faster alternative to existing logistics systems that aren’t as efficient during a pandemic or supply chain crisis caused by labor issues, port congestion, or maritime/air disasters. It will be interesting to see what evolves in this space.

UPDATED: Amazon Wants to Take a Bigger Chunk Out of Seller Profits with 2 New Fees

UPDATE 09/21/2023: In a rare move, Amazon has dropped its plan to impose a 2% fee on sellers who use Seller Fulfilled Prime (SFP). 🤯

The company had initially scheduled to initiate this fee on October 1st, in addition to the existing 8% to 15% commission it levies on all sellers. 

According to documents referenced by Bloomberg, Amazon stated that it based its decision on feedback from SFP sellers, though both some sellers and media outlets finger the pending antitrust suit as a more likely motivator. 

In a statement to Forbes, an Amazon rep said that “after careful consideration we’ve made the decision not to implement this program fee to ensure seller sentiment related to the fee does not impact program participation.” 

The spokesperson further explained that the additional fee was intended to assist the company in offsetting infrastructure expenses. However, many sellers refused to believe that, telling Bloomberg that the new fee was “as an attempt to pressure them into using Amazon’s logistics services rather than fulfilling orders themselves,” potentially implicating the eComm giant in another anti-competitive practice.

Amazon’s logistics program has been the target of FTC’s increasing antitrust scrutiny, alleging that it is favoring its own products and sellers who use FBA/Prime and disincentivizing non-Prime sellers on its platform. The agency may file suit centered precisely on that allegation later this month, as reported by Reuters.
Related: FTC Alleges Amazon of Tricking and Trapping Customers into Recurring Prime Subscriptions, Amazon Faces Tougher Scrutiny Under EU’s Digital Acts

One week after announcing a Prime Day-like event in October, Amazon decided to spoil the fun by bringing back its seasonal surcharge and imposing an extra fee for those who use Seller Fulfilled Prime.

2023 Holiday Peak Fulfillment Fee for FBA and MCF Orders

From October 15, 2023 through January 14, 2024, a holiday peak fulfillment fee will apply to the following orders:

  • US FBA
  • Canada FBA
  • Multi-Channel Fulfillment
  • Remote Fulfillment with FBA

The seasonal surcharge rates remain the same from 2022 for US and Canada, per Amazon. But you will see that the holiday fee has the following significant increases in comparison to fulfillment fees during off-peak:

  • Small standard: $0.20 more per unit
  • Large standard up to 2 lbs: $0.30 more per unit
  • Large standard between 2 lbs and 20 lbs: $0.50 more per unit
  • Small oversize: $1 more per unit
  • Medium, large, and special oversize: $2.50 more per unit

Check out the updated rate card for US FBA, CA FBA, MCF, FBA Remote Fulfillment to see the fee changes in greater detail.

Some sellers in the comment section of the news post feel like there’s no end in sight to Amazon fee hikes. Meanwhile, others are more concerned about whether paying these extra fees will really get their inventory checked-in on time for the holidays or Amazon’s “just charging extra for the same abysmal service FCs have been providing of late.”

One seller in particular is surprised about the announcement, given that “most customers already shop at Temu for lower prices,” causing their profits to fall. However, “Amazon has not taken any actions other than charging sellers for more expensive rates.”

To minimize the impact of fees on your margins, be sure to read our white paper, Attack of the Fee Stack. This year, more eCommerce sellers and experts have been sharing practical profit-focused advice and solutions to improve margins in the face of these fee hikes.

2% Fee On Each Product Sold for Seller Fulfilled Prime

Amazon has introduced a new fee targeted at sellers who opt not to utilize its fulfillment solutions, aka Seller Fulfilled Prime (SFP). This program lets Amazon sellers sell their products with the Prime badge and offer 1 to 2 day shipping to Prime customers while fulfilling orders from their own storage facility or by teaming up with an approved third-party fulfillment service provider. 

The fee hike has caught many sellers off-guard and is perceived by many as a strong-arm tactic (to get them to switch to FBA), especially in light of the impending antitrust lawsuit by the FTC against the eCommerce giant, Bloomberg reports.

In the course of FTC’s investigation, the agency has directed its attention towards Amazon’s treatment of sellers operating on its platform. Of particular interest is Amazon’s practice of punishing sellers who are shipping products themselves by favoring Prime sellers over non-Prime.

Currently, there are expectations for the agency to unleash the said lawsuit which has become almost unavoidable following the recent “last rites” deliberation between Amazon and FTC representatives.

With the FTC intensifying its scrutiny, Amazon’s decision to introduce an additional fee for sellers sidestepping its FBA services and choosing to manage their own product shipments seems rather poorly timed.

Starting from October 1st, SFP sellers will be subject to a 2% fee on every item sold. This is on top of any other applicable charges like the 8% to 15% referral fee.

Ever since its inception in 2015, SFP has enabled sellers to dispatch their products autonomously at no extra cost. However, the recently introduced 2% fee might create a compelling reason to transition towards using Amazon’s own logistics services, as they might now be cheaper than SFP. 

In a notice sent to SFP sellers last week, Amazon offered a vague explanation why the additional fee was necessary.

“We’re updating our requirements for Seller Fulfilled Prime to ensure that it provides customers a great and consistent Prime experience.”

However, in communication with Bloomberg, the company stated that the levy would assist in funding the expenses associated with maintaining “a separate infrastructure and measuring its effectiveness.”

Discussing the matter without revealing their identity, an anonymous source informed Bloomberg that SFP sellers were given only a few weeks’ notice about the fee change.

This limited time frame posed challenges for the sellers to accommodate this additional cost, especially considering that they had already procured inventory for the upcoming holiday season, the source further elaborated.

Amazon taking third-party sellers by surprise with sudden policy changes and short adjustment period is nothing new. The online retailer simply has too much control over the marketplace, which is why the FTC stepping in could potentially bring about great changes in the way Amazon or the US eComm industry is regulated.

Recently, Amazon offered concessions to the UK Competition and Markets Authority (CMA) to stop an ongoing antitrust probe. However, FTC Chairperson Lina Khan opposes such legal remedies. This means if the agency wins its long-awaited lawsuit vs. Amazon, it could finally break up parts of the retail giant.

Roundup: Upcoming Amazon Changes and Features

Here’s the latest on Amazon’s suite of products and services, including upcoming changes to the FBA removals policy. 

1. Set competitive prices with new Similar Product dashboard

Amazon just launched a new dashboard that allows you to compare the prices of up to 5 similar products being sold on Amazon.com. Think of it as your very own pricing advisor, empowering you to make informed choices that have the potential to boost your sales and maintain your competitive edge. 

However, a few sellers question the motive behind the creation of the new dashboard saying it could just be another tool to covertly harvest product data, while others doubt that it’s as useful as Amazon purports it to be. 

In the comments section of the announcement page, one seller, listed as SELLC, advises people to “pay attention” to their “desired profits to be earned”, further hypothocizing that you likely won’t see Amazon’s offerings in the dashboard and inferring that Amazon desires slow down sales for sellers by promoting higher pricing, thus encouraging them to make up for it with Amazon ad spend. 

Another seller expressed their lack of confidence in the new dashboard, writing “bots are not good enough at identifying ‘similar according to humans’ without a lot of human intervention.”

Moreover, “by using this dashboard, you’ll be creating data for an AI, which Amazon will then use to (poorly) identify similar items. Then Amazon will (a) push customers to cheaper versions of your product, largely from overseas, thereby taking away your sales and further eroding the middle class and (b) require that you match pricing to poorly defined similar products in order to get surfaced on the platform.”

This new feature could be of value to providing insight into what Amazon’s AI considers similar, which may or may not provide insight into some of the other features utilizing a “similar products” method throughout the platform.

However, if the shared opinions of the sellers commenting on the announcement prove valid, this new feature could become a dwindling spiral of lost sales and profits. 

If your products don’t sell because they’re not priced competitively, you’ll find yourself buying ads from Amazon to boost search visibility. So, while you’re fixated on keeping your prices slightly higher to stay profitable and managing ad campaigns, Amazon’s own brands and those others with the lowest prices continue to sell around the clock more easily.

Some fairly strong views on this feature but sellers will have to decide for themselves whether they see the value or not.

You can try comparing prices from your Manage Inventory page inside Seller Central. Or, go to Similar Product Pricing to learn more.

2. New end-to-end supply chain management across all sales channels

Amazon seems poised to intensify its competition with freight forwarders by unveiling a “completely automated” end-to-end supply chain management service, connecting suppliers directly to sellers through to their customers.

Introduced during this year’s Accelerate, Supply Chain by Amazon features “advanced logistics, fulfillment and transportation capabilities to keep products in stock, ship faster and more reliably, and significantly lower costs.” 

The logistics giant claims a 25% cost reduction for cross-border shipping directed towards its Amazon Warehousing and Distribution (AWD) facilities. Now open to all sellers, AWD is a low-cost bulk storage solution that autonomously restocks your inventory to align with anticipated demand levels. You also have the option to distribute your inventory from AWD to multiple sales locations, including physical stores, with the help of Amazon partner carriers.

In addition, AWD is exempted from capacity limits and Amazon’s peak holiday surcharges. Storage savings are a benefit to AWD that shouldn’t be overlooked. During non-peak, AWD is 51% less expensive than standard FBA storage, and 82% cheaper than FBA holiday storage. Long-term bulk storage discounts will also be available to sellers later this year, potentially making AWD 80% cheaper than FBA.

All of this makes it sound like Supply Chain by Amazon is just the polished version of Amazon Global Logistics, because it is!

“Amazon Global Logistics is now part of Supply Chain by Amazon, a fully automated set of services that gets your products from manufacturers to customers around the world,” the company said.

However, expect that Amazon will most likely continue to subcontract a lot of the pickup and delivery services to forwarders and couriers and then take their profits, as they do with their Partnered Carrier Program. 

The introduction of Supply Chain marks another strategic move in Amazon’s ongoing efforts to bolster its presence in the logistics sector. This program comes on the heels of some huge developments, including a 10-year agreement with Hawaiian Airlines to operate 10 converted A330-300 freighters and Buy with Prime integration with Shopify and the more recent Amazon Multi-Channel Fulfillment (MCF) App for Shopify.

With this latest deal, Amazon is positioning itself to become one of the premiere fulfillment providers for non-Amazon eCommerce sellers which represents a huge potential toward putting their, in recent years, over-extended logistics and warehousing network to good use and, dare we say, the road to profitability.

Overall, it’s exciting to watch this space and to see what logistics could become over the next several years.

3. Update to FBA removals policy

Effective November 1, 2023, if you’ve selected “Dispose” as your removal option within the Automated Unfulfillable Settings, the scheduling of your removal orders will be determined by Amazon’s capacity considerations. This may include immediate action following the assessment of returns.

Additionally, if you haven’t selected a removal option by November 1st, the default selection will be set to immediate “Disposal.”

While this may help streamline your removal process, one seller is concerned about the possibility of losing the ability to thoroughly check product returns that have been marked as “unfulfillable” by Amazon. 

In busy and clogged fulfillment centers such as FBA, mistakes can happen. An Amazon associate could mistakenly tag your products as unsellable. Unless there’s solid proof that your product has been returned by the customer poorly or damaged by carrier, it’s always good practice to maintain some control over your returns so you could still refurbish or repair those in sellable condition.

Try to maintain a regular removal schedule, whether on a weekly or biweekly basis, by going to Automated Unfulfillable Settings, select your preferred return option, and provide a valid return address. This will grant you the flexibility to manually initiate removal orders for your (unsellable) returns at any point before your chosen automated removal date.

Related: Amazon Return, Refunds and Reimbursement Policy Updates

Amazon Tries to Increase Revenue from Existing Shoppers

Sellers may soon not be the only ones bearing the brunt of Amazon’s restructuring efforts to boost profits.

The retail giant is reportedly testing a higher free shipping minimum for some non-Prime customers and charging Prime members a fee for in-garage deliveries beyond the designated Amazon Delivery day. While this may help Amazon generate an additional source of income, they (and Amazon sellers) also risk losing customers to competitors that offer surprisingly low prices like Temu, TikTok Shop, and Shein.

Related: Amazon is Testing a New Way to Show Product Reviews 

Raising the Free Shipping Threshold

In a statement to CNBC, Amazon spokesperson Kristina Pressentin confirmed that the company is testing a new free shipping minimum for some non-Prime members in selected regions.

Non-Prime customers generally have to place an order with a minimum value of $25 to qualify for free shipping. But that changed for some shoppers on August 28, when Pressentin said Amazon has increased that threshold to $35, while “Prime members continue to enjoy free delivery on over 300 million items.”

The new change seems like an effort by Amazon to align its shipping minimums with that of Walmart, perhaps in hopes of attracting a larger customer base to its Prime service that offers free 1 to 2-day shipping and a host of membership benefits for an annual fee of $139 or a monthly fee of $15.

On the one hand, non-Prime customers may start comparing free shipping offers from different sales channels and decide to take their business somewhere more affordable.

On the other, this could be an opportunity for sellers to increase their sales by implementing value creation strategies that will make customers see the worth of buying add-ons or more expensive products to meet or exceed Amazon’s new free shipping minimum.

  • Product bundling. Grouping related products for a slightly lower price than buying individually.
  • Cross-selling. Encouraging customers to buy items that complement the product they wanted to purchase. For example, a customer adds a  $25 French Press Coffee Maker in their online shopping cart. With cross-selling, you could recommend them accessories like a milk frother, coffee mug, espresso brush, or reusable straw to ensure a higher single order value.
  • Upselling. Influence customers to buy pricier items or upgrades to increase their order value. Suppose a customer is eyeing that $25 French Press. In that case, you can highlight an upsell offer for a $50 coffee maker that has more advanced features.

Related: Tiered Discounts on Multi-Unit Orders

Free to Fee: In-Garage Delivery Service

Amazon Prime members currently enjoy free In-Garage Delivery, a service that ensures packages find a secure haven inside garages equipped with Amazon Key openers (accessible via an app), safeguarding them from theft and bad weather. However, this perk is about to change, contingent on the timing of package deliveries.

Starting from October 4th, Amazon is introducing a $1.99 fee for those choosing In-Garage Delivery outside of the designated Amazon Day delivery slots.

As highlighted by reports from The Verge, discontent among members is palpable as posts circulating on Twitter reveal their dissatisfaction with this impending price adjustment, saying “Amazon Key In-Garage Delivery is by far one of my favorite services, but they’re going to charge $1.99 PER DELIVERY unless you choose the Amazon Delivery day option.”

Other customers who commented on the The Verge’s post also share the same sentiment, with one wondering if the change is “bad for Amazon? This was a “safe” option for a lot of consumers and beats dealing with potential package theft when your packages are left outside. I’m not sure what Amazon really wins here outside of trying to force more people to choose their Amazon Day shipping.”

In reply to said comment, one poster wrote “Not completely bad. Just bad for those that want deliveries outside of their designated “Amazon Delivery Day of the week”. So, are you patient or needs things ASAP? ASAP will cost money, like it should IMHO.”

Some customers speculate that the extra time drivers take to access the codes to open garages is slowing down deliveries, which can cost Amazon money.

Delivery is expensive business, so it is no surprise Amazon is trying to get as much juice from the squeeze as possible. In a study conducted by the data validation firm, Loqate, it was found that within a sample of over 140,000 online orders, ecommerce companies experienced an 8% initial delivery failure rate. These mistakes, with an associated average cost of $17.20 per occurrence, collectively incurred a substantial expense of over $193,000 among the 300 companies included in the survey.

In addition to delivery cuts, Amazon has been aggressively reducing costs through job cuts and eliminating excess warehouse space. The company has also recently brought back its holiday peak fulfillment surcharge for FBA sellers and started charging an extra fee for those who participate in the Seller Fulfilled Prime program

All of this contributes to the effort Amazon has been making in recent years to pull up out of the post-Covid tailspin it found itself in. Time will only tell whether these changes will be good or bad news for the retailer. Unfortunately, unless you factor in the broad possibility of more financial stability for Amazon, we can’t see an angle on this that serves the customer or the seller.

UPDATED: Amazon Faces Tougher Scrutiny Under EU’s Digital Services Act (DSA)

UPDATE 09/06/2023: The European Union has intensified its efforts to curb the dominance of Amazon, Alphabet, Apple, Meta, Microsoft, and ByteDance in the region. This move involves the implementation of comprehensive regulations designed to provide consumers with greater choices and level the playing field for fair competition.

According to the Commission, a total of 22 core platform services operated by these six “gatekeepers” have been designated for regulation under the Digital Markets Act (DMA)

The DMA consists of a set of rules, or “dos and don’ts,” that aims to streamline users’ ability to:

  • Transition seamlessly between rival services – for example, making it possible for WhatsApp users to send messages to others without needing to be concerned about which messaging platform they are using.
  • Retain control over the use of their data for personalized advertising. Gatekeepers must ensure that performance data regarding ad campaigns and pricing information for ads are accessible to business users.
  • Exercise a choice in selecting their preferred search engine or web browser rather than being constrained by default settings. 

“The most impactful online companies will now have to play by our EU rules,” European Commissioner Thierry Breton said on X, previously known as Twitter.

“DMA means more choice for consumers. Fewer obstacles for smaller competitors. Opening the gates to the Internet.”

This also means Amazon could soon be prohibited from ranking their own in-house brands or services higher than their competitors in search results pages, as covered in the “don’ts” section of the DMA.

The retail giant already started providing European shoppers with more choices when it settled antitrust investigations by agreeing to giving sellers equal treatment on the platform’s Buy Box and adding another “buy box” with a different delivery option or price for the same product.

To enforce compliance, fines of up to 10% of the company’s global revenue loom overhead, and there’s even the potential for the tech giants to begin to divest specific segments of their operations in order to secure their foothold in the European market.

DMA is set to take full effect in six months, during which the six gatekeepers will be required to communicate their strategies for compliance with the digital act to the Commission.
Related: Amazon Faces Backlash for Alleged Abusive Practices, FTC Lawsuit Alleges Amazon of Tricking and Trapping Customers into Recurring Prime Subscriptions

A cohort of corporate giants, including Amazon, Apple, and an additional 17 industry leaders, have been identified and classified by the European Union (EU) as “very large” online platforms or search engines.

Consequently, these companies are subject to enhanced scrutiny and more stringent regulatory measures, accompanied by the possibility of substantial fines should they veer from the newly established Digital Services Act (DSA) within the region.

Obligations Under the DSA

In late 2020, the European Commission, the executive body of the EU, laid out a fresh set of services-related regulations aimed at intensifying oversight of tech behemoths.

These regulations, known as the Digital Services Act (DSA), have been in effect for approximately four months now, granting regulators the authority to actively monitor online content, curbing the spread of harmful comments, and establishing guidelines for the utilization of AI.

This significant step highlights EU’s commitment to fostering a safer online environment and ensuring responsible practices by big tech operating within its jurisdiction. These platforms are defined as entities that reach a significant number of users (more than 45 million active users) and that have a significant impact on the EU market.

The DSA intends to impose various obligations on these major platforms, such as:

More user empowerment and protection

DSA aims to empower users and protect their rights online. Users will have clearer information about recommended content and the ability to opt-out of profiling-based recommendation systems.

Platforms must diligently process reports of illegal content from users. Advertisements based on sensitive user data are prohibited, and platforms must label ads and disclose the promoters. Tech giants are also required to provide easily understandable summaries of their terms and conditions in the languages of the Member States where they operate.

Overall, the DSA prioritizes user empowerment, combating illegal content, protecting privacy, enhancing advertising transparency, and improving communication online.

Increased transparency

Platforms will be required to provide clear information about their terms and conditions, content moderation policies, and advertising practices. They may also need to undergo third-party audits to assess their compliance with the DSA’s requirements.

Strong protection of minors

Platforms will be required to undertake significant system redesigns to prioritize the privacy, security, and safety of minors. Specifically, platforms must implement measures that safeguard children from targeted advertising based on profiling techniques, ensuring their online experiences are free from such practices. 

To assess the potential risks to minors’ mental health and well-being, platforms will need to conduct special risk assessments. These assessments must be provided to the Commission within four months of designation and, at the latest, be made publicly available within a year. 

By doing so, platforms will contribute to a better understanding of the potential negative effects on mental health associated with their services.

Content moderation and removal

Platforms will be expected to implement effective measures to combat illegal content, hate speech, and disinformation. They will also be required to provide mechanisms for users to appeal content removal decisions.

The companies falling under the scope of the DSA regulations are given a grace period of four months to facilitate a smooth transition, enabling them to adapt the new antitrust policies and procedures within a reasonable timeframe.

Non-compliance with these provisions may result in significant consequences, including potential fines amounting to 6% of the company’s global turnover.

In more severe cases of persistent non-compliance, platforms could face temporary bans from operating within the EU. These stringent measures underscore the importance of adhering to the DSA guidelines and reinforce the commitment to ensuring a responsible and accountable digital environment.

Impact of EU’s Digital Acts on American Online Service Providers

In this report dated November 2022, economist Kati Suominen estimates that the EU’s DSA and Digital Markets Act (DMA) would cost leading US digital service providers like Amazon between $22B and $50B in additional compliance and operational costs. 🧐

As a result, this might force them to either pass the added costs to their customers or let go of crucial business opportunities in the region. 

Suominen also believes that “if US digital services increased their costs on American companies by just 5% due to EU regulation, US companies could incur over $97B in new costs, with $45B carried by SMEs.”

Sellers currently selling in or planning to expand to the EU should watch closely how Amazon will respond to its DSA obligations. More importantly, sellers should brace for any potential cost increases once Amazon starts implementing new compliance requirements related to these digital acts.

Related: EU Advised by NGOs to Refuse Amazon’s Flawed Proposal for Antitrust Settlement, Amazon Faces Backlash for Alleged Abusive Practices, Why Amazon Wants You to Lobby Congress

UPDATED: Shopify Looking to Integrate with Amazon Buy With Prime

Shopify Looking to Integrate with Amazon Buy With Prime

UPDATE 08/30/2023: 📣 It’s official! Shopify announced on Wednesday that Amazon will release Buy with Prime in the platform’s app ecosystem, marking a ceasefire between the two eCommerce giants.

For Prime customers, this collaboration holds the potential for a more dependable checkout and delivery experience across a wider array of retail brands outside of Amazon.

For some sellers, this announcement may come as a surprise after Shopify cautioned its merchants against attempting integration of Buy with Prime on their respective online stores, citing breaches of its terms of service and the emergence of security vulnerabilities.

The subtleties surrounding this app integration provide insights into concessions orchestrated by both companies.

Customers who log into their Amazon Prime accounts on a Shopify store equipped with the “Buy with Prime” feature can choose to utilize a payment mechanism linked to their Amazon wallets. Yes, Amazon Pay will be added as another payment option within Shopify.

However, instead of Amazon Pay, the payment processing will be handled by Shopify’s checkout system, allowing the company to:

  • Keep the entire or a portion of the revenue generated by processing Prime orders within Shopify Checkout. It’s unclear whether both parties entered into a revenue sharing contract, where the income made from Buy with Prime transaction fees on Shopify is split between the two companies.
  • Help Shopify sellers “maintain 100% control of their brand and their customer data in Shopify’s admin,” the company said in a statement. 👏 

The program rolled out on August 30, initially catering to selected sellers on Shopify’s platform. By the end of September, it will become accessible to all Shopify sellers interested in leveraging Amazon’s extensive fulfillment network, Amazon said.
With Shopify out of the way, Amazon now stands to capture more non-Amazon merchants via wider Buy with Prime adoption, while existing sellers face increasing competition and fulfillment fees.

On Shopify’s Q4 2022 earnings call, President Harley Finkelstein revealed the company is currently in talks with Amazon about adding Buy With Prime (BWP) in Shopify-powered stores. 🫣

“We think any company that’s going to make their infrastructure available to merchants to sell more a great thing,” Finkelstein said during the earnings call.

“We’re going to talk to the Amazon now to make that work, but it has to be done in a way that we think is important for merchants to have a relationship with their end consumer,” Finkelstein added.

That’s great news for merchants and aggregators interested in using both Shopify and BWP, but not for those who don’t want to give up their customer data to Amazon. 🤔

BWP is a Fulfillment-as-a-Service (FaaS) program that allows merchants to offer 1 to 2-day shipping, free delivery, and free returns on their own websites outside of Amazon.com.

However, checkout is done via Amazon Pay, which requires a customer to create or log in to their Prime account to be able to complete a transaction. This process could allow Amazon to take a peek into the customer’s name, address, and possibly even contact details (for shipping purposes) that they could then use to launch remarketing and retargeting campaigns to that customer.

In September 2022, Shopify itself issued a warning to merchants about the potential security issues they could face when installing BWP. Moreover, taking the checkout process outside of Shopify is currently a violation of the platform’s Terms of Service.

But given Shopify’s recent complete turnaround on the issue, the warning may primarily have beenn due to its plans to launch its own FaaS program, Shopify Fulfillment Network (SFN). The service was first introduced in 2019, but has reportedly made little progress since.

Turning to Amazon to Overcome Challenges Ahead

The broader rollout of SFN unfortunately happened at a time when the company’s Q4 2022 shares fell nearly 7% and revenue growth slowed amid escalating Amazon rivalry, indicating a rough time ahead.

That might explain why Shopify is looking for a partnership with Amazon instead of competition, a business strategy called “Co-Opetition.” 🤔

Welcoming its rival into the fold might help the company reduce competitive intensity levels while expanding its customer reach with Prime, which currently has over 200 million members worldwide.

Same goes for Amazon, a collaboration presents an opportunity to tap into the rival’s customer base while keeping them at an arm’s length, as well as maintain its lead over Walmart.

The risk, however, is potentially greater for Shopify as it stands to loosen their grip on their merchants’ customer data. Additionally, BWP could eat into its profits. The Canadian eComm giant mostly generates revenue from transaction fees. 

For that reason, analysts recommend not allowing Amazon to take over checkout. But it seems unlikely to happen given that Amazon Pay has always been conditional to BWP, unless both parties come up with a fair revenue sharing arrangement.

If no deal is taken, Shopify might have to find other companies that can take Amazon’s place in solving this challenge for them.

Shopify Tries to Stay in the Fight 

Recent moves suggest that Shopify is not backing down in its fight for market share. It has teamed up with Flexport to expand its fulfillment capabilities globally and compete with Amazon Global Logistics.

The company also released new tools and features that will help merchants sell across channels, boost conversion, and run their stores more efficiently.

Meanwhile, Amazon continues to beef up Buy with Prime by making it available to US merchants that use BigCommerce. The Texas-based shopping site builder launched an app that allows sellers to easily enable BWP features on their stores with no coding required.

In sum, while integrating with BWP could temporarily hurt Shopify, the company also stands to gain some wins, such as the ability to offer faster delivery without doubling its fulfillment network, i.e., cut costs.

It all probably just comes down to how the two eComm giants will split the revenue from BWP transactions on Shopify stores. It will be interesting to see how it all shakes out. 

Updates to Amazon Return, Refund, and Reimbursement Policy

Updates to Amazon Return and Refund Policy

Update 08/24/2023: Currently in invite-only beta, Amazon introduced a new feature that allows some select sellers to disable the evaluation of returns, giving them more control over the return process. This means sellers no longer have to rely on Amazon’s evaluation of a returned product’s condition, which is not always accurate. 

🚩 Imagine a customer receiving a damaged or counterfeit product because an Amazon associate did not carefully check the returned item. An upset customer may choose to leave a negative review that will not only dent your reputation and Amazon order defect rate but also profits – Amazon does not reimburse customer-damaged units.

👌 By disabling returns evaluation, Amazon will automatically mark returned products as “unfulfillable,” instead of putting them back to your available inventory to be sold again. You may then create a removal order so that Amazon can return the items to your warehouse. From there, inspect the returned products yourself and decide whether to resell or dispose of them.

Note: Think twice before opting to have Amazon automatically get rid of returned orders for you. Some sellers lack confidence in the retailer’s ability to properly dispose of unwanted or damaged goods, saying that these items will somehow find their way onto pallets and be auctioned off on an inventory liquidation site or sold at a flea market.

Preserving the integrity of your brand, especially higher-end products, is crucial. The thought of these damaged goods re-entering the market troubles artisan sellers that they would rather cover the removal fees, recover whatever is salvageable, and recycle what they can.

How to disable evaluation of returns?

  • Log in to your Seller Account > FBA Inventory Evaluation Settings > Click Disable
  • Choose Disable Returns for All ASINs or Disable Returns for Select ASINs
  • Click Update

Visit FBA Inventory Evaluation Settings or read the Terms and Conditions for Disabling Returns Evaluation for more details.
Related: Claim Reimbursement for Losses Caused by Amazon

Update 06/15/2023: In an email, Amazon announced they’re introducing a revised reimbursement policy for Multi-Channel Fulfillment (MCF) in the US.

Effective from July 15, 2023, the maximum reimbursement limit for eligible units lost or damaged during the fulfillment process will be set at $300 per item. This adjustment ensures that MCF’s reimbursement policy remains consistent with prevailing practices within the industry.

You may file your claim for reimbursement on eligible MCF orders no more than 90 days after the promised or estimated delivery date. You can monitor the status of your existing claims by going to your Amazon Fulfilled Inventory report or the Payments dashboard.

Amazon has not shared the formula for calculating a product’s reimbursement value, but per company policy, the goal is to provide a (cash) reimbursement amount that aligns with the estimated proceeds (minus MCF fees) you would receive from selling your item.

Note: In the event that Amazon stumbles upon your lost units one day, they may nullify the cash reimbursement by deducting it from your forthcoming deposit. They will also reinstate your lost units into your inventory, thereby granting you the opportunity to sell said items once again.

In cases where Amazon lacks sufficient data to calculate the estimated sale price using multiple price indicators, they will assign an approximate value based on the price of a similar product. Occasionally, an Amazon rep might also request additional information or documentation from you to assist them in determining the reimbursement value accurately.

If the value of your item exceeds the max reimbursement amount, Amazon recommends purchasing third-party insurance for additional coverage. But if Amazon frequently loses your inventory, it may be worth taking your fulfillment needs elsewhere, especially if you sell a lot of high-value items. For instance, you may want to consider fulfilling luxury goods through a different 3PL provider with better reimbursement coverage and only leave products below $300 up to Amazon MCF or FBA. 
Be sure to read this blog post to learn how to minimize lost or damaged inventory.

Update 12/15/2022: 😩 Another fee will take a bite out of your profits in 2023! Starting January 14, Amazon will no longer cover carrier shipping correction charges on seller-fulfilled returns with “incorrect return label information.”

Correction charges can be applied when:

  • The return address label is invalid – for example, text is illegible or part of the address is incorrect or missing. According to Amazon, the carrier will charge $18 per undeliverable package. 
  • The package weight or dimensions do not match the information you provided. You will be responsible for the difference in cost between the initial label you paid for and the label correction cost. Fortunately, you may also be credited for any overpayment made due to these factors.

This update has drawn the ire of many FBM sellers, arguing that they don’t have control over how customers return unwanted products. A customer may return a small item in a box 5x to 10x its size, for instance. 

Some sellers call on Amazon to instead push these correction charges on shoppers who use unnecessarily large boxes when shipping items back, as they rarely receive returns in the original packaging anyway.

But considering Amazon’s customer-centric policies, that’s very unlikely to happen. So the only paths forward sellers seem to have are to either, as per usual, suck it up and just cross fingers that the majority of customer returns come back without additional charges, or to switch to FBA. Otherwise, they’ll be paying the price as another line item to add to the profit and loss. 🤔
Go to Shipping Correction Charges for Seller-Fulfilled Returns to learn more.

Update 11/11/2022: 📢 Amazon just updated their Reimbursement Policy! Effective November 11, 2022, eligible unfillable units “will be reimbursed at a discounted rate to reflect the actual fair value of the item” rather than their regular retail price.

Unfillable items are returns from customers that can’t be sold as “New” on Amazon. If an unfillable item is lost or sent back in damaged condition, Amazon will reimburse you at a discount on the regular price. 😦

This could impact a lot of sellers that get a lot of returns in Q4. Profit is less in case a customer returns a heavily worn item (and thus unsellable) or Amazon loses them.

👉 Be sure to read on to learn more about the latest on Amazon’s Return and Refund Policy, as well as some pro tips for reducing unnecessary returns and abusive claims.

Amazon has updated its Return and Refund policies in preparation for Q4! 🚚

Extended Returns Window

For US sellers, the eCommerce giant is temporarily extending the standard returns window for early holiday shoppers.

Amazon recently confirmed that it will hold a 2nd Prime Day sale on October 11-12 to give (inflation-weary) consumers a head start on finding and shopping the best deals online.

Most orders have a 30-day return window, but for products bought between October 7 and December 31, 2022, customers can return them until January 31, 2023. That’s a 3 to 4-month extension, which is good for buyers, but some sellers don’t see the benefit of this update.

It could allow unscrupulous individuals to use their products for free for 3 months and return them in January when they’re “no longer wanted or needed”’ – for example, buying Christmas decor in November and then sending it back after the holidays. 🤦‍♀️

But do note that the returns eligibility remains unchanged for all orders, so not all returns will be accepted.

Refund at First Scan (RFS) for Seller-Fulfilled Returns

Amazon is postponing the release of RFS for seller-fulfilled returns in the UK until October 24, 2022. It was supposed to take effect on September 30th.

Initially introduced on May 4th, RFS is part of the Prepaid Return Label program that allows a shopper to receive a refund after their designated carrier has successfully scanned their returned item using the prepaid return label issued by Amazon.

During the scanning stage, sellers have no way of inspecting the item themselves, so the risk of receiving a knock-off version (or worse, a brick!) instead of the original item is high. 😓

If the product is received in damaged condition, sellers can file a SAFE-T claim on their Seller Central account within 60 days of the refund charge. However, this means Amazon may still deny your claim and you will bear some losses. It also means much more manual oversight.

To minimize unnecessary returns, consider employing tactics like having highly detailed product descriptions, images, and product sizes and dimensions or offering live chat support to address customer concerns immediately. 

You can also try to reduce abusive claims by establishing some oversight mechanisms such as manual inspection of returned items, documenting each order (before and after photos), or using signature confirmation on premium products.

⚠️ Proper documentation of orders, from preparation to order tracking to delivery (e.g., signature confirmation on high-value items), is highly recommended to have a solid SAFE-T claim. 

Sellers should be aware of these refund and returns changes and factor these into your cost of doing business this holiday season.

Amazon is Testing A New Way to Show Product Reviews

Amazon is currently overhauling its product reviews system amid FTC’s pending rule on fake reviews.

In a recent blog post, top-100 Amazon seller and Zulay Kitchen Co-Founder Aaron Cordovez calls to attention the new review formats that Amazon is A/B testing to possibly find a better way to display key customer reviews stats like review count (number of reviews, e.g., 1,000) and overall product star rating (ranging from 1 to 5 stars) on its search engine results pages (SERP).

As Cordovez lays out, these are the major changes being seen by some customers on Amazon’s platform.

Test #1: Removing Review Count

Amazon Review Count Changes

Amazon has always featured product review count typically expressed in complete format (2,000; 20,000; 200,000) on search. However, in one of its A/B tests, review volume was hidden, which may not be a smart move.

A high review count is an essential metric that helps paint a picture of a product’s quality and size of customer base, thereby increasing the likelihood of shoppers to purchase.

A PowerReviews survey shows 80% of customers are less likely to purchase a given product if it has zero reviews. This impression most likely impacts new (though not necessarily inferior) products on the market, possibly giving Amazon a reason to hide review count to somehow level the playing field. 

Cordovez himself believes that “Amazon wants to test if there is a better way for new products to be discovered. This is a bullish sign for innovative products and more creative minds re-imagining the E-commerce space with better products.”

Removing review count may also help shift customers’ attention to “total units bought in past month,” which would be another way to create a positive first impression of your product.

Cordovez speculates that if a product with thousands of reviews from several years ago has gone stale, then letting customers rely on review count when making purchase decisions may not be a good idea.

“Number of units purchased last month gives much stronger social proof. It is taking away stale products from Amazon’s catalog,” Cordovez explained.

In terms of its impact on combating fake reviews on Amazon, there’s an upside and downside to hiding review count. On the upside, customers will be less likely to make purchase decisions based on this metric that can be easily inflated with fake reviews and review hijacking, essentially weakening the influence of these black hat tactics on consumer behavior.

On the contrary, Amazon could use this approach to make it difficult for ASIN alert tools and perhaps even antitrust watchdogs to track changes in review count during a particular period. 

As previously reported, we noticed in April that on some of Amazon’s own Basics line products, hundreds of thousands of reviews were removed overnight. It remains unclear whether the reviews purge included authentic low-star reviews or false positive reviews or was in any way motivated by a desire to avoid possible pending violations and penalties in the face of the potential FTC rule change on reviews.

Test #2: Changing the Review Count Format

Perhaps seeing how removing review volume altogether may negatively impact long-term sellers’ conversion rates, Amazon seems to be considering another alternative:

  • Changing the unabridged review count format to % of 4 or 5-star customer reviews
  • Replacing 5 review stars rating format with a single star icon while an inconspicuous drop-down menu button is provided to enable full view of a product’s customer star ratings.
Review Count 4 Star Percentage Format

The initial version displayed products with a percentage of 4+-star customer reviews, but as currently seen on Amazon search results pages, the reviews system now shows products with a percentage of 5-star reviews instead, irrespective of product type, total units bought in past month, and overall star rating. See example below.

Amazon Review Count 5 Star Percentage Format

On the one hand, this new format gives more weight to positive customer reviews, which could potentially help you generate more clicks.

On the other, less discerning customers or those that don’t have time to read online reviews and just rely on initial information presented may be misled to think they’re buying a high-quality product with that 5-star review percentage. They may overlook the actual lower star reviews and simply focus on the 5-star %. If the new format makes some customers less likely to spend time reading online reviews, it also increases their chances of falling victim to products with fake positive reviews or falsely inflated overall star ratings. 

In contrast, other customers may think that a product that has a high 5-star review % may be too good to be true, forcing them to seek out negative reviews.

Additionally, Amazon has also replaced the legacy 5 review stars format with a single star icon. At first glance, it appears you’re looking at one-star products, which some customers may find off putting.

To fully view a product’s customer star ratings (and facilitate smarter buying decisions), customers will have to hover their cursor over the small drop-down menu button next to the single star icon. 

New Product Star Ratings Art Format

Test #3: Hiding Product Star Ratings

Product Review Rating number is hidden but the star visual presentation is retained to still provide some form of social proof.

Hidden Review Star Ratings

Amazon may be testing how the star rating format (full or half stars icon) versus rating numbers (2.5, 3.7, or 4.8 out of 5) influence product preference.
This paper suggests that when looking at star ratings with a half star representing a decimal point, “consumers perceptually fill in the missing fragment by extending the yellow retained area to cover the grey cutout area.”

Star Rating Format

Interestingly, the “perceptual fill-in of the missing part of the rating unit will upwardly extend the decimal to the nearest integer [whole number, e.g., 4.0] and result in a visual rounding-up of the rating. Consequently, the non-rectangular (star) rating format will make the focal product seem more favorable.”

Test #4: Changing the Review Counter to Estimated Number of Thousands (27.2K instead of 27,220)

New Review Counter Format

The review system appears largely unchanged, except for the review counter, which now displays estimates with a “K” plus indicator which means thousand(s) instead of the exact review number. One seller in this discussion board believes this downplays the significance of presenting the review count in full. 

This change may again have something to do with how certain visual presentations influence customer buying decisions or simply optimizing the review stats section for improved user experience.

Sellers Weigh in on the Issue

In the comment section of Cordovez’s Facebook post regarding the matter, one seller summarizes this whole A/B testing best, “the new test version gives all the advantage to new sellers, and removes all advantages of being a long term, relevant player in your niche.” 

Another seller who has products that have more than 3,000 reviews also expressed concerns about increasing competition. Someone with three 5-star reviews (which, therefore, may appear as 100% 5-star review score on search) could have a better chance of selling or landing on prominent sections of search results pages than seasoned sellers with 88% 5-star review percentage, for example.

In this Reddit post, most sellers expressed dislike toward the new formats, with some saying “conversions will drop” and they “will only benefit products with fake reviews more than others.”

One seller offers a cautiously optimistic view on the anticipated reviews shakeup, saying it is “good for new brands, but limits older brands. But if your product is good, it doesn’t matter.”

When all is said and done, according to Cordovez, Amazon could re-adopt the traditional reviews system, or perhaps just modify the review count to reflect the number of thousands. Alternatively, the company might completely revamp the system, concealing either the review count or the overall product star rating. Many sellers are sure to be well-engaged in observing how all of this unfolds.

Amazon Delays Delivery Date Based Reserve Policy for Some UK Sellers After Backlash

In response to strong criticism from UK sellers who feared potential business closures, Amazon has decided to implement its revised payment schedule gradually, the Guardian reported.

Last week, the eCommerce titan announced that it would no longer provide instant credit to UK and EU sellers upon the completion of an online sale. This is to help Amazon ensure that sellers will have enough funds to cover the cost of customer returns or claims.

Under the new arrangement, however, sellers will encounter a delay of one week between the product being delivered and the receipt of their funds, also known as Delivery Date Based Reserve. 

Suppose you ship an item on August 17, and the delivery date is August 20, then the sale proceeds will be available for disbursement starting August 27. Previously, sellers faced a waiting period of around three days for the money to become available in their accounts, but because of the new reserve policy, many may have to endure a 7-day (or longer) wait after delivery before gaining access to the funds.

This rule change has triggered concerns about the viability of many Amazon businesses. For small sellers, for instance, having to wait 7 days to receive their money could lead to difficulty in paying employees and loans.

In an email sent out to affected sellers four months ago, Amazon itself acknowledged that implementing the Delivery Date Based Reserve policy may result in “a one-time cash flow disruption.”

However, according to BBC, some sellers said that “this email was not clear, or in many cases, went to their junk mail folder,” leaving them totally unprepared when the new policy finally took effect on August 3.

Consequently, some UK sellers turned to their Members of Parliament (MPs) for help. A UK government minister has reportedly started demanding Amazon for answers.

Following growing pressure from both sellers and the UK government, Amazon told The Guardian it was postponing the policy change for some sellers until January 31, 2024. The retail giant specifically said it was “extending the transition date for a small number of sellers who have contacted us and need support.

However, one seller believes that this move only delays the inevitable and that their business could still go under, thanks to the 7-day cash flow disruption.

That said, preparation is key to minimizing the rule’s impact on your cash flow. Ensure you have sufficient funds to cover any disruption to your earnings. You may also want to consider short-term financing options, if needed, though, as always, be well-informed of the terms of any funding you accept.

It would also be wise to keep an eye on your customer orders and their actual delivery dates. Depending on carrier and shipment options (standard or expedited), it might take your carrier up to 5 days to get items delivered.

In that case, if it is under your control, calculate the difference between the cost of using same-day or next-day delivery service providers and the potential impact of cash flow disruption on your business. It might be worth paying extra for faster delivery speeds than delaying inventory orders for Christmas because you couldn’t access your funds on time, for example.

It could also be worth taking a bit more action than that as, currently, Amazon is “listening to sellers’ concerns and is in contact with those who have experienced a one-time cashflow disruption,” as reported by The Guardian.


Consider reaching out to Amazon or contacting your MP to express your concerns. A large number of complaints could force the retailer to take similar action as Etsy did. The online crafts marketplace recently had to revise a policy that held back up to 75% of some UK sellers’ earnings for 45 days to appease those that initiated a boycott against the platform. Presently, Etsy expects that the standard withheld amount will now be around 30%.

Related: Amazon Faces Backlash for Alleged Abusive Practices

Amazon Working to Bring USPS Ground Advantage to its Buy Shipping Service

In a recent announcement, Amazon revealed its ongoing efforts to incorporate USPS Ground Advantage (GA) into Buy Shipping, a service that allows FBM sellers to purchase and print shipping labels for orders they receive from shoppers on Amazon. This service helps sellers save time and effort by integrating the label purchasing process directly into the Amazon platform.

We’ll take a deeper dive into USPS’s newest shipping solution and see how it might benefit your Amazon business, plus a few tips to help you deal with unexpected hiccups during this transition period.

What is Ground Advantage?

Launched on USPS on July 9, GA is a new service offering that rolls First Class Package Service (for letters and parcels under 1 lb), Parcel Select Ground (for packages weighing between 1-70 lbs), and Parcel Select Cubic (priced based on parcel dimensions) into one.

That means you will now be able to ship items that weigh up to 70 lbs through a single USPS ground delivery service.

Previously, USPS business customers such as Amazon FBM sellers who buy and print shipping labels with an online postage service provider had to use different service options for different types of shipments and sizes. For example, First Class for letters and lightweight parcels and Parcel Select or Priority Mail for medium and large items, causing seller confusion and indecision.

Aside from offering a streamlined shipping option, USPS also sweetens the pot by adding these benefits:

  • Up to $100 insurance
  • No fuel or residential surcharges
  • Available for shipping hazardous materials (HAZMAT)
  • Package forwarding and return-to-sender endorsements are included for all USPS Ground Advantage shipments

Pricing by Weight and Zone

Ground Advantage’s fee structure features tiers based on package weight and postal zones or distance.

For packages weighing less than a pound (previously known as First Class Package), rates will be determined at 4-oz increments (4 oz, 8 oz, 12 oz, and 15.999 oz). Rounding up to the nearest tier also applies. For example, if your parcel weighs 3.5 oz, then you’ll pay the 4 oz price. 

For packages weighing over a pound, rates will be calculated in 1-lb increments, extending up to 70 lbs (aka Parcel Select Ground). There will also be dimension-based cubic rates for weights over 1 lb, previously known as Parcel Select Cubic.

2 to 5-Day Delivery Promise

USPS is also making use of its “improved service standards and modernized operational structure” to increase delivery speeds across 50 US states. GA promises 2 to 5-day delivery within the continental US, which is as fast as First Class and faster than the previous standard of up to 8 days for Parcel Select.

Price-to-Win Strategy

To provide you with greater savings, GA rates will be lower compared to its previous offerings, with the legacy carrier looking to the new ground delivery service as a way to boost profits after posting a $2.5 billion net loss and lower parcel volume in Q2 2023.

In a statement dated May 10th, USPS said that the “published prices for GA will decrease 1.4% relative to current Parcel Select Ground and First Class Package Service pricing. USPS Ground Advantage Retail prices will decrease by 3.2% and USPS Ground Advantage Commercial published prices will decrease 0.7%.”
Presented below are the changes in commercial pricing for Ground Advantage in contrast to First Class Mail Package, Parcel Select Ground, and Priority Mail services.

Ground AdvantageFirst Class Mail PackageParcel Select GroundPriority Mail
Delivery speed (days)2 to 51 to 5 2 to 8 1 to 3
Tracking IncludedIncludedIncludedIncluded
Insurance$100; you can buy additional insurance coverage up to $5,000$0; No for letters (unless you buy certain other add-on services)$0; but you can buy external insurance options$100; you can buy additional insurance coverage up to $5,000
Package pickupIncludedIncludedNot includedIncluded
Commercial Pricing as of July 9, 2023 (4 oz)$3.59 to $4.13 (from Zone 1 to Zone 9)Large envelope: From $1.551(4 oz) to $3.711 (13 oz) N/AFlat Rate Envelope: From $8.05
USPS Mailing Box (Flat Rate): From $8.55 
Your Own Box By Weight/Zone: From $8.55 to $45.07
Commercial Pricing (15 oz, Zone 1 to Zone 9)$5.85 to $6.78N/A – Max weight is 13 ozFrom $2.84 to $5.06 depending on destination entry$7.64 to $18.03
Commercial Pricing (3 lbs, Zone 1 to Zone 9)$7.17 to $11.43N/A$3.91 to $6.17 depending on destination entry$8.43 to $37.43
Commercial Pricing (10 lbs, Zone 1 to Zone 9)$9.38 to $18.73N/AFrom $4.70 to $9.02 depending on destination entry$10.82 to $91.62
Pricing (up to 0.20 cubic, Zone 1 to Zone 9) $6.32 to $8.03N/A$7.07 to $10.12Large envelopes and Parcels: $8.23 to $27.59
Pricing (up to 0.50 cubic, Zone 1 to Zone 9) $7.52 to $13.15N/A$7.36 to $13.66$8.74 to $56.29
Pricing (1 cubic, Zone 1 to Zone 9) $9.45 to $18.82N/A$9.30 to $17.68N/A

First Class (1C) and Parcel Select (PS) may be cheaper than Priority Mail (PM), but they come with certain disadvantages. 

While 1C’s delivery speed is faster than PS, it offers limited shipping weight options, requiring you to shift to other services that have a higher max weight limit. You could opt to use Parcel Select for heavier packages over Priority Mail to cut costs, but you’d have to sacrifice delivery speed. Plus, PS doesn’t come with built-in USPS insurance.

By merging 1C and PS into Ground Advantage, however, USPS presents a competitive shipping alternative in contrast to Priority Mail. You could see savings of as little as $1 to as much as $43 per package, specifically in larger cubic shipments. This could be huge given how FBA fees have substantially increased in the last two years, mainly due to dimensional weight pricing and surcharges.

Not only does GA come with $100 insurance and decent delivery promise (albeit depending on destination and time of year it could be slower than 1C and PM), it also employs a pricing structure that adjusts according to weight, zone, and dimensions. That means you could get affordable rates for shipping compact packages over shorter distances. 
Conversely, rates may go up for longer or larger, lightweight items like pillows and tiki torches, as they take up more space. Being charged by dimensional weight (plus any applicable non-standard size fees) rather than your product’s actual weight can lead to higher shipping costs that can cut into your profits, unless you implement a price hike or resize your packaging to get to a lower size tier.

Related: Master Carton Calculator to Optimize Packaging and Reduce Shipping Costs

Another workaround is to buy USPS labels through Amazon, Shopify, ShipStation, or Pirate Ship to potentially save on fees. These online shipping label providers offer negotiated rates that are typically lower than the published rates.

Amazon, for instance, recently announced it’s now offering the lowest commercial USPS rates available, with an average of 35% off USPS Ground retail rates

Pirate Ship boasts even bigger savings. Its USPS Commercial Pricing offers discounts “up to 89% off what you’d pay at the Post Office.” 

Check out the full USPS price list here.

A Few Caveats

While some sellers may like the fact that they can now ship heavier packages without having to go the Priority Mail route, which is more expensive, others may not be happy about:

  • Slower delivery times. The 2 to 5-day delivery speed may be too slow for time-sensitive parcels or when trying to get your goods delivered on time during peak season. So, be sure to factor these variable into your process. Alternatively, you may also use Priority Mail for urgent shipments.
  • Transitioning issues. On June 30, USPS experienced some technical issues in preparing its system for the shift from First Class and Parcel Select to the new Ground Advantage shipping service.

    “Our IT teams are currently investigating the issues and plan to resolve these issues on July 2, 2023. Display issues on other eVS reports related to USPS Ground Advantage instead of First-Class Package Service, will be resolved as a part of the July 9, 2023 Release.”

    A few days after GA went live on eBay, however, several merchants reportedly run into some problems. For example, the USPS scanners failed to recognize the QR codes for the new shipping service, the listing form on the seller side displayed inaccurate pricing, and the vague wording of eBay’s announcement left many sellers confused about the steps they need to take to update their listings with the previous USPS services to Ground Advantage.

    It would be very concerning if these technical issues continue through Q3 because that’s when most sellers start to prepare for BFCM and the holiday sales period. Sellers want to make sure that there are no delays when shipping a large volume of packages during the busiest time of year. Exercise prudence by meticulously reviewing all facets concerning USPS shipping and billing, particularly as soon as Amazon launches GA, to preempt any potential issues during crunch time. 

Related: 3PL Logistics Backup Plan for Amazon Sellers

Many Amazon sellers are also not happy about the fact that it’s taking Amazon so long to enable Ground Advantage on its Buy Shipping platform, as this means they’re still stuck with the slower Parcel Select service and paying the additional insurance. Worse, a couple of sellers reported that their First Class parcels were refused by their local postal office locations, one stating that “USPS in my region is refusing to accept any First Class packages. They are rejecting all package with a First Class label printed from Amazon.”

Unfortunately, no official launch date has been released yet by Amazon. But according to USPS, it will still accept all First Class and Parcel Select services without penalty until September 30, 2023, allowing for an easier transition.

While Amazon is still playing catch up (perhaps working through some implementation issues), consider buying GA shipping labels from other service providers to be able to enjoy the mentioned benefits. If you’d like to stay with Buy Shipping, continue using the outgoing legacy services for your orders in the meantime. Just make sure to inform Amazon of any postal offices that refuse to accept parcels with First Class or Parcel Select labels to resolve the issue immediately.

All things considered, Ground Advantage seems to be a welcome improvement over First Class Mail with the max shipping weight limit expanded from 13 oz to 1 lb (plus insurance), Parcel Select with the faster delivery speeds and built-in $100 insurance coverage, and, with significantly lower rates, over Priority Mail as well.

Related: How to Ship to Amazon FBA (And Speed Up Check-In Times)

Amazon Feature Updates: 3 New Seller Tools and Product Recall Reporting Page

Over the last two weeks, Amazon has made a series of announcements introducing new features and dashboards for Amazon sellers. Let’s recap.

  1. View Insights on Your FBA Returns (UK)

    Introducing a fresh addition to UK Seller Central is a dedicated page that shares comprehensive insights into your FBA customer returns. Find out the reason behind the return, customer feedback, grading disposition, and return status updates, so you can take action on returns that may be eligible for reimbursement.

    Amazon has established clear guidelines concerning customer returns and associated refund processes. Should a return fail to align with these guidelines, sellers may request a refund reversal for the amount that Amazon debited from their account.

    For instance, you may have a return request with “Customer refunded” status, but the customer never sent the item back. Or, Amazon reps themselves mistakenly accepted a return with missing parts or approved a return and refund request past the 30-day return period.

    In that case, file a reimbursement claim with Amazon 60 days (and no later than 18 months) from when the customer refund occurred.
    Visit FBA Returns to learn more.
  1. Brand Tailored Promotions to Customize Promo Codes

    Just in time for the second Prime Day in October, Amazon introduces a new marketing tool that lets you to create and send discount codes to various types of customers.

    Called Brand Tailored Promotions, you can use this free tool to entice potential new customers, brand followers, repeat shoppers, big spenders, and cart abandoners (those who have added some of your products in their cart but haven’t bought in the last 90 days) with discounts ranging from 10% to 50%. Offering discounts will not only help you to expand your customer base but also encourage recurring transactions and boost customer retention.

Here’s how to get started:

  • Go to the Advertising tab in Seller Central and click on Brand Tailored Promotions.
  • In the drop-down menu, choose the brand and audience type you want to create the special offer for. The discount will be applied to all ASINs within the selected brand and each eligible shopper can only redeem the discount on a single purchase.
  • Fill out the Promotional Details section with your preferred promo name, discount percentage, budget, and promo start and end dates.

Note that unlike Amazon Tailored Audiences, Brand Tailored Promotions do not allow email messaging your existing customers. Instead, the tool showcases your promotional discount to your target audience type(s) on your product listing, search result pages, and Amazon’s dedicated promotional shopping pages. 

Visit Brand Tailored Promotions to learn more.

  1. Free 20,000 Transparency Codes for One Year

    Every new product enrolled in Amazon’s Transparency program by December 31, 2023, entitles brands to receive free 20,000 Transparency codes for a duration of one year.

    Distinctive for each product, a Transparency code is an alphanumeric, non-sequential barcode. When affixed to your product’s packaging, it means that the product is authentic, thereby protecting customers against counterfeit or inaccurate product variations, such as differences in compatibility, color, materials, language, and regulatory compliance. 

    Before enrolling in the program, be aware that applying a Transparency code to each qualified unit requires a bit of work.

    One seller commented that they have to “scan each transparency code” and “upload it to each and every order”, and thus, “should get reimbursed for the hassle, time and extra training we have to give to all employess to do this.”

    Given this, the benefits of Transparency are generally found with businesses prone to counterfeiting or unauthorized sellers.

    If the Transparency program fails to meet your expectations, you may reach out to Brand Registry Support to unenroll products. However, withdrawing participation from the program may be challenging, and sometimes unsuccessful, according to some sellers. 

    To make an informed decision, learn more about this special offer by contacting Amazon or checking out this presentation.

Related: Amazon Hopes to Restore Consumer Confidence with $1.2B Anti-Counterfeit Initiative

  1. Recalls and Product Safety Alerts Page

    On July 26, Amazon launched a new page that provides customers with details about recalls and product safety alerts related to their orders.

    This means Amazon customers will no longer need to go hunting for information about recalled products on various news outlets or relevant government websites such as recalls.gov, National Highway Traffic Safety Administration (NHTSA), US Food and Drug Administration (FDA), and the US Department of Agriculture (USDA). They can simply go to “Your Recalls and Product Safety Alerts” page within their accounts. Furthermore, any recall or product safety announcement will also be dispatched to customers via email.

    Amazon is also making efforts to provide accessibility to this new system for third-party sellers as well. Sellers in the US will have the option to participate in Amazon’s Recalls Logistics Service (RLS).

    By opting in, sellers can effectively communicate with their customers who have purchased items that are subject to recalls. Meanwhile, Amazon will take on the responsibility of handling refund issuance on behalf of sellers and overseeing the intricacies of return logistics.

    However, a limitation of this system lies in its focus on US sellers and its reliance on an opt-in model. A considerable portion of Amazon’s marketplace sellers operate from overseas locations, often within regions that lack the same rigorous safety standards found in the US. 

    This discrepancy has led to instances where hazardous products from third-party sellers have found their way into the hands of American consumers.

    A CBS News investigation in 2019 highlighted examples like unsafe children’s toys entering the market through Amazon. The retailer has since removed said products from its eCommerce site. A Product Safety Team has also been put in place to keep an eye on the products sold on Amazon.com and investigate product safety concerns.

    The team normally takes their information from public recall alert websites, manufacturers, and sellers. And when they learn of a recall, they may:
  • Remove the product from Amazon.com and hold any available stock in FBA.
  • Reach out to sellers and manufacturers for more details about the recalled product or its potential safety hazards.
  • Add a warning label to the product detail page.
  • Inform relevant government agencies of any product safety complaints or incidents.
  • Contact customers that purchased recalled or potentially hazardous products to tell them the next steps to take, such as refund, return, or repair.

In this way, Amazon hopes to make its platform a safer, more trustworthy retailer for consumers, assuring that they will not get their hands on items that don’t meet the standards set by the Consumer Product Safety Commission (CPSC).

UPDATED: UPS Workers Ready to Repeat 1997 Mass Walkout Over Pay, Work Conditions

UPS Workers Ready to Repeat 1997 Mass Walkout Over Pay, Work Conditions

UPDATE 07/25/2023: 💪UPS and Teamsters have just set a higher labor standard for the logistics industry after reaching an agreement.

Described as “historic” and “overwhelmingly lucrative” by the union, the five-year tentative contract includes pay raises for all 340,000 workers, additional full-time positions, and several workplace safety improvements.

Each UPS union worker is set to enjoy a $2.75 per hour salary hike during the present year, followed by a series of gradual wage increases totalling $7.50/hour over the subsequent five years. These increases will push UPS’s average top rate for its unionized full-time drivers to $49 per hour, making them the highest paid delivery drivers in the US.

Part-time employees, comprising half of the workforce, will see their starting wage rise to $21 per hour, marking a significant improvement from the current starting hourly rate of $16.20, albeit lower than the $25 an hour advocated by a group of part-timers. But through general wage increments, plus longevity bonuses of up to $1.50 per hour, part-timers may still be able to reach their desired hourly rate over the next five years.

Another significant win was claimed by UPS and Teamsters with:

  • The establishment of 7,500 new full-time positions, which will provide part-timers with more opportunities to transition to full-time jobs.
  • The addition of Martin Luther King Day as a paid holiday and putting an end to forced overtime on off days.
  • Removal of the two-tier wage system. All second-class drivers, or 22.4s drivers (see article below), would be reclassified to Regular Package Car Drivers and promoted based on seniority.
  • Enhanced working conditions for UPS drivers. Starting from January 1, 2024, UPS will be installing air-conditioning units in all of its new delivery vehicles. Moreover, to guarantee optimal ventilation within the cargo compartments, UPS will also install two fans and air induction vents in all of its vehicles.

According to Teamsters, over 60 total changes and improvements were made to the National Master Agreement.

“UPS has put $30 billion in new money on the table as a direct result of these negotiations. We’ve changed the game, battling it out day and night to make sure our members won an agreement that pays strong wages, rewards their labor, and doesn’t require a single concession. This contract sets a new standard in the labor movement and raises the bar for all workers,” said union President Sean O’Brien.

On July 31, representatives of the UPS Teamsters locals will meet to review and recommend the tentative offer. The endorsed agreement will then be put to a vote by the union members from August 3 to 22.

UPDATE 07/19/2023: A UPS protest on August 1 remains possible, as no agreement has yet been reached between the carrier and Teamsters. 

On July 5, contract talks collapsed, with both parties accusing each other of walking out of the bargaining table.

Teamsters reportedly refused to take UPS’s “unacceptable offer,” while the logistics giant denied it ended the negotiations.

According to the union, “UPS refused to give the Teamsters a last, best, and final offer, telling the union the company had nothing more to give,” adding it has “repeatedly made clear that UPS members will not work beyond the expiration of the current contract.”

Two weeks after talks broke down, UPS announced it will re-engage in negotiations with Teamsters, presenting an improved offer. The primary objective behind this move is to prevent the looming threat of a potentially detrimental strike scheduled for August 1st.

“We are prepared to increase our industry-leading pay and benefits, but need to work quickly to finalize a fair deal that provides certainty for our customers, our employees and businesses across the country,” UPS said in a statement.

UPS accounts for nearly a quarter of all parcel shipments within the US. That makes the company second only to USPS with 32% and ahead of Amazon with 23%, according to global shipping and mailing firm Pitney Bowes

This means any widespread disruption to its operations may not only delay UPS deliveries in the country but also overwhelm other carriers left to pick up the slack.

A huge financial loss may also result. A new report from the Anderson Economic Group shows that a 10-day strike at UPS could cost the US economy over $7 billion, with customers and small businesses themselves losing roughly $4 billion.

If that happens, it would be the costliest work disruption in a century, and the largest protest (over 340,000 workers) against an employer in the country’s history, the economic group found.

But amid disagreements and roadblocks, many transportation analysts remain optimistic that a deal will be struck between UPS and Teamsters well before the deadline. The underlying reason for this positive outlook is the interdependence that exists between both sides.

“Both sides are going to suffer if there is a strike and there is no revenue flowing to the company and no wages to the workers. They’re both going to lose in the end, because some shippers will shift to other carriers and not come back. And there will be other challenges to disappointing your customers that rely on you,” Paul Bingham, Director of Transportation Consulting at S&P Global Market Intelligence, told Transport Topics.

Amazon Taking Measures Ahead of the Potential UPS Strike

In a statement to USA Today, Amazon rep Steve Kelly said the company has been working to streamline its logistics network.

Amazon has recently installed same-day sites in major cities and is actively recruiting local businesses in rural areas as delivery partners for improved Prime delivery speeds. This could help minimize the impact of the looming strike on their logistics operations.

However, there could be some delays for sellers and customers in areas that heavily depend on UPS, experts warn.

“Amazon’s delivery service providers, the Amazon vans, those are more for denser urban areas where you have a lot more package density,” supply chain expert Jason Miller explained.

“So your Amazon shoppers in rural areas, and just in general areas that have less customer density, they’re the ones that are most likely to be affected.”

Amazon sellers that handle their own fulfillment and delivery “could also take more time since there’s a good chance that they could be using UPS.”

In that case, consider discussing your other options with your 3PL. For instance, you may want to implement backup carriers to stay flexible during supply chain disruptions.

🪧 In August 1997, around 185,000 UPS employees staged a 16-day long protest over pay and job security, causing a nationwide service disruption that cost America’s largest courier $780 million in losses.

The aftermath of the strike also left a lasting concern among customers that it could occur again, a warning that may soon proved prophetic if UPS fails to reach a deal with its unionized workers by July 31, 2023.

Teamsters Prepare for Contract Talks with UPS

The existing five-year contract between UPS and Teamsters, a labor union representing 350,000 UPS workers, is set to expire by the end of July. Negotiations over the new work terms and conditions will start in April.

Currently, the union’s UPS National Screening Committee is reviewing thousands of proposals for contract terms they should include in the Master Agreement.

Key issues that Teamsters aim to address include:

  • Pay gap between regular drivers and second-tier delivery drivers, known as 22.4 drivers after contract Article 22.4. In 2017, UPS rolled out Saturday Delivery to keep up with Amazon, FedEx, USPS, and gig workers that make weekend deliveries. To offer this service, the company hired second-class drivers whose rate ranges between $20.50/hour and $30.64/hour, whereas regular drivers’ can reach up to $40/hour. That’s a huge pay gap issue that Teamsters General President Sean O’Brien and some senior drivers aim to close by removing 22.4 employee classification or UPS’s two-tier wage system and expanding the number of full-time offers.
  • Part-time salary increase. O’Brien will push for a $20 starting rate (from $15.50) for part-timers (drivers and warehouse workers) and urge UPS to reward those who have been holding a long-term part-time position. Part-timers should also be given an opportunity to convert to full time.
  • Excessive overtime. A report from More Perfect Union reveals UPS forcing some of its drivers to take 12-hour shifts and constant overtime on the weekend, thereby ruining several marriages and families.

    In an interview with Insider, O’Brien said that the union is “open to finding a solution to the seven-day week delivery.”

    For instance, FedEx has been offering weekend deliveries for a couple of years, but has recently reduced Sundays in an effort to cut costs amid slowing eCommerce demand. 

    UPS may follow suit but that could also mean laying off numerous employees or hiring more seasonal workers.

    The stakes are higher at UPS, however, as the job cuts could impact 350,000 unionized workers responsible for handling and shipping the courier’s 21.1 million US daily package volume, which Teamsters could use as leverage. A mass walkout might force UPS to stop its operations until an agreement is reached.
  • Personal Vehicle Drivers (PVDs) or subcontractors. PVDs are temporary drivers hired to help full-timers deliver items while using their own vehicles. 

    Based on the existing contract, UPS can outsource jobs to seasonal drivers as long as the company gives priority to union workers. That means independent contractors may not be entitled to some benefits or incentives.

    Teamsters aim to eliminate “outsourcing” to ensure every UPS worker is “classified, treated, and paid as an actual employee, protected by a Teamster contract,” a spokesperson told Insider.

Related: California Truckers Protest AB5

  • Surveillance cameras. UPS has reportedly installed front-facing and driver-facing cameras inside their trucks that act as motion detectors to alert drivers when they don’t fasten their seatbelts or they’re using mobile devices while driving.

    However, for O’Brien, the inward-facing cameras are an “invasion of privacy,” and therefore, must be removed.

    “That’s just another tool to increase productivity and hold our members hostage,” he added.
  • Heat protection. 24-year-old UPS trucker, Esteban Chavez, Jr., died from heatstroke after finishing his last delivery in July 2022. This incident has prompted union members to demand UPS to put in place better heat-related safety initiatives like getting a fan installed in their vans or not giving them 12- to 15-hour routes during the hotter months.

If no agreement is reached on time, hundreds of thousands of UPS workers may hit the pavement in August to demand higher pay and better working conditions. 

In a statement to CNN in 2022, O’Brien said that the union will make use of its $350 million protest fund to get every advantage they need to win the contracts they want. The contract negotiations will also serve as an example for other workforces that have yet to unionize.

“Striking is a last resort, but if a company is not negotiating in good faith, we’re going to get what our members deserve.”

In other words, if Teamsters end up launching a protest this summer, it’s UPS’s fault. And given the fact that UPS handles more than 6% of the country’s gross domestic product (the only company to do so), the strike could create a massive void that the other courier service providers may not be able to fill, putting thousands of small businesses in a vulnerable position.

Consumers will most likely also have to endure delivery delays. 😫

UPS CEO Addresses Labor Issues

During the company’s Q4 2022 earnings call, UPS CEO Carol Tome assured analysts that a “win-win-win” agreement would be reached by July 31st.

“I would submit that a win, win, win is very achievable because we are not far apart on the issues. And let me make this real for you by giving you a few examples. First, both Teamsters and UPS agree that a healthy and growing UPS is good, good for Teamsters, good for our people, and good for our customers. In fact, we’ve added more than 70,000 Teamster jobs since 2018. So, we’re aligned that a growing and healthy UPS is good. To be growing and healthy, we need to be competitive and make sure that our offerings meet the needs of our customers.”

Tome also thinks that resolving these labor issues will only require “just a few tweaks” to the company’s existing contract with Teamsters. 🤔

These tweaks might include:

  • Implementing “new technology and hydration measures” to keep drivers and warehouse staff safe in sweltering heat.
  • Drivers, specifically 22.4 drivers, may opt not to work 6 days a week to reduce pressure on the workforce with weekend operations.

The company remains vague about raising pay rates, though. Moreover, Teamsters’s O’Brien also refused to disclose what the bottom line is for launching a strike.

The 1997 protest was won by getting UPS to agree to:

  • Increase pensions by up to 50%
  • Give hourly rate increases: $3.10 for full-time workers and $4.10 for part-timers over the next five years, the biggest salary increases at the time
  • Offer full-time positions to the company’s 110,000 part-timers

If union members go on strike this year, UPS reportedly has contingencies in place to reduce the event’s impact on its network.

According to sources interviewed by Freight Waves, UPS has requested its managers “not to schedule any paid time off during July and August in case parcels are required to be moved,” indicating the company’s desire to stay operational if Teamsters push through with its plans to walkout en-masse.

Other Things You Can Do

💪 Consider the following actionable tips when building your own contingencies in preparation for the potential Teamsters protest in August.

  • Discuss logistics strategies with your 3PL partner so you can stay flexible during disruptive protests.
  • If not working with a 3PL, consider splitting your shipments between UPS and other carriers like FedEx.
  • If using FBA, book delivery appointments ahead of time.
  • Make sure you have enough inventory stored in Amazon, 3PL, and/or supplier’s warehouse to avoid stocking out due to inbound delivery delays caused by the mass walkout.

Related: Amazon UK Workers to Launch Historic Strike in Early 2023, How to Ship to Amazon FBA (And Speed Up Check-In Times), Amazon Inventory Risks + 5 Tips to Mitigate Them, Bad Actors Book Multiple Inbound Amazon Delivery Dates to Create Scarcity

Amazon Offers New Fulfillment Fee Discounts on Select ASINs

📣 ICYMI: Amazon quietly introduced a new discount program Sufficient Inventory Level Promotion. This limited-time offer grants eligible sellers reductions on forthcoming fulfillment fees. 

To unlock these cost-saving benefits, you must have ASINs that meet Amazon’s eligibility requirements for the program and send in the suggested unit quantities for those products during specific time frames.

Are your products eligible?

Enrollment in this promotion is limited to specific ASINs only, determined by several factors including forecasted demand. 

Unit Demand Forecast is Amazon’s FBA restock tool for high-velocity products.

The graph above shows two main prediction levels: optimistic forecast model and mean prediction level, which Amazon describes as:

If the forecast shows you’re likely to stockout during the next quarter for example, you may receive a new recommended minimum that you should send in by a given ship date. Not only will this help you to stay in stock, but also qualify for a discount.

Amazon may want to incentivize efficient sellers because keeping a good amount of inventory at FBA allows the company to bring products closer to customers and therefore, fulfill orders faster. 

Note: If you’re using a third-party inventory forecasting platform or Economic Order Quantity model, you may notice your own forecasts may differ from Amazon’s depending on the restock recommendation settings used.

For example, SoStocked helps you generate a more accurate inventory forecast by allowing you to include in many variables not factored into most basic forecasts, such as adjusted daily velocity (accounting for stockout days to avoid under-ordering), sales spikes, lead times, future marketing plans, and more. This is a feature that Amazon’s tool currently doesn’t have so its forecasts may be inaccurate when compared to a more sophisticated inventory management software.

That means you may end up ordering too much or too little inventory and as a result, incurring additional fees, possibly canceling out the benefits of the promo offer.
Read this blog post to learn more about Amazon’s restock algorithm.

To see which ASINs are eligible for the promotional fee discount, you have a couple of options. 

  • Go to the “Fee Discount (New)” column on the Restock Inventory page or utilize the Send to Amazon workflow.
  • Download the Restock Inventory Report or use the Fee discount filter on the Restock Inventory page, which provides a list of ASINs that qualify, along with the corresponding fee discounts and ideal minimum units.

Discount Period Dates

Qualify for the fee discounts by shipping the recommended minimums to FBA during these three “goal periods.”

  • May 15 to June 14 (Past)
  • June 15 to July 14 (Current)
  • July 15 to August 14 (Upcoming)

Credit Period 

After each goal period concludes, expect a processing time of two to four weeks for Amazon to verify whether you have met the requirements and the subsequent application of discounts as reductions in your future fulfillment fees.

According to Amazon, discounts will be applied to all of your eligible ASINs, not just to the ASINs that met the minimum-units requirement.

Let’s say one of your eligible ASINs earned a $40 discount for meeting the replenishment goal in May-June. Instead of applying the discount on that single ASIN, Amazon may apply a one-time $40 fulfillment fee discount across all your ASINs. 

However, it is unclear where the discounts (pick and pack, referral, etc.) will be applied specifically. The policy just states:

“Your goal status, total units received, and discount earned will show on the Restock Inventory page and Restock Inventory report within two to four weeks after each goal period.”

What happens if you don’t meet the minimum threshold?

If you sent in some units but didn’t meet the minimum threshold, no partial or prorated discount will be given to you – for example, splitting a single shipment into smaller batches to try to earn a partial discount each time you ship one batch in.

Moreover, surpassing the recommended minimum for the specific goal period will not result in higher discounts.

Fortunately, you can try to increase your chances of earning fee discounts by:

Related: How to Automate Amazon Inventory Forecasting, 4 Ways to Improve Your IPI Score, Pros and Cons of Amazon Inventory Placement Service, How to Avoid Delays in Purchasing Inventory, 11 Benefits of Amazon Inventory Trackers

Sellers Cry Foul Following Amazon’s Decision to End FBA Small and Light

Amazon just found more pennies to squeeze out of sellers! 💰

On June 29, 2023, the etailer announced they will be replacing US FBA Small and Light (SnL) with a new program that will, in some ways, be similar to the current SnL program and in other ways much different. 

The first strange thing to note about this change is this, back in January, the SnL price cap for eligible products increased from $10 to $12. Now, 7 months later Amazon will be sunsetting SnL and shifting to this new program called Low-Price FBA, effective from August 29, 2023.

This change, however, sets the price threshold back to $10. That means although the new rates may still offer financial advantages to qualified items, they, for the most part, do not match the substantial benefits that the new 2023 SnL provided.

Per Amazon, general estimates suggest that:

The above messaging is a bit of Amazon sleight-of-hand. They lead with the benefit to sellers not currently enrolled and boast an average $0.77 savings on these products. However, these products should already have been getting this savings anyway but if they were not enrolled, they missed out.

And while it is true that Low-Price qualified products will save significantly over standard rates, a majority of those currently enrolled in the SnL program will actually see their fees increase and by an average $0.30 per unit by Amazon’s estimation, a significant impact to the under $10 product segment with already razor thin margins. 

Others in the $10 – $11.99 range will be fully priced out of their current discounted rate starting August 29th.

Check out the table below to see the price changes in detail (SnL vs Low-Price FBA vs Standard FBA) and their potential impact on your margins.

Size TierShipping WeightSnL Rates (as of January 17, 2023)Low-Price FBA Rates excluding apparel (Starting August 29, 2023)Standard FBA Fulfillment Rates (2023)
Small standard4 oz or less$2.47$2.45$3.22
4+ to 8 oz$2.54$2.63$3.40
8+ to 12 oz$2.61$2.81$3.58
12+ to 16 oz$3.15$3.00$3.77
Large standard4 oz or less$2.66$3.09$3.86
4+ to 8 oz$2.77$3.31$4.08
8+ to 12 oz$2.94$3.47$4.24
12+ to 16 oz$3.77$3.98$4.75
16+ oz to 1.5 lb$4.42$4.63$5.40
2+ to 2.5 lb$5.19$5.33$6.10
2.5+ to 3 lb$5.40$5.62$6.39
3+ to 20 lb$6.40 + $0.16/half-lb above first 3 lb$7.17 + $0.16/half-lb above first 3 lb
Small oversize70 lb or less$8.96 + $0.42/lb above first lb$9.73 + $0.42/lb above first lb
Medium oversize150 lb or less$18.28 + $0.42/lb above first lb$19.05 + $0.42/lb above first lb
Large oversize150 lb or less$89.21 + $0.83/lb above first 90 lb$89.98 + $0.83/lb above first 90 lb
Special oversizeOver 150 lb$157.72 + $0.83/lb above first 90 lb$158.49 + $0.83/lb above first 90 lb

While it appears that Low-Price FBA is indeed cheaper than standard FBA, it generally still has higher rates than Small and Light. 🤔

Suppose you have an SnL product that weighs 1.5 lbs and retails for $11.99. Under SnL, shipping would only cost you $4.42 per unit, but once Low-Price takes effect, your per unit FBA fee would move to standard rates, jumping to $5.40. That’s a $0.98/item increase – enough to potentially make products under $11.99 unprofitable.

The other strange thing is that, while, with SnL, eligibility capped at 3 lbs or less, Amazon has eliminated the weight and size restrictions from the Low-Price FBA program which allows both Large Standard products over 3 lbs as well as oversize products.

The joke here is that those heavier products have to be priced at under $10. So, while the product types newly included in this program can technically qualify, the fees almost certainly guarantee that the product, after Amazon fees, will be losing money. 

For a bit of solace in the face of this change, what makes up for the higher fees, according to the retailer, is the faster fulfillment speed which “customers love.”

SnL may have the lowest fees, but the program also provides slower shipping times than standard FBA. And given how the last-mile battle among eComm giants has been heating up lately, Amazon getting rid of SnL to offer customers faster delivery speeds across all product types and sizes might be one way to maintain edge – to say nothing about increasing their bottom line. 

For some sellers, the trade-off may be worth it, but for those who make just enough money or are struggling to stay afloat amid rising inflation, losing SnL may result in a substantial change to their business economics. 
As previously mentioned, Low-Price FBA only applies to products under $10. Without SnL, ineligible sellers might be forced to:

  • Absorb the fee increase and consequently, operate with thinner margins
  • Resize product packaging to achieve a lower size tier and to be able to ship as many units per carton/pallet as possible, thereby reducing shipping and storage costs
  • Implement a price hike
  • Reduce their prices to meet the new Low-Price threshold
  • Stop selling small and light products that don’t meet the new price limit
  • Ditch Amazon for a more affordable sales channel

What’s worse is that SnL sellers only have a little over a month left to prepare for this (unwelcome) change. Those who have inventory that’s scheduled to arrive after August may have to adjust their strategy now to account for the potential fee increases. 

What Sellers Are Saying

Amazon’s decision to decrease the cap from $12 to $10 was understandably met with dissatisfaction among sellers, who expressed their discontent.

A comment by one seller emphasized the importance of reevaluating the products falling within the $10-$12 price range. 

Another seller said that this change is “another example of Amazon taking a bite out of 3rd party sellers profit. If anything the price should have increased from $11.99 to 12.99, not gone backwards. Many customers do not care about delivery times like they used to obsess over it.” 

One suggests “If Amazon brought it up to $20, I would lower my prices to under $20 and I think the volume increase would be a triple win – Amazon, customers and our business.”

In summary, this news may catch sellers with products enrolled in SnL off-guard, as Low-Price FBA could have a significant adverse effect on a substantial number of customers, causing negative repercussions for everyone involved, including Amazon itself. Most items under $12 will likely see a retail price increase of up to $5 due to this change, further reinforcing the association of Amazon with higher prices.

As what many sellers suggest, it would be best for Amazon to reconsider and either maintain the $12 threshold or, better yet, raise it to a more favorable price point. Otherwise, the upcoming SnL replacement and the noticeable increase in prices may drive many Amazon customers towards competing eComm platforms and social commerce sites.

Related: 2023 Amazon FBA Increases, Pallet Calculator to Optimize Load Capacity, Master Carton Calculator to Reduce Costs

Aggregator Shakeups and Shifts in Strategy

Online sales growth is slowing after a huge spike during the pandemic, driving Amazon aggregators, or aggs, to implement various strategies to combat funding slowdown and declining revenue.

Strategy Shifts

In 2021, investors injected more than $12 billion into a new generation of startups that set their sights on acquiring Amazon marketplace sellers. However, beginning the first half of 2022, the flow of funding has considerably diminished, and the once-vibrant landscape of dealmaking has come to a near standstill.

“The private market almost shut down,” said Riccardo Bruni, Co-Founder of UK-based aggregator Heroes, in a statement to the Financial Times.

“For a certain period of time access to capital became impossible.”

The slowdown can be attributed to cooling demand amid inflationary pressures and recession fears – a confluence of events that has overall sparked caution among investors, leading to a more reserved approach.

Compounding the issue are the escalating FBA fee hikes implemented by Amazon, surging over 30% since 2020. This has significantly impacted the profitability of both sellers and aggregators. 

As a result, several aggregators find themselves compelled to make the following measures to foster margin improvements.

Layoffs 

Boosted Commerce, a California-based company, made the decision to downsize its workforce by 20% earlier this year. Similarly, Thrasio, a leading aggregator, had to lay off an undisclosed number of employees in 2022.

Thrasio’s new CEO, Greg Greeley, revealed in an interview with Forbes magazine that the company had mistakenly assumed that the demand for eCommerce would remain at pandemic-era levels. As a result, Greeley emphasized the need for Thrasio to readjust its expectations, ensuring that excessive inventory is not held and that acquisition prices are not set too high.

Other aggs with layoffs last year include the Benitago Group and SellerX.

Putting Acquisitions on Pause

As brick-and-mortar stores reopened, eCommerce demand slowed, making small sellers less appealing to potential buyers. Consequently, the estimated valuations of these smaller sellers plummeted, leading some aggregators to halt their acquisition efforts.

According to industry insiders who spoke to the Financial Times, the number of major aggregators actively pursuing new sellers has dwindled to less than ten. In the past, these aggregators were even willing to incur significant debts, often accompanied by steep interest rates of around 18%, all for the sake of finalizing acquisitions.

These acquisitions, in some cases, were completed at multiples as high as 7x the sellers’ adjusted valuation or earnings before interest, taxation, depreciation, and amortization (EBITDA). However, by Q1 of 2022, these brands were not performing as well as aggs had expected, primarily because for the first time in history, in-store shopping grew faster than eCommerce. That means aggregators have paid inflated prices for a large portion of those brands

With sales and funding shrinking dramatically in 2022, aggs have come to realize that relying solely on acquisitions for growth is not always a sustainable approach. As a result, some companies are opting to launch their own brands instead of acquiring existing ones.

For instance, Amazon aggregator Upexi is cautious on acquisitions spending 90% of its time building the business organically and 10% of its time on Mergers & Acquisitions (M&A).

Strategically Buy Up Quality Brands at Lower Prices

The long-term value of established aggregators may decline if the products they offer are considered common commodities. In a highly competitive market, only those who offer unique products are likely to survive.

So, while some aggs had to stop dealmaking completely, others have shifted their focus from doing rapid acquisitions to selectively “buying great assets at 20%-30% lower prices.”

Thrasio, for example, has expressed its growing involvement in emerging sectors that pose greater challenges for market entry. 

In an interview with Modern Retail, Thrasio President Danny Boockvar said that the company is actively expanding its portfolio by acquiring brands that they identify as a growth category, such as cleaning. These particular categories present higher barriers to entry (gated or regulated) due to the complexities associated with manufacturing products involving various chemical components.

Olsam, a European aggregator, disclosed to Modern Retail its strategic expansion into uncharted territories of patents and intellectual property, moving beyond conventional performance indicators such as seller ratings and product reviews.

Smaller aggs such as Heroes, Cap Hill Brands, and Gravitiq have also taken steps to streamline their operations and concentrate on a narrower range of categories.

Foundry Brands, in particular, exemplifies this trend by prioritizing quality over quantity as part of its aggregation strategy. Since its establishment in 2021, the company has strategically acquired fewer than 10 brands in total, emphasizing a selective approach.

Simultaneously, the prevailing economic conditions have presented an opportunity for aggregators to acquire high-quality brands at more affordable prices compared to the previous years.

Consolidate through M&A with other Aggregators

Facilitating strategic alliances and synergies is one way to create growth in times of austerity. From buying up online sellers, aggregators pivot to purchasing each other.

  • Acquisitions. To navigate the challenges, aggs have started acquiring one another, often expanding their reach globally. In a recent acquisition, Berlin-based SellerX purchased Elevate Brands, headquartered in Austin. By taking over Elevate Brands, SellerX will now oversee 80 Amazon marketplace brands, generating an impressive annual sales figure of $426 million. This also gives the heavily Euro-focused agg a better foothold into the US Amazon marketplace.

    Other noteworthy acquisitions took place in 2022 when Olsam acquired Flywheel Commerce and Marketfleet, and in April 2023 when Razor Group snapped up Stryze.
  • Mergers. Two smaller US aggregators, Suma and D1 Brands, recently merged to form a consolidated entity known as The Ambr Group. This unified business now manages a portfolio of over 30 enterprises, amassing a substantial annual revenue exceeding $100 million.

Less accomplished aggregators looking for cash in these tough economic times, however, could face the pressure of liquidation. 

According to Marketplace Pulse, there are 93 active aggregators across the world, 5 of which – namely Thrasio, Berlin Brands Group, Perch, Heyday, and SellerX – raised over $7 billion in 2021.

What’s Next for Amazon Aggregators?

Aggregators interviewed by Modern Retail believe that it’s not all bad news. There’s still a lot of growth opportunities in 2023, whether that means finding growth through M&A with other aggs, exploring beyond Amazon, or applying a more selective aggregation approach.

As Forum Brands CEO Brenton Howland puts it, “For sellers who are out there and want to know what the future state of the Amazon ecosystem is, as it relates to acquisitions, its continued health and activity. It may not be quite at the rate at the level that we saw in 2021. In 2023, we’ll see a healthy return to normalcy for business models that from a fundamentals perspective are outstanding and will continue to be that way.” 

Related: Amazon Aggregators: Comments and Concerns, Amazon Braces for Slowing eComm Growth in 2023

UPDATED: Amazon Taps into $100B Retail Media Market, Invests in New & Cutting-Edge Ad Platforms

Update 06/30/2023: Amazon just rolled out two new advertising features and revealed plans to add an ad-supported tier for Prime Video to boost its booming retail media business!

  • Add videos to sellers’ listings. EU Announcement. If you’ve been an Amazon seller for three months or more, you now have the opportunity to enhance your product pages by incorporating video content, such as product demos, installation guides, and setup tutorials. The addition of videos can significantly amplify your sales and reduce returns. Visit Amazon’s video upload page to get started.
  • 3D product pages with Hexa. Amazon has collaborated with Hexa, a Tel-Aviv based 3D visualization platform, to enhance its product pages with 3D images. Leveraging the power of AI, Hexa’s innovative tech transforms the conventional 2D product images provided by merchants into lifelike 3D models. These 3D images can be seamlessly integrated into websites, social media platforms, and augmented reality (AR) applications.

    Notably, these models offer an interactive experience as users can effortlessly maneuver and explore the product from various angles using their cursor. Hexa further assists its users by offering comprehensive services such as storage, management, distribution, and analysis for the 3D models they create.
  • Ad-supported tier to Prime video. According to Axios, Amazon is considering launching an ad-supported tier for its video service to boost revenue and attract more subscribers through less expensive subscription plans. The launch date, however, remains unclear.

    The move comes as more ad dollars shift from traditional TV to streaming platforms. Video streaming rivals Netflix, Disney+, and HBO have recently introduced their own ad-supported tiers. In its favor, while some rivals have only recently established their ad products, Amazon already has an established advertising team and other ad-supported video products, such as Freevee. This should play a significant role in guiding and enhancing the tech giant’s efforts in this area.

Amazon’s ad business is growing rapidly, with Q1 2023 ad revenue reaching $9.5 billion, a significant surge compared to the previous year. The company is also expected to capture 40% of new search ad dollars in 2023, per Insider Intelligence. It is possible that these figures may skyrocket even further once the new features roll out more widely and ads were to be introduced on Prime Video.

Not too long ago, retail media, aka marketplace advertising, caught the attention of advertisers as a rising digital channel, yet only a few big retailers like Amazon, Walmart, and Target dared to explore its potential.

Back in 2012, Amazon’s ad revenue amounted to just $609 million, and during that period, retail media was merely synonymous with advertising on Amazon itself.

Retail media networks like Amazon leverage their first-party customer data to serve customers relevant ads across search, display, or product pages. These ads can come in many forms, such as exclusive offers, coupons, and sponsored ads that appear during a shopper’s active browsing session on Amazon or other ad channels like Google Search and Facebook.

Related: Amazon Attribution Update Makes for a more Effective Sales Tool

Fast forward to 2022, retail media has experienced a phenomenal surge, primarily driven by the eCommerce boom. Advertisers allocated more than $40 billion toward retail media initiatives, with Amazon capturing an impressive 37% share of the total investment. Meanwhile, retail rivals Walmart and Target collectively accounted for a 36% share.

In a statement to Marketing Dive, Todd Krizelman, MediaRadar CEO, chalked it up to Amazon having such a “tight grip on the digital space that they really sit in a category of their own.”

“Other players are growing quickly, but it will be difficult for legacy brick and mortar retailers to beat Amazon on its own terrain.” 

Overall, these major players dominated the retail media landscape, commanding 73% of total ad investment in 2022. And over the next few years, the $40B market could potentially more than double.

Future is Bright for Retail Media

Touted as the “new frontier” of advertising, retail media is the world’s third-largest digital channel behind social ads (2nd) and paid search (1st).

Consulting firm McKinsey & Co estimates that the expansion of retail advertising networks in the US has the potential to surge up to $100 billion in ad spending by 2026. Moreover, these advertising investments prove to be immensely lucrative, yielding operating profit margins ranging from 50% to 70%.

Media investment company, WPP & GroupM, also predicts that retail media will increase by 60% by 2027.

Such projections highlight the tremendous growth and profitability that retail media is poised to achieve in the coming years, with Amazon leading the way. 

Leaning on the $100B retail media sector may catapult Amazon into the second spot of the overall US digital ad market, just behind Meta. 

Peaking at the Right Time

Insights from Insider Intelligence suggest that while Google and Facebook continue to see growth in their advertising businesses, their pace is comparatively slower than other areas of the US online ad market.
In the midst of this landscape, Amazon has been steadily gaining market share.

Per Insider Intelligence, Amazon accounted for 11.8% of US digital ad spending in 2022. This figure is projected to increase to 12.9% in 2023 and further to 14% in 2024. 

By 2025, the total online ad market share gap between Amazon and Meta will be down to just 3.2% points. This goes to show that Amazon’s ad business has become one of its key strengths. And sellers are well-positioned to take advantage of this growth area with Amazon’s advertising tools.

Amazon’s Working to Expand its Ad Business to Accelerate Growth

With momentum on its side, the retail giant wasted no time in beefing up its advertising division. The company recently:

  • Launched Amazon Anywhere, a groundbreaking program which allows customers to seamlessly browse and purchase tangible products from Amazon in virtual environments, such as video games, augmented reality (AR) experiences, and third-party mobile applications. With Amazon Anywhere, the boundaries between virtual and physical shopping blend, creating a truly immersive and convenient retail experience.
  • Assembled a team to build an AI-powered tool that will generate images and videos for advertisers.
  • Overhauled the Amazon Demand-Side Platform (DSP) to introduce more advanced machine learning and predictive algorithms to “enhance bidding and pacing decisions” and help advertisers reach “previously unaddressable audiences.” With these upgrades, users reportedly saw a 12.6% increase in click-through rate, 24.7% reduction in cost per impression, and 34.1% increase in return on ad spend.
  • Hired Kelly MacLean, a seasoned monetization product engineer at Meta, as VP of Amazon’s DSP business. According to Business Insider, she will play an important role in demonstrating DSP’s new offerings to agencies and non-Amazon advertisers. 

For sellers, these advancements could provide a new and better way to diversify their ad investments, optimize ads for performance, or reach untapped markets and thus, drive sales. For customers, improved search relevancy enhances the shopping experience by allowing sellers to offer them a more targeted product selection in real-time.

With this in mind, consider adopting a retail media strategy and seamlessly integrate it into your comprehensive marketing plans, if you haven’t done so already. This approach allows you to maximize the potential of Amazon’s available resources and leverage emerging opportunities in response to evolving customer behavior.

Related: Walmart Launches New Ways to Find and Buy Products, Amazon Will Pay Users $2/Month to Track Their Data, Amazon Now Allowing Email Marketing Campaigns to Repeat Customers, How to Optimize Amazon Attribution

FTC Lawsuit Alleges Amazon of Tricking and Trapping Customers into Recurring Prime Subscriptions

Right on the heels of Amazon’s 2023 Prime Day announcement, the Federal Trade Commission (FTC) has filed a complaint accusing the tech giant of duping customers into signing up for Prime and “knowingly” making it hard for them to opt-out.

What are the details of the complaint?

According to FTC, for years Amazon has employed what is being described as “manipulative, coercive, or deceptive tactics” in an effort to steer customers towards signing up for Prime, even if the customers may have harbored reservations at enrolling. Subsequently, these subscriptions were set to auto-renew, resulting in a monthly charge of $14.99 or an annual fee of $139.

Prime holds a major role within the tech giant’s retail empire, as its members tend to exhibit heightened shopping activity and expenditure. As of 2020, Amazon had a total paying Prime members of 200 million.

However, the current FTC lawsuit claims that a portion of these subscribers may have been acquired through deceptive means.

What are Dark Patterns?

Coined by British User Experience (UX) designer Harry Brignull, dark patterns are “deceptive user interfaces” designed to get people into performing an action that they didn’t mean to. Common types of dark patterns include:

  • Disguised ads – The individual, under the false impression, assumes they are interacting with an interface element or genuine content, unaware that it is, in fact, a cleverly disguised ad. For example, popular software download site Softpedia features a conspicuous download button that bears a striking resemblance to the genuine download button for the desired software. Consequently, users inadvertently fall prey to this deceptive design, mistakenly clicking on the ad thinking that they are initiating the actual software download.

    Another example of this type of dark UX may be observed in Amazon’s search results. The Washington Post reveals that unbeknownst to many Amazon users, the initial search results they encounter when looking for a product are primarily comprised of advertisements rather than organic listings. This exposes Amazon’s questionable tactics, as the company compromises the trust placed in its search results in order to generate additional revenue.
  • Bait and switch – When deceptive data or false information is presented, it revolves around the user’s interests and triggers their curiosity. Once the user expresses interest and proceeds by clicking, the information or data undergoes a complete transformation or shift. Bait and switch tactics are commonly employed by businesses to attract more clicks.

    Such a strategy enables site owners to generate additional revenue from ad impressions, while advertisers enjoy the advantages of enhanced click-through rates, potentially leading to increased sales.
  • Hidden subscription – The covert scheme of hidden subscriptions works by utilizing sneakiness and misdirection. Users are led to believe they are making a one-time purchase, unaware of a concealed legal provision that commits them to an ongoing subscription. After signing up, the service operates discreetly, refraining from sending any emails or notifications to remind users about the recurring payments. This lack of communication ensures that payments go on for an extended duration. Additionally, this tactic is commonly coupled with the hard-to-cancel deceptive pattern.
  • Hard-to-cancel subscriptions – Signing up is easy but canceling is difficult. More on that later.
  • Buried terms or hidden costs – Companies entice consumers by advertising only a fraction of the product’s total price while conveniently omitting any mention of mandatory fees until the later stages of the buying process. In a notable case involving LendingClub, the FTC accused the online lender of utilizing prominent visuals (design elements like art, text, and color that grab attention) to deceptively assure loan applicants that they would receive a specific loan amount and encounter “no hidden fees.” However, the mention of mandatory fees was cleverly tucked away behind tooltip buttons and inserted amidst more conspicuous text.
  • Tricks to obtain user data – These deceptive tactics often disguise themselves as granting users the power to make decisions regarding their privacy preferences or data sharing. However, their true intention is to deliberately guide users towards the choice that surrenders the greatest amount of personal information. According to FTC, smart TV manufacturer VIZIO was accused of facilitating default settings that enabled the company to gather and distribute consumers’ viewing habits to third parties. Only a small number of consumers received a brief notice regarding this practice.

Trick and Trap Tactics Allegedly Used by Amazon

FTC’s case involving Amazon focuses on the company’s hidden subscription and difficult-to-cancel tactics. By employing these devious mechanisms, Amazon has presumably violated the FTC Act and the Restore Online Shoppers’ Confidence Act.

FTC says throughout Amazon’s online checkout process, customers encountered multiple instances where they were presented with the chance to become Amazon Prime subscribers at a monthly cost of $14.99.

Often, it proved challenging for customers to find the option of buying items on Amazon without subscribing to Prime. Additionally, in certain situations, the button provided to finalize the transaction did not explicitly indicate that by choosing that option, customers were also agreeing to enroll in Prime for a recurring subscription.

Source: pudding.cool

To strategically dissuade members from leaving, especially after raising membership fees from $119 to $139 annually, Amazon has implemented a laborious opt-out process called the “Iliad Flow.” This process draws parallels to Homer’s epic poem about the decade-long Trojan War. In other words, if customers wanted to unsubscribe from Prime, it will take them ages to effectively do so.

In a blog post published September 2022, market analyst Dr. Pierre-Nicolas Schwab shares how Amazon used two dark pattern mechanisms to discourage members from terminating their Prime subscriptions.

  1. Make it difficult to find Prime in the menu.
  2. Put in place multiple confirmation prompts.

Allegedly, Amazon deliberately obscured the cancellation process, making it challenging for customers to locate. Upon discovering the cancellation flow, they were then directed to a series of pages enticing them with various offers, such as discounted subscription rates, the option to disable auto-renewal, or the choice to retain the service. It was only after navigating through these pages that members could ultimately proceed with canceling the service.

Based on internal Amazon documents reviewed by Insider in early 2022, it is believed that the company possessed knowledge of customers being involuntarily enrolled and encountered difficulties when attempting to opt out of Prime. And yet, the execs reportedly neglected to tackle these concerns until they were notified of FTC’s investigation.

Worse, FTC’s lawsuit also alleges that Amazon made deliberate efforts to delay the Commission’s investigation on several occasions.

Amazon’s Response

In an email to The Verge, Amazon spokesperson Heather Layman told the media outlet that the claims put forth by the Commission were entirely unfounded both in terms of factual accuracy and legal basis.

“The truth is that customers love Prime, and by design we make it clear and simple for customers to both sign up for or cancel their Prime membership,” Layman explained. 🤔

It is worth noting that the Commision recently proposed a new provision requiring sellers to make unsubscribing as easy as signing up. So, it looks like the FTC wanted to make an example of Amazon by filing suit.

“The proposed rule would require that companies make it as easy to cancel a subscription as it is to sign up for one. The proposal would save consumers time and money, and businesses that continued to use subscription tricks and traps would be subject to stiff penalties.” said FTC Chairperson Lina Khan.

If proven guilty, Amazon may find themselves paying up to $50,120 in civil penalties per violation of an FTC rule. Considering how quickly these penalties can add up, now’s the best time for the tech giant to review their business practices to ensure FTC compliance.

Related: A Purge Could Be Coming for Fake Reviews on Amazon, Amazon Faces Tougher Scrutiny Under EU’s Digital Services Act, S.2992: Why Amazon Wants You to Lobby Congress

Clash of the Titans: Walmart and Amazon Battle for Dominance Intensifies

Clash of the Titans: Walmart and Amazon Battle for Dominance Intensifies

Update 06/21/2023: Following in on Amazon’s footsteps, Walmart just launched an inventory distribution program called Inventory Transfer Services (ITS). 

“Our new solution allows for the seamless and efficient transfer of inventory to Walmart fulfillment centers, optimizing supply chain logistics and enabling faster delivery to customers,” said Jaré Buckley-Cox, VP of Walmart Fulfillment Services, in a LinkedIn post.

According to Buckley-Cox, ITS aims to enhance the availability of sellers’ inventory across Walmart fulfillment centers, cut down on inbound shipping costs by consolidating goods at a central hub, and provide faster shipping options.

The launch comes after the retailer announced they’re building small warehouses within their existing supercenters and four next-gen fulfillment centers (FCs) over the next few years. These high-tech FCs will be equipped with “a powerful combination of people, robotics, and machine learning,” allowing Walmart to take their 12-step fulfillment process down to just five.

With improved fulfillment speed and capacity, these next-gen FCs “could provide 75% of the US population with next- or two-day shipping on millions of items, including Marketplace items shipped by Walmart Fulfillment Services.”

When combined with traditional Walmart FCs and store locations, the retailer can reach 95% of US shoppers with 1 to 2-day shipping and 80% of the population with same-day shipping.

By contrast, Amazon has FCs within one hour of 77% of the US population. And given how both of these retail giants have many products with similar prices, customers will likely prefer the one with the fastest delivery.

No wonder Walmart is making huge strides in setting their stores and FCs up to fulfill online orders. Not only will these upgrades allow them to keep up with increasing demand for same-day shipping but also potentially to outdeliver Amazon.

🆚 For years, Amazon and Walmart have been pulling out all the stops to win customers and sellers. Both retail giants are offering a wide range of products at low prices and ramping up free, 1- to 2-day shipping and return services to maintain dominance.

While Amazon leads US eCommerce, Walmart rules over brick-and-mortar stores. But the battle for dominance intensifies as Walmart encroaches more deeply into eCommerce territory after:

With Walmart going after Amazon’s market share, it’s not surprising to see Amazon unveil new marketing capabilities for sellers during the recently concluded Accelerate event in an attempt to stay dominant.

On September 14, 2022, Amazon announced a new lineup of marketing tools to attract more e-commerce businesses to its marketplace. These include:

Interestingly, shortly after Amazon made these announcements, Walmart responded by introducing the updates to its display ad services, Search Brand Amplifier. 🔥

In a press release, Mike Greenberg, Head of Marketplace Walmart Connect, reveals that SBA is coming to sellers in October to help them reach more customers, especially this holiday season. 

New sellers or brands with new products that may not yet have high organic search rankings will benefit greatly from SBA, as it offers them the opportunity to showcase their products in prominent places within search results similar to Amazon’s Sponsored Brand ads.

Brand-registered sellers are eligible for the ad program. You can also take advantage of the following features to help scale your business:

  • Faster enrollment with automated onboarding at the Walmart Ad Center
  • Additional application programming interface (API) partners to support sellers in China, Canada, UK, India and other countries
  • New resources to help sellers optimize Sponsored Search campaigns 

Walmart’s Booming Ad Business

The move to open SBA to marketplace sellers also came after Walmart made $2.1 billion in ad revenue in 2021, which represents an important growth area for the company.

According to Doug McMillon, Walmart’s president and CEO, the ad business played a crucial role in elevating customer experience on the site by highlighting better deals and the right products.

Therefore, “the relationship between digital growth, marketplace growth and advertising is something that we’re trying to take advantage of,” said McMillon.

Aside from generating revenue, the ad business will also provide Walmart with valuable insights into the way customers shop on the site.

In fact, Walmart has recently added Innovation Partners to its ad network to connect advertisers with potential customers on TikTok, Snapchat, and Roku. Through this new program, you can:

  • Serve ads on popular social media platforms, including TV streaming site Roku
  • Create engaging shoppable videos via Firework and TalkShopLive
  • Measure your advertising campaign’s impact on your sales

Innovation Partners seeks to help sellers connect with Gen Z shoppers. But for Walmart, it allows them to take a crack at the elusive US live commerce market, which no other retail company, even Amazon, has figured out yet. For instance, Shopify’s attempt found them partnering with YouTube while Amazon released Amazon Live. 

If Walmart succeeds, it would give them a huge competitive advantage over their rivals. 
Amazon’s $31 billion ad business may be far up there with behemoths like Google and Meta, but with Walmart’s growing ad network, the competition will only get tougher in the future, especially as the lines continue to blur between in-store and online shopping. 💪

4 Major Changes Coming to Amazon

Stay in the know! Amazon has recently announced the following changes that sellers should prepare for.

1.INFORM Consumers Act: Amazon Threatens Non-Compliant Sellers with Account Deactivation

What is the INFORM Consumers Act and why should you care?

In the Consolidated Appropriations Act of 2023, an extensive bill governing federal government expenditures for the upcoming year, an important addition called the Integrity, Notification, and Fairness in Online Retail Marketplaces for Consumers Act, also known as the INFORM Consumers Act, was included.

On December 29, 2022, this Act was officially enacted into law. Its primary objective is to eradicate organized retail crime syndicates from online marketplaces through the authentication of seller identities. The Act additionally seeks to establish the responsibility of eComm platforms in preventing the sale of fake goods.

In accordance with the INFORM Consumers Act, online marketplaces like Amazon are now obligated to collect, verify, and divulge specific identification details relating to “high-volume third-party sellers.”

These sellers are classified as individuals who have completed more than 200 transactions and generated revenues exceeding $5,000 within a span of 12 months. If you’re eligible, you will be required to provide Amazon with your:

  • Personal Information (name and phone number)
  • Government ID
  • Tax ID
  • Business Address
  • Bank Information

Severe consequences await those who fail to adhere to this legislation. The Act empowers the FTC to impose hefty fines of $46,517 per violation, applied to each instance where an online marketplace neglects to gather, verify, or disclose the necessary information. Moreover, state attorneys general are granted the authority to initiate legal proceedings against non-compliant online marketplaces if their respective state suffers adverse consequences.

In order to adhere to the INFORM Consumers Act, online marketplaces must establish and implement policies, procedures, and controls by June 27, 2023.

With the deadline fast approaching, Amazon is intensifying their efforts, much to the dismay of sellers, to provide the required information within a short period of time.

The company has sent out an email blast to sellers who are at risk of account deactivation because they have some missing information. To ensure compliance ASAP, sellers are advised to click on and execute the action items enumerated in the email.

Things can get complicated if your information is fraudulent, outdated, or simply does match with Seller Central’s records. If outdated, promptly update your details in Seller Central.

It is unclear whether Amazon will let sellers who rely on a blend of personal information or personal bank accounts for their business operations to continue without encountering potential issues down the line. Be sure to check your Account Health Dashboard for verification status updates or contact an Amazon representative to learn more.

After June 27, sellers who neglect to comply might encounter a temporary suspension of their payments and potentially face account deactivation. 

Related: A Purge Could be Coming for Fake Reviews on Amazon, Amazon Faces Tougher Scrutiny Under EU’s Digital Services Act, What is S.2992?

2. Amazon Replaces Inventory Overview Page with FBA Dashboard

In a Seller Info email, Amazon revealed that the trusty Inventory Overview Page, aka Planning Page, will bid farewell on June 5, 2023, making room for the brand new FBA Dashboard.

FBA Dashboard

Embracing innovation, the FBA Dashboard takes the foundation laid by Inventory Overview and enhances it further. It presents a comprehensive and “unified view of your FBA business,” encompassing vital data such as the Inventory Performance Index score, inventory age, shipment information, and expert inventory management recommendations.

Head over to FBA Dashboard for more details.

3. Marketplace Web Service Migrating to Selling Partner-API 

UK/EU Announcement: Sellers who have utilized Amazon’s legacy Marketplace Web Service (MWS) API program to develop tools to interact with the marketplace are required to switch over to Selling Partner (SP) API by August 31st in order to avoid any disruptions to their business automation.

Previously, through MWS, sellers were able to build apps for their own or others’ seller accounts. These applications facilitated various tasks such as searching for products to sell, retrieving orders for fulfillment, confirming shipments, and generating reports.

However, starting from August 31st, 2023, sellers must transition from MWS to SP-API. Alternatively, they can opt to replace their current application with a 3rd party app that supports sections that will soon be discontinued, namely Merchant Fulfillment, Orders, and Reports API sections.

In addition, effective April 1, 2024, Amazon will shutdown all other remaining MWS API sections

In their recent announcement, Amazon emphasized the benefits of using SP-API, which includes a more streamlined and consolidated authorization process, more granular data access controls, and the ability to access information for both seller and vendor accounts.

To assist sellers in this transition, Amazon recommended reading this migration guide or exploring the Selling Partner Appstore, where they can find reputable 3rd party apps that have been vetted and deemed of high quality, serving as suitable replacements for the company’s existing MWS integrations.

Sellers who have never developed their own applications using Amazon APIs to exchange data between their systems and Amazon’s systems need not be concerned about these changes.

4. Heavy and Bulky Items No Longer Eligible for Amazon Vine

This announcement is for Amazon Vine users in the UK.

Effective immediately, the option to create new Amazon Vine enrollments for heavy and bulky items will be unavailable in an effort to enhance FBA’s fulfillment process. However, if you have already enrolled such an item, it will remain eligible for reviews until the end of your enrollment period.

Amazon considers products weighing more than 30 kg (66 lbs) or 1.5m in length as heavy and bulky. This might be yet another cost-cutting move given that these oversized items take up more space and usually have special handling or delivery requirements (e.g., using larger trucks). Therefore, they cost a lot to ship, which not only eats into Amazon’s profits but also sellers’.

Amazon Delivery Drones Off to a Rocky Start

AMAZON DELIVERY DRONES OFF TO A ROCKY START

Update 05/18/2023: Since launching in December 2022, Amazon Prime Air has just completed 100 deliveries in Lockeford, CA and College Station, TX. This figure only represents 1% of the company’s target delivery goal of 10,000 by the end of 2023. 

The once-promising projection now teeters on the brink of uncertainty. In Lockeford, a small town housing roughly 4,000 residents, reports from Prime Air staff reveal that Amazon’s drones are currently catering to a mere two households, both located within a mile’s distance from the company’s local delivery hub.

Considering College Station, a significantly larger town with 120,000 residents, one might assume greater prospects for Amazon’s drone operations. However, the company has yet to seize the potential of this market as well.

In a statement to CNBC, Amazon spokesperson Av Zammit cited FAA flight restrictions as the reason why the program is still experiencing slow progress in the two service areas.

As we’ve previously reported, Amazon has been diligently working to enhance its drone technology in order to satisfy the stringent requirements set by the FAA and gain greater operational flexibility. However, despite its efforts, the company has been unable to persuade the FAA to remove the substantial restrictions imposed on its drone operations.

Per FAA’s 2023 revised Exemption No. 18601B, Amazon can conduct drone deliveries in sparsely populated towns like Lockeford and College Station, but the drones are not allowed to fly over roadways, schools, or people without case-by-case permission, essentially limiting Amazon’s drone operations.
With a lot of regulatory hurdles to overcome, Prime Air’s wider rollout in the US might take longer than expected. But as they say, slow progress is better than no progress at all. Zammit told The Verge that the company will continue to cooperate with the FAA to ensure they meet all restrictions to be able to expand drone deliveries to more areas over time.

Federal Aviation Administration (FAA) restrictions and massive job cuts have reportedly stalled widespread use of Prime Air, Amazon’s drone delivery service, in Lockeford, California and College Station, Texas. 

As a result, Amazon completed less than 10 deliveries in its first 30 days. That is a far cry from the company’s aim to deliver 500 million packages annually by drones by the end of the decade and the number of deliveries truck drivers do each day, which are about 170 to 350 packages per shift.

Does this mean Prime Air is a failure? Will we ever see a wider rollout of the program in the near future?

It all depends on the FAA’s operating restrictions for Amazon and how they are going to comply.

FAA Flight Restrictions Impacting Prime Air’s Ability to Operate

In August 2020, the FAA issued an approval certificate to Amazon which allowed the company to utilize drones in a commercial setting. However, the aviation authority also included several conditions and limitations (see below) that the tech giant reportedly tried to downplay, which turned out to be a costly move.

Amazon argued that its latest drone model, MK27-2, is safer and more autonomous than its predecessors. It is also equipped with an enhanced perception system that can detect obstacles or people below it during delivery or landing.

That means it doesn’t need as many personnel, including visual observers (people who assist remote pilots in completing delivery drone flight operations). While Amazon’s drones can fly autonomously, it doesn’t mean they can cross public areas or no-fly zones without FAA’s permission, a rule that the company presumably violated.

One of FAA’s existing regulatory barriers for autonomous delivery drones include not allowing unmanned aircraft (UA) to fly over “non-participants” unless otherwise approved by the Administrator. In Prime Air’s case, “non-participants” would be people who are not part of the drone flight operations.

So, when Amazon’s drones tried to fly over people or public roads without case-by-case permission, the FAA intervened for the safety of the residents and temporarily blocked Amazon from continuing its drone operations, The Information reported.

The suspension has significantly reduced the number of drone deliveries in California and Texas. As of mid-January 2023, Prime Air made as few as three deliveries in Lockeford, CA, and five in College Station, TX.

In an email to Gizmodo, Amazon rep Av Zammit confirmed that they’re “making a limited number of deliveries” in the two towns. Despite FAA restrictions, the tech giant still plans to continue to expand over time. 

“Just last week we received the FAA’s approval to start delivering to more customers in these locations.”

However, FAA restrictions are just one of the many obstacles that Prime Air needs to overcome in its early stages. Public outcry and labor issues may further delay its national rollout.

Amazon Drone Safety Issues

In the US, drone malfunction (resulting in crashes) is the top concern for most people.

Insider recently reported that town residents expressed safety concerns after finding out Amazon’s delivery drones would be flying over their yards, and rightly so given the program’s erratic record with the FAA.

Amina Alikhan, a College Station resident, worried about the possibility of a 90-pound drone “falling from the sky onto our home, onto our car, onto our children.” 

MK27-2s weigh roughly 80 lbs when empty, and can carry a maximum payload of 5 lbs. By contrast, Amazon’s drones are 10 to 40 lbs heavier than Alphabet’s Wing and Walmart’s Flytrex and Zipline.

During one of Amazon’s test flights in Oregon, one drone crashed into a field, causing a 25-acre bushfire

Disastrous consequences such as this one is why the FAA has more stringent rules for heavier drones than it does for small Unmanned Aerial (UA) drones weighing less than 55 lbs. 

In 2019, the FAA modified Part 107 to allow “routine operations of small unmanned aircraft over people, moving vehicles, and at night under certain conditions” potentially without a waiver depending on the level of risk small UA present to people.

That said, Amazon may need to roll out a more lightweight drone, implement advanced autonomous systems, and invest in skilled pilots and observers to change the public’s perception of drones as killing devices to vehicles that benefit shoppers with same-day delivery of products.

Widespread Layoffs Immobilizing the Drone Flight Safety Division

Another factor that could delay Prime Air’s wider rollout this year is the impact of mass layoffs on its drone safety team.

According to CNBC, around half of the drone delivery department – that includes designers, maintenance staff, systems engineers, flight testers and flight operations specialists – have been laid off.

The employees said that the layoffs, along with increased pressure to meet delivery goals, “have created new concerns about the potential dangers Prime Air poses” and made them question the company’s commitment to safety, Insider reports.

“I think it says what their priorities are,” one current employee told Insider.

If the company prioritized drone safety “as much as they like to tell the media, that team wouldn’t have gotten laid off.”

Amazon spokesperson Maria Boschetti quickly squashed claims of widespread drone job cuts telling Insider in an email that they are “misinformed or inaccurate,” although she did not specify how many employees from the safety teams had been let go.

Boschetti reiterated that safety is the company’s top priority, and “implying that we no longer have a robust safety team in place is completely inaccurate.”

Prime Air got off to a rocky start, but the good news is it still has “a dedicated safety officer in each location, plus dozens of other employees who are responsible for safety as part of their job.”

The teams are also currently working on a new drone model, MK30, which is lighter, smaller, and quieter than MK27-2s, indicating their continued commitment to meeting FAA’s rigorous standards.

Related: 60-Minute Amazon Drone Delivery Now a Reality, Amazon Warehouse Automation Increases Concerns Over Job Loss and Product Selection Inaccuracy, Amazon Tweaks Logistics Strategy to Streamline Operations

Shein Moves Into the US Market, But May Struggle to Recruit 3P Sellers

After testing the waters in Brazil, Chinese fast-fashion giant and the world’s most downloaded shopping app, Shein, now appears to be finally moving into the US market and is adding new sales categories, such as Home and Beauty, to further compete with similar eComm retailers. 

Marketplace Pulse CEO, Juozas Kaziukėnas, recently came across multiple job openings posted by Shein on LinkedIn for positions in California. One of the newly posted positions is for a Senior Business Developer for the company’s US marketplace, whose primary responsibility will be to identify and pursue new business opportunities.

In addition, Shein is also seeking to fill the role of AML Compliance Officer – Global Operations Center, USA to “lead, oversee and ensure effective execution” of compliance and anti-money laundering initiatives in the Americas. Other available positions include a Supplier Management specialist and an Inventory Clerk.

This move comes after Shein revealed its plans to build 3 large distribution centers in the US to keep up with soaring demand and to shorten shipping times by 3 to 4 days. The retailer directly ships orders from China to over 150 countries and the standard shipping time for US customers usually takes 1 to 2 weeks, which has left many feeling frustrated.

By contrast, Amazon only takes about 1 to 4 days to get orders delivered across the mainland US, all made possible by its vast fulfillment network, including pickup locations at Kohl’s, Whole Foods, and Amazon Fresh.

According to Shein, they have been using both air and ocean freight for global shipping, but they are now exploring ways to identify more products that can be moved cost-effectively by sea. They’re also looking to source goods from locations closer to customers.

Last month, the etailer said it will invest almost $150 million in Brazil to build out its own network of manufacturers in the region. The money will be used to “provide tools and training for factories to upgrade their traditional production models” and “enable local producers to better manage orders, reduce waste at the source and lower excess inventory.”

Meanwhile, over the US, Shein is making strides to enhance its first distribution hub’s capacity by 50%. The company is also gearing up to launch a second center in California in 2023, with plans to introduce a third one in the Northeast with a yet-to-be-revealed timeline, the Journal reports.

Aside from significantly cutting shipping times, Shein also hopes to attract more local third-party sellers with its US expansion, which other Chinese eComm marketplaces like Alibaba and  TikTok have reportedly struggled with.

Shein needs American sellers to introduce more variety to its mostly Chinese-based product selection. However, retail experts interviewed by Modern Retail believe that the company might also suffer the same fate as its Chinese contemporaries.

According to Ryan Craver, Founder of Commerce Canal, Shein’s pricing strategy “works well” for Chinese merchants that have the same fast-fashion mindset.

“But it’s very difficult for US sellers and operators because the price point is so critically low,” which not only reduces the perceived value of a product, but also forces local brands to drop their prices in order to win the price war versus Chinese merchants.

Therefore, selling on Shein might feel like a race to the bottom for US sellers, especially those in the mid and upper-range markets.

Shein might have an answer to that, though. In 2021, the retailer launched a premium clothing brand called MOTF. Prices range from $5 to over $100 depending on the type of product and material.

The Journal reports that Shein aims to sell more high-end products with greater profit margins, but they may struggle to attract customers with a week-long lead time, hence why the company is doubling down on its fulfillment expansion plans.

So, perhaps until Shein has successfully gained a deeper foothold in the country with multiple distribution centers and a more favorable pricing strategy, only then will US sellers find the marketplace a viable contender to Amazon and other sales channels.

Related: Should You Be Selling on These New Sales Channels?, TikTok Gears Up for US Market Entry

A Purge Could Be Coming for Fake Reviews on Amazon

🚨 Amazon has quietly removed hundreds of thousands of customer reviews from some of its own Amazon Basics listings, indicating a new round of reviews purges may be soon at hand.
In April, a few Amazon Basics products saw a huge decrease in review count following Amazon’s heightened efforts to combat fake review brokers and counterfeiters on its platform.

As shown above, the review count for Amazon’s Pack of 50 Slim, Velvet, Non-Slip Hangers went down by 75% on average and around 98% for the Pack of 30 variant.

Given the company’s ongoing war on fake reviews, it is likely that most, if not all, of the reviews that have been taken down came from fraudulent sources.

However, it is unclear whether or not the listings had bogus positive reviews and if they did, were they also included in the removal process? 🤔

If the purge did include misleading positive reviews, it somehow implicates Amazon in the very fake review schemes they’ve been trying to eradicate for years (2016, 2018, 2020, 2021, 2022, 2023).

Now, that doesn’t necessarily mean Amazon is the culprit behind the dubious positive reviews. For instance, a nefarious seller may have hijacked the Pack of 30 Hanger listing to attach a completely different product to it, allowing the two items to share the same reviews. To bolster product visibility and trick more customers into buying, the hijacker could have also added more glowing feedback to the hijacked listing. 

An alternative, though unproven, theory is that Amazon themselves may have gamed the system to artificially inflate their product’s overall rating and drum up sales with false positive reviews. An analysis by the eComm consulting firm, Pattern, shows that improving one’s review rating by just one star can lead to a sales boost of up to 26%.

Even if Amazon’s hands are clean as far as positive reviews, that doesn’t discount the possibility of removing some authentic low-star reviews which would achieve the same results. 

This abusive behavior likely wouldn’t surprise sellers who have already seen how the retail giant can allegedly break its own rules to stay ahead.

How do bad actors abuse Amazon’s review system?

There are several ways that bad actors can cheat Amazon’s review system. These include:

  • Astroturfing. Bad actors or bots can create fake accounts or pay others to create fake accounts to leave positive reviews for their products. While this can increase a product’s rating and sales, this can also mislead customers into purchasing a product that may not meet their expectations.
  • Review stacking. Some sellers will add reviews from other (often dead or abandoned) products to their own listings to increase their review count. This may also help boost the listing’s total star rating from 3.4 to 4 stars, for instance. 
  • Review manipulation. This involves offering incentives or discounts to customers in exchange for leaving positive reviews. This can lead to biased or fake reviews.
  • Product swapping. Some sellers will send customers a different product than what was advertised, and then ask for a positive review in exchange for a refund. This can lead to deceptive top reviews for a product that is not the one being advertised.

What could be the reason behind Amazon’s review purge?

Amazon possibly deleting false positive reviews may be an attempt to remove traces of anti-competitive behavior that could potentially not bode lightly for its own antitrust probes and the financial penalties for its sellers.

Just last month, the Federal Trade Commission (FTC) levied a $600,000 fine against supplements maker, The Bountiful Company, for review hijacking on Amazon.com. 

Aside from potentially trying to get antitrust watchdogs off its back, Amazon is also well within its rights to remove fake negative reviews from its own and others’ listings. For instance, competitors can buy an Amazon Basics product and then fraudulently leave a bad review or report the product as defective or counterfeit. This can hurt Amazon’s reputation and sales, even if the product is legitimate.

The Fight Doesn’t End Here

Whatever the reason behind the purge, Amazon cleaning up its own backyard is still a step in the right direction. But with more than 2 billion listings to monitor, the fight is far from over.

In fact, our data just further proves that Amazon’s fake review problem continues to run rampant in the marketplace despite their years-long effort to eliminate it. This ruins not only Amazon’s own credibility but also third-party sellers’ selling on the platform, which ultimately impacts sales.

With a lot at stake, it’s crucial to take an active role in keeping bad actors from hijacking or sinking your product rating with fake negative reviews. Be sure to follow Amazon’s Product Review Policy and report any potential review violation.

It’s also best to check your competitors’ listings for fake positive reviews every once in a while. Some reviews are clearly written for other products entirely, such as a posture corrector with reviews on books and dog leashes.

Also, pay attention to the text (a few reviews may have similar wording or photos) and the number of good reviews that happened within a few days of each other. 

For example, if a listing received more than 6 verified or unverified reviews in a day, that could mean fraudsters made a push for those to occur on a certain timeline. As a result, Amazon may indefinitely block the listing from receiving additional reviews, but you can’t always rely on that happening, so keep an eye out. 👀

Related: Amazon Highlights ‘Frequently Returned’ Products You Should Think Twice Before Buying

25% Growth Rate: Euro B2B Opportunities Expand on Amazon

Amazon B2B continues to grow, with no signs of slowing down. 🚀

As the pandemic accelerated the shift towards online shopping, Amazon experienced a surge in office supply sales in Europe.

The tech giant is now looking to capitalize on this trend by expanding its Amazon Business to more countries.

In an interview with Reuters, Amazon Business VP Alexandre Gagnon stated that the division recorded a 25% compound annual growth rate in Europe during the two-year pandemic.

The business initially launched in Germany in 2016, then expanded to the UK, France, Spain, and Italy. However, Amazon refused to reveal which countries it would expand to.

Gagnon also mentioned that Amazon is investing in logistics to simplify the process for EU companies to procure bulk office, IT and healthcare equipment, and school supplies. By doing so, Amazon aims to secure contracts to procure these items for their clients.

Putting More Focus on Profitable Businesses

According to Reuters, Amazon’s B2B has higher margins than its B2C arm since it is cheaper to make bulk deliveries than individual small parcels.

“Because businesses buy in larger quantities, the fulfillment economics are more advantageous,” Gagnon said.

As we’ve reported, Amazon is currently facing slowing consumer demand and rising costs. In fact, the B2B expansion plan comes as Amazon announced it will be closing all 68 Amazon Books locations, pop-up chains, and 4-star stores in the UK and US. Workforce reduction impacting 27,000 employees globally is also underway in an effort to lower operating costs.

Therefore, Amazon may be trying to focus more on B2B to stimulate growth.

The 2022 European Retail eCommerce Consumer Forecast found that the total value of goods sold online in Europe is expected to reach $1.8 trillion by 2025, a consistent increase in online sales for B2B businesses operating in the region.

European Retail eCommerce Consumer Forecast
Source: US International Trade Administration

The report explains that the surge in B2B online consumption in the EU can be attributed to the heightened market demand for a wide range of products and services, such as spare machine parts, business and digital services, as well as packaged and bulk products. 

If you’re planning on joining Amazon Business, now’s the time to do it while demand is projected to increase at 11.9% through 2025

To grow your catalog with high-demand, no-competition B2B products, use Amazon’s ASINs Recommendations tool. It provides a list of items that many companies are looking for, but are presently unavailable on Amazon.

The tool also offers tailored suggestions based on the product category of your store so that you can incorporate new items that align with your brand or introduce new variations of existing products.
It’s important to note, however, that since ASINs Recommendations is primarily designed for B2B applications, not all categories may be included. You may also need to overcome certain restrictions imposed by Amazon before selling, including brand approval for gated products and compliance requirements.

Related: Walmart Launches B2B eComm Site to Rival Amazon and Shopify, Amazon Continues to Dominate B2B While Shopify Plays Catch-Up

UPDATED: Amazon Hopes to Restore Consumer Confidence with $1.2B Anti-Counterfeit Initiative

SoStocked - Amazon Hopes to Restore Consumer Confidence with $1.2B Anti-Counterfeit Initiative

Update 04/21/2023: 📢 In an effort to tackle organized crime on its platform, Amazon has rolled out its Anti-Counterfeiting Exchange (ACX) program. The initiative aims to assist brands in identifying and tracking counterfeit goods sold on Amazon.com.

Online marketplaces, including Amazon, have long struggled to keep counterfeiters at bay and prevent fake products from infiltrating their supply chain.

ACX is modeled after data exchange initiatives used by credit card companies to detect fraudsters and their methods. Under this program, participating stores can:

  • Report bad actors to Amazon anonymously
  • Use the ACX database to find stores or individuals that have been identified by other stores as counterfeiters

The strength of ACX lies in the ability of participating stores to share account information about detected counterfeiters.

Once the information is shared, all other stores involved in the program can be made aware of the counterfeiter and take action to stop them from selling on the platform. However, each participant retains autonomy to make independent decisions regarding the use of the information shared through ACX.

Since the program’s initial rollout in 2021, hundreds of matching accounts, in which the same counterfeiter attempted to create selling accounts on Amazon and at least one other store, have already been identified. 
In addition to ACX, Amazon is collaborating with the US Customs and Border Protection on a new program that will help identify and target low-value cargo that may contain counterfeit products or breach other regulations.

Amazon recently released its latest Brand Protection Report, which outlines its efforts to curb the sale of counterfeit goods to consumers worldwide.

The report highlights specific actions taken by the eCommerce titan to prevent the listing of knock-offs for sale. However, there are still lingering doubts about whether Amazon is truly committed to eradicating counterfeits and bad actors that it has historically neglected which caused big brands like Nike and Birkenstock to leave the platform a few years ago.

Billion-Dollar Anti-Counterfeiting Initiative in 2022

To prevent a potential mass exodus of sellers (and consumers) over growing piracy on Amazon, the tech giant had increased its efforts to protect brands by investing in cutting-edge technology and skilled personnel.

In 2021, Amazon invested $900 million into anti-counterfeiting efforts that saw the disposal of 3 million fake products, 170 counterfeiters sued in US courts, and 600 individuals sued or referred for investigation in several countries.

In 2022, the company poured $300 million more into its anti-counterfeiting program, showing its continued commitment to fighting fraudulent activities on the platform.

With an investment exceeding $1.2 billion, Amazon has employed more than 15,000 professionals dedicated to safeguarding customers, brands, selling partners, and the store from counterfeits, abuse, and fraud.

This crusade against bad actors has led to:

  • The seizure of more than 6 million counterfeit products that were being offered for sale on Amazon, doubling the number of the previous year.
  • A 1.7 million decrease in the number of bad actor attempts to create new seller accounts, from 2.5 million attempts in 2021 down to just 800,000 in 2022.
  • Significantly fewer notices of infringement submitted by brands, which could be, in part, attributed to Amazon’s efforts to address sellers that have purportedly issued fake takedown requests on competitors.
  • Over 1,300 criminals sued or referred for investigation in the US, UK, EU, and China.

At a time when the fight against counterfeiters has shifted largely to online and social media platforms, Amazon’s reported wins are quite significant. TikTok, in particular, has become a growing source of counterfeit products.

According to the US Chamber of Commerce, the global counterfeit trade is estimated to be worth over $500 billion annually. Some estimates also show that up to 10% of branded goods, especially luxury products, sold in the market may be fake. It is also believed that 80% of consumers have unknowingly handled falsified goods.

Since its inception in 2020, Amazon’s Counterfeit Crimes Unit (CCU) has been working directly with authorities to identify and seize dupes found in Amazon and factories where they’re being manufactured. 

For instance, CCU partnered with several Public Security Bureaus in China to carry out factory raids that led to the confiscation of more than 240,000 fake products. The report also mentioned additional joint efforts with law enforcement in Germany and London.

While these programs are a step in the right direction, for many victims of counterfeiting and abusive practices on the platform, the damage has been done and Amazon may be a little too late in trying to win their trust back. 

For years, brand owners have struggled with counterfeit products and have tried various methods to address the issue.

  • Chanel and Christian Louboutin sued Amazon and counterfeiters over knock-offs being sold on the retail site. In contrast, Cartier opted to collaborate with the tech giant in its effort to bring counterfeiters to justice.
  • Birkenstock and Nike cut ties with Amazon over the same unresolved counterfeiting issue.
  • Small businesses opting to enroll in Amazon Brand Registry for brand protection. Others also hire third-party service providers to help them comb through product listings and identify unauthorized sellers.

Yet despite these efforts from both Amazon and sellers, counterfeits still run rampant on the platform. Why? 

In an interview with Fast Company, Robert Handfield, a North Carolina State University professor who has conducted research on Amazon’s counterfeiting problem, says:

“Amazon does not do audits of distributors that claim to be selling original products. It has relied on companies and consumers to report counterfeit products to shut down the [unauthorized] seller. But then it’ll just pop up somewhere else.” 

Amazon’s behemoth size may have contributed to its poor ability to police itself, which then gave rise to its huge counterfeiting problem today.

Despite having a safety team in place, for example, lots of fakes or banned items did still slip through, as reported by Wall Street Journal in 2019. Similarly, in late 2021, Senate investigations also show that Amazon has not been quick to help small businesses take down fake listings.

So perhaps, until Amazon becomes more effective in verifying new sellers, checking the authenticity of goods that come and go, and defending sellers’ Intellectual Property (IP) rights, expect a large volume of counterfeiting activities to continue. Here’s to hoping that their investments in recent years will continue to show improvements in this arena.

Increased regulatory pressure from antitrust authorities will also be crucial in keeping Amazon themselves from creating knockoffs of successful products. Riding that distinction between counterfeit and knockoff may be legal, but is it ethical?

As reported, the tech giant opposes a lot of antitrust bills seeking to end self-preferencing in digital markets such as S.2992, sparking doubts as to whether Amazon is really serious about its road to zero counterfeit program and whether knockoffs are included in protections that should be awarded to brands on Amazon. 

That said, brand protection could, additionally, be a move by Amazon to slow down counterfeiting activity on the site to minimize Senate scrutiny, and that completely cleaning up the marketplace is a lofty, and possibly, insincere target.

The good news is that, whatever the motives behind the action, improvements are being made. However, we can’t expect change overnight or full eradication.

Counterfeiters are not going to go away anytime soon. It would be wise to maintain a proactive approach to protecting your brand, whether it’s by registering your IP, enrolling in Brand Registry, or working with service providers to identify unauthorized retailers and fake reviews.

Marketplace sellers will continue to play whack-o-mole. There just may be fewer moles to whack. Let’s hope the trend continues. 

Amazon Announces Further Cuts Amid Economic Uncertainty

As Amazon CEO Andy Jassy warns of an ‘uncertainty that exists in the near future,’ existing employees face reduced pay and job loss. The expected job cuts in particular will impact a number of roles across the company’s AMZ Web Services (AWS), Twitch streaming, human resources, online book store, and advertising businesses.

Fresh Round of Layoffs

Amazon has recently concluded the second stage of its yearly budgeting procedure, known internally as “OP2.”

In a memo dated March 20th, Jassy announced the company’s plans to let go 9,000 more employees in the coming months after cutting 18,000 jobs in January.

“The overriding tenet of our annual planning this year was to be leaner while doing so in a way that enables us to still invest robustly in the key long-term customer experiences that we believe can meaningfully improve customers’ lives and Amazon as a whole,” Jassy said.

Amazon’s workforce is being downsized as the company adjusts its hiring practices following a surge in employment during the pandemic. Its global headcount exceeded 1.6 million by the end of 2021, up from 798,000 in the fourth quarter of 2019.

As part of an extensive review of expenses, Jassy is implementing measures to address the economic downturn and slowing growth in the core retail business. Hiring in the corporate workforce has been frozen, certain experimental projects have been terminated, and warehouse expansion has been slowed down.

Despite these changes, Jassy remains optimistic about Amazon’s key business segments, including retail and AWS, as well as new divisions that continue to receive investment.

Reduced Employee Stock Awards

Aside from job cuts, Amazon announced it will also reduce employee Restricted Stock Units (RSU) awards by “a small amount” in 2025.

According to an initial report by Business Insider, Amazon is considering making changes to its employee pay structure, with plans to reevaluate compensation in Q1 of the following year to account for potential stock fluctuations.

The company is said to be exploring options for a more balanced compensation model, taking into consideration the current economic uncertainty and its compensation budget, as stated by an Amazon spokesperson.

Attempting to Make a Remarkable Recovery in 2023

After experiencing a sharp decline of nearly 50% in 2022, Amazon’s shares have made an outstanding recovery, surging 19% this year – thanks primarily to the 27,000 job cuts that helped to stimulate business performance.

By eliminating inefficiencies, for instance, the quality of work may improve and more cash will be available to the company, which could then result in increased profits and higher payouts for shareholders.

“While some may view these job cuts as a sign of a gloomier macro outlook, especially as it relates to cloud computing and digital advertising, we believe investors will appreciate Amazon’s heightened focus on cost savings and free cash flow,” Arun Sundaram, senior equity analyst at CFRA, said in a note to his clients.

Shares may be up 19%, but the company’s Q4 2022 financial results missed analysts’ expectations by a significant margin, with earnings falling well short. Additionally, the growth in AWS was slower than anticipated, resulting in a subdued forecast for the current quarter.

If revenue continues to decelerate through the end of Q2, we may still see Amazon announce additional cuts in the coming months to achieve a healthier level of profitability.

Amazon will release its latest quarterly earnings report on April 27, 2023 at 2:30pm PT with its virtual Q1 2023 Earnings Call.

Related: Amazon Warehouse Automation Increases Concerns Over Job Loss and Product Selection Accuracy, Amazon Delivery Drones Off to a Rocky Start

Amazon Attempts to Close Loopholes with New Shipping Policy

Amazon Attempts to Close Loopholes with New Shipping Policy

📢 Amazon has announced yet another change to their shipping policy, which could be perceived as an attempt to address and eliminate any potential loopholes.

As of March 31, 2023, shipping discounts will only be applied to compliant inbound FBA units in the Multi Destinations program. It may be news to you that this program even exists! Sellers enrolled in this program will save $0.05 per unit on fulfillment fees for Small Standard products and $0.09 for Large Standard. No small savings for sellers feeling the squeeze of recent 2023 fee increases.

While this program is invitation only to FBA sellers, accounts are auto-enrolled so sellers may be participating in this program without realizing it.

This policy change seems to specifically resolve issues around sellers who try to cheat the system and at the same time see discounts applied to their units – a double whammy. 

For instance, some sellers create and cancel their shipments, but still send them in anyway knowing that FBA associates may still accept them. This dirty tactic essentially allows the bad actors to get around their capacity limits.

There are also others who, after approving a multi-destination shipping plan, will try to send the shipment along a different route (most likely to a single warehouse or somewhere closest) to reduce cost. That’s probably because despite getting discounts on their inbound units, they may still end up paying higher shipping fees if they’re shipping inventory to multiple warehouses across long distances.

⚠️ With the updated shipping policy, non-compliant sellers enrolled in the Multi Destination Shipping Program will not only be ineligible to receive discounts on the violating units, their shipments may also get rejected, or worse, they may lose their ability to ship more units. 

Amazon requires sellers found in violation of its Shipment Policy to send a plan of action stating that future shipping plans will be compliant.

If you need to update any information or remove an item from your approved shipping plan, be sure to follow these steps and act in accordance to Amazon’s change shipment policy to do it properly.
In addition, read “Amazon Closing Shipping Loopholes May Wreak Chaos for Some Sellers” to learn more about the retail giant’s inbound shipping policies.

Related: Pros and Cons of Amazon Inventory Placement Service

Updated: Are You Prepared for the Updated Amazon Returns and Refunds Policy?

Amazon Returns and Refunds Policy Update

Update 04/06/2023: Amazon now offers sellers who use FBA Donations access to donation certificates.

Generated by Amazon yearly, this special document can be accessed conveniently on the Donations page within Seller Central. It includes details regarding the quantity and description of the inventory you generously donated through the program over the last 12 months. This means you can use the certificate to identify charitable contributions that are potentially tax deductible, which could help lower your taxes. 

Be sure to seek advice from your trusted accountant to learn more about the specific tax incentives you might be eligible for. You’d be surprised to find out how sometimes it may be more beneficial to simply donate your unsold inventory rather than destroying or liquidating it. 

For example, depending on your unsold inventory’s fair market value on the day it was donated, the tax deductible amount may be greater than its net recovery value if liquidated through FBA. Amazon’s Liquidations program currently pays up to 10% of your product’s average selling price and this results in additional revenue, which means you pay more in taxes. If you do the math, you might find that the tax deductions you get back from your donation might mean more money in your pocket in the long run that liquidation would bring you.
If you have donated goods through FBA Donations in 2022, you may now claim your donation certificate in Seller Central. If you want to learn more about the program, visit this FAQ page.

Seller-Fulfilled Orders Must Now Conform to Amazon’s Returns and Refunds Policy.

We all know that returns for seller-fulfilled orders work quite differently from those sold and shipped by Amazon.

So, to streamline and make the returns experience consistent for all customers, Amazon is updating their Returns and Refunds Policy for third-party sellers who manage their own shipments.

Starting August 1, 2022, seller-fulfilled orders (shipped from and sold by seller), including those not eligible for Prime, will be subject to the same returns policies as Amazon.com.

That means Amazon will automatically approve return requests and issue refunds that fall within their policy. ⚖️ On the one hand, it takes some of the autonomy away from sellers. On the other though, it reduces the work required to process their returns and helps to keep Return Dissatisfaction Rate (RDR) low.

What Has Changed?

Prior to this update, seller-fulfilled merchants could create and implement their own returns policies as long as they are in line with Amazon’s current guidelines:

  • Must accept returns within the 30-day return window.
  • Seller-fulfilled returns must be returned to the address listed in the merchant’s seller account, not to an Amazon warehouse. That also means merchants might have to shoulder the cost of sending an item back to their address, unless they offer “Returnless Refunds,” which allows them to refund a customer without getting the product back if it costs more to ship than its actual worth, e.g., low-cost items. See Refund Options for more information.
  • Must refund the customer within two days of receiving the returned item or offer a replacement.

Having your own returns policy also gives you the opportunity to communicate with the customer to try to fix the issue before resorting to the last step – a refund. However, the Amazon returns and refunds policy update will take that away from you in exchange for what the retail giant believes would be a more streamlined customer-centric buying and returns experience. 🤔

Studies have shown that excellent returns policies can influence new salesincrease customer retentionbuild brand loyalty, and help retailers gain competitive advantage.

It’s not uncommon for some online shoppers to make multiple purchases to ensure they get the item they want in the correct size–for example, buying 2-3 different sizes of the same t-shirt to ensure proper fit of one while returning the other items that didn’t fit.

Therefore, for these customers, it makes more sense to buy from a retailer like Amazon that can make it easier for them to return items that didn’t work out and receive refunds (partial or full) at no extra cost.

Unfortunately, some third-party sellers with return and refund policies are more restrictive than Amazon, which could be why the eComm giant thought the update was needed. However, rather than Amazon enforcing their policies only on those who violated them, they opted to hit all sellers with this blanket change.

What Happens If You Don’t Conform?

Any returns policies that don’t adhere to Amazon’s will be removed from your Returns Information & Policies page.

You need to be ready to behave accordingly – for example, using good packaging to ensure products don’t arrive in damaged condition, leading to a return request. Otherwise, you may receive penalties that can affect your performance metrics in many different ways.

If you keep getting return, refund, or replacement requests, it increases your risk for A-to-Z guarantee claims and negative feedback, which could impact your Order Defect Rate (ODR)A high ODR (more than 1%) may result in a restriction of your selling privileges, including suspension of seller-fulfilled offers. ☠️

To stay in Amazon’s good graces, you may need to look at your current processes and systems and make sure your staff, including 3PLs and returns service providers, are up to date in preparation for this change, because August 1st is right around the corner. 💪

Related: 6 Causes of Amazon Unfulfillable Inventory and How To Fix Them

Updated: Amazon UK Workers to Launch Historic Strike in Early 2023

Amazon UK Workers to Launch Historic Strike in Early 2023

Update 03/31/2023: Unionized Amazon workers in Coventry, England continue to fight for better pay with 6 more protest dates, bringing the total days at the UK site to 14:

  • April 16th to 18th
  • April 21st to 23rd

Union representative, GMB, also reveals it has started ballots for industrial action at five different fulfillment centers in the Midlands.

  • Mansfield in Nottinghamshire 
  • Coalville in Leicestershire 
  • Kegworth in Leicestershire 
  • Rugeley in Staffordshire 
  • Rugby in Warwickshire 

Members are asked to vote whether to go on strike over Amazon’s meager 50 pence pay increase. 

As previously reported, the labor group is pushing for a  £10.5 to £15/hour pay hike to ensure workers have a living wage amid rising prices.
Amazon has so far refused to give in to the union’s demand, but the additional 6 protest dates, ballots at five FCs, and over £2 million revenue loss from these multi-day strikes may force the company to “get serious and talk pay with GMB now,” said GMB Senior Organizer, Amanda Gearing.

Update 02/17/2023: 🚨 More than 350 unionized workers at an Amazon warehouse in Coventry have announced they will go on strike for seven more days.

  • February 28th
  • March 2nd
  • March 13th to 17th

Represented by GMB Union, the workers are fighting for a pay increase from £10.50 to £15 per hour to help them keep up with the rising cost of living.

The protest continues as Amazon refused to have any negotiations with GMB, arguing that they had already raised worker pay by 29% and benefits since 2018.

An Amazon rep said the unionized workers represented less than 1% of the company’s workforce in the UK, a tiny fraction that is less likely to cause any significant service disruption.

Normal operations will also continue at Coventry and across the UK, the Amazon rep added.

Update 01/04/2023: 📢 Amazon associates in a Coventry warehouse are set to strike on January 25, the GMB union revealed on Wednesday. The union also said that further dates will be announced “in the coming weeks.”

Read on to learn how to prepare your business for potential delays in delivery across Central England.

🇬🇧 A first in Amazon UK, hundreds of workers at a facility in Coventry, England have voted to strike over the eComm giant’s 50 pence an hour pay offer, the General, Municipal, Boilermakers, and Allied Trade (GMB) union said on December 16th.

The mass walkout is expected to happen in January 2023. 🪧

“Amazon workers in Coventry have made history – they will be the first ever in the UK to take part in a formal strike,” GMB Senior Organiser Amanda Gearing said in a statement.

“They should be applauded for their grit and determination – fighting for what’s right in the face of an appallingly hostile environment. The fact that they are being forced to go on strike to win a decent rate of pay from one of the world’s most valuable companies should be a badge of shame for Amazon,” Gearing added.

When asked to comment on the issue, an Amazon spokesperson said that the company:

“We appreciate the great work our teams do throughout the year, and we’re proud to offer competitive pay which starts at a minimum of between £10.50 and £11.45 per hour, depending on location. This represents a 29% increase in the minimum hourly wage paid to Amazon employees since 2018.”

⚠️ However, inflation in the UK is at an all-time high as food and energy prices soar. This means inflation is eating into pay increases, forcing workers to demand more money.

The planned industrial action is the latest in a series of union protests happening in the UK since Q2. In August, 115,000 Royal Mail workers went on a strike in a dispute over pay, disrupting deliveries and collections across the country.

Just last month, some warehouse workers joined the “Make Amazon Pay” campaign, a coordinated protest led by an international assembly of trade unions who demand higher pay, better working conditions, and lower carbon footprint.

Major rail and transport strikes in December have also brought UK’s transport services to a standstill, causing reduced foot traffic in retail stores. 

Make Contingency Plans to Mitigate Delays

Seeing that these labor actions will likely hit supply chain and logistics sectors, it would be best to create contingency plans to reduce shipping delays that they may cause and to avoid stockouts.

For instance, recent strikes at Felixstowe, UK’s largest container port, reportedly threatened to put $4.7 billion in trade on hold. Many shippers had diverted their goods from Felixstowe to other ports to make sure they hit the store shelves in time for the holidays. As a result, the unrest had not caused “any real significant impact” on supply chains, according to Paul Davey, Head of Corporate Affairs at Hutchison Ports (UK).

While there is no current port strike danger in UK, there is in the US, so it’s still important to be prepared.

Since May 2022, negotiations have been ongoing between The International Longshore & Warehouse Union (a group that represents over 22,000 West Coast port workers) and Pacific Maritime Association (port terminals and ocean carriers). If unsuccessful, serious disruptions to port operations in the West Coast may occur, prompting some shippers to reroute their US-bound containers from the west to the east.

So, if you’re shipping goods to the US, your best move would be to work with your 3PLs and freight forwarders to figure out alternative arrangements that can be made for any container that may get stuck at sea due to industrial action.

A good logistics company should be able to provide you with excellent supply chain visibility to see where all your inventory is located and keep you informed on any potential disruption danger, so you can quickly respond to any supply chain blockages. From that vantage point, decide whether to reroute some shipments through other ports or to use alternative transport (e.g., send buffer stock from your supplier or other warehouses into Amazon by air or express shipping).

Until these UK labor groups get the pay that they deserve, expect to see more protests in 2023. Luckily, you can reduce the impact of disruptions by making contingency plans with your logistics partners.

Related: How to Ship to Amazon FBA (And Speed Up Check-In Times), Amazon Inventory Risks + 5 Tips to Mitigate Them, Bad Actors Book Multiple Inbound Amazon Delivery Dates to Create Scarcity

Amazon Highlights ‘Frequently Returned’ Products You Should Think Twice Before Buying

SoStocked - Amazon Highlights 'Frequently Returned' Products You Should Think Twice Before Buying

Amazon has released a new badge that highlights frequently returned items in its marketplace. 

It appears right below the bullet point section of the product detail page and encourages potential buyers to read more about the featured item before purchasing. This feature has not been rolled out across the platform and seems to be in beta as some items that other publications previously reported to be showing this badge, no longer are.

The badge also doesn’t explicitly tell why a particular listing has been flagged, so that’s for customers to find out.


Checking out reviews, for instance, may provide valuable insights into the product’s quality, thereby allowing people to make a more informed buying decision. Likely, this could help minimize customer dissatisfaction, unnecessary returns, and waste.

Frequently Returned Item Badge
Amazon | The Verge

As useful as it sounds, some sellers in the comment section of The Verge’s post don’t see how the new badge will help solve other pressing problems, such as fake reviews, return scams, and listing thefts (hijackers).

Perhaps, the biggest disaster in this new development: this new badge may also pave the way for a whole new problem for sellers. ⚠️ Similar to fake reviews, this feature may lead to a wave of fake returns campaigns led by black hat sellers attempting to flag products with frequent returns badges.

If Amazon really wanted to help customers make smarter decisions, their search algorithm should account for listings with frequent returns and move them down the rankings to make them less easily searchable.

Measures should also continue to be developed by Amazon to better safeguard against fake reviews, hijackings, and return scams.

Instead, honest customers are burdened with more responsibility, requiring them to painstakingly sift through hundreds of reviews on and off Amazon just to avoid disappointing themselves with bad orders because they couldn’t tell genuine and fake ratings or listings apart. 

For sellers, they may have to update their product pages with more accurate information. They may also have to trademark their original products and regularly check their listings for signs of hijacking to avoid counterfeit issues that could then lead to frequent returns.

If selling premium items, it would be wise to establish new or improve existing oversight mechanisms like offering signature confirmation to minimize return scams. 

If using Fulfilled by Merchant (FBM), investing in high-quality packaging materials and boxing up orders properly would be crucial to ensure they arrive in good condition.
Even with the “frequently returned item” feature, protecting your brand and keeping your customers happy will still require a lot of work. It’s a band-aid solution that may stop the bleeding, but it won’t solve some of these underlying problems.

But, to get to the heart of why this is likely happening, with less returns, Amazon will be able to cut return costs by helping customers to avoid purchasing sub par products.

Related: Amazon Braces for Slowing eCommerce Growth in 2023

In an email to The Information, Amazon spokesperson Betsy Harden said they’re applying the same methodology they use to calculate return rates to identify which listings to flag and whether they’re sold by a third-party seller or an Amazon brand.

Makes you wonder, then, whether this returns badge will be dedicated to third-party sellers only or if sold by Amazon products will take the same heat.

The badge is currently seen on some select products sold in the US, but expect a broader rollout in the coming months.

Related: Claim Reimbursement for Losses Caused by Amazon CSBA Reps, Amazon Overhauls its A-to-Z Guarantee Policies to Streamline Damages Claims, Updates to AMZ Return and Refund Policy

Amazon Braces for Slowing eComm Growth in 2023

AMZ BRACES FOR SLOW ECOMM GROWTH IN 2023

Update 03/10/2023: 🪓 Cost cutting remains high on Amazon’s priority list after suffering a $2.7 billion net loss in 2022. Growth in certain areas such as the company’s cloud computing business is also expected to continue to decline in 2023, according to Amazon Chief Financial Officer Brian Olsavsky.

To curtail expenses as profit weakens, Amazon is:

In addition, Amazon also reportedly continues to close warehouses this year.

According to MWPVL, Amazon has so far shut down a total of 99 logistics sites in 30 US states, up 29 from last year’s report. 
Many of these facilities were old buildings that cost a fortune to maintain and were located outside of bigger cities, per CNBC. With Amazon expanding its same-day delivery network, the site closures may be an attempt to reallocate resources to those new same-day sites while reducing outbound transportation costs.

🚨 As US consumers spend less on products due to inflation, Amazon is left to deal with lots of unused warehouse space, which contributed to the company’s $3.8 billion profit loss in Q1 and another $2 billion in Q2 2022.

New data from MWPVL International suggests that it may take the online retail giant three (3) years to recover from overbuilding its fulfillment network during the pandemic. However, Amazon rep, Lisa Levandowski, reportedly called MWPVL’s estimations “pure fiction.”

Amazon CEO Andy Jassy himself did mention – albeit did not exactly say how long – in his Q1 2022 earnings call that “improving productivity and cost efficiencies” throughout the logistics side of things “may take some time” as the company tries to “work through ongoing inflationary and supply chain pressures.”

As a highlight to the concern, within the first 72 hours of the new year, Tech Crunch reported that Amazon had secured an $8B loan to help weather some of the uncertainty.

In 2022, the eComm giant has taken a few steps geared towards financial recovery amid a slowing online growth and a looming recession, including raising their FBA fees for 2023.

Recent moves that Amazon has been making to improve profitability include:

Subleasing or shutting down several old warehouses across the US.

After nearly doubling its fulfillment network during the pandemic, Amazon had to majorly pullback last year to lower operational costs and capital expenditures. As of September 2022, the company has shut down or subleased more than 20 logistics centers and postponed or canceled the openings of 50 more sites. And in doing so, Amazon saved approximately $4 billion in 2022, according to MWPVL Founder & President, Marc Wulfraat.

Increasing warehouse automation with robots to improve productivity and efficiency.

Amazon has recently deployed multiple robotic arm systems, Robin, Cardinal and Sparrow, in some of its facilities to streamline its fulfillment process – a sign that the company could also be ramping up warehouse automation to reduce its workforce amid increasing unionization activity, which could drive up annual operating expenses by hundreds of millions of dollars.

Rolling out Prime Air, Amazon’s drone delivery service

Rolling out Prime Air, Amazon’s drone delivery service, which could be “faster, cheaper, and greener” than traditional shipping modes, i.e., manned, gasoline vehicles versus unmanned, fully electric cargo aircrafts. Moreover, according to UVL Robotics, drones can efficiently take hundreds of quick trips per day (within a 6-mile radius) and transfer packages from days to hours. Amazon’s drone service in particular is expected to cut down last-mile shipping times from 2 days to under an hour. With increased delivery efficiency, it could potentially reduce Amazon’s outbound transportation expense, and perhaps that would also translate to lower fulfillment fees in the future. 🤞🏼

Introducing Buy with Prime (BWP) to non-Amazon sellers to possibly increase fulfillment revenue.

What better way to fill up unused warehouse space than to offer it to hundreds of thousands of non-Amazon merchants? Instead of building out their own logistics infrastructure in an attempt to offer free 1- to 2-day shipping and returns, DTC businesses can now pay to use Amazon’s fulfillment without having to sell on the platform directly.

Market intel firm, PipeCandy, estimates that there are around 120,000 Direct-to-Consumer (DTC) brands in the US. The growing DTC market represents an important growth area for Amazon, which if they’re able to capture, could help them to stay ahead of Shopify, Walmart, and other rivals.

Presently, 17% of 21,000 US DTC merchants that PipeCandy have surveyed are using Amazon Pay (which is conditional to BWP) as a payment channel alternative. Majority of these stores are in the $5-$50 million gross merchandise volume range, which only represents 8% of the overall B2C goods aggregate sold in the US. 

Therefore, it’s still too early to say whether or not BWP is going to make a significant dent in Shopify’s checkout processing revenue, which is still currently the preferred checkout provider of DTC stores. 

Rising MCF fees is another factor that could stop merchants from using BWP, which makes increased warehouse and logistics efficiency through automation all the more important for Amazon to remain competitive.

Related: Storage Limit Manager: Would You Pay for Extra Storage Space?, Amazon Enters the 3PL Space with Amazon Warehousing & Distribution

Selling excess cargo jet space

Selling excess cargo jet space is yet another attempt by Amazon to offset the cost of overexpansion they have accumulated throughout the pandemic. In a Bloomberg post, Amazon is reportedly looking to hire execs with experience in selling excess air freighter space.

This year, global demand for air cargo is expected to fall by 25% or $150 billion, so Amazon might be looking to increase profits during this softening period by offering their surplus cargo space to third-party shippers. Amazon might venture into importing perishable and seasonal goods into the US on return flights, according to the sources familiar with the matter. For example, shippers could use Amazon’s cargo space to transport flowers from South America for Valentine’s Day and seafood from Canada and New Zealand to the US.

All of these profit recovery and growth initiatives point to Amazon adjusting from accelerated pandemic-era expansion to declining online sales. But whether or not these efforts could lead to a slowing down of fee increases in the coming months is still up for debate, given the fact that current inflation numbers remain above 8%, with no signs of letting up.

Therefore, it’s possible Amazon might still introduce new fees this year to account for any significant increase in prices. And unless the tech giant speeds up the wider rollout of their robots and drones, among other cost-efficient logistics systems, FBA fees will likely remain high, or become even higher, in the coming years.

Boost Sales with These New Amazon Seller Tools

SoStocked - Boost Sales with These New Amazon Seller Tools

With FBA getting more expensive, finding new ways to increase sales is even more crucial to your success on Amazon. 

💰 That’s why we have put together this list of new Amazon tools and features that you can use to generate more revenue for your business.

Case Pack Recommendations

Use this tool to identify which products to bundle as case packs or add offers on your existing case packs.

A case pack contains multiple single units of the same product for individual sale, allowing you to quickly move your inventory. It also simplifies bulk purchases and offers customers savings with case discounts and consolidated delivery.

This packing configuration is ideal for high-volume sellers. Amazon offers two types of recommendations based on your product catalog and sales:

  • Create new case packs. This section features items you currently sell as single units and are not yet listed in Amazon as case packs by you or other sellers. Amazon looks at the number of multi-unit orders of your single products to see if there is demand for any of these items to be sold as a case pack. If a product is eligible, you will then be provided with a suggested size for a case pack based on the number of units that customers have frequently bought from you.

    When adding a new case pack, Amazon recommends creating a consolidated listing that shows both your product as a single unit and as a case pack. This makes it easier for customers to compare and buy goods in different quantities and packing configurations.
  • Add offers on existing case packs. This section shows case packs that are already listed in Amazon by other brand-registered sellers. Products in case packs are ranked based on sales in the last 12 months. Amazon provides a suggested price for each case pack on this list. If you wish to match Amazon’s suggested price for an existing case pack, you may add an offer on that listing by clicking the “Add an Offer” button and entering your price and quantity details into the Offer Page.

To get started, go to Case Pack Recommendations.

Transparency Badge

Product authenticity is important to customers. When people find out they purchased a fake product from a brand, most would not trust and buy from that brand again according to DigitMarc.

In a marketplace flooded with knockoffs, demonstrating product authenticity through Transparency Badge are be critical to protecting your business from fake sellers, especially if you have a trademark on your product or selling items highly susceptible to counterfeiting like electronic gadgets.

You must be registered with Amazon Brand Registry and enrolled in Transparency to be able to receive a badge for your eligible products.

Participating FBA products are given a unique “Transparency” code that cannot be duplicated by counterfeiters. However, that means you will have to take extra steps to carry out this process. Before sending your inventory into FBA, you will have to apply the individual Transparency labels to every unit yourself or hire someone else to do it. 

A listing with a Transparency Badge indicates that the featured product has been verified authentic by Amazon and customers themselves. 

Customers who have purchased the product can use an app to scan the code to verify its authenticity. This offers another benefit to the Transparency program: the ability to shareproduct information, videos and promotions that your customers can view upon scanning the code.

If customers face any authenticity issues with a product, they can reach out to Amazon’s Transparency team to file a counterfeit complaint.

Visit the Transparency page to get started.

New Seller Incentives

This program entices new brands to sell on Amazon or existing brands to expand to other country sites by offering them:

  • 5% new brand bonus on their first £800,000 in branded sales
  • £160 off fulfilment fees using Amazon Global Logistics for out-of-country sellers
  • 120 days free storage plus 180 days free removals  for 100 units with FBA
  • £40 credit for Sponsored Products CPC ads
  • £160 in Vine credits for free access to trusted reviewers 

According to Amazon, you can enjoy more than £40,000 in potential benefits, which you can use to promote your products and scale your business. However, these benefits are only valid for 90 days, reduced from one full year, so you’ll have to act quickly.

Go to New Seller Incentives to check your eligibility.

Related: Attack of the Fee Stack White Paper, Prepare for these 6 Major Changes to 2023 Amazon UK and EU FBA Fees, 4 New Amazon Seller Tools to Accelerate Business Growth

Amazon Fees Changes for UK & EU Multi-Channel Fulfillment Orders

Amazon Fees Changes for UK & EU Multi-Channel Fulfillment Orders

Amazon’s price hike spree continues, thanks to rising operating costs! 😫

Starting April 7, 2023, Amazon will introduce major fee updates to multi-channel fulfillment (MCF) orders.

Depending on shipping destination (local or cross border), delivery option (standard or expedited) and size tier, you may see a slight decrease or significant increase in your MCF fees. In some cases, you may see no fee change at all.

For instance, if you review the policy you’ll see that Amazon dropped the rate for shipping an envelop package within the UK by an average of £0.04, while some fees remain unchanged. Other parcel size tiers experience an increase.

⚠️ However, things can get substantially expensive for you if fulfilling cross-border shipments due to a massive fee hike that will take effect on April 7th.

Take standard shipping for example. From smallest to largest, the expected fee increase ranges between £0.77 (80g small envelope) and £7.32 (31.5kg large oversize) per single unit order.

Standard Shipping: Cross-Border Shipments (1 Unit Per Order)

Size TierFees Before April 7, 2023Fees On and After April 7, 2023
Small envelope to 80g£4.96£5.73
Standard envelope to 210g£5.12£5.91
Large envelope to 960g£5.51£6.34
Standard parcel to 1.4kg£8.37£10.43
Standard parcel to 6.9kg£13.07£17.32
Standard parcel to 11.9kg£15.41£21.24
Small oversize to 1.26kg£12.17£14.68
Standard oversize to 2.7kg£14.93£18.40
Standard oversize to 29.76kg£21.09£26.65
Large oversize to 31.5kg£30.95£38.27 

Moreover, fulfilling expedited cross-border shipments this year will leave you with even slimmer profit margins.

On average, Amazon has raised the MCF fees for envelopes to a little over £1, standard parcels between £1 to £5, and standard oversize £6 to £9, and roughly £10 for large oversize.

Expedited Shipping: Cross-Border Shipments (1 Unit Per Order)

Size TierFees Before April 7, 2023Fees On and After April 7, 2023
Small envelope to 80g£6.06£7.42
Standard envelope to 210g£6.22£7.71
Large envelope to 960g£6.61£8.11
Standard parcel to 1.4kg£9.47£10.73
Standard parcel to 6.9kg£13.77£17.37
Standard parcel to 11.9kg£15.47£21.29
Small oversize to 1.26kg£15.48£21.29
Standard oversize to 2.7kg£18.23£25.00
Standard oversize to 29.76kg£24.40£33.26
Large oversize to 31.5kg£34.26£44.59 

Note: These fees already include the 4.3% fuel and inflation surcharge.

Reduce MCF Fees with Multi-Unit Discounts

Given how steep the fee increases are, be sure to take advantage of Amazon’s multi-unit discounts to get lower fulfillment rates. 

Check out the table of fees below to see the difference between local shipping fees for one-unit and multi-unit orders.

With multi-unit discounts, you could save up to 40% on fees! Try to increase your multi-unit sales by:

  • Offering coupons for minimum purchase amounts. For example, get 15% off with a min purchase of 3 items or buy 2 get the third one at 25% off.
  • Creating add-ons to your products, e.g., if selling women’s swimwear, provide customers with an option to add sun hats, flip-flops, aqua shoes, and more.

It is not clear to us at this time whether a virtual bundle will be counted as a multi-unit order but, given what is known about how Amazon counts SKUs in those orders, this seems likely. If that is the case, promoting virtual bundles could be a good way to capitalize on these reduced shipping rates. Testing this theory by reviewing the shipping charges tied to these orders would be smart.

Related: Master Carton Calculator to Optimize Packaging and Reduce Shipping Costs

Aside from multi-unit discounts, Amazon also made significant improvements on the following areas to help you grow your business.

  • If you’re selling on the UK marketplace, you may now opt to ship your MCF orders in blank packaging at no extra cost. This is helpful when you are sending items from other sales channels such as your own website, and don’t want Amazon’s logo featured on your deliveries.
  • Providing you with ISO-certified IT security systems so you can safely and securely conduct business on Amazon. This means Amazon’s systems meet a global standard approved by the International Organization for Standardization.
  • Maintaining their 98% on-time delivery rate to consistently meet Amazon customer delivery expectations.

Go to 2023 UK MCF Fee Updates for more information.

Related: Attack of the Fee Stack White Paper, Prepare for these 6 Major Changes to 2023 Amazon UK and EU FBA Fees, How to Increase Profit Margins for Amazon Sellers

Foreign Amazon Sellers Are Closing the Competitive Gap with ChatGPT

SoStocked - Foreign Amazon Sellers Are Closing the Competitive Gap with ChatGPT

For cross-border sellers, overcoming language barriers can be a challenge. Inaccurate translations, for example, may prevent them from being able to clearly get their messaging across or can create consumer distrust, leading to lost opportunities that impact conversion and sales.

However, with the recent arrival of modern communication technologies like chatbots and other AI tools, that could all be changing. One such AI application, which has been making the headlines recently, is ChatGPT or Chat Generative Pre-Trained Transformer. 🤖

What is ChatGPT?

ChatGPT is an AI-driven chatbot that uses Natural Language Processing (NLP) to recognize patterns in datasets harvested from the internet and use that information to generate meaningful human-like responses. And because it has the ability to comprehend human language, it can also provide users with coherent and grammatically correct content.

It has reportedly aided people in various tasks, such as composing poems, writing blog posts, crafting love letters, and even something as bizarre as coming up with instructions for removing a peanut butter sandwich from a VCR, King James Bible style.

How ChatGPT Can Influence Competition on Amazon

Amazon sellers are using ChatGPT to create titles, bullet points, and product descriptions for their listings. Foreign language sellers expanding into the US market in particular may find this tool useful for improving the quality and efficiency of their content marketing efforts. 

With fewer barriers to entry, however, it is going to make competition much more intense on Amazon. Cross-border sellers will start publishing better listing copy, and customers will not be able to distinguish as easily that they are not from the US.

For example, some buyers can easily tell when a seller is ESL (English as a Second Language). But ChatGPT changes all of that. Chinese sellers, for instance, are going to fare much better against competition with this strategy.

They can simply go to ChatGPT and type in a set of instructions (in English or their native language) for the tool to generate a description or sales copy for a particular product. It could be something as simple as “Please write 5 bullet points for an Amazon listing selling an air purifier.”

Here’s what ChatGPT came up with:

As you can see, the generated response is decent enough to describe what the product does. It offers a good start, but it doesn’t really make you stand out with those generic details.

To reel in customers, it may be necessary to tweak the prompt in a way that will allow the tool to write a more detailed product description. Consider plugging in relevant keywords or technical specifications, for example. Even then, you may still need to add a touch of artistic flair to your copy. 

This may sound like a lot of work, but ChatGPT is only supposed to make getting started with writing English copy easier, not to replace human creativity.

It’s also crucial to do some fact-checking to avoid disappointing buyers with misleading or inaccurate descriptions. Unfortunately, AI tools like ChatGPT can’t detect malicious intent or accurately distinguish falsehoods from facts so they don’t always provide truthful answers.

This is where US sellers can have some advantage as they are more familiar with the nuances of the English language and know the local market better.

Subtleties like colloquialisms and tones of voice unique to local customers typically get lost in translation. Therefore, foreign sellers may not be completely aware of them or at least know how to properly incorporate them into the text. If you’re a local seller, leverage those cultural insights to create a more compelling copy.

Related: FBA Sellers Can Use ChatGPT to Write Amazon Listings – But It Might Be Unethical, According to ChatGPT

Final Thoughts

ChatGPT could be useful at overcoming language barriers in cross-border selling. Foreign sellers can utilize it to quickly source ideas, get started with writing copy, or proofread and improve their existing Amazon listings to effectively communicate with US consumers.

However, the AI tool also has a few drawbacks. It may not accurately depict your product’s unique selling points, unless you spend a lot of time tinkering with the AI so that it can meet your specific requirements. Those who don’t bother modifying the generated responses even a little are less likely to stand out and thrive in a saturated market.

Suppose all air purifier brands start using the same prompt to generate bullet points for Amazon, they may end up having the same copy for those listings. After all, ChatGPT uses existing words and phrases from the internet to generate responses to user input.

So, there is a likelihood of having a competitor publish a listing quite similar to yours. The message is clear: you may have well-written product titles, bullet points, and descriptions, but don’t rest on your laurels. 

With its ability to write and proofread English copy like a human, ChatGPT is rapidly leveling the playing field for foreign sellers. You need to step up your Amazon game right now to stay ahead of the curve.

Take advantage of Amazon’s Listing Quality Dashboard to find areas in your listings that need improvement. Keep your copy relevant and discoverable with updated keywords and genuine customer reviews. Adding a little pizzazz (e.g., humor or visually compelling images) to the whole thing can do wonders, too! 😉

Related: 5 Easy Ways Amazon Sellers Can Use ChatGPT to Increase Profits, Marketing on Amazon

Shopify Acquires Deliverr and Takes Aim at Amazon’s Buy with Prime

Amazon Shopify Completes Deliverr Acquisition

Update 02/10/2023: Shopify continues to battle Amazon for dominance as it expands its logistics and fulfillment network. 🚀

The Canadian eComm company recently:

  • Teamed up with Flexport to offer end-to-end import solutions to sellers, from requesting shipping estimates (for ocean and domestic freight) to booking shipments to tracking inventory orders (from supplier to fulfillment center). Smaller sellers can also use the company’s growing fulfillment network to import “as little as one pallet or 30 units of inventory,” according to Shopify Logistics CEO Aaron Brown.
  • Rolled out Shop Promise badge that allows sellers to communicate custom expected delivery dates to customers. Sellers can use the badge to feature the standard next-day and two-day delivery options or their own shipping dates as long as they deliver in five calendar days or less. 
  • Launched Shopify Magic, a new tool equipped with AI to help sellers generate product descriptions.

These latest moves are also likely done in response to Amazon announcing a nationwide roll out of Buy with Prime in January, which means increased competition for businesses that use Shopify.

Introducing these new logistics features will help Shopify merchants directly compete with Buy with Prime sellers.
“If we can level the playing field and give any merchant in the world before they’ve had their first sale all the benefits of a large retailer, we think that’s just giving pure magic to merchants,” Brown told Wall Street Journal.

As we know, Shopify and Amazon have been sparring in the ring for some time, but with Shopify’s recent acquisition of Deliverr, now the gloves are off. 🥊

Deliverr Acquisition Heats Up Competition Between Shopify and Amazon

Amazon has been going after Shopify’s customers and customer data for some time with their Multi-Channel Fulfillment (MCF) program. They even incentivized sellers last year into the program by handing out restock limit increases.

In case you missed it, we reported back in July 2021 that while Amazon was slashing restock limits for sellers due to capacity constraints, they were at the same time doubling restock limits for sellers who fulfilled their non-Amazon sales through Amazon.

You would think that they would implement more restrictions to further limit the influx of inventory into their already-strained warehouses, but they didn’t. 🤔

What could be the reason behind this?

Data grab

Amazon counts your MCF sales toward your sales velocity, which has a direct impact on your restock limits, something that was hugely important to leverage last year. The added benefit to Amazon is that each time you fulfill orders from Shopify and other channels through MCF, they gain access to velocity and customer data from other platforms, which allows them to size up their competition and to remarket to their customer base. Amazon could also acquire more valuable insights into what products are trending on other marketplaces and use them as additional sources to develop and improve their own private label brands.

Boost fulfillment revenue

Amazon most likely took a profit hit and more importantly, lost access to significant amounts of competitor data when sellers opted out of their fulfillment network due to inventory restrictions. Perhaps, they tried to soften the blow by incentivizing MCF sellers with higher restock limits so that they would keep using Amazon to fulfill and thus increase storage and fulfillment revenue.

Fast forward to April 2022, Amazon announced that they were making moves to go after even non-Amazon sellers, offering to fulfill for Direct-to-Consumer (DTC) merchants via Buy with Prime.

Shots fired. And now, Shopify is shooting back. 🔥

Shopify’s acquisition of Deliverr and plans toward 1- and 2-day delivery hit at the heart of Amazon’s Buy with Prime program.

With Deliverr, “Shopify Fulfillment Network (SFN) will allow all merchants to better align the supply of their inventory with buyer demand as we remove complexity for merchants in one of the most challenging areas they face today: logistics. And soon, we will roll out another powerful feature of SFN called Shop Promise, which will offer reliable two- and next-day delivery options across the US,” said Shopify Logistics Group CEO, Aaron Brown, in a press statement.

💯 Smart move toward Shopify working at offering alternative fast and easy fulfillment for sellers and protecting their data!

I wouldn’t be surprised if they eventually went the way of Walmart and stopped allowing Amazon to fulfill Shopify orders, or, at the very least, pulled API connections to such services.

But will these be enough to loosen Amazon’s grip on the eComm industry? 🤔

As of October 2021, Amazon leads US eCommerce with 41% market share, followed by Shopify at 10.3%, Walmart at 6.6%, and eBay at 4.2%.

Looks like it’s going to be a steep climb for Shopify! But with the addition of Deliverr into their fulfillment network, hopefully it will be enough to spark a change and even the playing field a bit.

Amazon Warehouse Automation Increases Concerns over Job Loss and Product Selection Inaccuracy

Amazon Warehouse Automation Increases Concerns over Job Loss and Product Selection Inaccuracy

Update 02/03/2023: Amazon is looking at ways to get rid of barcodes!

This might sound like science fiction, but according to Amazon, the Robotics team has developed a new camera system that can identify and match items against the ones listed in the inventory system without scanning barcodes. And it apparently does its job with 99% accuracy! 😲

In a Science blog post, the eComm giant explains that robotic arms are not good at locating and scanning barcodes, especially those that are attached to oddly-shaped items or hard-to-reach areas. Such challenges typically result in mispicks (customers receiving the wrong item) or shipping delays.

To increase warehouse efficiency, Amazon aims to automate identification of items in its fulfillment centers using Multimodal Identification (MMID). This process uses two or more “modalities of information” like text, sizes and shapes instead of barcodes. 

For example, when a camera monitors an item moving along the conveyor, it takes the item’s dimensions and appearance to see if they match the reference images stored in Amazon’s database. Once identified correctly, a robotic arm will then pick it up to be put in the correct bin to continue with the next step.

Initially, the match rates ranged between 75% and 80%. The system faced challenges when it couldn’t distinguish the difference between two different colors of Echo Dot – blue or gray.

But after extensive experiments, the system can now put confidence scores to its ratings and flag potential mismatches. Currently, the match rates are at 99%, thanks in part to “Amazon’s inventory systems that know where each product is at each step of the fulfillment process,” thereby reducing the need for barcodes.

According to AI researchers, “the algorithm does not need to match an item against Amazon’s entire catalog of hundreds of millions of products — currently an impossible task. Each item comes from a particular tote, and each tote contains a few dozen products. So, the algorithm only has to match an item against the contents of a single tote.”

Fortunately, this process happens in the early stages of the fulfillment process so any mismatch or mispick can be easily corrected by “recycling the incorrect item back into the system to its correct location” without causing any disruption, says Robotics AI specialist, Doug Morrison.

🤖 Over the past few months, Amazon has been introducing a series of innovative robotic systems to streamline its fulfillment process and make work safer (and faster) for employees.

During the first half of 2022, the tech giant rolled out two stationary robotic arm systems, Robin and Cardinal, to automate roughly half of its fulfillment process, such as grabbing a boxed-up item from the conveyor and scanning the label so that it can be sorted and transported (via mobile robots) to the correct loading dock. 

The other half? Retrieving products from shelves and putting them in boxes, a repetitive task typically performed by pickers, which now Amazon aims to automate with the launch of its newest robotic system, Sparrow. 🤔

Potential Impact of Sparrow on Workers

Introduced on November 10th, Sparrow is reportedly capable of recognizing and handling 65% of all pre-packaged goods sold on Amazon.com. That’s around 230 million out of 353 million products that the entire marketplace is supposedly carrying.

If the current iteration of Sparrow can already handle that much inventory, it’s only a matter of time before it can finally do the work of more than one million workers that Amazon employs to pick, stow, and pack 5 billion packages it delivers annually.

💯 Therefore, Amazon workers are right to be worried about:

Job Loss

The eComm giant describes Sparrow as a major technological advancement to support its workers.

However, employees fear that while it could help them meet their productivity quotas, it could also oust them from their job, especially at a time when Amazon is facing multiple issues in its warehouses.

  • Excess capacity amid slowing ecommerce growth. After nearly doubling its warehouse footprint in the last two years, Amazon is scaling back its logistics operations by delaying, shutting down, or subleasing more than 60 logistics centers to cut costs.
  • Increasing unionization activity. In a report posted by Yahoo in April 2022, Morgan Stanley analyst Brian Nowak speculated that Amazon might double down on its automation program in response to unionization activity. The analysis came after Amazon workers at a logistics facility in Staten Island voted to unionize, which could drive up labor costs (as opposed to robots that can’t demand higher wages or stage protests). The Wall Street analyst estimated that for every 1% of Amazon’s workforce that’s unionized, the company’s annual operating expenses would climb by $150 million.

“If unionization efforts did begin to spread rapidly, it may cause Amazon to increase the pace at which it invests and integrates robotics and labor alternatives into its warehousing efforts,” Nowak said.

  • Dwindling pool of workers. Vox’s tech news arm, Recode, reported in June that Amazon is facing a looming labor crisis. Leaked internal documents from mid-2021 show the company could run out of workers in two years if it doesn’t do “a series of sweeping changes” in its “hiring practices, productivity quotas, attendance policies and unequal enforcement of rules,” some of the biggest factors that contribute to Amazon’s high turnover.

    According to The Guardian, the eComm giant was losing 150% of its workers annually before the pandemic. By comparison, the retail sector’s annual average turnover in 2021 was 64.6% and in transportation, warehousing and utility, the turnover was only 49%. Amazon is reportedly looking at increasing wages and warehouse automation to delay the impending labor shortage by a few years.

    Or, the company could continue business as usual and rely more on robotics to fulfill orders instead of hiring more employees, ultimately wiping out a significant number of their workforce.

“You can’t compete with the robots. They want you to compete with the robots. They want all the employees to compete with them. But who can win against a robot?” a former Amazon warehouse worker, Mohamed Mire Mohamed, told Business Insider.

In a patent filed by the retail giant in 2020, Amazon said that Sparrow’s suction-grip “hand” is designed to replace workers who “pick items from inventory, place items in totes, remove items from totes, place items into bins, remove items from bins, and place items into boxes for shipping.”

But Amazon has denied speculations that its new robotic arm will replace human workers, saying that it’s designed to work alongside its fulfillment line, not against them. 🤔

“Working with our employees, Sparrow will take on repetitive tasks, enabling our employees to focus their time and energy on other things, while also advancing safety. At the same time, Sparrow will help us drive efficiency by automating a critical part of our fulfillment process so we can continue to deliver for customers,” an Amazon spokesperson said in a press release.

Higher Productivity Quotas

A robot identifying and selecting 65% of Amazon inventory for packing is without doubt extremely efficient. However, this could also lead to managers raising performance quotas significantly, requiring employees to do repetitive tasks over long shifts.

For instance, pickers at one warehouse said they had seen their quota grow from 100 to 400 items per hour, increasing their risk for burnout and injury. 

While robots can’t get sick like their human counterparts, that doesn’t mean they don’t have flaws.

Impact of Production Inaccuracy on Sellers

Sparrow may help speed up Amazon’s pick and pack process, but issues around production accuracy (e.g., mispicks) should also be addressed, as they could impact sellers and customers in terms of receiving the right order on time. 

For example, Amazon’s existing robotic arm system is built with scanners to be able to read labels on products and sort them by ZIP code. If it fails to scan your product correctly, however, it could be placed into a cart where it doesn’t belong, and potentially get lost.

Or, if your product is buried under a pile of objects of varying sizes and shapes, the robot may also fail to detect and pick it up.

⚠️ Amazon themselves are not oblivious to these problems, even admitting to the fact that robots will make mistakes in production as seen during their experiments with Robin. 

In this Amazon Science blog post, Bhavana Chandrashekhar, a software development manager at Amazon Robotics & AI, reveals “sometimes, the differences between one package and another are hard to see, even for humans. You might have a white envelope on another white envelope, and both are crinkled so you can’t tell where one begins and the other ends,”

To increase Robin’s success rate, Chandrashekhar’s team “gathered thousands of images, drew lines around features like boxes, yellow, brown and white mailers, and labels, and added descriptions.” This way, when Robin picks up and scans an object, it can quickly compare what it sees with thousands of sample data to find the closest match and stow it away in the right bin.

They also took note of errors, added them back to the training deck, and retrained Robin to improve its accuracy.

The robotics team developed and equipped the robot with a quality assurance system to oversee how it handles packages.

Charles Swan, a senior manager of software development at Amazon Robotics & AI, explains that if Robin detects a problem like dropping a package or placing two parcels (instead of one) onto a sortation robot, it will try to fix it on its own or call for human support if it cannot.

“If Robin finds and corrects a mistake, it might lose some time. However, if that error wasn’t addressed at all, we might lose a day or two getting that product to the customer.”

With Sparrow expected to handle the early stages of the fulfillment process, it’s not hard to imagine Amazon using a more refined training model to perfect its newest robotic arm system before deploying it at scale. One misstep could quickly trigger some sort of domino effect in its fulfillment process.

For instance, to minimize mishandling issues, Amazon is planning to equip its robotic arms with more advanced perception features like the ability to detect deformable products (plastic bottles in mailers) to avoid crushing them with so much pressure from the suction cups and getting them delivered to customers in damaged condition.

Amazon is currently testing Sparrow in a warehouse in Texas. 

The company expects a broader rollout in 2023. And when that happens, its fulfillment centers are going to become a lot less labor intensive. Conversely, it could also reduce the need for warehouse workers.

All of the above are the best-laid plans of Amazon and its robotics team. But as for the true test, that comes out in the wild when Amazon releases Sparrow more broadly into warehouses across the country. 

And while humans can also make mistakes, 65% accuracy in identification is not nearly as close as what human workers might be able to achieve, at least at this stage. This is to say nothing of any potential damage by robot arms the products may sustain on their way to your customers’ doorstep. 

However, this could solve a lot of problems for Amazon and for sellers in terms of faster delivery and, thus, greater sell-through for Amazon. Amazon warehouses working more efficiently could mean another moratorium on restock limits as warehouse space is utilized more efficiently. 


Sellers should follow along as this develops and brace themselves for when it launches more broadly. Even as confident as Amazon sounds and as hopeful as they may be, the jury is out on whether this will improve things or become another challenge for sellers to overcome. 

The Latest Update to Amazon’s Automate Pricing Features

The Latest Update to Amazon’s Automate Pricing Features

Update 01/24/2023: Amazon has added a new Automate Pricing feature that will help you to match or beat prices from competitors outside of Amazon.com. 💪

Here’s how the new feature works:

  • Enroll your product in Competitive Featured rule or Competitive Lowest Price rule on the Automated Pricing page.
  • Set your off-Amazon pricing rules (higher or lower than competing sellers)
  • Once set, Automate Pricing may automatically increase or decrease your price when offers from competitors outside of Amazon change.

At best, the automatic price increase may help you make money at higher prices. At worst, however, your competitors may purposely lower or keep their offers low to attract more customers, and at the same time, drive your prices to the bottom.

To protect your margins, consider tracking and updating your offers manually or setting your rules modestly.
Go to Automate Pricing or continue reading to learn more about this tool.

Automate Pricing tool finally has a bulk upload option! 🎉

Yes, that’s right. Some sellers may say, it’s about time. 

Instead of adding each product and setting its minimum and maximum price one by one, which is a pain in the neck, Amazon now allows you to apply the following pricing rules to multiple listings at once. 🚀

  • Select a single listing or a number of listings
  • Set the minimum and maximum prices for your listings
  • For sales-based pricing rules, assign a specific number of units you want to sell during a given period to test the right price for your new product or to simply manage your inventory levels. If sales are less than 10 units, you can set to reduce the price by 10%, for example.
Automate Pricing In Bulk

Once applied, Automate Pricing will automatically update your prices in accordance to your preset rules. 

You can set the min/max offer for your product around the Buy Box price or your competitors’ so that when it changes, the tool will match, exceed, or beat that price by a certain amount or percentage – yours could be automatically set 5 cents or 3% lower than the prevailing offer to stay competitive, for instance.

⚠️ However, there’s a negative aspect to this competitive lowest-price rule. 

On the one hand, if you suddenly become the only seller, your (low) price may stay the same. This could prevent you from making sales at higher prices unless you were to manually track and update this.

That is one of the cons of using Automate Pricing tool because many repricers will update your offer to the max price automatically if all your competitors ran out of stock, leaving you as the only seller. 

And because you’re selling at a more affordable price, you could sell out more quickly than anticipated, which is probably fine if you’re trying to eliminate slow sellers or products with a limited shelf life.

On the other though, offering the lowest price out there increases your chances of becoming the Featured Offer. And when you do get featured, it boosts your visibility on Amazon, which could then help drive more traffic and sales. 💰

For a smarter repricing strategy, Amazon also lets you review your pricing history for any SKU enrolled in Automate Pricing to track price changes and use business reports to measure success.

In addition, if you’re selling globally, you can adjust the prices of your exports for currency conversion, price increases, and discounts.

Overall, Amazon’s Automate Pricing can be an excellent alternative to paid repricer apps. It’s free for Amazon sellers, and with its new bulk pricing feature, it reduces the time it takes to enroll multiple SKUs to the system and implement pricing rules, making it as efficient as third-party repricer tools.

However, constantly keeping your prices lower than the Buy Box can hurt your profit per unit and increase your stockout risk due to higher demand. Therefore, you may still have to disable pricing rules to manually adjust your prices from time to time.

👆 So don’t cancel your current repricers just yet. Try Amazon’s tool on for size to see if it will actually work well for you. And consider testing Automate Pricing with 5 to 10 listings first to see if it’s for you before applying pricing rules to the rest of your inventory. 
Go to Automate Pricing to get started.

Walmart Launches B2B eCommerce Site to Rival Amazon and Shopify

Walmart Launches B2B eCommerce Site

Amazon, Walmart, and Shopify are taking their rivalry to a new arena: the fast-growing Business-to-Business (B2B) eCommerce industry. 

The Rise of B2B eCommerce

As US consumer spending weakens, B2B is growing at a rapid pace, prompting eComm companies to put more focus on B2B.

According to DigitalCommerce360, US B2B online sales grew from $1.39 trillion in 2020 to $1.63 trillion in 2021. B2B eComm is also estimated to reach a compound annual growth rate of 20.49% from 2022 through 2028, representing a huge growth opportunity for eComm players to tap into. Capturing this untapped market may provide some revenue boost that could help them offset Business-to-Consumer (B2C) sales slowdown.

Buyers going digital during the pandemic is one of the contributing factors to the rapid growth of online B2B.

In response to COVID-19 lockdowns in 2020, many businesses moved their B2B transactions from offline to online, and never looked back. Approximately 80% of B2B executives now prefer online self-service or remote human interactions over in-person sales primarily due to safety concerns, ease of scheduling, and savings on travel expenses, McKinsey reports. 

Among US B2B eComm companies, Amazon appears to be the most dominant player, having operated its own B2B arm, Amazon Business, since 2015 versus top competitors that have only been in the market for several months – Shopify since June 2022 and Walmart since January 2023.

Sales-wise, Amazon Business represented 1.4% of all B2B sales on eComm sites in the US in 2021. Moreover, by 2025, the company’s market share is estimated to grow by 2.4%. For context, Insider Intelligence forecasts B2B sales on eComm platforms to reach $2.3 trillion within the next two years. 

In an attempt to carve out a good proportion of this trillion-dollar market size for themselves, Walmart recently launched their own B2B eCommerce site. 🚀

Walmart Business for Small and Medium-Sized Enterprises (SMEs)

Announced on January 20, 2023, Walmart Business is an online procurement hub for SMEs and non-profit organizations looking to:

  • Simplify B2B purchases. Walmart removes the complexities of procurement by offering SMEs a curated list of over 100,000 products. They can easily shop for office supplies, furniture, bathroom items, food and beverage, electronics, or classroom and faculty needs all in one place. Buyers can then group their purchases by category to streamline their restocking process. Depending on a company’s organizational needs, one may select categories including administrative support (printing, stationary, or mailing items) or information technology (hardware or software).
  • Lower costs. Reduce travel expenses by eliminating face-to-face interactions with suppliers and opting for digital self-service orders or remote human engagement instead.
  • Leverage Walmart’s fulfillment network. Receive orders fast with the retail chain’s scheduling system, convenient store pickup locations, and 2-day delivery program.
  • Track and share spending information with multiple users. Add up to 5 users to a single account and track spending trends by sharing purchase history across members. Qualified buyers can also register in Walmart Tax-Exemption Program to enable automatic removal of eligible taxes during checkout.

SMEs can also upgrade to a Walmart Business+ account for $98 per year to enjoy the following additional benefits:

  • No minimum order required to qualify for free shipping
  • Free pickup and delivery from Walmart stores with a $35 minimum order
  • 2% rewards on orders $250 and above
  • 5% savings on eligible products set to subscription

Why Go After SMEs?

Like B2B eCommerce, the US small business market is a growth area with 33.2 million SMEs. This accounts for 99.9% of all American businesses, and is expected to grow by 36,000 by 2025.

Of the 33.2 million, 27 million do not hire any staff, while 5.4 million have under 20 team members and only 650,000 have fewer than 500 employees, according to Oberlo.

Therefore, tailoring Walmart Business to the needs of SMEs may help the retail giant win more sales while keeping existing customers from switching over to Amazon or Shopify, ultimately allowing them to grab a big piece of the B2B pie.

For sellers trying to lessen their reliance on Amazon, this could be an opportunity to branch out into Walmart. 🤔

It’s too early to say whether or not Walmart Business will make a dent in Amazon’s B2B sales, but it will surely bring new challenges to Amazon. 💪 Expect the eComm giant to try to forestall Walmart’s attempt to encroach on its market with new B2B tools and features in the near future.

Related: Walmart and Amazon Battle for Dominance Intensifies, Shopify Acquires Deliverr and Takes Aim at Amazon’s Buy with Prime, Amazon Makes Play Toward Offering Prime for Non-Amazon Orders

Prepare for These 6 Major Changes to 2023 Amazon UK & EU FBA Fees

Prepare for These 6 Major Changes to 2023 Amazon UK & EU FBA Fees

Like US sellers, UK and European marketplaces will welcome the new year with updated Aamzon FBA fees, the eComm giant announced on January 19th.

Amazon cited the current macroeconomic factors affecting the company’s operations as the primary reason for the upcoming changes. These include significant updates to the cost of fulfillment, storage, and return and disposal services starting March 1st, 2023.

The tech giant also announced it will introduce new fee promotions and reductions this year and improved benefits for products in the FBA New Selection Program, in what may be an attempt to keep sellers from opting out of FBA due to fee increases.

Read on to learn how these updates will impact your business in 2023 and what you can do to get ahead of mounting Amazon fees.

6 Major FBA Fee Updates for 2023

FBA Fulfillment Fee Changes

This year’s FBA fulfillment fee changes include:

  • Applying dimensional (DIM) weight calculations to all standard and oversize products. Previously, DIM weight pricing was only applied to oversize units. But that will change on March 1st, when Amazon starts using the greater of the unit weight and dimensional weight as the billable weight for standard parcels (and oversize items), which could potentially increase your per unit shipping cost. Amazon subtly slips into the announcement that DIM will also be applied to customer returns processing fees.

DIM Weight Sample calculation

Item unit weightItem dimension (cm)
Item DIM weight Greater of unit weight or DIM weightSize and weight tier before March 1, 2023Size and weight tier on and after March 1, 2023
900g35 x 25 x 12(35 x 25 x 12)/5,000 = 2.1 kgDIM weight is 2.1 kgStandard parcel ≤ 900gStandard parcel ≤ 3.90 kg

Assuming you’re shipping within the UK, here’s how much it would cost you to fulfill a standard parcel across the country from March 1st:

Standard Parcel2023 Fulfillment Rates
Standard parcel ≤ 150g£2.81
Standard parcel ≤ 400g£2.92
Standard parcel ≤ 900g£3.15
Standard parcel ≤ 1.40 kg£3.36
Standard parcel ≤ 1.90 kg£3.68
Standard parcel ≤ 2.90 kg£5.38
Standard parcel ≤ 3.90 kg£5.68

Based on DIM weight pricing, you may find yourself falling into a much higher weight tier than what your actual unit weight suggests and receive a massive per unit fulfillment fee increase for your large but lightweight products!

Pro tip: Parcels can get bulky due to excess air inside the packaging or using an excessive amount of bubble wrap or foam fillers. To reduce shipping fees, try to keep your products compact by implementing packaging optimization practices like using lightweight or condensed packaging materials or removing excess air or water from your primary packaging. Additionally, use our Master Carton Calculator to determine your optimal carton and pallet load capacity per shipment for additional savings to offset Amazon’s fees.

  • Making Fuel & Inflation Surcharge permanent. Amazon introduced this surcharge in 2022 to temporarily account for rising price levels during that period. However, “as economic conditions have progressed, these cost increases appear to be more permanent,” requiring the retail giant to adjust this year’s FBA fees to include these additional costs permanently. These fee changes are reflected in the rates published here.

    In general, this year’s fees are significantly higher with at least £0.17 per unit increases in many cases for the UK and €0.11 for EU.
  • Introducing new weight tiers in FBA fulfilment rates for Special Oversize items. Starting March 1st, Amazon will add 30 kg and 50 kg weight tiers to Special Oversize category to “better align fees” with its current fulfillment costs.

FBA Monthly Storage Fee Updates

Expect to pay:

  • Higher monthly storage fees for all Standard-Size units. Effective March 1, 2023, monthly storage fees for your standard-size inventory will increase by around £0.04-£0.10 per cubic foot depending on product category and storage month. Fees for storing dangerous goods and oversize products in FBA will remain unchanged.
  • Storage utilisation surcharge starting May 1st, if you meet the criteria. This additional fee (stacked on top of your monthly storage fee) will be based on the ratio of your average daily inventory volume (in cubic ft) and average daily shipped volume (cubic ft) over the trailing 13 weeks. 

    Rates will vary depending on your utilisation ratio, season, and product size tier level.

Quick sample

(Daily inventory volume over trailing 13 weeks / Daily shipped volume over trailing 13 weeks) / (7 days in a week) = Storage Utilisation Ratio (in weeks)

Or for example:

30,000 cubic feet / 140 cubic feet) / 7 = 30.61 weeks

Base monthly storage fee (off-peak standard size rate): £0.78 per cubic foot
Storage utilisation surcharge: £0.50 per cubic foot
Total storage fees: £0.78 per cubic foot + £0.50 per cubic foot = £1.28 per cubic foot

To reduce your utilisation ratio, consider deleting unused shipping plans, eliminating excess inventory, fixing stranded inventory, and improving your Amazon reserved inventory levels. Doing these things may also help increase your FBA capacity limits as storage utilisation is tied to your IPI score, which is one of the metrics that Amazon uses to calculate your inventory limits.

In addition, Amazon will charge a single storage utilisation fee for inventory kept in an Amazon fulfillment center in Spain, France, Italy, and Germany and a separate surcharge for your UK inventory. This means that your catalog sell-through will be analyzed separately for these marketplaces. If you sell both in Spain and UK, for instance, you could be charged two different storage utilisation fees.

  • Higher aged inventory surcharges. Effective May 15, 2023, all product categories will be subject to the following aged inventory fees. 

Aged inventory fees replace the fee structure that was previously referred to as long-term storage fees and significantly shortens the amount of time inventory can be held before these surcharges kick in.

As you can see from the above chart, items aged between 331 and 365 days will increase from £0.90 to £1.11/cubic foot per month.

Amazon will also add new tiers to begin the aged inventory surcharge for products that remain unsold between 271 and 300 days, excluding Clothing, Shoes, Bags, Luggage, Jewelry and Watches. At the 9th month, you could be charged an additional £1.11/cubic foot on top of your standard monthly storage fee.

Related: Amazon Automatic Aging Inventory Removal Starts April 15, Attack of the Fee Stack: How Sellers Can Maximize Profitability Despite Amazon’s 2023 FBA Fee Increases

FBA Return and Disposal Fee Changes

Return and disposal order fees will get more expensive for sellers starting March 1, 2023, while liquidation order fees will remain the same. Either way, this means carrying overstock inventory and getting rid of it will result in additional costs that could shrink your margins, so make sure to follow the best inventory management practices to avoid ending up with a lot of unsold products.

FBA Small and Light Changes

Amazon’s making some good changes to its FBA Small and Light (SnL) program in Europe this year.

Beginning March 1st, sellers will see an increase in price eligibility threshold of SnL items in:

  • UK (from £9 to £10)
  • France (from €11 to €12)
  • Germany (from €10 to €11)

Amazon will also introduce new size and weight tiers (460g in standard enveloped and 960g max weight limit for L and XL envelopes) to make SnL more affordable than its standard FBA fulfillment service, potentially making it a good alternative for those products that qualify.

However, be aware that the company will also start applying DIM weight pricing to SnL items effective March 1st. Additionally, you must be enrolled in the Small and Light program or the discounted rates will not apply even if you meet the weight and price thresholds.

Selling Fee Reductions and Promotions

Various fee decreases and promotions may help offset the cost increases that will be dropping throughout Q1 2023. These include:

  • Offering a 17.5% discount on EU fulfillment network fees (from EU to the UK and vice versa) starting from April 1, 2023. Click here to view the applicable promo fees.
  • Reducing the referral fee, from 15.3% to 7.14%, for products that fall under Clothing and Accessories. Eligibility requirements apply.
  • Extending the referral fee promo in Amazon Poland from March 31, 2023 to March 1, 2024.

FBA New Selection Program Changes

To help you save a little bit of money, Amazon will implement the following updates for standard-size products eligible for FBA New Selection Program:

  • Increased free storage, removal, and rebate benefits on up to 100 units per parent ASIN (clothing and shoes not included).
  • Extending free storage and rebate offer from 90 days to up to 120 days per parent ASIN (clothing and shoes not included).
  • Increasing rebates from 5% to up to 10%.

These changes are set to take effect in March 2023.

How to Prepare

With a little over 5 weeks to prepare, it would be best to start taking action now.

Fortunately, most of the upcoming additional FBA fees can be offset or avoided altogether (e.g., storage-related surcharges) with good inventory management.

Good inventory management practices include:

  • Finding out whether or not FBA is still a feasible fulfillment method for your business. Consider running some profit calculations now so that you can make the necessary adjustments to your inventory plans and fulfillment strategy ASAP.
  • Making accurate inventory forecasts to avoid over-ordering and under-ordering.
  • Keeping a firm eye on your inventory levels to know when and how much inventory to reorder.
  • Adopting inventory-minded marketing to ensure coordinated execution of your inventory and marketing plans.
  • Moving excess inventory through flash sales or by bundling them with your best sellers to avoid incurring storage utilization and aged inventory surcharges.
  • Ensuring timely delivery of your inventory by negotiating a better lead time with your supplier, freight forwarder, and/or 3PL so that you won’t miss out on your target sales events and therefore, sell through your inventory quickly.
  • Calculating your optimal carton and pallet load capacity to reduce shipping, storage, and handling costs.

These are just some of the best inventory management practices that you can implement in your business to protect your margins.

👌 For a more in-depth guide, download our Attack of the Fee Stack White Paper or join our upcoming live Q&A webinar, where industry experts and white paper authors Vanessa Hung and our very own Chelsea Cohen will answer questions about Amazon’s relentless fee hikes and how to ease their pressure on your profits.

Related: Amazon Hikes US FBA Fees Again, Protecting Your Profitability Webinar, How to Increase Profits for Amazon Sellers

Amazon Automatic Aging Inventory Removal Starts April 15

Amazon Automatic Removal of Aging Inventory Starts April 15 2022

Update 01/13/2023: 📢 ICYMI, Amazon recently announced they will implement aged inventory fee increases starting April 15, 2023, which coincidentally is also the company’s aged inventory removal start date.

Aged Inventory Fees April 2023

The longer your FBA stock remains unsold, the more expensive it’s going to get for you. New rates start at $0.50/cubic foot for inventory stored between 181-210 days to as high as $6.90/cubic foot for units aged 365 days or more.

To help you save on surcharges, Amazon has enabled automatic removal of your aged inventory. Depending on your product’s condition, you may opt to have it sent back to your return address for a fee, liquidated through FBA liquidations, or disposed of. More on that below.

Removal fees are increasing again this year in a big way on top of utilizing dimensional weight to calculate shipping weight, so the costs could really start stacking up if you’re not careful. 

🚨 If you want to disable automatic aged inventory removals, do so now and be sure to get your FBA inventory checked for any:

  • Extremely slow-moving items – for example, underperforming products that are less likely to get sold within 3 to 6 months. To boost sales, consider launching flash sales or bundling them with your top sellers.
  • Excess inventory that has been in Amazon warehouses for 6 months or more.
  • Obsolete, damaged, or expired goods, i.e., unfulfillable products.

Get rid of aging or unsellable items by April 15 to avoid tying up your capital in holding costs like aged and long-term storage fees.

Read on to learn more about automatic aged inventory removals and how to recover profits from your unsold inventory.

To make room for Prime Day, Amazon has enabled automatic removal of the following inventory starting April 15th:

  • Inventory that has been in Amazon fulfillment centers (FCs) for over 12 months and is subject to long-term storage fees.
  • Inventory that has remained unsold for six consecutive months and has been in FCs for over half a year.

You can, of course, disable automatic removals for your inventory on the Settings menu of your Seller Account. However, carrying a lot of slow sellers is not ideal.

A high excess inventory percentage and a low sell-through rate can negatively impact your Inventory Performance Index (IPI) score. As of this writing, scoring below 400 could mean Amazon placing limits on your FBA storage capacity. Plus, letting inventory sit for more than six months can also lead to additional storage fees.

Pro tip: Regularly check your Manage Inventory Health report to identify and get rid of slow sellers before they start impacting your IPI score and incurring holding costs.

Recover Value from Your Aging Inventory

Once you’ve enabled automatic removal for your old inventory, you can select any of the following value-recovery options:

Arrange a flash sale
As the April 15th deadline approaches, review your excess inventory that falls into this category and try to move as much of your inventory before this date by having a flash sale. Promote the sale via your email list or social media, drop prices or provide a deep coupon discount. Flash sales may make more sense than a straight return or disposal of inventory which can lead to financial losses.

Include a Return Address to have your inventory sent back to your warehouse
Make sure to provide a valid return address to avoid getting your units disposed of automatically at FBA. If you need to change your return address, do so now to ensure all changes are saved before the disposal start date.

Liquidate to have your inventory liquidated
This option will help you to recover 5% to 10% of your product’s selling price.

Go to Automated Fulfillable Inventory Removal for more information.

Amazon Tweaks Logistics Strategy to Streamline Operations

Amazon Tweaks Logistics Strategy to Streamline Operations

Update 01/10/2023: Amazon site closures continue! On Tuesday, the tech giant announced it is shutting down three (3) warehouses in the UK, putting 1,200 workers at risk.

All affected employees will be given the opportunity to move to a different facility.

However, Steve Garelick of the GMB union argues that workers can’t be expected to suddenly relocate to other fulfillment centers that could be several miles away.

The facilities facing closure are located at Gourock, Hemel Hempstead, and Doncaster. The move came after Amazon’s thorough evaluation of its fulfillment network.

Warehouse evaluations are done “to make sure it [fulfillment network] fits our business needs and to improve the experience of our employees and customers,” an Amazon rep told CNBC.

“As part of that effort, we may close older sites, enhance existing facilities, or open new sites,” 

The tech giant plans to open two new UK facilities over the next three years, one in Peddimore and another in Stockton-on-Tees, creating 2,500 jobs.

Out with the old, in with the new! 🎉

Amazon is reportedly shutting down some of its older warehouses and retiring a few Boeing 767s in its air fleet as part of a larger effort to lower costs while improving each stage of the company’s fulfillment process.

As previously reported, Amazon nearly doubled its fulfillment network to meet the heightened customer demand during the pandemic. The company spent 30% of its $60-billion capital investment on distribution and 25% on transportation, accounting for more than half of its total capital investments.

However, by early 2022, eCommerce demand began to decline as consumers cut back on online spending and returned to in-store shopping. This has resulted in excess capacity that contributed to Amazon’s $3.8B profit loss in Q1 and another $2B in Q2.

Amazon CEO Andy Jassy remains confident about the future of the retail giant’s logistics arm stating:

“Today, as we’re no longer chasing physical or staffing capacity, our teams are squarely focused on improving productivity and cost efficiencies throughout our fulfillment network,” 

“This may take some time, particularly as we work through ongoing inflationary and supply chain pressures, but we see encouraging progress on a number of customer experience dimensions, including delivery speed performance as we’re now approaching levels not seen since the months immediately preceding the pandemic in early 2020,” Jassy added.

Amazon Attempts to Rightsize its Fulfillment Empire

To reduce operational costs and capital expenditures, Amazon is trimming down its warehouse footprint across the US. 

A report from MWPL International shows that, as of September 2022, Amazon has closed over 20 logistics centers and canceled or postponed the openings of 50 more sites. Most of these sites were delivery stations, where associates sorted orders by ZIP code and then dispatched them to customers via couriers.

Sites that are shutting down are either being subleased or having their operations consolidated into a nearby facility to lower outbound transportation expense. 

Facility closures might have also led to fewer third-party delivery partners this year. In 2021, Amazon added 670 delivery service partners in the US, but now it plans on curbing the network’s growth by 33%, just adding 451 partners in 2022.

With fewer recruits, however, the company will be able to focus on improving the quality of service that their partners provide, which could mean faster delivery times.

Aside from Amazon’s shrinking warehouse network, the growth of its air cargo fleet has also slowed in recent months.

Research from DePaul University shows that Amazon Air’s total flight activity only increased by 3.8% from August 2021 to March 2022, 10.5% lower than the daily flights recorded during the previous six months. This move makes sense from a financial and operational perspective, given that there are now fewer facilities to supply inventory to and fewer packages to move through its delivery network as demand declines.

“The natural business reaction to that is to pause, because your margin for error in an environment of complexity and increasing costs shrinks, and the cost of a mistake rises,”Jason Tolliver of Cushman & Wakefield said.

However, more streamlined operations don’t always result in greater customer satisfaction, especially for people who have come to expect same-day or two-day delivery.

For example, consolidating last-mile delivery stations into other facilities (usually located in the middle of highly populated sites) to cut costs might lead to longer delivery times for customers on the outskirts of metropolitan areas.

And because there are fewer delivery stations, it could even lead to more orders not delivered directly to customers’ homes, forcing them to step out of their house to pick up their parcel from a designated drop-off point. This defeats Amazon’s speedy port-to-porch delivery promise, which made the company almost as good as UPS and FedEx.

With Amazon scaling back its warehouse footprint and air deliveries this year, are we more likely to order from other sites that offer instant deliveries even if that means paying for shipping? Or, are we more likely to have to wait longer than 1 to 2 days? 🤔

It appears that Amazon is not only trying to rein in logistics spending, but also control customers’ same-day shipping expectations in an attempt to keep costs low. 

Customers within metropolitan areas will still likely receive their orders within hours, but those outside of city centers might have to wait longer than a day or two. But this could all be temporary, as Amazon is still trying to return to “a healthy level of profitability” after inflation and supply chain challenges took a huge chunk out of its Q1-Q2 2022 earnings.

Amazon Has Bigger Plans for 2023 

Although it seems that Amazon remains on track with its rightsizing plans, Wall Street Journal recently reported that the eComm giant is looking to add three new mega-warehouses in the US.

These include:

  • A five-story, 3.1 million-square foot distribution center in Niagara, New York
  • A five-story, 3.8 million-square foot warehouse in Loveland, Colorado
  • A five-story 4.1 million-square foot mega-facility in Ontario, California 

In a press statement, an Amazon rep said, “While we’re closing some of our older sites, we’re also enhancing some of our facilities and we continue to open new sites as well.” MWPVL estimates that Amazon will open 250 more distribution centers in 2022.

Aside from building these mega warehouses, Amazon has also acquired Cloostermans, a Belgian machinery and robotics manufacturer, to automate aspects of its fulfillment operations, such as moving heavy pallets and packaging products for delivery.

And just last month, Amazon hired Hawaiian Airlines to fly 10 Airbus A330 cargo planes for its air network in 2023. The converted freighters will replace the older Boeing 767s.

“These A330-300s will not only be the first of their kind in our fleet, they’ll also be the newest, largest aircraft for Amazon Air, allowing us to deliver more customer packages with each flight,” Director of Amazon Global Air Fleet Philippe Karam said in an Airbus press release.

The widebody jets are slightly larger than Boeing 767s and have a high volumetric payload capability that makes them ideal for carrying large amounts of packages in express delivery networks. 

For improved overnight operations across the US, Amazon launched a new air hub facility at the Cincinnati/Northern Kentucky International Airport. The facility can handle 44 flights daily, a 71% increase from March, according to researchers at DePaul University. It also operates similar to UPS, FedEX, and DHL with its synchronized scheduling and fast aircraft-to-aircraft transfers to ensure same-day deliveries in Kentucky, Indiana, and Ohio.

A few weeks back, we have reported that Amazon’s doubling down on its logistics expansion plans to possibly provide support for its new low-cost logistics service called Amazon Warehousing and Distribution (AWD) and its Buy with Prime program.

In 2023, AWD won’t just serve Amazon fulfillment centers, but it’s also expected to replenish inventory to non-Amazon locations, including to fulfill brick-and-mortar stores. 

So, once these new mega warehouses and freighters are fully operational, both Amazon and non-Amazon sellers can expect a significant improvement to transit times.

DePaul University researchers estimate that sellers who ship via Amazon Air from Cincinnati and have the goods ready for shipment by noon could have those packages delivered by next day to 25 largest US metropolitan regions. And they could also have the packages delivered by sometime the next day to approximately 95% of the mainland’s population. 

Clearly, with these expansion plans for 2023, Amazon’s not only looking to please shoppers with a better delivery promise, but also to make Prime a more attractive logistics option for sellers, a crucial move amid increasing competition.

Amazon Makes Play Toward Offering Prime for Non-Amazon Orders

Amazon To Offer Prime for Non Amazon Orders

Update 01/10/2023: Took Amazon a while, but the eComm giant is finally extending Buy with Prime (BWP) to all US direct-to-consumer (DTC) merchants on January 31, 2023. The service was previously available to some select sellers only.

With BWP, retailers not selling on Amazon.com can now offer Amazon checkout and fulfillment services on their own site, essentially allowing Prime users to shop anywhere online using their saved Amazon Pay checkout details and at the same time, receive free 1 to 2-day shipping and returns. 

To help drive traffic, build consumer trust, and boost sales, the company also released a few marketing solutions back in September 2022, and recently, Reviews from Amazon, which lets BWP users show reviews from their AMZ listings on their own sites.

Amazon’s new fulfillment revenue stream has been reportedly shown to increase conversion by 25% on average.

“We’ve been working closely with merchants since the launch of Buy with Prime and have been thrilled to hear the results it’s helped drive for them so far,” said Peter Larsen, VP of BWP.

The retail giant did not disclose how many sellers have joined BWP so far or estimates on how many will be willing to adopt it. But if we had to guess, the program may make more sense for sellers without fulfillment capabilities or small brands with less than $5M gross merchandise volume, which is about 16% of US DTC merchants, according to PipeCandy.

However, issues around the company’s rising fulfillment fees, data grabbing history (more on this below), or Shopify warning merchants against BWP may be viewed as the dealbreaker.
As of this writing, BigCommerce is the first eComm service provider to roll out a self-service integration into Buy with Prime.

In the past two years, Amazon has ramped up its fulfillment capacity to meet high customer demand. Reports show that the eComm giant’s global fulfillment network and data centers grew from 272 million square feet in 2019 to 532 million square feet in 2022. Most of these facilities are located near metropolitan areas so that Amazon can deliver customer orders in one day or less, allowing them to compete with UPS and FedEx.

This unprecedented growth is much in response to what happened in 2020 and 2021. In the last two years, sellers had been subject to strict restock limits due to capacity constraints at Amazon (tough times!). Now, the pendulum is swinging the other direction and this kind of paints a picture of what we’ve been hoping for–that restock limits really may have eased up for a lot of people.

On an earnings call with analysts in November 2021, Amazon CFO Brian Olsavksy stated that Amazon hasn’t had capacity restrictions for the first time in a while. But the commitment to build out a larger network of facilities to store, sort and ship products at breakneck speed came at a cost.

Amazon Grapples With Excess Capacity

Amazon ended up with excess labor, storage space, and transportation capacity amid rising costs and eCommerce growth decelerating after a huge spike in 2020. This has resulted in $2 billion in incremental costs, according to Amazon Q1 Earnings Report for 2022.

To mitigate these costs, the online retail giant is expected to spend less on fulfillment centers this year than last.

Amazon will also try to generate more money from its vast fulfillment network by offering Buy with Prime to non-Amazon sellers, aka direct-to-consumer (DTC) merchants. This new service allows merchants to use Prime’s free two-day and next-day shipping and returns.

So, we went from Amazon turning away huge amounts of our inventory because it only had room for essential goods, which forced us to outsource storage to 3PLs, to now using its empire to fulfill orders for other retail sites.

While these are good profit-recovery measures for Amazon, could there be other reasons they’re doing this? What’s in it for them?

Data Grab

Not only is Amazon using Buy with Prime to potentially boost their revenue and offset some of their expenses, but we might as well say the quiet part out loud here, that this initiative has the added benefit of grabbing customer data, such as consumer names and addresses and potentially even phone numbers and emails as a requirement of shipment handling.

This information would be everything that Amazon would need to launch massive remarketing and retargeting campaigns to your non-Amazon customers if they chose to do so.

Beyond this, Amazon could also gain more insights into what products are successfully selling on other platforms which could act as an additional R&D source beyond the extensive Amazon data that is currently available to it. This scenario would not be out of the realm of possibility based on past history.

Were they to go this route with Buy with Prime, it wouldn’t be Amazon’s first attempt at (allegedly) violating user data privacy. In 2020, the Wall Street Journal reported that Amazon employees used third-party sellers’ data to launch competing products for their own Private Label (PL) business to boost their sales. Although an Amazon spokesperson denied this, and even launched an internal investigation of its PL division, the retail giant failed to provide a copy of its report. This has prompted the House Judiciary Committee to ask the Justice Department to conduct another investigation into Amazon over a possible criminal obstruction.

With that in mind, could this be an under the sleeve motivation for Amazon to attract DTC merchants who otherwise would have no Amazon relationship outside of Buy with Prime? If so, this would allow Amazon to surveil their data, such as sales velocity per SKU and customer details, and possibly use those to their advantage, i.e., fight for more market share.

Related: How a Seller Doubled Their Amazon Restock Limits

Potential Fulfillment Issues

Since Amazon didn’t have enough capacity to fulfill FBA orders for Amazon sellers and now they’re trying to fulfill for others, what headaches are we going to deal with?

On the one hand, it could be a welcome sign that restock limits are gone for good. On the other though, it could not. In July 2021, we discovered that, while Amazon was slashing restock limits for sellers, they were at the same time doubling restock limits for sellers who fulfilled their non-Amazon sales through Amazon.

At the same time they were telling us there was no space for our FBA-fulfilled inventory, they were incentivizing sellers to use their fulfillment network for other sales channels. The only sense it made was from a data grab perspective. Perhaps this was the initial testing ground for Buy with Prime and why so much focus was put into it in a time when FBA warehouse space was supposed to be at a minimum.

With that in mind, it could go either way but it’s worth posing the question:
Is this actually going to backfire and make it more difficult for Amazon to fulfill deliveries to our customers? 🤔

Buy with Prime could be beneficial to multi-channel sellers fulfilling Shopify orders through Amazon, as it might help them maintain or improve their restock limits if that remains relevant in coming months. Sales from multi-channel orders actually contribute to your Amazon sales velocity. So, the more you use multi-channel fulfillment (MCF) for your off-Amazon business needs, the higher your restock limits will be.

However, Buy with Prime is currently invite-only. Amazon could be reaching out to sellers who are currently selling on their retail site as well as selling on Amazon, or they could be focused only on sellers who are not selling on Amazon at all, including people interested in starting to sell on the platform who just haven’t made the move yet. So, again, all of this may partially be a play to try to get them into Amazon itself.

Expect a slow roll out from Amazon, as they’re still trying to see how it goes.

Participating merchants will be able to display the Prime logo and expected delivery date for eligible products on their online retail sites.

Other benefits include:

  • No fixed subscription fee
  • All fees except storage fees are charged only after you make a sale
  • Pricing includes service fee, payment processing fee, and fulfillment and storage fees per unit

The payment processing fee likely means that Amazon’s going to be running payment processes through Amazon Pay, a service that gives your customers the ability to pay with Amazon payment methods rather than entering their credit card on your website.

Upside to Buy with Prime

Not to be a complete doomsday predictor, there are also many benefits to consider with Buy with Prime. Amazon’s Prime shipping program has set up an expectation in the mind of the online shopper that few other businesses can even hope to meet. Buyers expect free, fast shipping and 25% of cart abandonment is due unexpected shipping costs, while lack of express shipping option is another one at the top of the list.

For this reason, Amazon making their fast, free shipping network available is kind of a big deal. A note of caution is that, as opposed to your standard inventory on hand in your single outside fulfillment center, you’ll likely want to have much more inventory on hand in order to meet one or two-day shipping demands as Amazon meets these targets based on the spread of their inventory across the selling region.

The other benefit is borrowing the trust that Amazon has built around its shipping and payment processing. Your buyer does not need to enter his credit card information on your website because it is processed directly from Amazon’s site. This helps to safeguard against another cart abandonment issue which is concerns about payment security.

All of these factors, both the above warnings and benefits, should be weighed so an eyes-wide-open decision can be made on what you feel is best for your business if you are interested in exploring the Buy with Prime service for your off-Amazon fulfillment.

Final Thoughts

Now that its infrastructure has been built out to such a massive degree, Amazon is definitely looking to try to make Prime more of a concrete revenue generation system. While they have been previously focused on the “investment in the future” side of the operation by capturing buyer market share and adjusting consumer expectations regarding shipping cost and time, they seem now to be pivoting towards making it work for them on both the financial and data side of things.

And with the recent additions of dimensional weight calculations and 5% fuel and inflation surcharge, fulfillment fees just got a heck of a lot more profitable for them, all while sellers’ wallets unfortunately take the hit.

It seems like they’re flipping a switch and figuring out a way to make Prime an even more lucrative program for them. Amazon done a great job over the years in focusing on getting those delivery timetables right so that potential merchants and customers change their perspective on what is expected in the market, such as free shipping and fast handling and delivery times – from 2 days to same day, while keeping any other intention behind the strategy a bit more ambiguous.

Shipping FBA Inventory from China to UK with SEND: What Could Possibly Go Wrong?

Shipping FBA Inventory from China to UK

After leaving the European Union (EU) in 2020, UK’s largest import market is China. The country imported £63.6 billion Chinese goods in 2021, which represented 13.3% of all foreign products shipped in to the UK.

According to the British Chamber of Commerce, the exit allowed the country to “independently control its trade,” changing the way in which it interacts with trading partners.

One such change is introducing the UK Global Tariff (UKGT) system, which enables the country to set its own tariff rates for imports with any international trading partners like China. As a result of this change, “over 3,500 products have seen tariffs canceled, reduced, or simplified – enhancing market access and thus encouraging further growth in the UK-China trade.”

However, UK’s departure from the EU also added some complexities around its import law and regulations that could make market entry difficult for some sellers. For instance, dealing with UK customs alone can be a long, arduous process that the government itself suggests hiring customs brokers or freight forwarders to help speed things up.

This is where Amazon’s new logistics service called SEND comes in handy. 🤔

Announced on January 9th, SEND is an Amazon Partnered Carrier Program (APCP) that makes it easier for sellers sourcing in China to ship their FBA inventory from China to the UK.

It’s a shipping solution that allows you to get your inventory: 

  • Picked-up by a partner carrier at a factory in China
  • Cleared through customs and then shipped across Asia to a port in the UK
  • Transported from the port to FBA centers in Great Britain

SEND essentially removes the middleman (3PLs, customs agents, or freight forwarders) from your supply chain, which may help lower shipping fees and cut down transit times. 

You may also be eligible for the following fee reductions until April 12, 2023:

  • Approximately 20% reduction on APCP fees for domestic shipments sent to UK FCs (from a UK shipping address to a UK fulfillment center).
  • Up to 50% discount on APCP fees for domestic packages and palletized shipments shipped to Amazon facilities in France, Germany, Spain, and Italy.

Program Features

Aside from Amazon-facilitated cargo shipping, SEND also offers:

  • Seller Central Integration
  • FC locking enabling, which means your inventory will only go to a single FBA facility.
  • Customs clearance
  • Carrier rates negotiated by Amazon
  • Shipment tracking

Downsides of Using SEND

While SEND sounds like a cheaper and quicker way to get your goods to the UK, it has a few disadvantages that should be taken into consideration when making a decision.

  • Letting Amazon take over your supply chain may not be a good idea. What happens when things suddenly go south, and you don’t have a contingency plan? Shipping delays are almost always a guarantee, especially during peak season. That’s why it would be wise to set aside some extra stock in your backup 3PL or supplier’s warehouse for emergencies, instead of just putting your entire inventory in one basket, especially when that basket is Amazon.

Related:How to Ship to Amazon FBA (And Speed Up Check-in Times)

  • Can’t use your preferred carriers. When using APCP, you will be limited to carriers available within Amazon’s shipping network. You might have to spend extra time vetting those carriers you haven’t worked with before or pay a bit more to hire established carriers.
  • Amazon may use your supplier information to their advantage. If you’re a top seller, chances are, Amazon’s already keeping a close eye on you. Similar to how they allegedly use seller data to develop competing products, they may use SEND to take a peek into your supplier information and undercut you by working with your supplier to create copycats.
  • Amazon may just deliver your cargo from China to UK without checking it. Although not exactly a downside, as inspection is the seller’s responsibility, it’s still something that should be considered to prevent check-in delays at FBA. Amazon may also refuse to accept damaged or defective units. So, before handing your shipments over to Amazon, consider requesting detailed photos of your products and packaging labels from your supplier. Check if the goods meet your quality requirements or are packed correctly to minimize damage during transport. You may also hire a 3rd-party inspection company in China to do these things for you so that your supplier will be less likely to try and cut corners to save money.

In closing, hopefully this post has addressed the advantages and disadvantages of SEND or using APCP in general.

If you still want to give SEND a go, log in to Seller Central > FBA Inventory Dashboard > Select Product(s) > Send/Replenish Inventory to Amazon > Confirm Shipping > Amazon Partnered Carrier.

Or, click here to learn more about the program.

Sellers Feel the Squeeze After Amazon Announces US MCF Fee Hike

Sellers Feel the Squeeze After Amazon Announces US MCF Fee Hike

Amazon decided to be the Grinch who spoiled the holidays for US sellers after announcing major fee changes to its Multi-Channel Fulfillment (MCF) program. 🫣

Sneaking Fee Increases Just Before Christmas

On December 20th, the eComm giant said they will update their US MCF fees to reflect the recent improvements they have made to offer sellers:

  • Faster shipping times (from 7 days to 5 days)
  • Advanced shipment tracking capabilities and IT security systems
  • Free MCF integrator apps for Big Commerce, Adobe Magento, and Wix

⚠️ The updates will take effect on January 19, 2023.

It seems to us that these improvements most impact customer experience rather than seller benefit. While sellers may feel the effects of faster shipping times, it probably won’t be nearly as much as they’ll feel the strain on their profit margins. 

On the Forums page, one seller commented that these adjustments would increase the cost of MCF by a whopping 37% for them. Currently, a 5 oz large standard item costs $5.35 to ship, but in 2023, the fee would climb to $7.35 per unit, making MCF an expensive fulfillment method for many sellers. 🤦‍♀️

Here’s a quick look at how Amazon’s fee adjustments will increase MCF costs for Standard 3-5 Business Days Shipping in 2023:

Size TierCurrent Rate Card (As of August 16, 2022)New Rate Card for January 19, 2023 and after
Small standard 2 oz or less$4.75$7.15
Small standard 2+ to 6 oz$5.35$7.15
Small standard 6+ to 12 oz$6.20$7.80
Small standard 12+ to 16 oz$7.45$8.25
Large standard 2 oz or less$4.75$7.35
Large standard 6 oz or less$5.35$7.35
Large standard 6+ to 12 oz$6.20$8.20
Large standard 12+ to 16 oz$7.45$8.50
Large standard 1+ to 2 lbs$7.65$9.50
Large standard 2+ to 20 lbs$7.65 + $0.46/lb above first 2 lb$9.50 + $0.62/lb above first 2 lb
Small oversize 2+ to 30 lbs$12.50 + $0.46/lb above first 2 lb$16.00 + $0.62/lb above first 2 lb
Small oversize Over 30 lb$24.70 + $0.46/lb above first 30 lb$32.88 + $0.62/lb above first 30 lb
Medium oversize$20.20 + $0.51/lb above first 2 lb$25.25 + $0.62/lb above first 2 lb
Large oversize$103.39 + $1.05/lb above first 90 lb$118.80 + $1.16/lb above first 90 lb
Special oversize$171.99 + $1.10/lb above first 90 lb$189.19 + $1.21/lb above first 90 lb

As you can see, Amazon has also made a few adjustments to its weight tiers. Both “2 oz or less” and “2+ to 6 oz” tiers now fall under a single new category: 6 oz or less. 🤔

So, any small standard item weighing less than 6 oz, for instance, will now cost you $7.15/unit to ship via MCF, a $1.80 to $2.40 per unit increase from the current rates.

If you’re using MCF for small and low-cost products (under $20), you might have to rethink your fulfillment strategy to stay profitable next year. You could raise your prices to account for this fee change, switch to FBA Small and Light to take advantage of reduced fulfillment costs, or incentivize shoppers to buy multiple units in one order so you can qualify for MCF shipping discounts.

Related: Amazon Announces Unbranded Packaging for MCF Orders

Tiered Discounts on Multi-Unit Orders 

If the cost of shipping a single item is too steep for you, consider giving out discount coupons or bundling items to encourage customers to increase their units per order – for example, get 10% off with a minimum purchase of 3 items.

According to Amazon, when your MCF order has multiple units, you’ll receive up to 50% discount on your fees. 

Suppose you’re shipping a 4-unit small standard 6 oz or less order. In that case, you’re going to be charged $3.72, which is 50% less than what you’d be paying for per 1 unit order. 

Here’s how discounts will be applied to standard shipping multi-unit orders.

Go to Amazon Supply Chain to view the latest US MCF rates for expedited and priority shipping.

These price hikes are obviously squeezing every penny out of sellers. And if they continue to increase with little room for adjustment (amid soaring gas prices and inflationary pressures), Amazon might just become too expensive not only for sellers but also for customers, forcing them back to shopping in-store or to look for alternative online marketplaces.

If you have any feedback on these updates, send an email at
[email protected].

You can also visit Multi-Channel Fulfillment for more details.

Related: Amazon Hikes FBA Fees Again: What This Means for Your Business

Walmart Launches New Ways to Find and Buy Products

WALMART INTROS NEW WAYS TO FIND & BUY PRODUCTS

🙌 Amazon may be the undisputed eCommerce leader, but Walmart is catching up by introducing two new ways to find and shop products online.

TrendGetter

Announced on December 8, TrendGetter is a platform equipped with image recognition technology that lets you:

  • Upload or take a picture of an item you want to buy.
    Often, shoppers browse through their TikTok or Instagram feed and find trending products that don’t have shoppable links or come with a hefty price tag. Luckily, they can now go to TrendGetter to add photos of their must-haves and then let the platform’s visual AI tech offer an exact match or similar items at affordable prices on Walmart.com.
  • Select and buy products in seconds.
    Once a product is found, buying is as quick as a few button clicks.

While Walmart just released this unique way of shopping online, the technology has been around  for some time. In 2020, Amazon launched StyleSnap, where customers can upload a picture of the product they’re looking for in order to find and buy it in just a few clicks instead of scouring Google search for information. 

Then in 2022, Amazon Fashion and Snap took things a step further by offering an AR-powered shopping experience on Snapchat through AR lenses that allow people to virtually try on sunglasses.

Given how ahead Amazon is in transforming eComm with artificial intelligence, it’s not surprising to find Walmart launching AI-powered features to change the way customers shop on their website in an attempt to level the playing field.

“We know our customers are searching for what they love at can’t-miss prices. Now, whenever you find a product you love, you can easily search for a similar item at Walmart’s everyday low prices and purchase as soon as inspiration strikes,” Walmart said in a statement.

Text to Shop

Walmart has also recently added a text-to-shop functionality to their eComm site and app so that customers can “shop as easily as texting.”

New users with an Apple or Android device can sign up for an account to get started. Existing eComm shoppers can simply log in to their Walmart account and follow the instructions to get their phone set up with Text to Shop.

Once you’re all set, you can start adding items to your cart with a text or voice text. The AI shopping assistant will then give you the most relevant search results so you can find the best match(es) easily.

Text To Shop was also designed to remember your previous buys so you can quickly update your cart with your favorite products with a text message. This allows for faster and smarter reorders, helping you save time.

“Between balancing your busy schedule, performing at work, managing your household, preparing meals — and ensuring you’ve got everything you need, when you need it — you’ve got a lot going on,” Walmart’s VP of Conversational Commerce, Dominique Essig, said in a statement.

“At Walmart, we know that keeping track of your household shopping list is often a mental task you manage as you go about your day. That’s why Walmart is excited to offer our customers a new and convenient way to shop — by simply texting us.” 

Enhanced Version of Alexa

Walmart’s Text to Shop is similar to Amazon’s Alexa in that both AI assistants let you create shopping lists, but the similarities end there.

Walmart took a step further by making Text to Shop capable of remembering and offering items you’ll want to buy next based on your shopping history, and allowing you to set a time for home delivery or store pickup rather than just creating a list.

When grocery shopping with Alexa, for instance, it just helps you make a list, but it doesn’t know the brand names you usually purchase. Unless you specifically said “add Quaker Instant Oatmeal to the list,” it’d just add oatmeal.

Text to Shop, however, will already know what you usually buy, including serving size (e.g., 40 oz oatmeal bag), and suggest Quaker when you text for oatmeal.

And if you’re looking for something you haven’t purchased before, simply text Walmart the product name or information (in as little as one word) and the app will provide you with a few options to select from. 

Overall, these advanced AI features may help narrow the gap between Walmart and Amazon. Customers who lead a very busy life may find Walmart the most convenient way to shop online – either by adding a photo of the product they’re looking for to TrendGetter or sending Walmart a text message via Text to Shop.

Related: Walmart and Amazon Battle for Dominance Intensifies, Should You Be Selling on These New Channels?

4 New Amazon Seller Tools to Accelerate Business Growth

4 New Amazon Seller Tools to Accelerate Business Growth

In case you missed it, Amazon recently introduced multiple seller tools designed to aid you in growing your business quickly. 🚀

FBA Small and Light Recommendations

Amazon’s Growth Opportunities program continues to expand with indications of eligibility for Small and Light (SNL), an FBA program that offers fulfillment discounts on eligible compact and low-cost products. Based on current eligibility requirements, items weighing up to 3 lbs and priced under $12 may be qualified for the program.

With FBA Small and Light Recommendations, you can now:

  • Discover and review products that are eligible for enrollment in SNL so you don’t miss out on potential savings. For instance, if you’re selling a 4 oz product that’s qualified for SNL, you will only pay $2.47 fulfillment fee per unit, $0.75 less than Amazon’s rate for non-SNL items weighing 4 oz or less.
  • Use sales metrics to figure out which SNL products will deliver the best return on investment possible.
  • View Amazon’s recommendations for your business in the Explore Selling Programs page.

This could be a quick win for sellers giving them an easy way to identify products that are eligible for SNL. Qualifying for the program could also give them more room to adjust their prices, especially after Amazon recently announced they will be raising FBA fulfillment fees again next year.

To get started, go to Product Recommendations > Top 50 Opportunities > Enroll in FBA Small and Light.

Account Health Assurance

Launched on November 16th, Account Health Assurance (AHA) helps sellers who maintain a high Account Health Rating (AHR) avoid automatic account deactivation when they encounter an issue. This new benefit basically allows them to keep their selling privileges while working on getting any issues resolved with Amazon.

Sellers who maintain an AHR of 250 for at least 6 months (except seasonal businesses) are automatically enrolled in the program. Suppose your account is at risk of deactivation due to policy violations, an Amazon rep will reach out by phone or email and provide you with recommendations for addressing the problem within 72 hours.

While AHA can be a helpful account deactivation risk alert tool, meeting or exceeding the 250 AHR threshold to be eligible may be quite steep for budding micro businesses that nevertheless have a good track record.

According to some sellers on the Forums page, one would need around 14 orders each day without any violations for 6 months to reach the 250 AHR cap, essentially putting smaller sellers at a disadvantage. So, either they have to significantly increase their daily order volume to hit (and maintain) the target or Amazon has to update its metrics to account for these micro brands.

As of this writing, the AHR formula only tracks order volume and violation count and type. For example:

  • 200 is base AHR score with no infractions
  • Assuming no infractions, to increase your score, you would have to fulfill 50 orders to gain 1 point. Simply put, 1 point for every 50 orders in 6 months.
  • 204 AHR = 200 orders in 6 months
  • 250 AHR = 2,500 orders in 6 months
  • 1,000 = 40,000 or more orders in 6 months

In sum, AHA seems like a great tool for those who at least have 250 AHR, although its limitations may exclude some micro sellers who don’t want to go big or those that otherwise may have qualified if the AHR formula also takes the type of product (large appliances, luxury goods, among other niche items that are less likely to get sold 14x a day but enough to turn a profit) into account.

Related: How Does Amazon’s Account Health Assurance Work – And Is There A Catch?

Group Buyer-Seller Messages into Cases (UK Sellers)

Keep your interactions with the same buyer organized!

Group buyer-seller messages into cases instead of forming an ongoing thread.

For instance, once a buyer’s issue or question is solved, you can mark the “case” as resolved so that when that same buyer communicates with you again in the future, the interaction will start as a new case.

This new feature also allows you to sort messages by order and topic, making it easier for you to address concerns, which is essential in keeping shoppers satisfied with your customer service.

You can opt-in to this new feature by clicking the Messages Inbox banner.

Related: Amazon Now Allowing Email Marketing Campaigns to Repeat Buyers

Express Payout

Announced at Amazon Accelerate 2022, Express Payout is a new payment service that lets you receive deposits within one day (even on Sundays) rather than waiting 3 to 5 days on Automated Clearing House (ACH) transfers.

This is a huge deal for small and medium-size sellers that need to access their funds quickly to be able to buy additional inventory or fulfill any financial obligations owed to suppliers, aka inventory payments.

Who is Eligible for Express Payout?

US sellers must have the following to be eligible for the payment service:

  • An in-network US bank account
  • A primary address in one of the 50 states. Those in US territories are not eligible.
  • Transactions of $1 million or below at the time of payment initiation

Service Fees

Express Payment is available to US sellers for free until September 2023. After the promo ends, Amazon will charge a $0.50 flat fee per transaction. 

Visit the FAQ page for more details.

Bonus: Make last-minute changes to your product descriptions and brand story features to boost product visibility and sales this Q4 with A+ Content Practices Best Guide.

Amazon Will Pay Customers $2 per Month to Track Their Ad Data

Amazon Will Pay Customers $2 per Month to Track Their Ad Data

Amazon is offering some select shoppers in the UK and US monthly monetary rewards for access to their ad data in an effort to improve personalized ads, a major growth area in Amazon’s booming ad business. 💰

Personalized ads have been found to have a higher click-through rate than other types of ads. In fact, a 2018 study from Epsilon showed 80% of shoppers are more likely to buy from a brand that offers personalized experiences. And in exchange for better user experience, 90% of customers are willing to share their personal behavioral data with companies, according to SmarterHQ.

But if provided with several offers from various pay-for-data apps, will they still choose Amazon and do it for $2 per month? You’re probably thinking it’s better than nothing. Afterall, many people are already trading their data for free apps like Google Search, Facebook, or Gmail, except that they’re not getting paid for it.

How Ad Verification Works

Ad Verification Program

Some members of the Amazon Shopper Panel have been invited to opt into Amazon’s Ad Verification program, which if enabled on their phones, will allow the tech company to monitor:

  • What ads users saw
  • Where they saw them
  • And the time of day the ads were viewed

The program tracks Amazon’s own ads and ads from third-party businesses that advertise through the company’s ad platform.

On the one hand, Ad Verification may be able to provide sellers with a vast trove of data about their customers’ shopping patterns, allowing them to target buyers at the exact moment they’re most likely to buy.

On the other hand, not only will this program help boost Amazon’s ad revenue, but the company could also use its access to people’s phones to identify and develop trending products for its own private label division – products which could compete with sellers’ own offerings.

Related: Amazon Reduces Their Private Label Catalog Amid Mounting Regulatory Pressure

Implications of Selling Your Data to Amazon

While it’s good that participants will get something in return, some industry experts can’t help but feel skeptical about Amazon’s ad data collection program, given the company’s penchant for questionable data mining tactics. 🤔

Some think that $2/month is too small in comparison to other pay-for-data apps that offer up to $50 per year, while others have data privacy concerns.

In a comment to Retail Wire, Ryan Mathews, Founder and CEO of Black Monk Consulting, said: 

“Amazon telling consumers their ad data is worth something is a good move. Telling them it’s only worth $2 a month is an insult to their intelligence. Maybe $24 a year is a fair price for privacy in some people’s heads – it clearly is in Amazon’s – but I think the lack of participation and potential consumer and regulatory feedback will cost Amazon more than it will gain.”

When asked to comment on privacy concerns, an Amazon representative pointed Business Insider to Amazon Shopper Panel’s FAQ page and the retail site’s privacy notice, noting that participants can quit the program at any time. 

Another concern raised by some experts is that the program may also suffer from some degree of self-selection bias (people select themselves to be included in a program, survey, or research, resulting in biased sample data). ⚠️ Therefore, when only those who like trading their data for a fee choose to opt in, the sample may leave out other demographics that could be just as, if not more, important or relevant to Amazon and third-party sellers, i.e., the big spenders.

For shoppers interested in joining Ad Verification, it would be best to consider the value of the data you’re trading versus what you’re getting in return and whether or not you’re the right demographic for the program.

For sellers, additional first-party data from Ad Verification may help them refine their ad strategies, especially at a time when ads are increasingly getting more expensive – might as well get your money’s worth with high-performing personalized ads – not to mention more restrictive

However, the program is still in its early stages so its impact on Amazon Ads remains to be seen. Amazon may also have to ease people’s biggest concern first – how it handles customer data – in order to attract more participants to the program and reduce scrutiny from antitrust watchdogs. 👀

Related: Amazon Agrees to Final Deal to Close EU Antitrust Probes

Updated: EU Advised by NGOs to Refuse Amazon’s Flawed Proposal for Antitrust Settlement

EU Advised by NGOs to Refuse Amazon’s Flawed Proposal for Antitrust Settlement

Update 12/06/2022: 🙌 Three years after Brussels launched an investigation into whether or not Amazon uses seller data to conduct anti-competitive practices. The EU Commission has reportedly reached a final deal with the eCommerce company, according to the Financial Times (FT).

👌 Amazon has agreed to:

  • Boosting the visibility of competing products by giving them equal treatment on the platform’s Buy Box.
  • Creating an alternative featured offer for shoppers where the speed of delivery is less important. This means customers, including Prime members, will no longer be locked into Amazon Logistics.

These commitments show how other tech giants Alphabet, Apple, and Meta will have to comply with the EU’s Digital Markets Act, a pan-EU legislation that aims to ensure that platforms behave in a fair way online.

The EU Commission plans to make an official announcement on the 20th of December, noting that the date could still be changed, FT said.

I’m sure this will be a win for many sellers but time will tell as to how significantly the impact will be felt in the end. The Buy Box victory could be a big one in theory but we had hoped to see something around prohibiting the use of seller data for Amazon’s own branded product development. 

After three years, the results seem a little lackluster but I don’t think we expected anything too mindblowing here. However, the EU seems to always be several steps ahead of the US in terms of fair practices towards sellers so we’ll give kudos there and wait to see how it all actually rolls out in the marketplace.

🇪🇺 Twelve civil groups called for the European Commission to reject “outright and in full” Amazon’s proposed changes to its business practices in Europe in order to resolve the two antitrust investigations formally opened by the Commission against the eCommerce giant.

The commitments that Amazon offered including their use of third-party seller data and non-discriminatory access to Buy Box and Prime have been criticized as “weak, vague and full of loopholes” by a dozen civil and digital rights associations, non-governmental organizations and labor unions.

These organizations include:

  • Austrian Federal Chamber of Labour (AK Europa)
  • Balanced Economy Project
  • Digitale Gesellschaft e.V.
  • European Public Services Union (EPSU)
  • Foxglove
  • Goliathwatch
  • FairVote UK
  • LobbyControl
  • Simply Secure
  • Center for Research on Multinational Corporations (SOMO)
  • UNI Europa
  • WEED (Weltwiommitmertschaft, Ökologie & Entwicklung e.V.)

How it All Began

In a press release dated 17 July 2019, the Commission announced its first antitrust investigation against Amazon to examine if its use of data from the independent sellers on their platform have violated the bloc’s competition rules.

Commissioner Margrethe Vestager, who handles competition policy, said she will closely examine the company’s business practices and its “dual role as a marketplace and retailer”, to guarantee healthy retail competition levels, diverse product choices, and competitive prices for consumers in the European market. 

Sixteen months later, the Commission announced in another press release that it has sent a Statement of Objections to Amazon after its initial findings revealed the company had violated the EU’s competition rules by using the private business data of its marketplace sellers to drive Amazon’s own business decisions, resulting in unhealthy, distorted competition. 

Vestager said Amazon utilized big data to “illegally distort” competition in eCommerce markets and take advantage of its market position in France and Germany, its two biggest EU markets. 

The Commission also announced it is opening a second investigation into the company’s potentially biased practices regarding their own product offers and those of sellers who choose Amazon’s shipping services.

The first antitrust investigation stemmed from a sectoral eCommerce review conducted by the EU’s competition division way back in 2015. The Commission itself started probing on whether Amazon sellers were being placed in an unfavorable position by the company in 2018 – given its ability to access their business data. 

Amazon’s Response

Amazon came up with a list of voluntary commitments to adjust its business practices in the EU and address the Commission’s antitrust concerns.

These commitments show Amazon’s determination to end the ongoing antitrust investigations by the European Commission while it is facing increasing criticism and pressure from different law-making bodies all over the world, mostly about the misuse of its independent sellers’ business data for its own profit. 

Should the Commission accept Amazon’s offer, the proposed commitments will be effective for a five-year period and enacted across the bloc except for Italy, which has already fined Amazon over $1 billion for exploiting its position in the market.

Any breach of the commitments will result in the eCommerce giant paying up to 10% of its worldwide revenue as penalty. 

Dated July 7, 2022, the commitment proposal includes changes to:

  • Amazon’s use of marketplace seller data. Amazon will not use the data linked to, or sourced from, the business operations of the sellers on its marketplace for Amazon’s own retail business that is in competition with said sellers. 
  • Amazon’s Buy Box winner selection and competition. Amazon will be fair to all sellers in evaluating their Buy Box offers; the company will also put a second competing offer to the Buy Box winner that is significantly different from the winner in terms of cost and/or shipping.
  • Amazon’s Prime qualifications and shipping. Amazon will establish fair requirements for sellers and products to qualify for the program. Prime sellers will also have the freedom to choose their own courier and discuss matters directly with their chosen logistics provider. The company will also not use any data regarding external logistics providers’ terms and activities derived from Prime.

The Commission sought feedback from the public regarding these commitments from July 14 to September 8.

Reasons for Rejection

In a statement, the twelve organizations pointed out that the commitments Amazon offered are susceptible to avoidance and abuse by the company. 

They argued that most of the commitments Amazon offered will be included in the Digital Markets Act (DMA), an upcoming pan-European legislation, that will change the EU’s strategy related to ensuring competition in Big Tech.

DMA will impose certain regulations for “gatekeepers” who are oftentimes accused of misusing data and showing preferential treatment.

Comparing the DMA and Amazon’s offer, the group said the new law – which is expected to take effect next year – is more comprehensive and will be imposed by the Commission instead of Amazon itself. The signatories do not agree that a private company should propose voluntary commitments that resemble the stipulations from an upcoming European law. 

Amazon’s suggested five-year validity period or any time period at all is also deemed “unjustifiable.”

The fact that it is Amazon itself defining the terms of their proposed commitments ultimately undermines the European Commission’s authority, which, clearly, the civil groups have picked up on and are rallying against. 

The group collectively urged the Commission to persist in pursuing its antitrust investigations against the company and enforce the necessary resolutions and sanctions on its own terms. They also requested the Commision to demand from Amazon a separation of its marketplace, retail, and delivery operations to tackle issues relating to its superior position and influence in interconnected services.

Impact on Amazon’s Future Operations

The ongoing EU probe, not to mention the impending US antitrust law called the American Innovation and Choice Online (AICO) Act (S.2992), could have significant repercussions on Amazon’s operations worldwide. ⚠️

These issues could force Amazon to rethink their use and level of access to the private data of their marketplace sellers in the bloc, US, and other regions that may follow suit. 

Should US lawmakers pass the AICO, for example, Amazon could be penalized by the US government and antitrust bodies if found to have used their marketplace seller’s data to produce a similar product to intentionally compete with their third-party sellers. 

Amazon already previously announced the reduction of their private label (PL) catalog items earlier this year due to low sales and possibly to avoid penalties under AICO.

Since its launch in 2009, Amazon’s PL business has been criticized for giving the company an opportunity to compete and highlight their own products over the independent sellers’ on their platform through a manipulation of their own search algorithms.

As a data-driven company, these laws will compel Amazon to rethink its current business model if it wishes to remain a trusted, relevant leader in the eCommerce environment.

Amazon Announces Unbranded Packaging for MCF Orders

Amazon Announces Unbranded Packaging for MCF Orders

📢 Amazon announced on December 3rd that sellers can now ship all Multi-Channel Fulfillment (MCF) orders once again in brand-neutral packaging, but this time, at no extra cost.

In 2016, the eComm giant inexplicably removed unbranded packaging from its paid FBA services and thereafter Walmart started suspending sellers guilty of using branded boxes or logistics services from its competitors because it was (and still is) against the company’s policies to fulfill Walmart orders in Amazon-branded boxes or to use Amazon Logistics for fulfillment.

In 2020, Amazon brought the program back under a different name – MCF Blank Box Order Fulfillment – but it was only available to a select group of sellers.

And just this month, Amazon announced a wider roll out of unbranded packaging service and started shipping MCF orders in plain cartons or poly bags at no additional cost.

This is especially helpful for sellers who may want avoid using Amazon’s branding when shipping to customers from competing sales platforms.

What changed?

Increasing Competition

The reintroduction of unbranded packaging may be Amazon’s answer to rivals catching up. As previously reported:

  • Walmart is rapidly branching out into eCommerce after dominating the brick-and-mortar space for decades. Over the last two years, it launched its own fulfillment service for third-party sellers, opened its online marketplace to non-US based sellers, and expanded its display ads program, Search Brand Amplifier, to take on Amazon.
  • Shopify has also spent the last two years building out its own fulfillment network. It has recently acquired Deliverr to be able to compete with Amazon Buy with Prime.
  • Alphabet continues to expand its suite of eCommerce tools to turn Google into an online shopping site and transform YouTube into a live shopping platform, allowing them to stand toe-to-toe with Amazon, Shopify, and Walmart, as well as social commerce giants TikTok and Instagram.
  • Chinese tech giants Pinduoduo, Shein, and TikTok have also recently entered the US eComm market.

Clearly, the battle for dominance is no longer just between Amazon and Walmart. Sellers now have more diverse marketplace options to expand their businesses into – all the more reason for Amazon to try to keep hold of Walmart, Shopify, or Google orders to maintain dominance and more importantly, to hold on to your MCF data.

Gain Access to Valuable Intel

The termination of brand-neutral packaging in 2016 worked greatly to Walmart’s advantage as it helped them to keep their data from the prying eyes of Amazon.

As we’ve explained before, Amazon uses your MCF volume when calculating your Inventory Performance Index (IPI) score and restock limits. Additionally, when you fulfill orders from Shopify through FBA MCF, for instance, Amazon also gains access to your off-Amazon sales and customer data – extremely valuable information that they could use to:

  • Size up and fend off the rise of their rivals
  • Develop their own private label brands
  • Remarket Amazon products to shoppers from other platforms

Realizing the significant amount of intel that Amazon lost from removing unbranded packaging may have prompted them to gradually bring the service back.

And to make sure you stay compliant with other marketplaces’ policies, Amazon now automatically ships all MCF orders in plain boxes or poly bags. 

Unbranded packaging is available for eligible sortable items. Non-sortable goods, footwear, apparel, and any products heavier than 50 lbs (rounded off) or bigger than 56 inches are not eligible and therefore, cannot be shipped in brand-neutral packaging.

If, however, a certain marketplace prohibits you from using Amazon Logistics for fulfillment (like Walmart and eBay), MCF has a paid service that lets you add the option to block orders from being shipped by Amazon. 

Even though Amazon provides this option to circumvent certain delivery, we still wouldn’t recommend using FBA’s MCF for Walmart as the channel is strictly against it and has ways of tracking down whether you may be violating their policies. Walmart seller accounts have been shut down for doing this so it is best not to take on the risk.

But overall, launching unbranded packaging is a smart move for Amazon that not only allows them to get their hands on some valuable data, but could also keep you dependent on MCF and make FBA look more attractive to non-Amazon sellers.

Amazon Storage Limit Manager: Would You Pay for Extra Storage Space?

Amazon Storage Limit Manager: Would You Pay for Extra Storage Space?

Sellers can now buy more FBA storage space, but is it worth it? 🤔

What is Storage Limit Manager?
Introduced in February 2022, Storage Limit Manager (SLM) is a program that offers sellers with Inventory Performance Index (IPI) storage volume constraints a way to request for extra storage at potentially no additional cost.

Note: IPI storage volume limits must not be confused with restock limits, which is an Amazon inventory restriction based on storage units (e.g., 4 months’ worth of inventory), not storage space (e.g., 2,000 cubic feet).

When Amazon lowered the IPI threshold from 450 to 400 in January, we knew a service like SLM was imminent.

There are already sellers paying for Vine reviews and other Amazon programs. Around 10% of FBA sellers would be subjected to storage volume limitations with the recent IPI change. Thus, there was an opportunity to offer a pay-to-play service that lets eligible sellers bid for additional space.

Is Storage Limit Manager an example of Amazon making rules so they can create programs to allow you to pay to break those rules? 🤦‍♀️

While you could benefit from extra storage, you need to have the right processes and systems in place to efficiently use that space and minimize storage fees. Otherwise, it would just be an added expense.

⚠️ So, before pulling the trigger, consider the facts below.

How It Works

  1. As of December 2022, the service is only available by invitation to US sellers with an IPI score ranging from 350 to 400. We don’t know if “by invitation” means Amazon is sending out invites to everyone within the required IPI score range or to some pre-selected sellers within that range.

    In order to apply for a storage limit increase, go to the Storage Limit Manager in your seller account and see if you have the ability to submit storage limit increase requests through their portal.

    If you do not but you believe you are qualified, it would be best to contact Amazon to try to gain access to this program. But before you do that, be sure to read the rest of this article to know what you’re getting yourself into.
  2. When creating a request, you can specify how much additional space you need (up to 20% of the original limit) for a specific quarter and the maximum reservation fee you’re willing to pay to reserve it. You may request additional storage increases for standard-size, apparel, oversize, or footwear storage types.
  3. Amazon reviews their fulfillment capacity weekly and grants requests until all available space has been allocated. Seller(s) with higher bids are likely to get approved for storage increase more quickly.
  4. If granted, you will then be committed to the reservation fee specified in your request. However, depending on your inventory performance over that time, some or even all of that fee may be waived. More on that below. 

Now, let’s look at the pros and cons of Storage Limit Manager.

Pros

  • May help improve IPI score. If you’re eligible, you can use the additional storage space to boost sales. And as your sales increase, so will your IPI score, taking you closer to unlimited storage in the succeeding quarters. 
  • Only pay what you can afford. Again, you have complete control over how much you’re willing to pay for the additional space you need.
  • Lowest reservation fee guarantee. Your fee may be lower or equal to the amount indicated in your request. For sellers whose storage increase requests are approved in the same week they applied, similar to how PPC bids work, Amazon could apply a lower reservation fee than your suggested reservation bid.
  • Qualify for performance credits to reduce fees. These are monetary credits earned from sales made using the additional storage space. You’ll earn $0.15 per dollar of sales and they will be used to lower your reservation fee.
  • No upfront payment required. Only pay the reservation fee (if there’s any remaining) after your target selling period.

Cons

  • Amazon grants requests starting with the highest bidder. You may need to gamble a good amount of your working capital to increase your chances of getting approved, especially if you’re on a tight deadline. Otherwise, you may have to wait for weeks before getting the storage increase you need.
  • Under pressure to move inventory as quickly as possible. You only have a quarter to sell through inventory and earn enough performance credits to reduce or eliminate your reservation fee. To achieve that, you may need to run flash sales, buy more ads, or generally have a solid marketing plan. If not, you will be “responsible for the remaining balance (reservation fee minus performance credits)” at the end of your target selling period.
  • Not for everyone. You may be eligible for the program, but if you’re not confident that you can utilize the additional storage space efficiently and offset your fee with performance credits, it may be wise to not proceed and to instead explore other options.

If gaining additional storage space will really help your business, but you’re anxious about the cost, consider doing some math first.

IPI Storage Limit Increase Calculator

Thankfully, Amazon has provided sellers with a downloadable calculator that allows you to estimate performance credits and payments based on performance credits earned.

Estimate Performance Credits

  • Inside the spreadsheet, enter your storage and sales information, such as storage type, initial FBA storage limit (cubic ft), and desired storage limit increase to calculate your estimated sales for the target period in your selected storage type. Amazon recommends keeping your storage increase request within 20% of your initial limit. This is perhaps to ensure efficient use of the added storage space.
  • Based on the information above, Amazon automatically calculates your:
    • Increase ratio (up to 20%)
    • Sales qualified for performance credits (increase ratio x total estimated sales)
    • Estimated performance credits ($0.15 x sales qualified for performance credits)
    • Estimated performance credits per cubic foot (performance credits / storage limit increase)

    Estimate Payments Based on Performance Credits Earned

    There are three different sales scenarios that show the amount of performance credits you should earn to offset a portion or 100% of your reservation fee. 

    • Sales 20% below estimate – Sales below this percentage will result in fees. 
    • Sales equal to estimate – You’ll pay no reservation fee.
    • Sales 20% above estimate – You’ll pay no reservation fee.

    Ideally, you need to keep your sales right on or above 20% of the estimate to be able to fully offset the reservation fee.

    Run multiple calculations so you can find the best possible scenario for you. Don’t forget to factor in the other expenses that will go into moving that additional inventory like marketing, logistics, and fulfillment fees. Then, compare the estimated total cost with alternatives like Fulfilled by Merchant (instead of FBA) or Amazon Warehousing and Distribution to figure out which path is best to pursue for your business. 

    Updated: Bad Actors Book Multiple Inbound Amazon Delivery Dates to Create Scarcity

    Bad Actors Book Multiple Inbound Amazon Delivery Dates to Create Scarcity

    Update 12/02/2022: The struggle to secure appointments at FBA continues! 🚨

    In a LinkedIn post, Ephraim Ausch, Chief Logistics Officer at Tactical Logistic Solutions, shared that Amazon is routing a lot of FBA shipments to a new fulfillment center (FC) called QXY9 instead of LAX 9. Worse, still no delivery dates are available for the remainder of December, thanks to the scalpers! 🤦‍♀️

    Amazon Delivery Appointment Dates Update LinkedIn

    Ausch has already called on Amazon to stop the people that are selling delivery dates for large sums of money.

    🤝 The Amazon seller community can also help out by sending over any proof of the alleged scalping incident to Jeffrey Cohen, Tech Evangelist for Amazon. On Ausch’s thread, Cohen personally called out for evidence that can be forwarded to Amazon during their investigation. The scammers are reportedly bundling these appointments with their trucking services or offering them “a la carte” to desperate sellers.

    If you have any proof of these incidents, please reach out to Cohen to help with this matter. 

    We’re hoping for a quick resolution to this ongoing issue to help ensure that sellers who fight fair and square will have a successful holiday season. 💪

    A LinkedIn Post from Brandon Young, CEO of Data Drive & Seller Systems, reveals that full truckload delivery dates to fulfillment centers in Southern California and other locations are booked up until the end of December because bad actors have found a way to rig the system. 🤦‍♀️

    Brandon Young

    Malicious Concerted Action Against Competitors

    When we reached out for more details, Young told us he’s “seen through WeChat messages in Chinese seller groups that some are booking the appointments with the intent of creating scarcity and hurting competitors. They warned others to get appointments early to avoid also being hurt.” 

    This anticompetitive behavior puts many sellers at great risk of missing the holiday selling period. Top sellers from China and Hong Kong make up 63% of all third-party (3P) sellers on Amazon, while their Western counterparts only take up around 37% of the entire 3P marketplace.

    If a large number of Chinese sellers are in on the scheme, they could easily cause significant disruption to their competitors’ logistic operations, especially American sellers who make up 34.8% of Amazon 3P marketplace and have reportedly been gaining market share since November 2020

    Interestingly, California has the most number of sellers in the US, according to Ecomcrew. It is also one of the largest Amazon distribution hubs as west coast ports are most highly trafficked for Chinese shipments due to proximity. For these reasons, bad actors may have specifically targeted the Bear Flag state to ensure widespread disruption. 🤔

    The US economy showing signs of slowing down might be one of the key factors driving this ferocious competition among sellers. During a downturn, consumers set stricter priorities (essentials over non-essentials) and reduce their spending. 

    These challenges have caused some sellers to take drastic action. Sellers who aren’t keeping up with these economic shifts are facing declining margins, forcing some to lower their prices to attract more customers, while others resort to abusive practices to reduce competition, which could then lead to higher prices.

    However, rather than fighting for their market share fairly, some Chinese sellers are actively working to hurt their competitors, although some are not strangers to such extreme methods. In 2021, Amazon banned thousands of Chinese stores on its platform for review fraud, counterfeit products, sabotaging competitors’ listings, among other Terms of Service (TOS) violations.

    Related: How Sellers Can Compete Against China’s Amazon Dominance

    Truckers Extorting Sellers to Generate More Money

    Young also shared in his statement that some trucking companies are booking multiple free delivery appointments “with the intent of selling them back to desperate sellers.”

    The malicious truckers allegedly bundle the appointments with their delivery offers, while others just sell them as a stand-alone service for outrageous prices ranging from $500 to $2,000. 🤦‍♀️

    Amazon recommends sellers to get their holiday inventory checked in by December 1st to avoid delays. With a few days left before the deadline, sellers who haven’t secured any appointment yet due to the artificial scarcity created by these bad actors may find themselves either:

    • Giving in to one of these extortionists
    • Or, shipping small parcels at 5x to 10x the cost of truckload deliveries

    Not only will this add more stress on sellers (and their third-party logistics providers), but also take a huge bite out of their profits.

    In a comment to Young’s LinkedIn scoop, Ephraim Ausch, Chief Logistics Officer at Tactical Logistic Solutions, expressed frustration over the issue and shared, “Some locations are booked up till end of December! I know someone that paid $2,000 yesterday for LAX9 appointment… This has to be resolved by Amazon!”

    Hope for Resolution

    Currently, Young is gathering more information about the sellers and truckers hijacking Amazon’s delivery appointment system. Industry experts in his post’s comment section also recommend naming and reporting these bad actors so that Amazon can remove their appointments and ban them on the marketplace.

    The manner in which they’re able to game the system, whether by using some technology or buying intel from an Amazon employee, remains unclear. An internal investigation by Amazon will definitely help shed some light on the matter. 💡

    Jeffrey Cohen, Amazon Tech Evangelist for the eComm giant, works with sellers and looks to help to bridge the gap between Amazon and industry influencers, brands, and third party integrators, has already asked Young to email him all of the pertinent details so that he can share them internally for investigation.

    “I know that Amazon has been reaching out and trying to work with me on it as well,” Young told SoStocked. 

    “They acknowledge things need to change to ensure all sellers have the ability to send goods in a timely fashion,” he added.

    His post and the fast action within the community have helped to sound the alarms to make Amazon aware of this issue. 

    Our hopes are that it can be resolved very quickly and that the loophole be closed so that the holiday season will be successful for the many thousands of sellers who play by the rules.

    Note: This is a developing story. We will give updates on the situation as we learn more from our sources. 

    Related: How to Ship to Amazon FBA (And Speed Up Check-In Times, 3PL Logistics Backup for Amazon, 14 Mistakes Sellers Make When Shipping to Amazon FBA, Amazon Closing Shipping Loopholes May Wreak Chaos for Some Sellers

    Is Amazon Prepared for the Holiday Rush?

    Is Amazon Prepared for the Holiday Rush?

    Labor issues, rising costs, facility closures, bad actors rigging inbound FBA delivery systems, and persistent supply chain challenges grip Amazon, leaving many sellers wondering whether the eComm giant is really prepared for the holiday rush. 🤔

    It’s Not All Doom and Gloom

    Amazon’s record-breaking BFCM sales are a beacon of hope amid all the doom and gloom. 

    The retailer said on Wednesday that this year’s Thanksgiving-BFCM shopping weekend, aka Turkey 5, was its “biggest ever,” with shoppers ordering hundreds of millions of products during the sales period. 💰

    Amazon did not disclose the sales figure for its Turkey 5 weekend, but data from Adobe Analytics show customers shelled out $9.12 billion online on Black Friday, a 2.3% increase from last year, while Cyber Monday sales grew 5.8% to $11.3 billion.

    This suggests people are ready to splurge again and comb through Amazon for deals, thanks to deep discounts from sellers. In addition, this shopping trend may continue through December as customers are still not done with holiday shopping, according to the National Retail Federation (NRF). This indicates more purchases in the weeks ahead – all the more reason to be extra prepared for the rest of the holiday season. 

    Months-Long Preparation

    For Amazon, the holidays may be short, but preparation begins a few months in advance.

    Amazon has been preparing for Q4 since August when it brought back restock limits. With this change, sellers can only send up to four months’ worth of inventory, allowing the company to ease pressure on its warehouses ahead of the holiday rush.

    In October, Amazon announced it’s hiring 150,000 US workers to “help deliver great holiday experiences” (and possibly to replace the 80,000 employees the company lost to attrition). The jobs include stowing, picking, packing, sorting, and shipping customer orders, among others.

    The mass hiring began as the eComm giant geared up for major Q4 events, such as Prime Early Access Sale in October, Turkey 5 in November, and Christmas/Year-End Sales in December.

    Amazon distribution centers typically see a significant increase in their deliveries during this period. For instance, a new facility in Ashland only delivers about 15,000 packages in Missouri during off-peak, but that number could rise to more than 23,000 packages per day during the holidays. Therefore, hiring additional workers is a crucial part of the company’s holiday preparations.

    “We have spent the last couple of months preparing for this time,” Aaron Pondrom, owner of Frontline Logistics, told Komu, a local TV station in Missouri.

    “We’ve been actively hiring within our community to hire good drivers in order to deliver for this time of the year,”

    Although Amazon is looking to employ 150,000 warehouse associates for Q4, it also plans to lay off 10,000 corporate employees to cut costs starting in December. This may sound concerning given that they’re doing it during such a crucial time of year, but holiday orders will not be affected, according to Ofori Agboka, Amazon’s VP of People, Experience & Technology, Global Operations.

    “In our operations, we are prepared, and we believe we’re gonna deliver on behalf of our customers in the timeframe that they need,” Agboka told CBS News.  

    Aside from ramping up its workforce, the tech giant also continues to develop its drone delivery fleet and increase warehouse automation efforts to streamline its fulfillment process despite getting flak from workers and union leaders.

    While automation makes labor a lot less intensive, it also reduces the need for Amazon to hire more employees, which also means less unionization activity.

    Amazon’s Black Friday event in particular kicked off with protests from warehouse workers around the world. Led by Make Amazon Pay, an assembly of 70 trade unions and organizations, protesters are demanding higher pay, safer working conditions, and lower carbon emissions.

    Strikes were held in over 30 countries, including the US, UK, France, Germany, and Japan, according to the coalition. In the US, protests took place in more than 10 cities, including Amazon’s corporate headquarters in Seattle, Jeff Bezos’ penthouse in NYC, Whole Foods stores, and FBA fulfillment centers.

    Amazon spokesperson Kelly Nantel recently told Insider that the retail company is working to address workers’ concerns, including carbon emissions.

    So far, there has been no report from news outlets of any disruption to operations.

    Interestingly, if you’re in California, there’s a greater chance of experiencing disruption from a group of malicious sellers and truckers than protestors.

    According to Brandon Young, CEO of Data Drive & Seller Systems, inbound delivery dates to warehouses in Southern California are unavailable until the end of December because bad actors have hijacked Amazon’s delivery appointment system and booked up a lot of those dates to either hurt competitors or sell them to desperate sellers for up to $2,000.

    In his updated LinkedIn post, Young mentioned that Amazon has acknowledged “things need to change to ensure all sellers have the ability to send goods in a timely fashion.”

    Seeing that Amazon is still trying to resolve this issue, make sure you have a contingency plan to avoid giving in to these extortionists.

    Talk with your 3PL or preferred Amazon-partnered carrier to figure out the best way to get your inventory checked in for Christmas. See if switching over to FBM is a feasible option for you during this period in case that becomes necessary. You may also have to resort to sending in small parcels, but only do so on an as-needed basis to keep costs under control.

    Related: Amazon Tweaks Logistics Strategy to Streamline Operations

    Amazon Hikes FBA Fees Again: What This Means for Your Business

    Amazon Hikes FBA Fees Again: What This Means for Your Business

    Steel yourselves, as Amazon decided to kickstart the holiday season by announcing updates to its FBA fees. 😫

    In an announcement last week, Amazon said it will implement changes to its US FBA and referral fees. Most of the changes will be effective on the 17th of January next year, while two other changes will be in force on February 16 and April 1, 2023. Full updated fee guidelines are available here. 

    FBA Fees Just Keep Stacking Up

    These increases on FBA seller fees, which we’ll go over in more detail shortly, are the latest in the Amazon Fee Stack, the name we’ve assigned to the company’s incremental but regular fee increases and which is not unlike fee stacking in the auction industry.

    According to Amazon, some of the fee changes are the result of their observation that some sellers utilized more of their storage space than what they deemed necessary. This has consequently limited the amount of inventory that other sellers could ship to Amazon warehouses.

    For that given reason, the eComm giant said it “will create additional granularity” (e.g., new weight tiers) in its FBA fees to “better align fees with our underlying costs.” Amazon itself has emphasized that they hope these fee increases will encourage an improvement in seller inventory health. This makes proper inventory forecasting and packaging optimization more important than ever. 

    For example, over-ordering or sending in unnecessarily large boxes, will hike up your FBA storage needs and fees. You might need to examine and change the way you manage your inventory if you want to keep your costs down next year.

    Without further ado, here are the affected FBA fees, how much they will increase, and when they will take effect in 2023:

    FBA Fulfillment Fees

    Though we always expect FBA fee increases around this time, it’s always painful.

    Big changes this year include Amazon getting rid of its on and off-peak fulfillment fees and instead combining both into one single fulfillment. Peak season fulfillment rates are only slightly lower whereas off-peak fees are generally considerably higher with at least $0.10 per unit increases in most cases. 

    Dimensional weight calculations still apply. 

    This year, we don’t get to wait until February to enjoy these fee increases as they take effect January 17, 2023.  

    Fuel and Inflation Surcharge

    Technically speaking, Amazon did not increase its fuel & inflation surcharge, which it introduced on April 28th this year. What they did was to instead add it to their regular FBA fees permanently so there will no longer be a separate fuel & inflation surcharge.

    Of course, we already knew that this surcharge wouldn’t be temporary, even though the company initially said so. History taught us that it’s almost impossible to withdraw a surcharge after it has already taken effect.

    Since fuel costs and inflation rates have skyrocketed pretty much everywhere, Amazon increased their fulfillment costs and chose to call it a surcharge earlier to soften the blow that we ourselves knew would finally come. They, of course, announced its permanence in the holiday season when they can be sure most sellers are busy with Q4 sales and personal holiday activities. 

    ⚠️ Sellers can (unfortunately) expect this permanent addition to their FBA costs beginning on January 17th. 

    $0.22 Average Increase in FBA Outbound Fees

    Amazon was quick to point out that this increase is still lower than what other delivery and fulfillment partners offer. They also said they will come up with more specific weight tiers for the ¼ and ½ lb. categories (as shown below). Effective January 17th.

    Use of Dimensional Weight Pricing for Large Standard-Size Apparel

    Amazon first applied dimensional weight (DIM weight) pricing catalog-wide last year, excluding apparel.

    Starting February 16, 2023, however, apparel goods that fall under the large standard-size tier (4 oz to 20 lbs) will now also be subject to DIM weight pricing, where the greater of unit weight or DIM weight will be used to determine the shipping weight for apparel.

    Notice in the table of fees below that Amazon has indeed added new weight tiers to its 2023 fee structure: 4 oz or less, 4+ to 8 oz, and 1.5 lbs just to name a few. Shipping a 4 oz large standard-size apparel in 2023 would cost you $4.43 per unit, which was Amazon’s rate for items weighing 6 oz or less in 2022. This tier structure will be an improvement for some lighter products but will drive some heavier products into more expensive tiers at higher rates.

    And when you apply DIM weight pricing, your shipping fees could get even more expensive.

    Suppose your large standard-size apparel only weighs 16 oz, but the DIM weight is 1.5 lbs. In that case, you’re going to be charged $6.10 instead of $5.32/unit, a $0.78 difference.

    If you haven’t done so already, try to keep your apparel packaging compact. Consider using vacuum bags to remove excess air that makes it bulky. Read Master Carton/Pallet Calculator for more packaging optimization tips.

    $0.03 to $0.20 per Cubic Foot Increase for Storage Fees

    During the off-peak months of January to September, an extra $0.03 per cubic foot will be added for products under the oversized category, while those under the standard size category will be charged an extra $0.04 per cubic foot.

    During the peak months of October to December, an additional $0.20 per cubic foot will be added for products in their non-sortable fulfillment centers (i.e., those holding huge and heavy items like furniture and large equipment). Effective January 17th.

    New Storage Utilization Surcharge

    Amazon said this only applies to sellers with large inventory cube sizes in their warehouses compared to their “recent weekly sales.”

    ⚠️ This is a big one! What this means is that you will now have a surcharge tied directly to your cubic sell-through. Amazon will look at your stored cubic feet against the daily average in cubic feet shipped over the trailing, past 13 weeks.

    While the company gauged that around 7.5% sellers will be affected by this surcharge, it is something that all sellers need to be aware of as a slow in sales or too much overstocking can have a significant impact on your Amazon storage costs.

    This surcharge will be effective on April 1st.

    Aged Inventory Surcharges

    Products stored in Amazon warehouses between 180-270 days will now be fined with an aged inventory surcharge. Additionally, existing surcharge rates will be increased for items stored between 271-365 days.

    These adjustments apply to all product categories except for Apparel, Bags, Jewelry, Shoes, and Watches. 

    Fees increase every 30 days starting at $0.50 per cubic foot at the 180 day mark with a significant jump at 271 days increasing by 2.5x to $3.80/cubic foot, which is also 2.5x what it previously was in 2022.

    Amazon claims these increases will boost efficiency and free up warehouse space for sellers who are able to maximize their storage space.

    This change is effective for the April 15th aged inventory assessment period. Amazon encourages sellers to review their aging inventory and take the necessary measures. 

    Removal and Disposal Fees

    Amazon said the rising costs of removing and disposing products led them to increase these fees.

    Here’s what changed:

    You’ll want to be prepared for significant fee increases by almost double for removal and disposal fees, effective January 17th.

    Related: Removal Order Fees Get More Expensive (2022)

    Which Fees Went Down

    The good news is that some FBA fees were adjusted in favor of the sellers’ profit margins. Here are the three FBA fees Amazon lowered and by how much:

    $0.20 Average Decrease In Returns Processing Fee for Some Categories

    Sellers of apparel and shoes can save an average of $0.20 per return when customers send back their purchased products. This does not apply to other product categories.

    US FBA New Selection Program

    Amazon made several attractive changes to its US FBA New Selection program, in a move that seems to encourage catalog growth through incentives for new-to-Amazon offerings.

    Sellers will receive higher sales rebates – up to 10% on average from 5% – for qualified new parent ASINs. Amazon also doubled the number of eligible units from 50 to 100 per unit per parent ASIN and stretched the 90-day eligibility period for rebate and storage benefits to 120 days. 

    These changes will take effect in March 2023.

    Related: Qualify for Rebates and Free Liquidations with the Updated FBA New Selection Program

    Small and Light Program

    Sellers can enjoy lower fees for more of their products after Amazon expands it to include items priced at $12 and below, up from its previous $10 mark. Effective January 17th. 

    Which Fees Stayed The Same

    There is no movement on referral fees and liquidation fees.

    Amazon also announced they will remove the Collectible fee categories, namely:

    • Cards
    • Coins
    • Entertainment
    • Sports

    Affected ASINs will be reclassified to the most appropriate category, but there is a chance that sellers will be charged a higher (or lower) fee after they have been reclassified.  

    What This Means For Your Business

    Amazon has a penchant for announcing price hikes and fee increases that significantly affect sellers’ margins, sometimes on short notice. 

    Unfortunately, we cannot predict which fee or surcharge they will introduce next time and when. 

    This is why sellers who want to run a profitable Amazon business need to be not only agile but also strategic.

    Adapting quickly to changing storage needs, making accurate inventory forecasts, and right-sizing your packaging are more important than ever.

    Given the increases in storage fees and aged inventory surcharges that Amazon will implement next year, sellers need to be very careful not to send excessive amounts of inventory to Amazon fulfillment centers.

    What The FBA Sellers Are Saying

    Many FBA sellers reacted negatively to this announcement and expressed their anger at Amazon for draining their diminishing profits (or what’s left of it).

    Some sellers pointed out that the company already gets up to 40% of their sales because of these never-ending fees. A couple of sellers shared their frustration that their products were returned by customers because of “missed fulfillment promise” or because they were “delivered late by courier” but still, they are the ones absorbing the costs for Amazon’s failures.

    Other sellers expressed their frustration that, as much as they want to increase the prices of their goods, they cannot because their product listings get deactivated due to high pricing errors.

    Several sellers also raised the fact that because Amazon is laying off 10,000 of its employees and shutting down or subleasing several warehouses, there is a slim chance that things will improve in the near future.
    For these reasons, some have started looking at other e-commerce platforms like Shopify and Walmart to ensure their business remains viable.

    Related: Should You Be Selling on These New Sales Channels?, TikTok Gears Up for US Market Entry, eComm Players Dial Up Rivalry Ahead of the Holiday Season

    TikTok Gears Up for US Market Entry

    TikTok Gears Up for US Market Entry

    Update 11/14/2022: TikTok has officially launched its in-app shopping feature in the US, allowing American users to watch live selling videos and buy products directly on the app.

    “We’ve seen the positive impact of TikTok Shop, and we’re excited to continue experimenting with this new commerce opportunity to support businesses of all sizes,” a TikTok spokesperson told Semafor.

    The social media giant is currently inviting select American businesses and influencers to participate in testing TikTok Shop. Interested sellers can also apply on the TikTok Shop Seller Center website.

    TikTok is reportedly preparing to launch live shopping just in time for the holidays. Recent job listings on LinkedIn also indicate the company’s plans to build out its own fulfillment network in the US, allowing them to play in the big leagues. 🥊

    An interesting and not totally unexpected play for the platform that practically reinvented the concept of virality, going so far as to spawn the FOMO-fed trend, “TikTok made me buy it.” 

    If any platform can make this work for them, TikTok has a better chance than most.

    New Disruptor

    According to the Financial Times, the Chinese social commerce app is bringing TikTok Shop, a Quality Value Convenience (QVC)-style shopping feature, to North America through TalkShopLive. The two companies are still in talks, which is why no official announcement has been made yet.

    TalkShopLive runs an online platform for live streaming and home shopping shows featuring various brands, retailers, and influencers. Once its partnership with TikTok is finalized, it will provide the technology and support that TikTok needs for its live commerce efforts.

    Owned by ByteDance, TikTok Shop would enable sellers to advertise and sell products on the short video platform as they stream videos live to their followers. It’s quite similar to how Instagram lets users buy items directly from stores on IG.

    TikTok has found massive success in Southeast Asia (SEA) but failed to establish a foothold in the UK in 2021.

    If the UK didn’t embrace live online shopping, does this mean TikTok Shop will also flop in the US?

    After canceling its plans to expand in Europe, TikTok has instead set its eyes on the land of milk and honey.

    However, expanding the business to the US won’t be a breeze. Here’s why:

    Live Commerce Struggles to Take Off in the US

    As we’ve previously reported, the US live commerce market is still in its early stages and no company, including social media giant Meta, has figured it out yet. 

    While live selling worked out great in China with sales estimated to hit $423 billion in 2022, it has failed to attract large audiences in the US, with only $11 billion in sales in 2021. But that didn’t stop US eComm giants Shopify and Walmart from recently investing in live shopping, while Facebook decided to remove its live shopping feature this month.

    In a Times post, Ying Zhu, an assistant professor in the Faculty of Management at the University of British Columbia, theorizes that the slow adoption of live commerce in the US is probably because consumers themselves don’t understand how it really works. 

    “[Live commerce] is a really good concept,” Zhu added. “But without building up infrastructure and educating consumers, suddenly dropping this idea into the market and expecting it to just be successful is kind of naive.”

    But with TikTok’s proven live shopping feature and popularity among more tech-savvy shoppers (aka Gen Z’s), it may succeed in turning things around. 

    “TikTok likely won’t ever be an Amazon killer,” Insider analyst Andrew Lipsman says.

    “But its unique algorithm could help break new ground in the social commerce space by turning social shopping into a more habitual practice. TikTok is really good at serving up the content that people want based on their behavior,” 

    “If it can use its algorithm to tee up the right products,” that could help attract more consumers to the app and increase buys.

    TikTok Faces Scrutiny in the US over Data Privacy

    Another obstacle to TikTok’s entry to the US is its close ties to China.

    A report from Forbes reveals that 300 current employees at TikTok’s parent company, ByteDance, used to work for state media outlets, indicating “significant connections between the app and the propaganda arm of the Chinese government.” 

    Some speculate that Beijing could use TikTok to access American user data to manipulate public opinion, and even track the location of its users. 😟

    TikTok is currently working with the Biden administration to come to an agreement, under which it would make changes to its data security practices to resolve national security concerns, but the agreement is only in the preliminary stages.

    TikTok Plans to Create its Own US Fulfillment Network 

    🤔 It is even more likely that TikTok Shop will be pushed through in the US, seeing that the company is already planning on building out its own supply chain infrastructure, as indicated by several new job openings recently published on LinkedIn.

    The US is TikTok’s largest market outside of China. No wonder the company’s doubling down on its expansion plans to make the country its next major revenue stream.

    In a report from Axios, the new entrant is looking to fill a Logistics Solutions Manager position for a global fulfillment center.

    Part of the job description is to “plan and design fulfillment centers and eCommerce logistic solutions that include the transportation of goods, order prediction, and inventory management.”

    Other job openings indicate the need for a team responsible for a global logistics and warehousing network.

    In sum, live shopping has potential in the US, although getting more people to get used to it is still a struggle for many eCommerce companies. This represents an opportunity for TikTok to bring about improvement in the live commerce market if it can get the approval of US lawmakers and the public. However, concerns about data privacy may delay its launch. 
    It’s an exciting time. The eComm cold war between giants is nothing if not wildly entertaining. I, for one, am reaching for my popcorn. 🍿

    eComm Players Dial Up Rivalry Ahead of the Holiday Season

    eComm Players Dial Up Rivalry Ahead of the Holiday Season

    The clash of eCommerce titans just heated up as Amazon, Shopify, Google, and Overstock announced new features and partnerships that will enhance their ability to attract more customers this holiday season. 🚀

    Both online shoppers and sellers are in for a treat with:

    • Amazon partnering up with Snap to offer Augmented Reality (AR) shopping feature on Snapchat
    • Google introducing new live commerce solutions to make YouTube more shoppable
    • Shopify adding big celebrity brands to its platform
    • Overstock repositioning itself from being an online liquidator to a home and furniture retailer

    Amazon and Snap Collab

    To take online shopping to the next level, Amazon Fashion and Snap have teamed up to provide brands and customers with a seamless AR-powered shopping experience on Snapchat through a digital Shopping Lens which enables a “try on” feature for various shoppable products.

    The new AR lens allows 363 million Snapchatters to virtually try on a variety of eyewear products from Amazon Fashion brands such as Ray-Ban, Oakley, and Persol and then click on the “Shop Now” button to buy it from there. 

    The eyewear AR lenses are accessible via Amazon Fashion’s store in Snapchat, Snapchat Camera Lens Carousel, and Snap Lens Explorer in the Dress Up and For You pages.

    Amazon-Fashion-Snapchat-Profile

    According to Snap, more than one billion products were ordered on mobile phones by Amazon Fashion users in 2021. And that number could grow with the addition of this new Virtual Try-On feature for eyewear, as AR apps in general can help boost engagement and conversion.

    Marketing Dive research shows that people utilizing AR tools typically spend 75 seconds interacting with them, which is 25 seconds longer than with 60-second business-related videos. This indicates that AR users are far more engaged in the content than with some other marketing methods.

    As for boosting conversion, a study from sunglasses manufacturer, Goodr, shows that the company saw a 32% increase in conversion rates among mobile customers who used its virtual try-on features.

    While Amazon and Snap’s AR lens is initially designed for specs, it will be the first of more AR lenses to come.

    “With the combined innovation and technology between Snap and Amazon, we are unlocking exciting and fun new try-on experiences for hundreds of millions of Snapchatters. AR eyewear is just the first step in our partnership, and we can’t wait to continue our innovation together.” Ben Schwerin, Snap’s SVP of Content and Partnerships, said in a press release.

    Google Expands Suite of Live Shopping Tools

    In an attempt to transform YouTube into an online shopping destination, Google has been adding eCommerce features to the video platform since 2018.

    It has also recently made advancements geared towards winning more shoppers and keeping them on-site rather than outside of YouTube, potentially making it a lucrative sales and ad channel for brands. 

    In 2018, YouTube allowed popular content creators to sell their merchandise like t-shirts, phone cases, or hats directly to fans by listing them below their videos. YouTuber Lucas the Spider sold over 60,000 plushies, raking in around $1 million in profit in just three weeks.

    In 2020, the company introduced a new advertising solution that lets marketers showcase their video ads on their storefront and complement them with “browsable product imagery to inspire the next purchase… and drive traffic to the product pages that matter.”

    One year later, YouTube entered the live commerce space by launching Shop and Stream hosted by some of the biggest content creators, such as Mr. Beast, Gordon Ramsay, The Merrell Twins, and Patrick Starr. 

    In 2022, YouTube doubled down on its live commerce plans by bringing Shopify into the fold. With this partnership, Shopify sellers are able to connect their store to YouTube, hold live selling events themselves or with their preferred influencers, and process payments within the platform via Shop Pay, essentially allowing them to take on Amazon Live sellers. 

    At its recent Broadcast event, YouTube announced new features that will allow creators to:

    • Go live at the same time, i.e., co-host a live shopping video. For brands, this could double the viewers for the event, as each host would bring their own loyal fanbase to the live stream. For YouTube, this could make them more competitive with Meta’s Instagram, which launched the same co-hosting feature last year.
    • Start live selling on their YouTube page and then redirect viewers over to a brand’s channel for them to keep watching, also known as Live Redirects. This allows brands to leverage the creator’s platform to reach new customers.

    As you can see, both sellers and content creators are provided with everything they need to offer a seamless live shopping experience on YouTube. This reduces the need for customers to be redirected to a different website to complete their purchases, which increases the risk of discovering other eCommerce channels like Shopify-powered stores that offer Amazon Buy with Prime.

    It’s a smart move that allows YouTube to keep customers on-site, which gives them the opportunity to persuade people to spend more time on the platform and watch more video content, essentially increasing their ability to boost ad revenue after experiencing a 1.9% drop in Q3 2022.

    Shopify Launches New Celebrity Product Lines

    The Canadian eComm giant banks on the Kardashians and other major influencers in a bid to increase market share after two quarters of sluggish growth.

    During Shopify’s Q3 2022 earnings call, company President Harley Finkelstein shared that celebrities are going to play a big role in their strategy for the platform’s digital sales.

    “The world’s biggest superstars are also building their brands on Shopify Plus. In Q3, the Kardashian brand continued to build their Empire on Shopify with their latest brand, Courtney Kardashian’s vitamin and supplement company,” the president shared.

    In Q2, Kim Kardashian rolled out her SKKN BY KIM line of skincare products on the platform. Fashion model Hailey Bieber also launched her own skin care brand called Rhode Skin. Shopify Plus appears to be positioning itself as the go-to platform for celebrities to grow their personal brands and transform them into products for their massive fanbase.

    In addition to the Kardashians, Shopify Plus will also feature:

    • Celebrity chef Giada De Laurentiis’s new line of sauces and condiments, Giadzy
    • American singer Ciara’s On A Mission Skin
    • Toronto star Matty Matheson’s workwear brand, Rosa Rugosa

    The addition of big names comes at a time when Amazon revealed that its net income dropped to $2.9 billion in Q3 2022 compared to $3.2 billion during the same period last year, while Shopify’s revenue grew 22% this quarter or $1.4 billion versus last year’s $1.12 billion.

    The gains in revenue indicate Shopify’s resilience to economic uncertainty and is a good sign of progress as we head into the holidays. 

    “Looking ahead, the flexibility of our platform, breadth of solutions, pace of innovation, and disciplined investment approach position Shopify well to realize the enormous opportunity ahead,” said Amy Shapero, Shopify’s CFO.

    Overstock Launches Ad Campaign as a Home Furnishings Retailer

    Inventory liquidation pioneer, Overstock.com, is repositioning itself as an online home and furniture retailer, teeing up to directly compete with Amazon Home, Wayfair, and Ikea.

    On October 20, Overstock launched a home-focused national campaign entitled “Making Dream Homes Come True” to promote its wide array of stylish home products at smart value prices. The campaign also features brand ambassadors Vanessa Deleon, Lizzy Mathis, Farah Merhi, Tarak El Moussa, Luke Caldwell, and Taniya Nayak. The six brand ambassadors collectively bring a huge audience of 20 million followers.

    “This new campaign is the next step in our journey. It shows our strong vision for the future as we continue to deliver simple product findability, smart value, and easy delivery and support to our customers. As we better associate our name with new home products, it should dispel any lingering misconception that Overstock sells liquidated or excess merchandise,” said Overstock CEO Jonathan Johnson.

    Earlier this year, the company finished stripping itself of all non-home items, a process that took six grueling quarters to complete. In June, Johnson shared with Furniture Today that pivoting to home will “create a better, fitter company in the long run.”

    Over the last few years, Overstock offered a broad assortment of discounted goods across multiple categories. But in 2021, 94% of the platform’s sales came from home products, the highest percentage in the company’s history.  

    eCommerce sales skyrocketed for a lot of home-focused retailers during the pandemic as homebound consumers began shopping online to renovate their bedroom and living spaces. And even after the pandemic-driven highs, home goods sales of $11.8 billion in August 2022 was only down 1.6% from August 2021’s $11.97 billion. 

    “Our business is growing. We’re taking market share, and we’re doing so profitably,” Johnson said.

    “Because we’re profitable, our partners are more inclined to sell to us. They know we’ll pay them on time compared to many competitors… These suppliers limit how much inventory they will tie up with someone if they don’t know if or when they’ll get paid.” he added.

    Overstock maintains an asset-light business model with “three flexible warehouses that can accommodate up or down depending on suppliers,” which makes them nimble. As of this writing, the company only has 3,500 suppliers dropshipping most orders, allowing them to hold minimal inventory. 

    👉 In closing, Amazon, Shopify, Google, and Overstock continue to make great strides in their commitment to provide customers with remarkable online shopping experiences.

    A huge part of their strategy seems to be focused on working with influencers and creating tools that support the influencer economy, suggesting that live commerce could be the next big thing in eCommerce. 🤔

    However, all these platforms launching influencer programs ahead of key selling events may lead to tougher competition in the days leading up to and throughout BFCM, Christmas, and New Year’s, as brands may try to supplement their ad efforts with shoppable videos in order to attract livestream shoppers.

    So if you haven’t already, consider getting on these new trends now to gain a grip on an influencer’s fanbase before someone else does.

    Amazon UK At Risk for Box Shortages During BFCM

    Amazon-UK-At-Risk-for-Box-Shortages-During-BFCM

    Brace yourself for another potential disruption, as there’s a chance Amazon may have a packaging shortage during the upcoming Black Friday/Cyber Monday (BFCM) sale period. ⚠️

    The reason for the potential shortage?

    Almost 1,000 employees of the packaging company DS Smith – all of whom are General, Municipal, Boilermakers, and Allied Trade (GMB) union members – voted to hold a strike over their pay.

    According to the union, their members working across the five DS Smith offices in Britain could protest before November ends.

    Aside from Amazon, this British packaging company supplies corrugated boxes to beverage giants Diageo Plc and PepsiCo Inc., biscuit company McVitie’s, brewer BrewDog, and snack company KP Snacks.

    What Triggered the Vote to Strike

    DS Smith submitted a proposal to increase their workers’ salaries by 3% and release a £760 payment for the fiscal year 2022-2023. The union said that out of their 1,000 members employed by the company, 93% apparently responded to this proposal with a vote to strike.

    The union went on to say that the salary increase and payment offer is a “massive real-terms pay cut” as the nation grapples with its record-high inflation rate. Market research company Kantar announced that the UK grocery price inflation is now at 14.7% and overall inflation rate at 10%. 🤯

    GMB national secretary Eamon O’Hearn pointed out that DS Smith employees continued working during the pandemic and urged the company to adjust their offer, noting that the company can afford to propose a better offer that shows its appreciation for the work put in by its members. 

    How Amazon Sellers and Consumers will be Affected

    O’Hearn also emphasized the repercussions of an industrial action to the company and their clients’ businesses.

    “A strike at DS Smith could have serious implications across a range of household names – not least Amazon which gets packaging from the company,” he said.

    Amazon is just one of the many retailers that offer promos and sale events during Black Friday, the last Friday of November.

    For this year, Black Friday falls on November 25th, which may coincide with the industrial action that the affected DS Smith employees are planning to hold. 

    🚨According to The Guardian, Amazon said that it isn’t expecting a shortage of packaging. No further explanation was provided.

    However, the mass walkout could still spell trouble for Amazon sellers as higher sales volumes, which are typical during the Black Friday up to Cyber Monday period, result in a greater demand for packaging.

    With less workers involved in the production of these boxes during an extremely busy period, Amazon sellers may encounter delays before their products get shipped out to their customers. 

    The DS Smith union members’ decision to take industrial action is the latest in a series of strikes that have plagued London since the start of summer.

    London retailers have shared that their revenues dropped drastically because of less footfall in stores due to the back-to-back rail and transport strikes held by different unions for the same reason: dispute in pay. 

    For retailers who are only just beginning to recover from the pandemic’s losses, these strikes are making their efforts to achieve their business’ pre-Covid sales and profits futile.

    How Sellers can Prepare for the Potential Delivery Disruption

    While Amazon said it is not expecting a shortage of packaging despite this news, it would be best for you to plan and prepare for this potential disruption in order to still make the most out of BFCM.

    With only two weeks left before Black Friday, you may have just enough time to keep your 3PLs up-to-date with your packaging needs and ensure you have buffer stock in your 3PL warehouse to fulfill orders via Fulfilled by Merchant (FBM).

    ✔️ That way, if the strikes push through, you have the option of selecting your preferred courier and shipping orders from your own warehouse instead of Amazon’s. 

    To save on shipping costs, try packaging optimization techniques like using a material that can remove excess air or bubbles from your packaging (e.g., vacuum bags for pillows) to reach a smaller parcel size. This method will allow you to fit more units per carton. 

    Check out our Master Carton Calculator to figure out the best way to optimize packaging and reduce shipping costs.

    Updated: Amazon Enters the 3PL Space with New Amazon Warehousing & Distribution Program

    Amazon Enters 3PL Space With New Amazon Warehousing And Distribution Program

    Update 11/03/2022: There have been questions about whether or not inventory will still be sent to FBA from AWD warehouses even if sellers are currently overlimit in their maximum restocking capacity.
    Now, here’s the official and confirmed answer from Amazon themselves:

    AWD Restock Limits Confirmation

    This screenshot was shared by our friend, Gianmarco Meli, Founder and Host at The Seller Process podcast, known for shorter-form episodes focused on actionable systems and processes to scale your eComm business. 🚀

    Amazon may be a formidable player in the logistics space, but for years, they’ve also been one of the more expensive out there, especially during the holiday season when rates nearly triple for standard-size products.

    For that reason, many sellers opt to outsource their bulk storage and distribution needs to third-party logistics companies (3PLs) that are typically more affordable than Amazon FBA.

    🔥 Well, the game is about to get a little more interesting with the launch of a new low-cost logistics service called Amazon Warehousing & Distribution (AWD).

    But looks can be deceiving, especially when you’re not comparing apples to apples. Is AWD really more cost-effective than your 3PL? It depends on your rates. Read on and then weigh your options. 

    What is AWD?

    It is a storage and distribution solution that gives sellers access to state-of-the-art logistics facilities and services without the hefty price tag that comes with Amazon FBA. Participation is currently by invitation only, so keep an eye out for Amazon updates.

    Top features and benefits include:

    • Auto-replenishment feature. To avoid stockouts, Amazon will automatically send additional units from AWD to their fulfillment centers (FCs). 
    • No restock limits. This is huge because Amazon has just brought back restock limits! With AWD, however, you can circumvent this restriction and not worry about having to jump through a lot of hoops to stay in stock this Q4.
    • Integrated supply chain. No need for 3PLs when you have a service provider that will take care of everything for you, from receiving your inventory to storage to distribution to fulfillment.
    • Transfer inventory to Amazon and non-Amazon destinations. In 2023, the AWD program won’t just search Amazon warehouses, but can also replenish to other non-Amazon locations, including to fulfill brick-and-mortar stores.
    • Pay As You Go Pricing. No hidden costs like early termination fees and only pay for services you use.
    • Lower storage and processing fees. This is welcome news for sellers who have been cutting back on spending this year due to rising costs and increasing inflation. According to Amazon, they’ve made changes to their rate card to offer more competitive pricing. For example, based on the updated card rate below, it would only cost you around $24 (non-peak) to store one pallet of standard-size goods per month in AWD (versus FBA’s $47). A standard 40” x 48” pallet (plus 50” overall pallet shipment height) can hold 56 cubic ft, so multiply cubic ft by the current AMZ rate to get your monthly AWD storage fee.

    Amazon Warehousing & Distribution Fees

    Versus FBA Fulfillment Centers (February 2022 and after)

    Storage MonthStandard SizeOversize
    January – September$0.83 per cubic ft$0.53 per cubic ft
    October – December$2.40 per cubic ft$1.20 per cubic ft

    Cons of AWD

    • You have less control over your inventory. Using AWD basically means turning over a boatload of products to Amazon and hoping that they don’t mess up, e.g., skip over your trailer, swap two trailers with different destination addresses, or lose your shipments. This is why it’s still best practice to have a backup 3PL for emergencies, especially during peak season.
    • May not be cheaper than your local 3PL. While $24/pallet may be a savings for some sellers if paying over $20/pallet, that pricing is only between the months of January through September.

      Peak holiday storage, however, is where it could become more expensive than your average 3PL warehouse, with a standard 50” stackable pallet clocking in at close to $45 per month.

      Of course, that’s still much cheaper than the $133 per pallet equivalent that you’d be doling out at FBA from October to December.

    You should also look at Processing and Transportation Fees when estimating the difference between using your current 3PL and AWD. If you’re paying $3.60 per carton/case in processing with your 3PL but AWD is offering $2.00 per case, that savings may be enough to offset the additional per pallet storage in peak season.

    Of course, Amazon is also sweetening the pot with a waiving of restock limits for any of the inventory held within the AWD network. All these factors will have to be considered when determining whether AWD is right for you. 

    Related: How to Ship to Amazon FBA (And Speed Up Check-In Times)

    Is AWD Different from Amazon Upstream Storage?

    In 2021, the eComm giant rolled out a low-cost bulk storage and distribution program for full container load (FCL) shipments called Amazon Upstream Storage (AUS). 

    AWD and AUS share a lot of similar features like auto-replenishment, no restock limits, integrated supply chain, and lower storage costs, but the difference is that you don’t need full containers to use AWD. 

    Amazon Continues to Add More Mega Warehouses

    Despite posting a $3.8B loss due to excess storage and transportation capacity in Q1 2022, Amazon is still reportedly looking to add:

    If these plans push through, these 3 multi-million-square-foot warehouses would top among the biggest in Amazon’s entire network of 1,200 facilities in the US. 

    As of this writing, the largest is a 3.6 million sq ft distribution facility in Mount Juliet, Tennessee.

    ⚠️ Amazon doubling down on its warehouse expansion plans is a strong sign that AWD is here to stay. 3PLs that are too small to beat Amazon may see themselves joining its vast distribution empire as a partner in the future, while others may struggle to keep their customers if they don’t offer more competitive rates. 

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    What Amazon’s New Merchant Cash Advance Program is Going to Cost You

    What Amazon’s New Merchant Cash Advance Program is Going to Cost You

    Amazon US recently announced its new financing program to help their online sellers expand their businesses. (Or so they say). 🤔

    The sales-based merchant cash advance program offers eligible Amazon sellers access to capital—from $500 to $10 million-–that they can use for:

    • Business-related activities
    • Marketing and promotions
    • Product research and development
    • Recruitment
    • Payroll
    • Procurement 

    The program is being offered in partnership with Parafin, a US-based capital financing provider that enables marketplaces and platforms to extend capital to their sellers. 

    According to Amazon, sellers with approved cash advances only need to pay Parafin a fixed capital fee: there are no interest charges or late payment fees.

    As this is a sales-based funding program, the payment for the cash advance is tied to a part of the seller’s future sales. They will also enjoy a flexible repayment schedule that is pre-arranged according to a forecast of the sellers’ Gross Merchandise Sales (GMS).

    Unlike other loans, this program does not involve credit checks, tedious paperwork, minimum payments, and personal collateral and guarantees. 

    Currently, this program is available to those who have been selling on Amazon’s online store for a minimum of three months. The e-commerce giant is targeting to make this program accessible to more than a hundred thousand Amazon sellers by 2023.

    The Catch With Merchant Cash Advance

    Any seasoned Amazon seller knows that every time the company launches something new that sounds too good to be true, 99.9% of the time, it really is.

    ⚠️ Amazon and Parafin’s merchant cash advance program is no different.

    A closer inspection of the details of this program revealed what we suspected: Amazon is not necessarily offering this program purely out of goodwill, but because they are also getting something out of it.

    Parafin’s website clearly states that companies and platforms that choose to partner with them can earn additional revenue by getting a portion of every successful capital advance.

    But the real question on many sellers’ minds is this: given that nothing is free in this world (and certainly not in the world of Amazon), what are the real, hidden costs of getting approved for this cash advance?

    A couple of sellers pointed out a screenshot on Parafin’s website that shows a 12% repayment rate calculated against the seller’s daily sales.

    Another seller awaiting his cash advance approval shared that, while the program is positioned as a “no interest” funding solution, repaying the advance within one year is equivalent to paying a high-interest charge, adding that it goes higher the sooner a seller pays for the advance in full.

    One thing sellers should remember: merchant cash advance is not the same as a loan.

    The amount of the cash advance is determined by the cash flow and volume of sales of the business and not by the credit score of the merchant. The payment for a merchant cash advance can also be taken against the future sales of the business. This helps explain why Amazon and Parafin’s program is marketed as a “no interest” financing solution, as merchant cash advances, by their nature, do not come with interest. 

    Instead, they use a flat capital fee, so, holding the money longer means you are paying less for that borrowed money. The faster you pay it off, the more that money technically costs you when stacked up with a traditional loan with interest rates. With traditional loans, you are able to reduce the total interest paid by paying the loan off early. With flat capital fees, you have no incentive for early repayment, yet, with this program, you’ll be locked into just that with this if you do better in your business. 

    Now, this may work out better for some sellers who take out loans with monthly payments that are much larger than what the repayment structure of this loan would be, or sellers who see their sales volume drop within the life of the loan who would have gone out of business if they had to make such large monthly payments. But those business owners should use great caution as any loan taken out puts them in a precarious position as the business itself needs more stability and a loan could worsen the risk.

    For sellers who wish to proceed in applying for this program, make sure you count the cost before accepting the offer.

    Consider evaluating whether the fixed capital fee is a fair amount in your best-case scenario and if you’ll be able to sustain your business against it in a worst-case scenario. Then make the decision that is best for you and your business according to your profit and cash flow goals and risk tolerance.

    Get To Know Parafin First

    Amazon sellers who are considering applying for this program may want to investigate further before filling up the online application form. After all, responsible borrowers take the time to scrutinize their lenders, and eligible sellers should do the same too.

    As a fintech startup (Parafin was founded only in 2020), the company still has a lot to prove in terms of its sustainability.

    Despite its young age, however, the company has had significant success in terms of raising funds for its cause, which is to help platforms, marketplaces and vertical SaaS providers, among others, offer embedded financial services to their sellers and to small businesses.

    Last August, Parafin was able to raise $60 million during its Series B financing round, which drew participation from former and new investors.

    Financing Options for Amazon Sellers

    Now, if you think a merchant cash advance is not for you—and taking out a business loan is also off the table—don’t worry!

    There are many types of alternative funding available to online sellers in particular. You may want to consider Amazon inventory financing or check out the other products under Amazon Lending

    Of course, it’s worth emphasizing that just because you can borrow, doesn’t always mean you should and that every business should consider the pros and cons and analyze the best and the worst of what’s possible with any funds they borrow.

    The right funding at the right time can mean huge things for your business so long as you are strategic about it and go in with your eyes wide open. 

    Amazon to Shut Down Appario Amid Allegations of Circumventing Indian Law

    Amazon to Shut Down Appario Amid Allegations of Circumventing Indian Law

    In a joint statement released on October 31st, Amazon has announced that it will close Appario, one of the biggest sellers on its platform in India. 🤔

    The brand is a unit of Frontizo Business Services, an Amazon and Patni Group joint venture that started in 2017. 

    A Move to Minimize Regulatory Pressure

    For years, Amazon has been in the crosshairs of antitrust regulators for allegedly giving preferential treatment to a few sellers and using them to circumvent Indian laws. 

    Leaked internal documents reviewed by Reuters show that in 2019, Amazon exec Jay Carney was “cautioned not to divulge that some 33 Amazon sellers accounted for about a third of the value of all goods sold on the platform,” to India’s ambassador to the US, as that information was “sensitive/not for disclosure.”

    Other documents also reveal that Amazon had indirect equity stakes in two more sellers on the platform (24% in Frontizo and 26% in the now-delisted Cloudtail, internally called as “special” merchants). These two sellers also accounted for about 35% of the site’s sales revenue in early 2019. They were also allegedly given “discounted fees and exclusive access to Amazon’s retail tools for inventory management,” to stay ahead of the competition.

    Recent changes to India’s foreign direct investment regulations threatened to disrupt Amazon’s business operations in the country. One of the new rules that came into force in 2016 prohibits a single seller to have more than 25% of total sales for any online marketplace, forcing Amazon to sweep that “sensitive/not for disclosure” information about Cloudtail and Appario under the rug.

    Another recent change to domestic regulations now also involves not allowing marketplaces to have controlling stake in sellers on their platform.

    To prevent further scrutiny, Amazon reduced its stake in Cloudtail – registered as Prione Business Services, a joint venture with Catamaran Ventures providing support systems for sellers – from 49% to 26% and in Frontizo from 49% to 24%.

    However, in early 2021, the Competition Commission of India (CCI) approved Amazon’s acquisition of its partner’s entire stake in Prione Business Services, prompting it to close Prione’s B2C retail unit Cloudtail.

    Now, Amazon appears to be making the same move with Frontizo/Patni Group joint venture by delisting Appario to possibly avoid more stringent foreign investment laws and disruption to its operations (e.g., India’s antitrust authorities raiding Appario office as part of its investigations into the company’s anti-competitive behaviors) 🚨

    According to an Amazon spokesperson, “The partnership with the Patni Group is the next step in our strong ramp up to support Amazon’s vision to transform the way India buys and sells. The Patni’s have a strong track record of building large-scale operations for IT-enabled services and understanding of India as a market.”

    Therefore, it’s crucial for the partners to “continue to explore new business opportunities, including helping businesses across India to scale up their online presence,” even if that meant delisting Appario as a seller within the next 12 months.

    Related: Amazon Reduces their Private Label Catalog, EU Advised by NGOs to Refuse Amazon’s Flawed Proposal for Antitrust Settlement, Why Amazon Wants You to Lobby Congress: What is S.2992?

    UPS Braces for Holiday Delivery Surge in December

    UPS Braces for Holiday Delivery Surge in December

    During UPS’s Q3 earnings call, CEO Carol Tome revealed that they expect package volumes will peak a little bit later this year compared to 2021 as customers postpone holiday purchases until Christmas or go back to “more pre-pandemic shopping behaviors,” such as in-store shopping or opting for store pickups. 

    Christmas-Like Surge During Q2 2020 & 2021

    Before the COVID-19 pandemic, the holiday season used to be the busiest time of year for UPS.

    However, when nationwide lockdowns took hold in March 2020 to mitigate Coronavirus transmission, millions of homebound consumers quickly turned to eCommerce for their shopping needs, creating an avalanche of packages that UPS wasn’t prepared for.

    During the second quarter of 2020, UPS’s average daily volume (ADV) in the US increased by 22.8% or 21.1 million packages a day. 🤯 And despite experiencing a decline in domestic demand in Q2 2021, the legacy carrier’s ADV was only down by 0.8% during that quarter. 

    What happened was people felt highly optimistic about their spending and started holiday shopping earlier than before to avoid delays and missing out on popular items (#FOMO). Many were even willing to shell out extra dollars to receive their packages within 1 to 2 days.

    But this year, retailers have a surplus of products and not enough buzz because consumers are now more conservative with their spending in attempts to make ends meet amid a looming recession, marking the end of their 2-year shopping spree.

    UPS Predicts Package Volumes will Peak in December

    The prediction follows a quarter wherein the company suffered a 1.5% drop in its domestic ADV and a 5.2% dip in its international ADV due to a general slowdown in economic activity (e.g., disruptions to manufacturing output in China).

    “In the third quarter, the global economy softened, especially outside the United States,” Tome explained during the quarterly earnings call.

    “Softening” is a stage in the economic cycle where a market shifts from rapid growth to slow growth to flat revenue growth.

    In retail, if there’s more supply than demand, businesses are forced to offer promotions like deep discounts to win inflation-fatigued customers and boost sales.

    Given the current economic situation and retailers facing inventory bloat, we may see more products on sale this Christmas compared to the previous years. 🛍️

    In fact, holiday shopping started early at Amazon.

    For the first time, the retail giant held a second Prime Day called Prime Early Access Sale that ran from October 11 through 12 to reduce inventory glut. However, reports show that the event failed to best the initial Prime Day launched back in July. 

    It could be that customers simply didn’t like the featured products or they wanted to wait for bigger bargains usually offered during BFCM and Christmas.

    Either way, UPS is ready for the anticipated package volume surge in Q4, although overall volume in this quarter is expected to decline from 2021 due to contractual agreements with Amazon and Amazon itself bringing more and more of their logistics and shipping into its own growing internal network.

    To prepare for the holiday season, UPS is reportedly working with major shippers and looking to hire 100,000+ seasonal workers to ensure timely delivery of packages across the US. It has also recently put shipping limitations on Amazon to make more room for its B2B segment and provide businesses with excellent logistics service during peak. 🚀

    Related: 3PL Logistics Backup Plan for Amazon, How to Ship to Amazon FBA (And Speed Up Check In Times)

    Should You Be Selling on These New Sales Channels?

    Should You Be Selling on These New Sales Channels?

    🥊 Macy’s, Pinduoduo, and Google have just joined Walmart and Shopify in battling Amazon for the US market share!

    This means greater marketplace diversity for sellers, especially for those who are looking for (cheaper) alternatives to Amazon, which as previously reported, has gotten 30% more expensive in the last two years.

    For Amazon, however, tougher competition is an incentive for them to keep innovating (i.e., launch new tools, services, or products) so they can stay in the game and continue capturing more independent sellers and consumers.

    Simply put, opening the market to emerging players not only generates more attractive offers, but also breaks up anti-competitive practices. 🔥

    Introducing the New Amazon Challengers

    Amazon is a global eCommerce leader with a reported revenue of $610 billion in 2021, surpassing America’s largest brick-and-mortar store, Walmart, with only $566 billion. 

    However, as big as Amazon is, it doesn’t stop new players from firing onto the scene. 🚀

    Pinduoduo
    On September 1, Chinese eCommerce giant, Pinduoduo, quietly launched its US online shopping site, Temu, in an attempt to replicate the international success of Shein and AliExpress. The company’s expansion to the US also offers new growth areas at a time when the Chinese tech sector is having a rough year due to the government’s tech crackdown.

    We present this new marketplace to sellers not so much to consider selling on the platform, but more to provide a view of what new competition is coming that could steal clicks and purchases from sellers on Amazon.

    Temu Landing Page

    What to expect with Pinduoduo

    • Ideal for discount retailers. To keep the prices low on the platform, Pinduoduo negotiates with sellers to achieve the lowest offer possible. At a glance, the prices on Temu range from $0.99 to $25, making it a good online shopping destination for customers who love a good bargain.
    • Extensive connection with manufacturers and merchants. The company works directly with over 11 million sellers from across the globe, which allows them to cut out the middlemen, aka distributors. They also don’t have in-house brands like Amazon does, as all products are supplied by third-party sellers. 
    • 10-billion worth of resource packages for Chinese manufacturers. Pinduoduo launched an overseas support initiative that aims to help 10,000 domestic factories sell internationally.
    • No warehouses in the US. All products are shipped from China, which suggests delivery may take longer than 2 days. If customers prefer 1- to 2-day shipping, Pinduoduo may not be the best alternative marketplace for them.
    • Low margin business. As mentioned earlier, most products on Temu are sold at bargain prices, so depending on market demand, you may make profit, break even, or lose money. In addition, unsold products (let’s say more than 90 days) may be returned to you, and when it does happen, you will sustain a loss. Alternatively, you can try to join Temu’s flash sales to attract more customers. 
    • Potential counterfeit issues. In 2018, Pinduoduo was added to the US Trade Representative’s blacklist over suspected fakes. This means you could face the same intellectual property issues that are troubling Shein sellers.

    Pinduoduo may be a good option for suppliers in China who want to easily connect with US customers. But for Amazon sellers, that means that your suppliers could quickly become your competitors, if they aren’t already.  

    Macy’s, Inc.

    On September 28, the department store chain officially welcomed third-party sellers to its eCommerce site, macys.com.

    Powered by Mirakl, a top online marketplace technology provider, the new digital channel now allows you to seamlessly integrate your products into Macy’s and access tools that will help you to monitor and grow your business.

    As of this writing, Macy’s provides customers with 400 new brands, 20 product categories, and sustainable offerings from women-owned and diverse-owned businesses.

    Macys 3P Seller Badge

    Reasons to join Macy’s

    • Guided onboarding process. The retailer will work with a select group of sellers and brand partners to ensure they meet Macy’s product and fulfillment standards. They will also offer seller support, training programs, and promotional participation.
    • Sellers will be denoted by a badge. A “Shipped by and sold by” badge will be displayed on your product listings to differentiate yourself from other brands and communicate who’s responsible for fulfilling and shipping customer orders.
    • Send your products for approval and listing. Similar to Pinduoduo, Macy’s makes the final decision as to which products end up on the marketplace. This helps the company to maintain a well-curated assortment of goods, control product prices, and combat counterfeiting.

    Reasons not to join

    • Seller-fulfilled orders. As a third-party seller, you’ll be responsible for processing your own orders. If you don’t have the storage space and manpower to fulfill orders yourself, you may need to hire a third-party fulfillment company to pack and ship items for you, which means added costs and complexity to your operations. 
    • Fierce competition. Like Amazon, Macy’s has multiple in-house brands that you need to compete with, not to mention the other private label brands from participating third-party sellers. And as the platform owner, they could easily collect and use customer data and analytics to gain an edge over direct competitors.

    Advanced sellers may find Macy’s an excellent addition to their multi-sales channel strategy, whereas beginners or smaller businesses may struggle with the downsides of fulfilling orders themselves and competing in a highly competitive marketplace.

    Google

    Released the same day as Macy’s new digital marketplace launch, Google has nine (9) new online shopping features and tools designed to offer a more efficient way for you to discover and shop products on its search engine. 

    Introduced at the recent Search On event, these new features include:

    New Google Shopping Tools And Features
    • Search with the word “shop,” followed by brand name, product type and category, among other relevant search terms.
    • Shop the look. Find and buy your preferred clothing ensemble (e.g., summer outfit) within Google search.
    • Trending products. Check out what’s trending in Search to discover the latest styles, models, and brands.
    • Shop in 3D. Engage with 3D visuals of staple products like home goods, clothing, and sneakers as you search them on Google.
    • Buying guides. Make an informed buying decision by reading all the relevant information about a product from trusted sources. If you’re looking to buy a road bike, for example, the buying guide feature might display information about the item’s size, weight, materials, fork suspension, wheelset, and so on. Arming yourself with this information will allow you to make decisions with a great deal of confidence.
    • Page insights. Find out what other customers think about a product’s pros and cons.
    • Personalized results. Enable personalized results on Google to narrow down your search to your preferences and previous shopping habits.
    • New filters. Take advantage of dynamic shopping filters to discover what’s popular right now. If you’re shopping for sneakers, you might see filters for “retro” and “white” right below the search bar because those are the hottest styles.
    • Suggested styles in Google app. If you prefer mobile shopping, use the Google app to browse through Google’s suggested styles for you. These suggestions will be based on your previous buys and what others have searched (and bought) too. Use the “Lens” feature to expand your shopping options.

    Several of these features seem to be making Google a great resource for product research for sellers as well, so this is something to keep in mind the next time you look to find your new best seller.

    Reasons to join Google

    • Free for sellers. In a blog post, Google states that they have taken two steps to support all merchants: remove commission fees and make product discoverability free for sellers on Search. The tech giant uses a powerful AI called Shopping Graph that allows them to provide customers with relevant shopping information, such as brands, images, videos, product reviews, and inventory data from different sellers. If you have something a customer is looking for, your product ad or listing may show up on search. When a customer decides to buy it on Google, you won’t have to pay any commission fee (versus Amazon’s 8% to 15% fees). 
    • Plethora of shopping features and tools. Google is trying to establish itself as the one-stop-destination for customers. That’s why it’s introducing a suite of features designed to quickly sift through over 35 billion listings on the internet and bring a more personalized, immersive, and informative shopping experience. 
    • Optimized for Shopify merchants. Google has an existing partnership with Shopify that lets its merchants feature their products across Search, YouTube, Shopping, and more in just a few clicks. This collaboration helps sellers become highly discoverable to different types of buyers (intent buyers and window shoppers, for example), and as a result, drive traffic and boost conversion.

    Reasons not to join Google

    • Cut-throat competition. If you have a competitive product such as fashion and jewelry, you may experience difficulty in getting your ads to reach your target customers given that there may be thousands of others doing the same exact thing. Conversely, if you have a niche or rare product, you may have a better chance of attracting customers.
    • Products could be disapproved or suspended. If you want to sell directly or advertise on Google Shopping, you have to get your products approved by meeting specific attributes and compliance requirements stated in the Shopping Ads policies. What may be allowed on Amazon may be prohibited on Google, so be sure to read up on the company’s product approval process to avoid potential issues that could delay your launch.

    In sum, while expanding to new sales channels has its own advantages, it also has a few disadvantages, such as additional costs. It can also complicate your business operations, from sales & marketing (inconsistent messaging on different channels) to inventory management to fulfillment.

    If you want to cast a wider net with a multi-channel selling strategy, make sure you understand the risks involved with selling on a particular sales channel. 👌

    Related: Amazon FBA Calculator

    New Ad Strategies for Winning the Holiday Season

    New Ad Strategies for Winning the Holiday Season

    🤔 Unsure of how best to approach your holiday ad campaigns at a time when 55% of consumers are cutting back due to economic uncertainty? Want expert guidance from the best and brightest in the business? 

    From October 25 to 27, live and in virtual access, Amazon is holding its annual advertising conference, unBoxed, at the Jacob Javits Center in New York City, where you’ll:

    Learn the Latest Amazon Ads Solutions and Innovations

    Similar to Accelerate, the unBoxed keynote will be chock full of new product releases and services so you can equip yourself with the latest knowledge and tools necessary to:

    • Smoothly navigate the economic challenges that are affecting consumers and businesses today
    • Create engaging assets that resonate with your audiences to help you stand out
    • Launch ad campaigns that reach the right customers
    • Measure and improve the impact of your ads and channels

    Create Meaningful Connections with the Industry Pros

    unBoxed is bringing you closer to several industry leaders, including Amazon Ads execs themselves. Take this opportunity to learn about actionable insights to inform your ad strategy. Attend the breakout sessions you need to help you end the quarter on a strong note.

    Key topics include the future of advertising, best practices for brands, navigating supply chain issues and inflation, strategies for driving growth during high-traffic shopping events, video advertising, the power of audio storytelling, and more.

    Rub Shoulders with other Marketers

    On October 26th, unBoxed will have an “After Dark” concert with the American rock band, The Killers🤘🔥

    Both novice and seasoned advertisers are welcome to attend! 🥳

    Whether you’re preparing for a rocky Q4 or just need to stay up-to-date with the latest advertising trends, unBoxed is your chance to learn what you can do with Amazon beyond sponsored ads!

    If your brand is looking to expand into display, programmatic, OTT, streaming, or video, then you’ll have a lot to learn at unBoxed. 💪

    How to Join

    You can join in person in NYC or online via live stream.

    • General admission ticket (in-person) costs $349, which includes access to 60+ educational sessions, hands-on training and demos, networking events, breakfast and lunch, and an exclusive musical performance. 
    • Virtual admission is FREE, but only provides access to the keynote live stream and select video-on-demand content post-event.

    There’s only a couple of weeks left to register. Don’t miss out!

    Get your tickets now 👈

    Amazon Unveils New Affordable Shopping Hub Just in Time for Holidays

    Amazon Unveils New Affordable Shopping Hub Just in Time for Holidays

    To better serve customers during these challenging times marked by record-breaking inflation, the eCommerce giant introduced Amazon Access, a resource hub for easier and more affordable shopping on Amazon.com. 💰

    What is Amazon Access?

    Amazon Access is Amazon’s newest hub packed with resources to help customers discover ways that they can shop and save more on Amazon. These resources include information on Amazon’s various flexible payment options, discounts offers, and programs designed for a more budget-friendly shopping experience.

    The cost-saving features and benefits of the new program include:

    SNAP EBT payments

    Customers holding a valid SNAP EBT card can now order their essential goods and grocery items from Amazon.com, Amazon Fresh, and Whole Foods Market using their SNAP funds. 

    With the exception of customers from Alaska, this option is available for customers from the remaining 49 states. They can also take advantage of Amazon’s fast and free delivery service for qualifying orders.

    Amazon Layaway

    Amazon Layaway allows customers to pay for their purchases over an extended period of time without incurring huge interest fees or going through stringent credit checks. Under this program, customers only have to pay 20% of their total purchase amount to reserve items and lock in their price. The remaining 80% is then paid over time; product to be delivered once paid in full. 

    Prime Access for less

    Qualified US customers who receive government subsidy can take advantage of a discounted Amazon Prime membership amounting to only $6.99 per month – an $8 monthly savings compared to the regular Amazon Prime membership cost.

    Prime Member discounts

    Aside from getting Prime for more than 50% off its current price, qualified customers can also enjoy more discounts on home products, get access to clip coupons, save up to 15% on various products with Amazon’s Subscribe & Save, and enjoy free shipping on auto-deliveries of certain items. 

    Pay and pick-up your way

    Customers without a credit or debit card can still shop from Amazon.com and pay with Amazon Cash. They can also opt to pick up their goods from an Amazon Hub Locker or Hub Counter. 

    30-day free trial

    US customers can try out Amazon Access for free for 30 days. After the 30-day period has passed, they can simply register by uploading a valid proof of their identification or government benefits documents.

    Why Did Amazon Launch Amazon Access

    It probably goes without saying that Amazon came up with Amazon Access not only to serve Prime members but also to gain more customers!

    Here are the top three reasons why Amazon decided to introduce this hub at this time:

    Increase Prime membership

    Amazon Access can be viewed as the retailer’s latest attempt to attract more customers to sign up to Amazon Prime.

    By making Prime’s benefits more accessible to a wider range of consumers, Amazon can ensure the program’s profitability. In case you’ve forgotten, the company increased Prime’s subscription fee from $119 to $139 last February (the original fee when it was launched was $79).

    Boost 2nd Prime Day profits

    In light of the upcoming Prime Early Access Sale, Amazon is also probably looking to maximize its revenue from the two-day sale event. The more customers who are subscribed to Prime by that time, the higher their sales and profits will be.

    Response to inflation-weary consumers

    Consumers are on the lookout for the biggest bargains and discounts during times of economic turmoil, and this time is no different.

    The US inflation rate of 8.3% for August 2022 may have improved from July’s 8.5%, but it was still higher than the forecasted rate of 8.1%. Economists predict an average rate of inflation of 2.4% from 2022 through 2026, with this year being the worst of it. They also expect inflation to return to its normal rate next year and beyond, thanks to the central bank’s interest rate increases. 

    Take Advantage of Amazon Access

    In these tough economic times, people continue to spend on essential goods, but cut back on wants, or at least wait for the next big sales event. 

    But with Amazon Access, the tech giant can make a wide selection of goods affordable, allowing them to encourage more customers to shop on its retail site and essentially help sellers keep making bank.

    To finish the year strong, take advantage of the sudden demand increase that Amazon Access may create by offering discounts, flexible payment options, and promotions, especially on basic must-haves. Just make sure you have enough inventory for this new demand to stay in stock. 💪

    Related: Inventory-Minded Marketing for Amazon Sellers

    Amazon to Hold Prime Early Access Sale on October 11-12

    Amazon to Hold Prime Early Access Sale on October 11-12

    🛍️ Holiday shopping at Amazon is starting early this year, allowing customers to reduce the cost of their BFCM and Christmas purchases by taking advantage of the 2nd Prime Day sales event!

    What We Know So Far

    Amazon announced that its 2nd Prime Day event, dubbed as the “Prime Early Access Sale”, will take place from October 11 to 12, in a move that mimics that of its rivals Walmart and Target.

    The new two-day sales event is exclusive to Amazon’s more than 200 million Prime members, and will grant them access to huge discounts on the most popular brands as early as fall, giving them a head start to find and shop the best holiday deals.

    The sales extravaganza will also showcase Amazon’s Top 100 list which includes best-selling gift items and amazing deals in electronics, fashion, home, and kitchen products, among other top categories.

    The announcement confirms Business Insider’s report just three months prior, when it said that the eCommerce giant was planning to hold another Prime Day event in October.

    Why is Amazon Holding a 2nd Prime Day Event?

    • Protect its Q4 market share. The competition for sales during the upcoming holiday season is heating up as other retailers announced sale events scheduled earlier than Amazon’s. Walmart’s holiday sale will start on October 1 and will feature thousands of discounts in toys, tech, home, and beauty product categories.

      On the other hand, Target will kick off its own two-day Deals Day event from October 6 to 8, offering shoppers “hundreds of thousands” of deals in different product categories plus a price-match guarantee until Christmas eve

      According to Texas A&M marketing professor Venkatesh Shankar, Prime Early Access Sale represents Amazon’s attempt to “cover its bases” and grab the largest share of consumers’ holiday shopping.
    • Offload excess inventory. The fact that there is an oversupply of consumer goods from fashion, electronics, toys, home and other popular categories also fuels the competition between these rival retailers. Due to supply chain challenges, these products, which the retailers ordered to meet their projected customer demand, arrived late and are now stuck on store shelves and in warehouses. These retailers must be feeling the pressure to sell these products fast and replace them with new products for the holiday season and the new year.
    • Fill up unused warehouses. Another possible reason is that Amazon is seeking to fill up its empty warehouse space for the coming quarter and so is hoping to invite more sellers to send in inventory. 

      Amazon CFO Brian Olsavsky admitted to reporters last April that the company has way too much warehouse space, infrastructure, and staff than the required demand. Amazon has made significant investments in logistics and human resources given the surge in eCommerce during the onset of the pandemic. 

      But now, given the record-breaking inflation that consumers are grappling with and the decreasing eCommerce purchases, retailers like Amazon need to be creative in increasing their revenue. Holding these big sale events will allow them to attract more sellers to stock up on their products, which will occupy more space in their warehouse, and increase their fulfillment revenue. 

    It is also possible that Amazon is trying to recreate the success of its first Prime Day of 2022 held last July 12 to 13, which saw the company earning $12.09B

    Related: Walmart and Amazon Battle for Dominance Intensifies

    What’s in it for Amazon Sellers?

    Sellers may want to take advantage of Prime Early Access Sale to increase their restock limits, which can come in handy for the upcoming Black Friday/Cyber Monday (BFCM) event. 🚀

    Just last month, Amazon announced that they are bringing back restock limits in preparation for the Q4 holiday rush. Sellers have been given up to four (4) months’ worth of inventory in FBA fulfillment centers. 

    ⚠️ However, I wouldn’t recommend maxing out your restock limits for the October Prime event, as it means increased difficulty in restocking until you free up enough storage space for products as limits fluctuate. In turn, this may translate to missed selling opportunities during BFCM and through the rest of the holiday season. 

    If you have excess inventory, try getting rid of it faster by offering deep discounts during this 2nd Prime Day. Increasing sales results in a higher sell-through rate, which is a very important metric used by Amazon in determining seller restock limits. 

    And remember, the Prime Early Access Sale is expected to be a “high velocity” sales event, so make sure your business and inventory are ready for it! 💪

    Related: 3PL Logistics Backup for Amazon, Master Carton Calculator, How to Ship to Amazon FBA (And Speed Up Check-in Times)

    Non-Amazon Sellers Are Now Stealing Your Ad Space

    Non-Amazon Sellers Are Now Stealing Your Ad Space

    Amazon continues to beef up its Buy with Prime business with more marketing capabilities to help non-Amazon sellers drive traffic and increase sales on their own stores. 📈

    Buy Ads to Drive More Shoppers to Off-Amazon Stores

    The tech giant launched Buy with Prime in April 2022 to allow direct-to-consumer (DTC) brands off Amazon.com to offer free 1 to 2-day shipping, an easy checkout process, and free returns to customers. They do this by becoming these brands’ fulfillment centers. FBA essentially becomes available to non-AMZ sellers. 

    That’s right. While you get saddled with restock limits and reduced FBA warehouse space, Mr. Shopify Only seller snuggles up in your spot. 🤔

    Participating brands feature a Buy with Prime button on their sites to provide shoppers with a seamless buying experience via Amazon payments and fulfillment.

    Buy With Prime Button

    As Prime benefits are some of the main reasons why customers pick Amazon over other online retail platforms, offering Prime on an eCommerce site can be an effective way to increase conversion.

    However, conversion is only half the battle. The other half is expanding your reach and driving new customers to your own DTC site, which many participating sellers are reportedly struggling with. 

    To help address this pain point, Amazon is introducing three (3) new marketing solutions that will enable DTC brands to attract and direct more shoppers to their own brand offerings. 

    So now, not only are non-AMZ sellers stealing your warehousing space, they’re also stealing your ad space. 

    However, it’s not all bad news. This actually could present some interesting opportunities for Amazon sellers to take Amazon traffic into their own websites and finally collect some of that customer information in a way that is TOS-compliant. Read on.

    1. Buy with Prime Pages and Sponsored Brands Ads

    Amazon invites DTC sellers to showcase their products on Amazon with a Buy with Prime page within an Amazon brand storefront.

    Amazon Buy With Prime Page

    They would then create and launch Sponsored Brands ads to attract and drive Amazon shoppers to their products.

    Sponsored Brands ads are customizable cost-per-click (CPC) ads that highlight a brand’s logo, headline, and products. They also appear in relevant parts within the Amazon search result pages to help shoppers discover your brand.

    When a customer clicks on a Sponsored Brand ad, it directs them to a seller’s Buy with Prime page on Amazon.

    Buy With Prime Product Preview Page

    From there, the customer can preview the product offerings and decide whether to buy on Amazon or directly from the brand’s website via Buy with Prime.

    However, as you can see, this process takes several clicks that may increase checkout friction in the customer’s path to purchase, which could then lead to cart abandonment.

    But the good news is that both these DTC Sponsored Brands Ads and Buy with Prime pages are currently in beta. So, expect to see some changes to these features as they go through this testing period.

    In a blog post, Marketplace Pulse Founder Juozas Kaziukėnas speculates that non-Amazon sellers might be able to advertise directly in Amazon search results in the future.

    We could imagine a world where, when a customer types in “filtered water bottles,” and clicks on the first Sponsored Ad they see, for example, it would take them directly to the brand’s website instead of its Buy with Prime page on Amazon. Amazon would pocket the ad spend and the fulfillment fees and it is possible that they’d throw in an additional referral fee on top of the ad spend, knowing Amazon.

    Removing as many steps as possible is key to improving customer experience and ecommerce sales.

    2. Amazon-Funded Social Media Ads

    With the advent of omnicommerce, people are no longer following a linear customer journey path. Many shoppers now go back and forth between your own website, social media ads, emails, and Amazon storefront to search for and buy products.

    For this reason, Amazon is launching a co-branded Buy with Prime social media page and ads on Facebook and Instagram to help Buy with Prime sellers reach more customers at no extra cost. The ads from the Buy with Prime page will also feature specific sellers. This is a smart value add that Amazon is using to attract sellers to the program. 

    Suppose a customer sees a Buy with Prime ad featuring your brand on Facebook and clicks on that ad. In that case, they will be redirected to a Buy with Prime page where they can place an order.

    3. Buy with Prime Marketing Toolkit

    This toolkit provides you with a Buy with Prime badge that you can feature in your media assets, including product pages. It also allows you to market to Prime members on your own website.

    Buy With Prime Marketing Toolkit Sample

    In Amazon’s official press statement, Patrick Sean Briseno, eCommerce and marketing manager at Great Circle Machinery shared:

    “It’s tough to gain shoppers’ trust to make a purchase on our own website, but the Buy with Prime badge gives them peace of mind knowing their orders are fulfilled by Amazon with the Prime delivery promise.”

    Related: Amazon Now Allowing Email Marketing Campaigns to Repeat Customers

    Effective Way to Embrace Omnichannel Strategy

    Many consumers rely on Amazon through all stages of their shopping journey. So, while you could come up with compelling offers to entice people to shop directly on your website, you could still face an uphill battle when competing with the retail giant.

    But with Buy with Prime, along with borrowing trust, you can also use Amazon as an additional marketing and distribution channel to massively expand your reach and fulfill orders for Amazon shoppers, especially the company’s over 200 million Prime members. 🚀

    But if you didn’t already consider it, this could also be a backdoor into Amazon getting all those non-Amazon, DTC sellers actually going toe-to-toe with you selling on Amazon itself. I’m sure, for Amazon, it’s just a waiting game. It’s all a bunch of these tiny yeses til Amazon’s got them going all in.

    A word of caution for Shopify sellers: Shopify warns its merchants against Buy with Prime as using it violates the company’s Terms of Service. If you’re on Shopify, make sure you understand the risks of participating in the Buy with Program before getting involved. Read this article to learn more. 

    Related: Shopify Acquires Deliverr and Takes Aim at Amazon’s Buy with Prime

    Amazon To Increase UK Multi-Channel Fulfillment Fees By November 12th

    Amazon To Increase UK Multi-Channel Fulfillment Fees By November 12th

    Amazon just announced another fee increase that may whittle away at your profits just in time for the holidays. 💸 

    Amazon said that they will be increasing the multi-channel fulfillment (MCF) single-unit-order fulfillment fees beginning 12th of November this year. The price hike will apply to all parcel size tiers and already includes the additional fuel and inflation costs. 

    The retail giant explained the increase mirrors the surge in order fulfillment and logistical costs, and will allow them to keep on providing the same high-speed delivery and high-quality service their customers expect. 

    This is the latest in the seemingly never-ending fee increases Amazon imposes on its independent sellers.

    If you have been following our posts for some time, you may remember the Amazon Fee Stack, the term we’ve assigned to the incremental but regular fee increases that Amazon has been making at the expense of the sellers’ profit margins

    ⚠️ Constant price hikes, even if they are only small in amount, can have a negative effect on your bottom line.

    When you add them all up, you may be surprised at just how much they amount to. And when you add these higher fees on top of all the other increasing operating costs of your business, you may be shocked to see how little is left for your business to operate sustainably.

    UK MCF Fees Before November 2022

    Amazon actually reduced their MCF fees for specific size categories beginning on April 26, 2021.

    For the large envelope 960g size tier, for example, the MCF fees for Standard and Expedited Delivery dropped from £3.93 and £4.95 to £3.39 and £4.10, respectively.  

    But starting from May 12, 2022, Amazon added a 4.3% fuel and inflation fee to the existing FBA fulfillment fee per-unit rates in the UK and other European countries and territories. MCF, in case you’ve forgotten, is a division under the FBA Program.

    UK MCF Fees After November 2022

    Have a look at the table below to see the difference between the old and new MCF rates per unit for local and international deliveries. Keep in mind that these rates apply to standard shipping, not expedited shipping.

    Local shipping Cross-border shipping
    Domestic, Multi-Country Inventory, Pan-European European Fulfillment Network
    Size tier Before November 12 After November 12 Before November 12 After November 12
    Small envelope to 80g £3.15 £3.31 £4.59 £4.96
    Standard envelope to 210g £3.30 £3.45 £4.74 £5.12
    Large envelope to 960g £3.39 £3.48 £5.10 £5.51
    Standard parcel to 1.4kg £3.65 £3.91 £7.75 £8.37
    Standard parcel to 6.9kg £4.95 £5.90 £11.73 £13.07
    Standard parcel to 11.9kg £6.38 £7.34 £12.75 £15.41
    Standard oversize to 2.7kg £6.48 £7.13 £13.82 £14.93
    Standard oversize to 29.76kg £9.28 £9.45 £19.53 £21.09
    Large oversize to 31.5kg £13.77 £14.50 £28.66 £30.95

    For local shipment, sellers will have to pay an extra £0.09 to £0.96 per unit – depending on the size of the product – after the MCF fee adjustment takes effect on November 12. 

    Following our large envelope 960 g size tier example, Amazon increased the MCF rate per unit by 2.69% from £3.39 to  £3.48, or an additional £0.09. If your item falls under the standard parcel to 6.9 kg size tier, expect to fork out an extra £0.95 per unit as the rate jumped by 17.51% from £4.95 to £5.90.

    On the other hand, cross-border shipping will incur higher rates – between £0.37 to £2.66 more per unit. From £5.10, the new rate for an item under the large envelope 960 g size tier will be £5.51 – an increase of £0.40 or 8.03%.

    If your product is categorized under the standard parcel to 6.9 kg size tier, you’ll see an increase of £1.34 or 11.42% as the old rate of £11.73 rose to £13.07.

    These small increases, while seemingly negligible at first, can be significant enough to shrink your profits and test your business’ level of resilience.

    Multi-Unit Order Discounts

    The good news is Amazon still seems to be listening to sellers when it announced the launch of multi-unit order discounts, as suggested by the sellers themselves.

    Sellers who ship multi-unit orders will enjoy lower per-unit costs, resulting in savings averaging to 25.2%. If you want to save more and/or offset the higher MCF fees, you may want to consider taking advantage of this new offer by creating multi-unit or cross-selling offers on your UK marketplace listings. 

    Check out the table below to see the difference between the local shipment fees for single-unit orders and multi-unit orders.

    Aside from this new discount, Amazon also shared three developments geared towards boosting their sellers’ business growth:  

    • Launch of unbranded packaging for UK sellers, available for free
    • Reached over 99% on-schedule delivery rate
    • Allocated for the expansion of fulfillment center capacity

    Read more on these in the updated MCF rates announcement under the section “What am I getting for these higher rates?” (Yes, that really is the name of the section.)

    Keep your head up and your margins down.

    Amazon Now Allowing Email Marketing Campaigns to Repeat Customers

    Amazon Now Allowing Email Marketing Campaigns to Repeat Customers

    Amazon makes huge strides in its Manage Your Customer Engagement (MYCE) tool to help brand-registered sellers expand their email marketing reach. 🔥

    Amazon Tailored Audiences

    On September 14th, at its annual seller conference, Accelerate, the eComm giant unveiled Amazon Tailored Audiences, a free email marketing tool within MYCE, which allows sellers to set up email promotional campaigns for three new audience types.

    Aside from brand followers, you will now be able to send email marketing messages to your:

    • Repeat customers. Customers who have ordered your products more than once in the last 12 months.
    • Recent customers. The most recent 20% of shoppers who have bought from your registered brand.
    • Biggest spenders. The highest spending 25% of your customers in the last 12 months.

    Other features include:

    • Option to select a specific audience type
    • Enhanced email templates
    • Custom HTML content
    • Monitoring tools to track your campaign’s key performance metrics like emails delivered, open rate, click-through rate, opt-out rate, sales, and conversion

    With expanded email marketing capabilities, you will have more control over how you engage your customers, build brand loyalty, or increase product visibility and sales – for example, remarketing to recent buyers, allowing for more specific messaging and upselling. 🥳

    Amazon is Breaking its Own Rules

    As you know, Amazon has strict guidelines for communicating with buyers to prevent fraud and unethical competitor actions.

    For example, you may only send Permitted Messages to previous customers and those who have contacted you about buying a product. Or, as mentioned earlier, send marketing emails to your brand followers, making it difficult for you to build and maintain long-lasting relationships with other types of audiences.

    But with the launch of Tailored Audiences, the rules have changed. Amazon may have decided to make this move to:

    There’s one drawback, however. Directly sending promotional emails to more customers could lead to a lot of spam. If you send too many emails, people may get overwhelmed and decide to unsubscribe. A high opt-out rate may result in Amazon reducing your campaign reach or suspending your campaign. ⚠️

    Be sure to follow customer engagement best practices to minimize your opt-out rate and to stay compliant with Amazon’s communication guidelines.

    Amazon Tailored Audiences is currently in beta and is expected to roll out more broadly in 2023. Check out Customer Engagement Tailored Audiences for more information.

    Financial Win for FBA Sellers in PA Court

    Financial Win for FBA Sellers in PA Court

    On September 9, 2022, the Commonwealth Court of Pennsylvania released an order prohibiting the state’s Department of Revenue (DOR) from pursuing Amazon FBA sellers for sales tax nexus owed from previous years. 🎉☝️

    This means less financial burden to bear especially amid the mounting Amazon fee stack moving into the fourth quarter! 

    What is Sales Tax Nexus?

    In tax law, nexus describes the level of connection between a business and a taxing authority such as Pennsylvania’s DOR. Nexus specifically applies to businesses with little to no physical presence in a state, aka out-of-state online sellers, who meet certain criteria such as having physical inventory in the state – as is the case with FBA warehousing – or who exceed a set level of sales or number of transactions within the state.

    Until a nexus is established, a state cannot impose its sales tax on a remote seller.

    The US Constitution provides two clauses to determine a nexus:

    • The Due Process Clause which requires a definite or minimal connection between a state and the business it seeks to subject to sales tax
    • The Commerce Clause which requires substantial presence 

    Nexus determination may vary by state, but it generally requires that an entity such as your Amazon business must meet the following conditions to be considered to have a connection or presence in a particular state.

    • You maintain a place of business
    • You employ workers or salespeople
    • You store merchandise in a warehouse
    • You engage in an activity related to leasing or servicing of property

    The third bullet point puts FBA sellers in a very tricky situation because Amazon distributes their inventory across multiple states.

    Suppose Amazon stores a portion of your inventory in a state where nexus laws are enforced. In that case, the retail giant may be authorized to collect taxes on your sales in that state and remit them to the revenue department on your behalf. Or, depending on the nexus provisions of the state, the tax man may require you to pay directly.

    For years, Amazon has resisted calls from state governments to charge sales tax to keep the prices of goods on their platform more affordable than brick-and-mortar stores. Both parties have engaged in a long, arduous debate over whether online sellers having a physical presence in a particular state through FBA (i.e., storage and distribution centers) causes them to have a nexus. 🤔

    In a 2017 New York Times post, Amazon reportedly found a loophole that allowed them to collect sales tax only when the order came from their own inventory, e.g., customers buying from AmazonBasics, not from third-party sellers who account for 60% of Amazon’s total sales. This action basically left sellers to charge and remit taxes on their own. 🤦‍♀️

    Many sellers found this action unfair and self-serving, claiming that they don’t have control over which warehouse location(s) Amazon selects to store their goods. Besides, Amazon is the owner of these warehouses, which establishes their connection with the state.

    Therefore, out-of-state sellers, whose only connection to an Amazon warehouse is their inventory, should be exempted from sales tax. 

    Unfortunately, the loophole has resulted in millions of dollars in uncollected sales tax revenue and states aggressively pursuing sellers (instead of Amazon) for back taxes they presumably owe. 😓

    Paul Rafelson, Director of Online Merchants Guild (OMG), said he believed that some states were chasing after sellers for back taxes to prevent a clash with Amazon. 

    States Started Taking Action

    To close any loophole and protect their budget, several states have passed nexus laws, aka Amazon laws. These laws seek to remove the burden and cost on out-of-state FBA sellers to charge and remit sales and income taxes.

    Some states have also used different approaches, such as increased reporting requirements on retail companies and implementing certain mechanisms (e.g., concessions or state agreements) to collect back taxes that sellers owe.

    As of this writing, Amazon now collects and remits for many states, but not all of them. Florida, for example, still requires third-party sellers to pay directly. Either way, this puts an end to tax-free online shopping on Amazon and places more strain on sellers and consumers.

    👌 This is why getting the Pennsylvania (PA) court to side with FBA sellers is a pivotal moment, as groups like OMG could leverage this win as precedent to challenge other similar Amazon laws. It could also pave the way for more states to stop pushing for more e-commerce taxation.

    Dispute Over Obligations to Pay PA Sales Tax

    In OMG (a group of Amazon sellers) vs. Hassell (Secretary of Revenue), the PA court found that:

    “The Revenue has failed to provide sufficient evidence that non-Pennsylvania businesses selling merchandise through the FBA Program, and whose connections to the Commonwealth were only shown to be limited to the storage of merchandise by Amazon in one of Amazon’s Pennsylvania warehouses, have sufficient contacts with the Commonwealth such that Revenue can mandate they collect and remit sales tax pursuant to the Tax Code.”

    Simply put, any attempt to collect sales tax from out-of-state FBA sellers is considered illegal in Pennsylvania. 🚨

    This legal battle within the Keystone State has been going on since 2012, when non-PA online retailers, including Amazon, agreed to voluntarily collect and remit sales tax on their internet, catalog, and telephone sales. However, this state agreement did not apply to FBA sellers.

    In 2018, Amazon entered into a new agreement with the state to collect and remit sales tax for FBA sellers. The remittance also included taxes the retail giant failed to collect before 2018. 

    Furthermore, representatives from the DOR handed out Business Activities Questionnaire Requests to members of the Online Merchant Guild. These forms indicated that they may have a physical presence in PA that would subject them to sales tax and personal income tax. In addition, the DOR provided voluntary compliance services to assist the Guild members in paying back the taxes owed.

    In 2021, OMG filed a lawsuit with the Pennsylvania Court to stop DOR’s attempt to request payment from its members, stating that it violated their civil rights.

    When asked about the impact of the PA’s ruling on nexus with other states, OMG Director Rafelson told EcommeceBytes that “Basically all of that tax nonsense for the last five years, and even going forward was bogus and unconstitutional. Of course, this is one state ruling, but it is a first state ruling.” 🔥

    Boost Conversions with Amazon’s New A/B Testing Features

    Boost Conversions with Amazon’s New A/B Testing Features

    Amazon continues to roll out new tools to help you manage and optimize your content more efficiently! 🚀

    Unveiled at the Accelerate event on September 15, you can now use these new A/B Testing features to update your product listings with winning content. 🤩

    • Title and image notifications. Run A/B tests on your titles and main images to see which version performs best. You will also receive an alert for content that’s too similar to your existing content so you can make the necessary adjustments to ensure maximum conversion. 
    • Recommendation system for images and titles. Review Amazon’s best recommendations for product images and titles to increase your conversion rate.
    • Auto-publish winning content. Amazon will automatically publish title and image experiments that are at least 66% better than the other versions, thereby reducing the time spent updating your product listing. 

    With these new Manage Your Experiments features, it’s now easier to test more content and convert traffic from hundreds of millions of Amazon shoppers.

    Go to Manage Experiments to get started.

    Amazon FBA Deadlines for Sending In Q4 Inventory

    Amazon FBA Deadlines for Sending In Q4 Inventory

    📢 Amazon just dropped the deadlines for checking in your Q4 2022 inventory! It’s time to get into gear if you want to stay in stock during the holiday season.

    Make sure your inventory arrives at FBA ahead of the following dates:

    • November 2nd for Black Friday and Cyber Monday
    • December 1st for Christmas

    ☝️ Also, keep these public holidays in mind when creating your shipping plans or securing delivery appointments with FBA to avoid receiving delays.

    • October 10th: Canadian Thanksgiving Day
    • November 24th: US Thanksgiving Day
    • December 24th: Christmas Eve
    • December 25th: Christmas
    • December 26th: Boxing Day – Canada
    • December 31st: New Year’s Eve

    Be Mindful of Your Restock Limits

    As previously reported, Amazon recently brought back restock limits to prepare for this year’s holiday selling period. 

    All sellers will be allowed to store at least four months of inventory in FBA fulfillment centers. However, those who already have a high utilization rate might not be able to restock additional units, unless they make more space for their inventory

    Before sending in your shipments, be sure to check your Restock Inventory report to avoid maxing out your restock limits overnight, which can lead to stockouts on best sellers. ☠️

    But if you’re currently facing restock restrictions with no clear way around them and want a quick solution, consider enrolling in Amazon Warehousing & Distribution program to leverage its no restock limits benefit.

    Alternatively, follow my in-depth guide to improving restock limits or join my live webinar to learn what you should do right now to prepare for Q4. 🔥

    Related: How to Ship to Amazon FBA (And Speed Up Check-In Times), Amazon Freight Forwarding Tips to Avoid Stockouts, 14 Mistakes Sellers Make When Shipping to Amazon FBA

    Software Updates For September 2022

    SoStocked Software Updates For September 2022

    Here’s what’s new this month!

    🥳
    NEW RELEASE

    Now Connect To All Amazon Marketplaces! 
    Including Australia, UAE, India, Singapore, Japan, and More!

    SoStocked Amazon Additional Marketplaces are Live

    Thank you for your patience! We are happy to announce that we have opened up SoStocked worldwide with the new Amazon SP-API!

    You can turn on new marketplaces and start tracking your inventory across all your stores. Some of the newer marketplace additions include Australia, Abu Dhabi, Dubai, India, Japan, and Singapore.

    To turn on a new marketplace, simply go to the Settings page, Connected Stores, Connected Amazon Stores. From there, you can connect to a new region of your choosing. Follow our how-to video for more details. 

    If you have any questions, feel free to email us at [email protected]

    🔥
    ICYMI: FEATURE SPOTLIGHT

    Contact Us or Get the Help You Need Faster With the New Guided Tours and Resource Center. On the bottom right corner of SoStocked there is a new Guided Tour option. This is great for setting up your new account and learning how to use SoStocked, onboarding new VAs, or accessing our helpdesk any time of day or night when you need help.

    SoStocked Get the Help You Need Faster With the New Guided Tours
    SoStocked Get the Help You Need Faster With the New Guided Tours and Resource Center

    When you first connect your account, you walk through the Guided Tour Get Setup steps. For most of you, this has already been completed. But from this same menu, you can access our comprehensive collection of tutorial videos or set up a 1-on-1 onboarding call with our SoStocked team. Even if you have had SoStocked for a long time, you can always schedule a call with our onboarding specialists to get one-on-one tips on how to best set up your account for your business model or specific needs. We hope to keep providing you with the best hands-on customer service within the Amazon software space.

    Need more information?

    1. Send Message: We typically reply within 2 hours during office hours.
    2. Schedule Demo: Dive deeper into the nuances of our software with Chelsea.
    3. Join Live Upcoming Webinar: New to Amazon inventory management? Learn three inventory techniques you can implement right away.

    Gloves Off: Shopify Warns Sellers Against Amazon Buy With Prime

    Gloves Off: Shopify Warns Sellers Against Amazon Buy With Prime

    🥊 Shopify’s fight to maintain and increase their eComm market share continues, as the Canadian company recently issued warnings that are bound to cause sellers to reconsider Buy with Prime, Amazon’s new service offering fulfillment and checkout to Direct-to-Consumer (DTC) businesses that don’t even sell on Amazon. 

    Protect Your Shopify Store Against Fraud

    According to Marketplace Pulse (MP), Buy with Prime badges started to appear on a few Shopify stores back in June.

    This new service offers a way for non-Amazon sellers to attract new customers to their stores by offering 1-2 day shipping and secure, trusted payment processing through Amazon Pay.

    Shopify Store Showing Buy With Prime Button

    How do sellers enable Buy with Prime on their sites?

    First, you need to receive an invitation from Amazon to sign up. Once signed up, Amazon will send you a few lines of code that you need to embed in your product template to display the Buy with Prime button.

    Sounds harmless, right? Shopify thinks otherwise. 🤔
    In an article posted by MP on September 1st, Shopify has reportedly sounded the alarm about the potential security issues that you could face when installing the Buy with Prime button code in your store. 🚨

    Shopify Warns Sellers Against Using Buy With Prime

    The code includes an “Unsupported external checkout script” that violates the platform’s Terms of Service (ToS). It takes the checkout process outside of Shopify, thereby disabling Shopify Fraud Protection against fake orders, which can result in chargebacks, which can then lead to financial loss.

    Shopify’s ToS states:

    Shopify Terms of Service

    These are the account terms that Amazon’s service supposedly violates.

    Shopify also warns that Buy with Prime could steal your customers’ data and cause incorrect charges – for example, discounts not applied correctly due to a technical glitch or Amazon themselves incorrectly charging your customers.

    While you may still opt to install the unsupported script, you must agree that Shopify will not be liable for any fake orders, illegal valuable data extraction, or incorrect charges conducted through Buy with Prime. 

    My prediction however, if they’re smart, is that Shopify will update its ToS to ban Buy with Prime altogether, following the example set by Walmart.com. We may see that they even develop a script that removes the Buy with Prime code snippet from even appearing on your product pages. I’d put money on it eventually going this way.

    Amazon’s Response to Shopify’s Claims 

    In response to the accusations, Amazon reps said that they developed the new fulfillment service to serve Prime members no matter where they shop online. And while they do collect data via Buy with Prime, they use the information to improve the service for sellers and customers. Uh huh… Makes sense. 🤔

    As for providing a safe and secure payment processing platform, Amazon Pay is equipped with the same fraud protection technology used on Amazon.com. In addition, sellers also have full control over how much they charge their customers.

    But those statements don’t exactly excuse them from other anti-competitive allegations like data grabbing, which I believe is the clandestine intent of Buy with Prime to Amazon. ⚠️ More on this in the next section. 

    Amazon’s Data Grabbing History

    As we’ve reported on in the past, Amazon is no stranger to data grabbing, which involves harvesting valuable information about web users which can then be used for a variety of purposes.

    The data collected from customers and competitors, including third-party sellers, could then be used to create unfair competitive advantages. 

    Here are just a couple of the data grabbing opportunities available to Amazon:

    ✊ In a move to protect their data and market share, Shopify acquired Deliverr, a fulfillment operation with the capacity to offer 1-2 day fulfillment for merchants across multiple sales channels, including Amazon, Walmart, Etsy and social commerce sites like Facebook, Tiktok, and Google.

    Therefore, with Shopify’s revamped fulfillment network, merchants will be less likely to need to use Buy with Prime and risk exposing their sensitive data to Amazon.

    Shopify is certainly holding its own against Amazon’s advances and has really been making some impressive moves in defense of their own market share. But the battle rages on and I for one am busting out the popcorn. 🍿

    Amazon Brings Back Restock Limits to Prepare for the Holiday Rush

    Amazon Restock Limits Are Back

    LIVE WEBINAR: The Return of Restock Limits 🙁. Learn what you should do RIGHT NOW to Prepare for Q4 2022. Register Here

    🚨 After not having capacity restrictions for the better part of 2022, on August 29th, sellers woke up to just that with an announcement from Amazon that they are, in fact, bringing back restock limits to prepare for Q4!

    With this update, all sellers will be allowed at least four (4) months of inventory in FBA, which completely contradicts recent moves they’ve been making to entice eCommerce sellers that are not even selling on the Amazon platform to use FBA Prime fulfillment services – all signs pointing to Amazon not being worried about running out of space after nearly doubling their fulfillment network during the pandemic. 😓

    The announcement also came after the launch of Amazon Warehousing & Distribution (AWD), a low-cost upstream storage and distribution program that could rival independent 3PLs. 

    One of the selling points of this new service is that you can send inventory to an AWD facility without any storage limits. Interesting timing… 🤔

    They also boast lower storage and transportation costs, making it an attractive logistics option for sellers who may want to bypass the current inventory restrictions without leaving the Amazon fulfillment network, and possibly to keep costs down amid rising FBA fees.

    So, coinciding the return of restock limits with the launch of AWD seems like a deliberate move by Amazon to:

    • Make sellers more reliant on their storage, distribution, and fulfillment network. Otherwise, if sticking with your 3PL, you’ll be dealing with low restock limits leading to stockouts. You may have to run flash sales to sell through your slow-moving inventory that’s clogging your storage limits, pay hefty removal fees to get rid of extremely slow sellers, or cancel your FBA shipping plans to make room for products within your restock limits.

    But if everything works out in Amazon’s favor, they will be able to generate more revenue for their fulfillment business arm, which recently grappled with excess capacity and massive financial obligations associated with maintaining facilities they no longer need as economies reopen.

    It’s unfortunate (but not surprising) that the cost of Amazon’s over-expansion is, more and more, trickling down to sellers. While AWD can be a good way to avoid restock limits, it is still in its early stages and may not be as seamless as one could hope. We saw how Amazon handled its logistics last year!

    Handing over months’ worth of inventory to Amazon may be risky given that they’re not exactly immune to shipping delays and mistakes, especially during congestion times.

    So, proceed with caution, weigh your options carefully, and don’t ever let anyone have all your stuff! Especially not Amazon. Be sure to check out Amazon Restock Limits Tips and Updates for more information and sign up to get notified when new restock updates drop!

    New Amazon Badges Increase Discoverability and Allow for Values-Based Buying

    New-Amazon-Badges-Increase-Discoverability-And-Allow-For-Values-Based-Buying

    Amazon continues to usher in a more values-based shopper experience by spotlighting small business and minority-owned brands through new Amazon badges. 🙌

    US-based small businesses and artisans may qualify for and apply to this certification program by registering with Brand Registry or Amazon Handmade. It is currently being tested and allows for clearer identification and transparency as to the brands behind the listings.

    New Badges to Highlight Small Businesses

    Amazon-Badges-For-Small-Businesses
    • Black-Owned Business Badge. In celebration of the Black Business Month and the 1st year anniversary of Black Business Accelerator, Amazon launched a new badge that will make it easy for shoppers to find Black-owned businesses on the retail platform. This badge tells people when a product offer they’re looking at is sold by a Black-owned business. Aside from search, the badge will also be visible to customers when they’re on a Black-owned product detail page.
    • Small Business Badge. You’ve probably heard of the Small Business Badge, but it’s worth repeating here in case you missed it.

    Amazon introduced the small business badge earlier this year, announcing, “We’re starting first by testing the Small Business badge on a subset of eligible product detail pages in the U.S., and plan to scale further as we learn how the badge can best help customers discover small business products they love.”

    Making good on the promise, it is now possible to apply for one of several of these new badges on the Add a Certification page. 👌

    Other certifications that may be of interest to you include:

    • National Diversity Certifications for Women-Owned Businesses, Veteran-Owned Businesses, Economically Disadvantaged Women-Owned Business, LGBT Business Enterprise, and more.
    • State Diversity CertificationsState Diversity Certifications
    • Climate Pledge Friendly Badges

    ♻️ We previously featured the Climate Pledge Friendly Badges in another post, specifically highlighting Amazon’s own Compact by Design program.

    In this competitive landscape, it’s important to take any advantage you can and these badges are beginning to allow us “little guys” to start differentiating ourselves from the big brands that are sometimes harder to compete with. 💪

    As buyers increasingly become socially conscious and begin to realize they can reinforce their values through their buying habits, Amazon seems to be attempting to humanize the shopping experience and community sellers may reap the benefits. 🔥

    Royal Mail Strikes to Disrupt Mail and Deliveries Across UK

    Royal-Mail-Strikes-To-Disrupt-Mail-And-Deliveries-Across-The-UK

    UPDATE 08/23/2022: Amazon just announced that they will extend delivery date promises to Amazon customers for seller-fulfilled orders during the Royal Mail strikes. The planned 4-day protest is expected to cause UK-wide postal disruptions, prompting the retail giant to create a contingency plan to minimize customer dissatisfaction that may impact seller account health.

    ⚠️ In one week, over 115,000 Royal Mail workers will go on strike over pay, which could jeopardize deliveries and collections across the UK. If you haven’t done so already, it’d be wise to find an alternative carrier ASAP to avoid delays or lost parcels in the coming weeks.

    When is the Mass Walkout Happening?

    The Communication Workers Union (CWU), a group that represents British postal workers, recently announced that they will stage four days of industrial action, a protest against low pay and poor working conditions, on the following dates:

    • August 26, Friday
    • August 31, Wednesday
    • September 8, Thursday
    • September 9, Friday

    The August Royal Mail strikes are also set to coincide with:

    • Crown Post Office protest on the 27th. Employees who work in 114 Crown Post branches will stop work again in an escalating fight over pay. The staff rejected and took industrial action against the 3% pay offer and £500 lump sum by the Post Office last month because it wasn’t enough to improve their living standards, especially at a time when inflation is at 10.1%.
    • Strike at Port of Felixstowe from August 21st to 29th. Around 2,000 dockers at UK’s largest container port will protest for 8 days over poor pay. Transport economists at MDS Transmodal estimate that this week-long industrial action could put $4.7B in trade on hold, potentially delaying the arrival of goods expected to go on sale this holiday season. Companies that rely on the port like Amazon, Mars Foods, GSK, and General Mills will all be impacted.
    • Bank Holiday in England and Wales on the 29th. This is a public holiday that gives workers a long weekend to make the most of the summer season.
    • Supply Chain & Admin action on the 30th. Union members whose jobs are related to supply chain and administration will also walk out at the end of this month in hopes of getting a fair pay increase for their hard work and dedication.

    These additional walkouts could lead to an even bigger postal disruption. 😩 And if the planned protests go ahead, collectively it would be the largest summer strike ever held by postal workers in the UK, according to CWU.

    Postmen walking out of their jobs on the 26th of August means you’ll have to make sure customer orders or any additional inventory must get picked up before the 25th. It’s also best to notify your customers of expected delays due to the protests. Because even if collected, they won’t be delivered right away, which could create a massive backlog of undelivered items.

    Additionally, Post Office walkouts and the Bank Holiday coinciding with the Royal Mail strikes may also exacerbate the situation. So, experiencing shipping delays even after the industrial action in September is highly likely.

    Certain items are at even bigger risk of being delayed during the strikes because Royal Mail will prioritize special deliveries, medical prescriptions, COVID testing kits, and tracked shipments over letters and normal parcels to minimize the impact of the upcoming disruption.

    Main Reasons Behind the Postal Strikes

    Postal workers are threatening to walk out of their jobs in a dispute over pay amid soaring inflation.

    According to CWU, the Royal Mail leadership has presented an offer worth up to 5.5% for their workers, which they have broken down to:

    Therefore, for the union, there was never a 5.5% pay increase put on the table, resulting in approximately 97.6% of postal employees voting in favor of industrial action. 💪

    Scottish Regional Secretary of CWU, Craig Anderson, told BBC that “a fair offer from our perspective would be for them [Royal Mail] to sit back round the table with us and actually look at where or what comes out at the moment with a cost-of-living crisis, where the company’s been with the profits that they’ve made, and actually start negotiating on a percentage pay raise that reflects that.”

    In 2021, Royal Mail raked in £758M in profit and handed over £400M to shareholders, and £2M in bonuses to 2 CEOs and finance executives, while many employees overwhelmed by the rising costs were forced to rely on food banks to feed their families. 😓

    In a report from Bloomberg, Royal Mail argued that it will suffer a full-year loss in the event of mass walkouts by their workers over several days. The negative impact of the strikes on the company will only make pay increases less affordable and therefore, could lead to layoffs.

    But CWU General Secretary, Dave Ward, said, “Nobody takes the decision to strike lightly, but postal workers are being pushed to the brink. There can be no doubt that postal workers are completely united in their determination to secure the dignified, proper pay rise they deserve. The CWU’s message to Royal Mail’s leadership is simple – there will be serious disruption until you get real on pay.

    Royal Mail said it remains open to negotiate with the union to “try and avert damaging industrial action.”

    Prepare Your Business for the Upcoming Disruption

    With one week left before the protest, both Royal Mail and CWU only have a small window of opportunity for negotiations. So, it would be best to put some contingency plans in place now to minimize shipping and delivery delays in the event of strikes.

    Here are some tips:

    • Keep some buffer stock in your 3PL or supplier’s warehouse and transfer only when needed.
    • Consider sending additional units via small parcel delivery for faster FBA check-in times.
    • Ship parcels with alternative couriers, such as DHL, FedEx, DTDC, and UPS. While typically more expensive than Royal Mail, they will try to get your items picked up and delivered to customers on time. Plus, deliveries will not be limited to health essentials like what UK’s postal office is planning to do. For letters, consider UK Mail, Citipost Mail, The Direct Mail Company, or Whistl as alternatives.
    • If shipping costs are too expensive, try to reduce your packaging to achieve smaller dimensions and pack as many units per carton as possible. Consider using a Master Carton Calculator to find your ideal carton configurations.

    Related: Amazon FBA Freight Forwarder Tips to Avoid Stockouts and Reduce Costs

    Amazon’s New Holiday Surcharge Takes Another Bite Out of Seller Profits

    Amazon-Introduces-Peak-Holiday-Fulfillment-Fee

    🚨 Fulfillment costs continue to climb as Amazon has just announced a new holiday surcharge that will be applied to core FBA, apparel, and dangerous goods from October 15, 2022 to January 14, 2023.

    Sellers will now pay an average of $0.35 per unit sold via US and Canada FBA on top of all other applicable charges plus peak holiday storage surcharge of $2.40 per cubic foot. 😩

    This is the first time the eComm giant has raised fulfillment fees for Q4 in order to deal with soaring inflation. Though on January 15, 2023, the fees will revert back to current levels according to Amazon. 🤞

    The Mounting Amazon Fee Stack

    We’ve recently been “lovingly” referring to Amazon’s extensive fee increases as the Amazon Fee Stack. What we’re referring to is the series of seemingly small fee hikes that yet are leading to significant increases when all added up. Also known as “death by papercuts”.

    Unfortunately, when costs are greater than your total sales, your profit can turn negative, so it’s crucial to learn how much you’re actually paying in fees in order to protect your margins.

    According to Marketplace Pulse, Amazon has raised their fulfillment fees by more than 30% since 2020.

    It is true that the past two years have seriously challenged the eComm giant, rirst with supply chain disruptions, followed by record-breaking inflation rates. The company also sunk a lot of money into its warehouse expansion efforts to keep up with the surge in eCommerce demand.

    “At a certain point, you can’t keep absorbing all those costs and run a business that’s economic,” Amazon CEO Andy Jassy told CNBC in an interview in April.

    Dealing with these macroeconomic factors, however, has led Amazon to apply:

    Below is a table showing the historical increases for standard size and oversize items. You can easily see how the various fee changes over the years (2019 – 2022) impact your margins.

    Standard Size

    Small
    6 oz or under
    Small
    12 oz
    Large
    1lb
    Large
    3lbs
    Large
    3lbs to 20lbs
    2019$2.41$2.48$3.28$5.26$5.26 + $0.38 above the first 3lbs
    2020$2.50$2.63$3.48$5.42$5.42 + $0.38 above the first 3lbs
    2021$2.70$2.84$4.25$5.68$5.68 + $0.30 above the first 3lbs
    2022$2.92$3.07$4.52$5.79$6.13 + $0.30/lb above first 3 lb
    April 2022 (base rate + 5%Fuel and Inflation surcharge)$3.07$3.22$4.75$6.08$6.44 + $0.32/lb above first 3 lb
    2022 Holiday Peak, including fuel and inflation surcharge$3.28$3.43$5.06$6.60$6.96 + $0.32/lb above first 3 lb

    Oversize

    SmallMediumLarge
    2019$8.26 + $0.38/lb above the first 2 lbs$9.79 + $0.39/lb above the first 2 lbs$75.78 + $0.79lb above the first 90lbs
    2020$8.26 + $0.38/lb above the first 2 lbs$11.37 + $0.39/lb above the first 2 lbs$75.78 + $0.79lb above the first 90lbs
    2021$8.66 + $0.38/lb above the first 2 lbs$12.20 + $0.39/lb above the first 2 lbs$76.57 + $0.79lb above the first 90lbs
    2022$8.94 + $0.38/lb above the first 2 lbs$12.73 + $0.44/lb above first lb$82.58 + $0.79/lb above first 90 lb
    April 2022 (base rate + 5%Fuel and Inflation surcharge)$9.39 + $0.40/lb above first lb$13.37 + $0.46/lb above first lb$86.71 + $0.83/lb above first 90 lb
    2022 Holiday Peak, including fuel and inflation surcharge$10.44 + $0.40/lb above first lb$15.99 + $0.46/lb above first lb$89.33 + $0.83/lb above first 90 lb

    Clearly, there has been a steady increase in Amazon fulfillment fees since 2019. The pandemic and its aftermath have presented certain economic conditions that induce the online retail giant to introduce multiple surcharges in 2022, making fulfillment cost per item significantly more expensive in August than in January.

    While inflation and holiday surcharges are only temporary, the latter, we are predicting, is most likely going to be a yearly fee similar to what major carriers have been doing. In fact, the US Postal Service has already requested a temporary price hike for Q4 to help cover additional handling costs, while the UPS and FedEx are expected to follow suit shortly.

    Like the online retail giant, you can’t keep absorbing these increasing fees. Therefore, at some point, you might also have to raise your prices to stay profitable. Or even better, learn some strategies for recovering more of your profit to stay resilient throughout the rest of the year and beyond.

    Amazon Attribution Update Makes for a More Effective Sales Tool

    Amazon Attribution Makes For More Effective Marketing Tool

    Great news for sellers using Amazon Attribution to drive external traffic to Amazon! 🥳

    The tech giant has reportedly rolled out a new Amazon Attribution feature that will replace the previously featured competitor ads placed at the top of your listing with other popular products from your own store. 🔥 This means an increase in brand awareness and new cross-selling opportunities within your catalog, which may help boost conversion and minimize Advertising Cost of Sales (ACOS) for off-Amazon traffic.

    Currently in beta, the new feature is available to sellers utilizing Amazon Attribution with Google Ads through January 2023.

    What Prompted This Update From Amazon?

    Brand-registered sellers use Amazon Attribution (AA), a free advertising tool, to track and measure the performance of their off-Amazon efforts, giving them insights into which channels are best for their business. They also utilize the Brand Referral Bonus (BRB) program in conjunction with AA to earn, on average, a 10% discount on referral fees associated with the sales generated from off-Amazon ads.

    🤔 It makes sense for Amazon to incentivize sellers willing to drive external traffic using AA because they are more likely to continue driving that traffic if they can see that it is working for them. Without that visibility to measure against, they might abandon external traffic campaigns that are actually working for them. Attribution helps to prevent this from happening.

    ⚠️ However, there was a major flaw in the program.

    Prior to the update, when a customer is directed to a listing from Google Ads, the first thing they see at the top of the screen are ads from competitors. This essentially resulted in sellers paying for Google ads that simply drove traffic to their competitors. 🤦

    To prevent this from happening, some sellers started sending traffic to their brand Storefront instead of driving it to a specific product page. However, the former doesn’t convert nearly as well as the latter, as the shoppable content customers see may not be related to what is being advertised on Google. Some may get confused and leave the store, while, less often, others may end up browsing through and buying more than one of the seller’s products.

    💪 The bottom line is sellers did not want to be twice-burned by wasting ad dollars and sending their potential customers into the arms of their competitors.

    Amazon Has Finally Listened

    “Now in beta, when brands use Amazon Attribution to direct their non-Amazon marketing to their product detail page via Google Ads, customers will see a new section at the top of the page labeled ‘Other popular products from this brand.’ This new feature is meant to help increase brand awareness and promote new selling opportunities by showcasing three additional products from the brand.” Amazon said in an email sent out to its brand partners on August 9.

    Amazon Attribution New Feature

    Making this change also shows Amazon’s desire to strengthen its partnership with sellers conducting off-Amazon marketing campaigns. Now, they can bring more customers to their target listing when utilizing Amazon Attribution with zero competitors at the top section of the page, which should help increase sales through conversions and cross-sells while decreasing Amazon fees. 💰

    However, note that your BRB rate may vary by product category and marketplace. As of August 2022, Amazon US is the only marketplace that rewards sellers with a 10% bonus, whereas Canada, Mexico, EU, among others simply have the tracking capability.

    It’s possible that Amazon would lower the BRB rate for the US marketplace from 10% to 5%, or to 0% eventually. But the opposite scenario could occur too, in which Amazon offers BRB to sellers from other marketplaces in the future.

    Overall, Amazon Attribution can be beneficial to your business. Not only does it help increase conversion and potentially lower referral fees through BRB, it also improves your on-Amazon organic ranking, leading to more sales.

    So, sellers who adopt this program early could gain a huge competitive advantage over those who don’t. And the good news is that Amazon Attribution has only just begun and as the eCommerce landscape continues to change, sellers and SaaS companies alike, in conjunction with Amazon Attribution, will continue to find new ways to make external traffic more measurable and impactful within the Amazon seller toolbelt. 🚀

    Related: Amazon Budgeting & Advertising Tips with the Customer Journey Principle

    Software Updates For August 2022

    SoStocked Software Updates For August 2022

    We are excited to fill you in on all of the new changes in SoStocked, so let’s get right to it…

    🥳
    NEW RELEASE

    SoStocked Joins the Carbon6 Family

    SoStocked_900x350_Gif

    We are excited to announce that SoStocked has recently become a part of the Carbon6 family! This is very good news for you, our SoStocked users!

    Our roadmap and vision for SoStocked haven’t and won’t change. This will only help us to get there faster. Now with Carbon6, we have many more resources at our disposal to catch up on some backlogged development. You can look forward to a smarter, more integrated, efficient, and profitable way to run your eCommerce business, something that we’ve needed for a long time now. Carbon6 was brought together by entrepreneurs who want to empower entrepreneurs. The group of like-minded eComm advisors and industry-leading software tools who have come on board is what made it a great fit for us.

    The SoStocked team and leadership aren’t going anywhere. The team that you have come to know and love will still be here for you. In fact, several SoStocked execs are even stepping into advisory roles within Carbon6 to help bring more value across the entirety of the Amazon seller journey. We truly believe in Carbon6 and what we can accomplish together. Our mission has always been to change the face of operations and profitability within the eCommerce industry. With Carbon6 we can do that. They truly stand behind and support our vision and can provide the team and resources to help us go further.
    This is a pivotal success for SoStocked. We are very grateful to all of our users who have helped us along the way and we can’t wait to see all sellers benefit from our coming together!


    COMING SOON

    API Access to Amazon AU, Far East, and Middle East

    Migrating from the old Amazon MWS programming Interface (API) to the new Selling Partners API that is required in order to add these additional selling regions has been a huge undertaking and we appreciate your patience. Our development team has worked hard to do an entire overhaul of the SoStocked system to make this process not only possible but fast and reliable, and the best inventory management tool worldwide. We are in the quality assurance phase and we are set to release the new regions later this month.


    COMING SOON

    Shopify

    Shopify is on track for Q3! Yes, we thought this would have happened much sooner, too. We have been testing Shopify in beta for a while now, with distractions like Amazon restock limits and new API out of the way we are almost set to roll out this new marketplace. With the help of the Carbon6 additional resources, the focus is on training a larger software development crew and getting Shopify out of beta and released quickly.

    ⚡️
    MICRO UPDATES

    Subtle Improvements to Make Your
    Forecasting Easier

    SoStocked - MICRO UPDATES

    Faster Recalculations on the Forecast Page
    Making changes and updating information from Amazon now takes half the time so you can complete your work faster.

    📩 Set a Default cc Email Address for Purchase Orders and Work Orders
    Always cc another contact on POs and WOs? Now you can add a default cc email for orders and save time. From the Settings page, click Company Info to set the default cc email.

    🔥
    ICYMI: FEATURE SPOTLIGHT

    Vote For or Add New Suggestions

    Flat File for Amazon’s New Shipment Workflow
    Amazon Seller accounts are using a new shipping plan interface. This interface still accepts flat files, but sometimes asks for an additional flat file in the workflow. This new file is called the “Manifest Shipment Workflow”. These templates are now included in the SoStocked download. See full tutorial here.

    Warehouse Location Now on the Bulk Export/Import File
    You can find this new column under the Warehouse Inventory Levels tab. This feature is especially useful for tracking items with a short shelf life like perishable goods. Or wholesale sellers with many different kinds of items in storage. Now you can use the Bulk Export/Import file to keep up-to-date with your warehouse locations. Let us know if you have any questions!

    Need more information?

    1. Send Message: We typically reply within 2 hours during office hours.
    2. Schedule Demo: Dive deeper into the nuances of our software with Chelsea.
    3. Join Live Upcoming Webinar: New to Amazon inventory management? Learn three inventory techniques you can implement right away.

    Amazon Releases Inventory Ledger to Streamline Inventory Data Reports

    Amazon Streamlines Inventory Reports With All In One Ledger

    Simplify the way you view all your inventory movements! 🚀

    Amazon UK announced the roll out of their new Inventory Ledger report that will help you check your Amazon-fulfilled inventory more efficiently.

    This all-in-one report offers you:

    • A comprehensive and full view of your FBA stock and its movements. You can now see your beginning inventory balance, shipments to Amazon fulfillment centers (FCs), purchase orders, returned items, settlements, reconciliations, removed products, and closing balance – all from one place.
    • Historical movements of your FBA inventory during the last 18 months, including event type, product name, quantity, unique product codes, FC transfer updates, location (country or name of warehouse), and disposition (products sold, returned, removed, disposed of, damaged, lost, and found).
    • A list of your reimbursements. However, reimbursements for lost or damaged products may take up to 45 days to show up on your account.

    You can use the new Inventory Ledger to also spot any discrepancies in your inventory balances that could have occurred in the previous months, thereby affecting the accuracy of your data in the report window.

    For instance, discrepancies could occur due to human error or warehouse theft. If it goes undetected for months, it could lead to significant profit loss.

    • Keep an eye on your available (and unfulfillable) stock by expanding the dates of your ledger to get a detailed view of your inventory movements in Amazon FCs and to reconcile inventory balances.

    The Inventory Ledger receives updates every 24 hours and essentially replaces these six older inventory reports:

    1. Daily History
    2. Monthly History
    3. Inventory Adjustments
    4. Event Detail
    5. Inventory Reconciliation
    6. Received Inventory

    Amazon said that the six reports will no longer be used beginning the 30th of September 2022.

    Related: Types of Inventory that Amazon Sellers Should Know About

    Updated: Amazon Suspension Risk For The Uninsured

    Amazon Suspension Risk For The Uninsured

    UPDATE 08/02/22: A win for sellers! Amazon has reversed its recent policy change requiring sellers earning under $1M in sales to obtain a $0 deductible insurance plan citing the challenges they face in procuring zero-deductible policies as the primary reason for the reversal.

    Less than 2 months ago, we told you about changes to the A-to-Z Guarantee. Well, a lot has changed in that short time.

    This is important, so pay close attention. Amazon may restrict you from certain selling categories or even suspend your account for non-compliance of this policy.

    You can read the full policy on Seller Central, but the cliff’s notes are this: if you’ve sold $10,000 or more in any one month, you need business insurance of at least $1 million in aggregate. Previously this was set as any seller who hit $10,000 for any 3 consecutive months.

    Further, it is not enough just to have it. (I’ve had this insurance since I started selling in 2014.) You now need to ensure Amazon is named as an additional insured by way of a certificate of insurance.

    I’m not done yet. You also need to provide Amazon with proof of this insurance by uploading the certificate into your Seller Central account.

    Do this by going to Settings > Account Info > Business Insurance and then following the steps to submit your proof of insurance.

    Now, if you’ve already had a certificate of insurance created for Amazon in the past, that likely will not be valid as Amazon has changed it’s requirements for what may be listed on the additional insured certificate. If you do not have the name listed correctly, your proof of insurance will be rejected.

    The name to be listed on the certificate is:

    “Amazon.com Services LLC., and its affiliates and assignees”

    Anything else will be rejected. You also need to meet the minimum requirements for coverage. For full details on exactly what you need, check out Amazon’s insurance requirements page.

    You can usually just send this list of requirements to your insurance provider and they can provide you with what you need. But move quickly as, since this policy took effect on September 1st, 2021, so you technically have until September 30th to submit your insurance before your account or selling privileges are at risk.

    For most sellers who already have this insurance, getting a certificate is usually quite easy, taking only a matter of hours to receive from your provider via email.

    But for those who need a new policy, this may prove challenging, especially as all other sellers on Amazon are likely attempting the same just now.

    You may, however, try using the new Amazon Insurance Accelerator program where Amazon has teamed up with insurance providers to make the process of acquiring insurance smooth and easy for sellers.

    It has always been good business for any company to be properly insured, now Amazon makes it a verifiable requirement. For more on what types of insurances might be valuable to eCommerce sellers, check out our blog post on Amazon Seller Insurance Tips.

    Amazon Plans to Hold 2nd Prime Day in October

    Amazon Plans To Hold 2nd Prime Day October 2022

    Leaked files seen by the Business Insider (BI) show that Amazon may be planning a second Prime Day in the fall to boost growth.

    Amazon Is Looking to Replicate Prime Day 2022 Success

    Prime Day 2022 results are out, and Digital Commerce 360 estimates that the eComm giant made $12.09B globally during the 2-day extravaganza that ran from July 12 through 13.

    That’s up 8.1% from last year’s $11.19B, and is considered as the “biggest” in history. Based on Numerator Prime Day 2022 Insights, most purchases were basic must-haves, such as household items, consumer electronics, and health and beauty.

    Rising costs did impact customers’ buying decisions, though. The report shows that 58% of products sold for under $20, while only 5% sold for over $100, as many tried to beat inflation by prioritizing their needs over wants.

    Moreover, 34% of Prime Day 2022 customers said they waited for the event to buy a specific product at a discounted price, while 28% ignored a good deal because it wasn’t a necessity. Inflation also forced 22% of customers to compare prices with stores outside of Amazon before placing an order.

    This spending habit may continue through to Q3/Q4, as the Fed continues to raise interest rates and inflation is likely to remain above target until 2024. Therefore, people may be looking to use Amazon to stock up on essentials or buy holiday items at discounted prices before they get even more expensive by Q4.

    Prime Early Access Sale

    The next 2-day sale event that will be held in October is reportedly being named the Prime Early Access Sale. The exact date is yet to be determined.

    “This event is one of the best deals events of the year and Prime members would be crazy to miss it,” one document said.

    The BI report also says that the eComm giant has already started asking sellers to send their special promotion deals for the event, which is expected to feature promotions for sneakers, TVs, and other basic items. Prime members may also be given early access to such deals, specifically Prime-eligible Lightning Deals on Amazon.

    Prime Early Access Sale may be Amazon’s way to preserve its growth through economic uncertainty and regulatory pressure.

    Q2 2022 earnings results show that while the company exceeded Wall Street expectations for the second quarter with a reported revenue of $121.2B, up 7% from last year and well above the $119B projection, it did suffer a loss once again, this time for $2B in Q2.

    By holding another mega sales event in October, Amazon could drive more sales. It may also help them to attract more subscribers to its Prime program.

    What Does this Event Mean for Sellers this Black Friday/Cyber Monday (BFCM)?

    A Prime Day-like event in October may throw a wrench into your BFCM plans. It means bracing yourself for:

    • Added competition. Competitors may use this Prime Early Access Sale to launch their products into top ranking positions before the holidays.
    • Potential shipping delays. More packages will keep fulfillment centers and carriers extremely busy as early as October, making the supply chain situation worse.

    It would be best to have a plan that will help you to stay flexible on the days leading up to and during BFCM. Consider monitoring Prime Early Access deals and see if you can make adjustments to your own BFCM deals to capitalize on lessons learned during that preview. You might also want to start launching your BFCM promos earlier than your target date (e.g., first week of November) to benefit from the sudden shopping rush that Prime Early Access Sale may create.

    Related: Amazon FBA Freight Forwarder Tips to Avoid Stockouts and Reduce Costs

    UPS Shipping Limits for Amazon Threaten to Delay Holiday Deliveries

    UPS Shipping Limits For Amazon Threaten Q4 Deliveries

    ⚠️ Brace for potential delivery delays in Q4 as UPS places shipping limits on Amazon to pursue more profitable shipments, such as B2B.

    Sudden Drop in eCommerce Parcel Volume

    After experiencing a surge in revenue and parcel deliveries in 2020 and 2021, the average US daily volume for UPS dropped 4% during the second quarter of 2022. The unexpected drop was greater than expected as eComm delivery growth has finally slowed.

    “The fear is that, after a strong 2-year period, UPS could see revenue growth waver thanks to high inflation. We can expect parcel volumes to decrease in line with consumer spending,” said Senior Analyst at Third Bridge, Patrick Donnelly.

    The company’s decision to put limits on Amazon’s package volume also contributed to the decline, according to CEO Carol Tome. The eComm giant is UPS’s largest customer, accounting for 13.3% of its total revenue in 2020 and 11.7% in 2021. However, by throttling Amazon’s delivery volume, it will now only make up 11% of UPS revenue by Q4.

    “We’ve contractually agreed on what makes sense for us versus what makes sense for them. That means that the volume and revenue for Amazon is coming down,” said Tome.

    The shipping restrictions also came after Amazon launched Buy with Prime, which allows non-Amazon sellers to leverage 1- and 2-day shipping through its own fulfillment empire. Although Amazon’s logistics service is expanding rapidly and could potentially surpass UPS, the eComm giant still relies on the legacy carrier to carry out millions of last-mile deliveries for them.

    In addition, with fewer parcels coming in, UPS has more Q4 capacity it can use to “go out and win’’ new customers.

    Therefore, entering into a mutually beneficial agreement on what Amazon parcels UPS delivers versus what is fulfilled in-house definitely makes a lot of sense.

    Putting More Focus on B2B Deliveries

    Despite the decline in its core domestic unit, UPS’ per-package revenue grew 11.9%, thanks to price hikes and putting limits on discounts usually given to bulk customers.

    UPS also plans to focus on B2B shipments to make up for the eCommerce slowdown. In 2019, the carrier’s B2B delivery volume grew 3.4%, representing an important growth area for the company. However, in 2020, its growth stalled when stay-at-home orders were implemented across the country to mitigate Coronavirus transmission. Since most office buildings were unoccupied, and thus a reduced need for essential business items and shipping services, buyers had to cut back on spending.

    But as COVID restrictions ease up across the globe, UPS expects more and more B2B buyers will revert back toward spending on services.

    Effects of UPS Shipping Restrictions on Sellers

    • Shipping delays. With limited UPS services available to Amazon sellers, we might see shipping delays during the Prime Early Access Sale in October, Black Friday/Cyber Monday in November, and the holiday season.
    • Sellers might have to seek alternative options or backup carriers such as 3PLs or Shopify’s Shop Promise to continue offering speedy shipping to customers. While Amazon has sunk a lot of dough into its warehouse and transportation this past year to keep up with demand, it still depends on UPS to deliver millions of packages to homes. So, without UPS in their back pocket, Amazon might find it difficult to handle shipping during the holiday rush.
    • Amazon might bring back restock limits even if mildly. Amazon does have a lot of storage space that they invested in, but congestion may become an issue in Q4 due to these shipping concerns. Hence why, placing inventory restrictions on sellers before the holiday rush may be utilized as a means to control the influx of inventory into their fulfillment centers. This is a long shot based on what we know about their new, bolstered warehousing network but something not to be ruled out based on their faltering shipping infrastructure.

    💡 To prepare for potential shipping delays, consider keeping some buffer stock in your 3PL warehouse or with your supplier and sending additional stock into FBA as needed. You could also switch over to FBM in order to fulfill orders yourself or use Amazon Upstream Storage to circumvent restock limits if imposed. Securing early delivery appointments with FBA is also crucial to avoid check-in delays, so be sure to discuss your options with your 3PL or preferred carrier.

    Shopify Shares Down By 14% After Laying Off 10% of Their Employees

    Shopify Lays Off 10 Percent Of Workforce Causing Stock To Drop

    Shopify suffered a major blow as shares of the company dipped by 14% on Tuesday. 📉

    Earlier that day, Shopify founder and CEO Tobi Lütke sent a heartfelt memo to the company about the immediate changes regarding their personnel.

    “Shopify has to go through a reduction in workforce that will see about 10% leave by the end of the day,” Lutke wrote.

    ⚠️ The company’s global workforce of more than 10,000 will now be downsized to around 9,000, as most of their staff with hiring, support, and sales functions will be let go. Those found to have redundant and extremely specialized roles and teams that had functions not closely related to product development but were still previously helpful for the company – will also be laid off.

    A Costly Miscalculation

    Lütke admitted that he made the wrong bet regarding Shopify’s manpower expansion.

    In the same memo, he explained that based on the available data before the pandemic started, they made a bet that the ecommerce boom would persist and the money going to e-commerce than traditional retail stores would surely shoot up by 5 or 10 years.

    To match their forecasted exponential growth, they expanded and hired more employees. But now, the data shows otherwise.

    US Ecommerce Adoption Growth Rate

    The line graph on his memo shows the growth of e-commerce adoption descending to “where pre-Covid data would have suggested it should be at this point.”

    “Ultimately, placing this bet was my call to make and I got this wrong,” he wrote.

    The New Reality

    The Canadian ecommerce company joins the 140+ American tech companies who have collectively laid off more than 30,000 of their employees so far this year.

    Tech – which is one of the industries that emerged as a winner during the pandemic – is now one of the hardest hit sectors of 2022.

    The continuous lockdowns during the first two years of the pandemic plus the health scare caused by a novel virus forced consumers to conduct their day-to-day activities within the confines of their own homes.

    The demand for tech products like laptops and tablets used for online schooling and remote work, and services like live streaming and online shopping skyrocketed, prompting the tech companies to rapidly expand to cope up with their anticipated, long-lasting growth. As a result, the stock prices of these tech companies also ballooned.

    That explosive growth is now showing signs of decline as the world is transitioning back to face-to-face classes and work. Travel restrictions are being lifted and consumers are allowed to shop in malls again.

    LinkedIn’s principal economist Guy Berger shared his observation with Yahoo Finance last week.

    “Tech just kept hiring and rising and rising at least through the end of last year. Now [tech] is coming down much faster. It’s almost like a boomerang in that it went up faster and is coming down more sharply.”

    As Infrastructure Capital Management CEO Jay Hatfield points out, “It’s a liquidity and pandemic-driven bubble.”

    The layoffs happening across the sector seem to show that the companies that enjoyed initial success early on in the pandemic (and quickly expanded as a response to that) may have overestimated the duration of that success, not to mention their ability to sustain their growth.

    Now, there is a need for them to recalibrate as the new reality continues to evolve.

    Reasons for the Layoffs

    The spike in layoffs during the mid-year may have something to do with the tech companies wanting to sort out their plans and resources before Q3 ends. 🤔

    The high-risk stocks of these tech giants have also been battered by significant macroeconomic factors such as the incessant lockdowns in China, Russian invasion of Ukraine, Federal Reserve’s doubling of interest rates, record-high inflation, and fears of a recession.

    In addition, some tech companies also cited the current macroeconomic environment and their goal to prudently manage their expenses are the reasons why they are trimming down their workforce.

    In the case of Shopify, their recent $2.1B acquisition of Deliverr – an eCommerce fulfillment company – may be another reason behind the layoff. It is likely that the company is downsizing to reshuffle their resources towards their fulfillment network so they can compete better with Amazon’s Buy With Prime.

    In all fairness to Shopify, they are not the only company to miscalculate and overestimate their projections regarding the e-commerce boom during the pandemic.

    eCommerce giant Amazon made the same bet (and mistake) when it increased its employees to 1.7 million, only to lower it to 1.6 million in the next quarter.

    Amazon stock prices also dropped by 10% after the company reported a $3.8 billion net loss – its first loss since 2015 – in April this year. Amazon CEO Andy Jassy shared the loss is attributed to the pandemic and ongoing war in Ukraine, though how that latter could be is unclear.

    There’s no way to fully predict what will happen next in the tech sector, but one thing’s for sure: these companies need to remain agile and strategic if they want to withstand and overcome these inflationary economic shifts. 💪

    SoStocked Joins the Carbon6 Family Shortening the Timeline to Future Innovations

    SoStocked-Joined-The-Carbon6-Family-Of-Amazon-Software-Tools

    It’s been a challenge keeping this under wraps but we’re finally ready to announce that SoStocked has recently become a part of the Carbon6 familyThe SoStocked team and leadership aren’t going anywhere. In fact, several SoStocked execs and I are even stepping into advisory roles within Carbon6 to help to bring more value across the entirety of the Amazon seller journey.

    Our roadmap and vision for SoStocked haven’t and won’t change. This will only help us to get there faster. I have always held fast to the mission to change the face of operations and profitability within the eCommerce industry. With Carbon6 we can do that. They truly stand behind and support our vision and can provide the team and resources to help us go further. Big things are coming!

    I can’t divulge much quite yet, though I have hinted at such things in the past, but know that our focus on profit optimization and recovering margins won’t stop at reducing stockouts and holding costs.

    Helping sellers to succeed by staying in stock and keeping more of the money you make is a major goal shared by both SoStocked and Carbon6.

    Our new partnership also comes with a new look:

    SoStocked_900x350_Gif

    We truly believe in Carbon6 and what we can accomplish together. I’ve personally developed a strong relationship with their core executives, especially their CEO, and have had deep insight into their mission, road map, and team.

    At the heart of Carbon6 are entrepreneurs who believe in empowering entrepreneurs. The mentality of being seller-first and team-oriented, coupled with the eComm advisors, industry-leading software tools, and passionate SaaS founders who have come on board are really what made it a great fit for us.

    Believe me, there are many SaaS tools, major thought leaders, and top sellers that you know and respect joining this mission; several that have not even been announced yet. I’m excited for what’s coming. They truly have assembled a dream team.

    You can look forward to a smarter, more integrated, efficient and profitable way to run your ecommerce business, something that we’ve needed for a long time now.

    Much more will be revealed soon. It’s going to be a game-changer, and I’m eager to see all sellers benefit from our coming together.

    Exciting times ahead,

    Chelsea Cohen
    CEO & Co-Founder, SoStocked

    Shopify Introduces YouTube Shopping Integration to Compete in Live Commerce

    To Complete With Amazon Shopify Introduces YouTube Live Shopping Integration

    Canadian tech giant Shopify continues to challenge Amazon’s dominance over the US eCommerce market, from acquiring Deliverr to offer 1- to 2-day shipping to recently teaming up with YouTube to allow merchants to directly link their stores and sell products on the video platform.

    Shopify Gets on the Live Commerce Trend

    On July 19, Shopify launched YouTube Shopping to make it easy for sellers to manage and sell merchandise across their YouTube channels. 💪

    Key features include:

    • Connect your Shopify store to Youtube.
    • Display your merchandise on YouTube in three different ways: livestreams, on-demand videos to show products in the end screens or in a product shelf below your videos, and a dedicated store tab to feature all your shoppable content.
    • Access to live shopping tools that will allow you to tag and pin products at key points during a livestream.
    • YouTube Shopping API automatically syncs your inventory data with Shopify so that shoppers can see whether a product is in-stock or out of stock in real time.
    • If eligible, you may opt to enable on-site checkout so that shoppers can buy items directly from your YouTube channel. Read Buy on Google to learn more.
    • Manage YouTube Shopping orders, returns, and payments, as well as monitor your key performance metrics for your live streams directly from your Shopify account.

    As of July 2022, YouTube Shopping is available to Shopify sellers worldwide. However, they will need a minimum of 1,000 subscribers to use it.

    👉 Check out the full list of requirements to see if you’re eligible.

    A Move to Compete With Amazon

    Shopify has been steadily merging live shopping elements into its platform over the last few months.

    Back in March, the company launched Linkpop, a link-in bio tool for influencers. This tool allows people to promote links to their own website, YouTube channel, and other pages and simultaneously advertise their Shopify products that their followers can buy without leaving the link-in bio page instead of clicking on a separate URL that directs them to a different website.

    One month later, Shopify acquired Dovetale, an influencer marketing tool that helps sellers recruit and manage their own brand ambassadors and influencers. The eCommerce giant had also recently hired Yeezy General Manager, Jon Wexler, to lead its Creator and Influencer Program.

    These recent moves suggest that Shopify wants to position itself as the main live commerce platform for both sellers and content creators, rivaling Amazon Live, which potentially is now the biggest competitor after TikTok canceled its live commerce expansion plans in the US and Europe due to poor sales.

    Live commerce is booming in China with sales expected to reach $423B by 2022, but only $11B in the US in 2021 and $25B by 2023. Nevertheless, these surveys show that there’s a growing interest in live shopping among US consumers. 🤔

    And so, the two eComm giants are fighting to grab a share of the growing market that’s seen as the future of retail by Facebook, Twitter, among other social media sites.

    However, Amazon is reportedly struggling to be the first to make live commerce happen in the US due to its lackluster content (not entertaining enough) and poor online presence (little or no interest from shoppers), according to Marketplace Pulse Founder and CEO, Juozas Kaziukėnas.

    Perhaps Shopify could succeed where Amazon failed by using a live commerce-focused platform like YouTube Shopping coupled with robust influencer marketing efforts that include Dovetale and Linkpop. Sellers would be able to easily find and manage their influencers on Dovetale, offer an easy checkout process via Linkpop or YouTube’s on-site checkout, and host livestreams on YouTube, for example.

    YouTube already has a captive video-viewing audience, whereas Amazon is trying to retrain their customers to consume video content that is somewhat hidden on their site. It’s been an uphill battle for AMZ to try to shift the platform to being more social whereas Shopify is going straight for the jugular with YouTube and link-in bio plays.

    That said, it’s a very exciting time for consumers, but challenging for sellers, as they attempt to spend a lot of resources trying to create an attractive product selection, provide a seamless live shopping experience, and produce engaging content with influencers. Luckily, Shopify could potentially make all of that easier with their suite of live commerce apps and partnership with YouTube. 🔥

    Amazon Continues to Dominate B2B While Shopify Plays Catch-Up

    Amazon Continues To Dominate B2B Businesss To Business Sales

    Seven years after its launch in 2015, Amazon Business has grown to be the leading B2B online marketplace for business buyers. 🚀

    In its first year, the eComm giant made $1B from selling office supplies. In year three, the annual sales reached $10B, which drew the attention of Bank of America securities analyst Justin Post.

    “While Amazon Business is just beginning to establish itself, Bank of America projects there is a total addressable market for e-commerce B2B of $1.4 trillion by 2021, which is nearly double the firm’s estimated $761 billion market for consumer e-commerce. Essentially, the market potential for Amazon Business is about twice the potential for its core retail business,” Post said in a statement to CNBC in 2019.

    This massive growth estimate represents a great opportunity for Amazon. Bank of America projects that the company will hit $41.B in 2022 and potentially double that with around $83.1B by 2025. 🤯

    If Amazon stays on track, it would singlehandedly account for the rapid growth of online B2B marketplace sales, essentially cementing its claim to be the go-to B2B channel for corporate buyers, resellers, schools, hospitals, governments, and institutional markets (e.g., non-profit organizations).

    Amazon’s Plans for B2B eCommerce Success

    In a blog post published by the US Chamber, Rob Green, Director and GM for AMZ Business, shares how Amazon plans to dominate the US B2B procurement market:

    Recent Efforts to Attract More Business Buyers

    On July 18, Amazon launched a marketing campaign “Buy smarter. Dream bigger.” demonstrating its capabilities to track essential business items for corporate buyers who rely on these goods to keep their businesses (and workforce) up and running, whether it’s paper products, pens, printers, ink cartridges, face masks, disinfecting wipes, or pantry goods.

    While essential, procurement of these items has been difficult over the past few months due to the impacts of the pandemic on the supply chain.

    With Amazon’s improved B2B arm, however, it would provide a platform where buyers can efficiently manage the complexities of procuring and shipping by tracking spending, purchase orders, and inventory levels all in one place. This essentially makes Amazon Business a one-stop-shop for a company’s needs for office supplies from multiple merchants.

    But long-time rival Shopify wants to challenge that with its new B2B eCommerce tools and features.

    Shopify Enters B2B to Grab a Piece of the Pie

    Shopify announced on June 22 that it will be focusing on B2B commerce, primarily to compete with Amazon and increase revenue after losing $1.5B in the first quarter of 2022.

    The Canadian eComm giant will introduce new tools designed to make it easier for wholesalers to sell in bulk and manage procurement in one place. These tools will also allow them to easily integrate with their own enterprise resource planning software.

    In a statement told to Financial Times, Shopify President, Harley Finkelstein, sees this move as an opportunity to fight for a bigger market share and to not just “go after Direct-to-Consumer businesses, big and small, but to now go after wholesale business, which is a huge untapped market.”

    With this move, Shopify stands toe-to-toe with Amazon Business, which takes the competitive rivalry between the two tech giants to a new level. As previously reported, Amazon launched Buy with Prime to open its fulfillment services to non-Amazon sellers, taking aim at Shopify’s customer base.

    In response, Shopify acquired Deliverr to be able to offer 1- to 2-day shipping to merchants. The Canadian company also recently rolled out YouTube Shopping to enable sellers to upload their stores onto YouTube and set up live shopping videos, allowing them to compete with Amazon Live.

    🤔 Curious to see how all of this will unfold! Amazon may already be too big to fail at this point, but it would be great if Shopify could shake things up a bit to make the market more competitive for sellers and consumers.

    Freight Disruption at Port of Oakland as California Truckers Protest AB5

    Amazon Feight Discruption As Truckers Protest AB5

    Watch out, folks! 📢

    More shipment delays may be expected as more than a hundred protesters – composed of truck drivers who own and operate their own rigs – descended upon the Port of Oakland on Monday to challenge the California Assembly Bill 5 (AB5).

    The protests prevented other trucks from entering the port, resulting in port congestion and halting operations for one of the busiest ports in the US. And disruptions may continue until the U.S. Supreme Court grants judicial review of the controversial state law.

    What Is AB5?

    The California Assembly Bill 5, also known as the gig worker law, is a law signed by Governor Gavin Newsom last September 2019 affecting independent contractors doing business in California. The law took effect four months later, resulting in countless independent contractors or workers belonging to the gig economy to be reclassified as employees.

    The law aims to prevent companies from exploiting workers who categorize their staff as independent contractors instead of employees, and thus, withhold from them their mandated rights and benefits such as receiving minimum wage and paid sick leaves, among others.

    The law intends to regulate companies that employ independent workers in huge numbers such as app-based delivery and ride-hailing service providers like DoorDash, Lyft and Uber. These companies opposed AB5 from the start, and with the support of more than half of California voters, succeeded in overriding it with Proposition 22, which designates their drivers and workers as independent contractors and not employees.

    Why Are The Independent Truck Owner-Operators Against It?

    Under AB5, trucking companies must reclassify and treat all their drivers as their employees. This is problematic for the independent truckers who value the flexibility of the current set-up: trucking companies deal with the port and all the paperwork and the independent drivers just procure and deliver the goods.

    As independent service providers, the only way they can still make use of their rigs is for them to establish their own trucking company and deal with all of the legalities, paperwork, and headaches of running a trucking business.

    Given this unfavorable situation they are in, the strike may be their last-ditch effort to express their disagreement over the new law. On June 28, the U.S. Supreme Court declined to listen to the challenge raised by the California truck drivers regarding AB5.

    How Will The Strike Affect Sellers?

    The Port of Oakland ranks among the top ten busiest container ports in the United States, where over 99% of the container goods headed for Northern California are loaded and shipped out. The protesters account for 90% of the port’s business, highlighting the scale of the disruption their strike has on the economy of the state.

    As a result of the port being extremely congested – authorities were able to negotiate with the protesters to let ten trucks enter the port every half hour – the supply chain of affected businesses suffered greatly.

    For the countless business owners who rely on the trucks to deliver their stock, the strike is very bad news for their operations and ultimately, their bottom line.

    Delayed arrival of goods translates to delayed shipping of orders, poor customer experience, negative seller reputation, and potentially lower sales – not to mention capital tied up for a longer period of time. Marketplace sellers are also facing an increased risk of stockout as the strike hinders the usually smooth passage of goods and quick replenishment of supplies.

    As every business owner knows, a delay in one part of the supply chain will have a domino effect along the rest of the line. It will take a significant amount of time before the port gets decongested and its operations resume as normal.

    Related: How to Ship To Amazon FBA (And Speed Up Check-In Times)

    What Can Be Done To Alleviate These Supply Chain Challenges?

    While waiting for the authorities and the independent truck owner-operators to arrive at a resolution, you may want to go into solution mode and research ways to minimize your risk for these shipping delays.

    Choosing a reputable 3rd-party logistics (3PL) provider could offer you more flexible and cost-effective delivery methods.

    Preparing air freight, while more costly, could help you to avoid stockouts that could hurt your rankings.

    What Else Can We Expect?

    While AB5 applies only to the state of California, companies and business owners from other states who hire independent contractors may want to keep themselves updated about any legislative developments concerning the gig economy and gig workers. For example, the states of Illinois, New Jersey, and New York may enact similar laws in the near future so there certainly is a risk that this problem could spread if things go that way.

    Amazon Reduces Their Private Label Catalog Amid Mounting Regulatory Pressure

    Amzon To Reduce Their Private Label Catalog Regulatory Pressure

    Amazon is reportedly reducing the number of items and categories under its private label (PL) business by more than half due to poor sales, and as we assume, the impending antitrust bill. 🤔

    Inflation Takes its Toll on Amazon and Consumers

    The decision to scale back Amazon’s PL selection came after a profitability review by Dave Clark, former head of Consumer Business for Amazon. While the PL segment offers a wide range of products to customers at affordable prices, it only accounts for 1% of the company’s total retail sales, a stark contrast to the 10% target set by former CEO, Jeff Bezos, a few years ago.

    Clark also wanted the PL team to focus on better-selling essential items instead of products that didn’t meet the profit threshold. And this proved to be a good strategy, as Prime Day 2022 customers kept much of their purchases to basic goods, such as household items, health and beauty, and consumer electronics.

    ⚠️ In fact, Numerator found that 5% of Prime Day products sold for over $100, while 58% sold for below $20. Additionally, a little over a third of customers waited for Prime Day specifically to buy a certain product at a much lower price, while 28% passed on a great deal because it wasn’t essential, indicating that people would rather prioritize their needs than wants, a shopping behavior that may continue through to Q4.

    Amazon’s reported $3.8 billion net loss in the first quarter of 2022 (their first loss since 2015) may have also been one of the deciding factors. Amazon CEO, Andy Jassy, has attributed part of the company’s shortfall to reduced online consumer spending, Rivian’s shrinking valuation, and added costs in the form of excess fulfillment and transportation capacity.

    Increasing Pressure from Antitrust Regulators

    According to Wall Street Journal (WSJ), the eComm giant may also exit the private label business altogether to address regulatory pressure and possibly to avoid potential hefty fines ahead of the impending US antitrust bill targeting Big Tech.

    Although Amazon has denied this in a statement to WSJ, it’s not beyond the realm of possibility for them to close their PL business or at least make a concession (e.g., end data grabbing), considering they recently offered to stop anti-competitive practices in Europe in an attempt to halt two investigations.

    In the US, Amazon’s private label business has been under scrutiny from lawmakers (and third-party sellers) since its launch in 2009.

    Amazon has flooded the marketplace with 243,000 products across 45 different PL brands, allowing them to directly compete and even prioritize their own offerings over third-party sellers’ by manipulating the search algorithms to drive customers toward AmazonBasics and other in-house brands.

    In one of its investigative reports, WSJ also revealed that some PL employees spied on sellers and collected their sensitive data to develop their own brands that resembled original items, thereby undercutting sellers on Amazon.

    Under the proposed antitrust law, S.2992, these practices would be considered anti-competitive, and therefore subject to injunctions and penalties.

    As sellers, perhaps we could take Amazon’s move to reassess their PL business to reduce regulatory pressure as a win and a step toward leveling the playing field. 💪

    Related: Why Amazon Wants You To Lobby Congress: What is S.2992?

    Discounts on EU/UK Amazon Partner Carrier Fees

    Amazon Discounts on EU UK Partner Carrier Fees

    Possibly some good news for UK/EU sellers… 🇬🇧🇪🇺

    From July 2022 to April 12, 2023, you can take advantage of the following fee reductions:

    • Average 20% decrease on partner carrier fees for Small Parcel Delivery (SPD) and pallet shipments in the UK. For instance, shipping parcels with a partner carrier like UPS from a local address in the UK to a UK fulfillment center.
    • Average 50% discount on partner carrier fees for pallet shipments and SPDs sent to FBA in France, Germany, Spain, and Italy.

    The fee reductions sure sound attractive, especially with the recent increases in shipping and FBA fulfillment costs.

    🤔 Why the sudden generosity? This move might be Amazon’s attempt to:

    • Encourage sellers to use partner carriers versus non-partner carriers to recover the money they sunk into infrastructure following the logistics dumpster fire that was 2020. Amazon reportedly suffered a massive US$3.8 billion loss in Q1, which was partially driven by US$6 billion in added warehouses and transportation costs. This is the first down quarter Amazon has reported since 2015.
    • In addition, based on the discounts more sellers who were fulfilling by FBM may be enticed to sign up for the partner carrier program due to the savings discounts, which may also help Amazon to fill underused warehouse space in Q3 and Q4.
    • It could also help soften the impact of fee hikes on sellers, and in return, prevent them from raising their product prices too quickly, something that Amazon may be mindful of based on the slower sales growth in 2022.

    All this aside, however, UK sellers who have done mock shipments tell a different story. Instead of getting a lower shipping fee, they saw a considerable price increase due to the high fuel surcharge.

    To cover their bases, Amazon did mention that the final fee may vary depending on the shipment quantity, packaging weight and dimensions, and other applicable rates, and that rates are subject to change. So, I guess the sellers complaining about increased prices fall under the “subject to change” category then. 🤷‍♀️ Essentially, the conclusion becomes that your shipping fee could still stay the same as before, could go down, or unfortunately, go up substantially from the last time you used the program. 🤦‍♀️

    Read the Amazon Partnered Carrier Program Overview to learn more.

    💡 If you need to reduce shipping costs to stay profitable, try to keep your packaging compact by removing excess air from your products, minimizing their cubic dimensions, using lighter materials, avoiding excessive amounts of internal packaging materials, and more.

    Lastly, use our Master Carton and Pallet Calculator to determine your optimal carton/pallet load capacity and reduce your total cartons and pallets per order.

    Amazon Intros New Hack to Find High-Demand, No-Competition B2B Products

    New Amazon Hack To Find High Demand Low Competition Products

    Want to expand your catalog with new B2B products? 💰

    Amazon just launched a new ASINs Recommendations Page for its selling partners in the UK. Designed to help you find your next best seller, the page offers a list of products that many business customers are looking for but aren’t currently available on Amazon.

    It also provides you with recommendations that are specific to your store’s product category, allowing you to add new versions of existing products or simply add new items that align with your brand. Not all categories will be represented, of course, as it is B2B-focused.

    😩 From there, you’d of course have to find suppliers for your target B2B products and may even have some Amazon-imposed restrictions to overcome, such as compliance requirements and brand approval, especially items that belong to certain gated categories.

    As this is a new feature that hasn’t yet been mainstreamed into the seller community, and if the tool does what Amazon claims it does, you could become the first (and for a time only) seller to spot a gap in the market and come up with an offer to fill that gap, which is a step toward market domination. 🏆

    Go to ASINs Recommendations to get started.

    Software Updates For July 2022

    Amazon Inventory Software Updates July 2022

    We hope everyone is having a fantastic and profitable summer so far and getting ready for Prime Day! We have some big, exciting changes coming to SoStocked very soon so be sure to follow along with our updates. Here’s what we have this month…

    🥳
    NEW RELEASE

    Merge Shipments

    SoStocked logistics

    With this new feature you can merge multiple shipments together into one. Logistics and shipping plans can change fast, so we’ve got you covered. It used to be that if you had separate shipments that needed to be merged you would have to delete them and rewrite a new order.

    Now you simply select a PO, Edit Order, go to Merge Shipment and you can select which shipments (or POs) you would like to merge.
    You can even choose to merge all products from the PO or select which specific products you wish to merge!

    🥳
    NEW RELEASE

    Improved Automation of Seasonal Sales Spikes

    For those who haven’t used the new automated seasonal spikes feature, this allows you to set automatic seasonal ups and downs month to month, bi-weekly, or even weekly, based on past sales curves. SoStocked will find the annual average daily sales for the product, indicate which time periods extend above or below that average, and then allow you to input trend settings above or below those projections.

    SoStocked Improved Automation of Seasonal Sales Spikes

    This algorithm is always looking for a “new normal” or an average velocity to compare your seasonal ups and down to. However, there was an anomaly occurring where if you turned this feature on when your product was having an abnormally slow month (or for example, you have a new product you just launched) then it was presenting a crazy high velocity as your future seasonality projection. So our dev team solved the problem by creating an exception in that first month. There’s a bit of math involved, so get more details on this exception see this video here.

    To learn more about the seasonality feature see this tutorial.


    COMING SOON

    SP-API – Amazon Far East Marketplace Integration

    SoStocked AU

    You might have heard about this new API around the Amazon community. Just in case you don’t already know what it is, here is a brief explanation.

    First, API stands for Application Programming Interface. In layman’s terms, this allows 2 applications or softwares – like SoStocked and Amazon – to talk to each other.

    SP-API is a new type of API for Amazon. The SP part stands for Selling Partner. SP-API is the next generation or new version of API for Amazon. They have been using MWS (Marketplace Web Service) for years and now they are launching SP-API as an evolution of MWS. The new SP-API is needed for SoStocked to connect with the newer marketplaces such as Australia, India, Japan and Dubai.

    Here at SoStocked, we are ready for the new global API. Our international currency and exchange rate options (find out more here) along with this new SP-API, will create a streamlined SoStocked experience for selling across the globe.

    We have been patiently (or not so patiently) waiting for Amazon to do what they need to do to allow us to integrate with the new SP-API system. We heard positive confirmation that they have a deadline to get this done by July 31st. So get ready folks, it’s almost here!


    MICRO UPDATES

    Subtle Improvements to Make Your
    Forecasting Easier

    SoStocked - MICRO UPDATES

    🛠 Improved warehouse and 3PL filters added to the Inventory page
    We improved the filtering on our Inventory page, specifically for warehouses.

    This means you can now filter out warehouses that you want to exclude from bulk actions, such as transferring inventory, adjusting inventory levels, and more.

    SoStocked 3PL filters

     Improved bulk upload speeds
    Now when uploading a spreadsheet back into the system it will be faster and easier.

    🔥
    ICYMI: FEATURE SPOTLIGHT

    Vote For or Add New Suggestions

    Archive an Old Vendor With Products Assigned To It

    Sostocked Archive an Old Vendor With Products Assigned To It
    SoStocked vendor with products

    If you have a vendor with products assigned to it, you can now archive the vendor without having to jump through the extra hoops of unassigning all products. Just click on the hamburger menu next to the vendor name and click “Archive”. A window will then open up giving you the option to bulk unassign the products from the vendor.

    Change a Vendors Lead Time Without Affecting Your Custom Lead Times

    If you change a vendor’s lead time, SoStocked gives you the choice between changing the lead times for the products or leaving the products with their current custom lead times.

    SoStocked Change a Vendors Lead Time Without Affecting Your Custom Lead Times

    Need more information?

    1. Send Message: We typically reply within 2 hours during office hours.
    2. Schedule Demo: Dive deeper into the nuances of our software with Chelsea.
    3. Join Live Upcoming Webinar: New to Amazon inventory management? Learn three inventory techniques you can implement right away.

    Amazon’s Recent Ban on Mylar Bags and Other Potentially At Risk Products

    Amazon Bans Multicolored and Non Transparent Bags

    Amazon just announced that multicolored and non-transparent Mylar bags must be pulled out from their store effective August 5, 2022. 😲

    Affected FBA sellers with leftover stock of these bags in Amazon warehouses are advised to file a request for removal no more than 30 days after the announcement was made in order to have their unsold Mylar bags returned to them.

    Mylar Bags Affected By the Ban

    Mylar bags – resealable foil pouches commonly used for food storage – come in clear, single color, and multicolor options.

    ⚠️ The ban only applies to Mylar bags that are non-transparent or multicolored, as these items fall under Amazon’s list of “Products associated with drugs and controlled substances.”

    Transparent and single-color Mylar bags are still allowed to be sold in the store.

    This can be a big blow to affected sellers as they will also have to shoulder the new (and much higher) removal fees issued by Amazon earlier this year on top of dealing with unsold inventory. 😟

    Amazon didn’t share any details on how these types of Mylar bags ended up on their list of prohibited drug-related products, but it probably has to do with the 2017 case of Stashlogix.

    These multi-compartment storage bags with odor-proof features and UV-proof jar containers were seized by the federal government after classifying it as drug paraphernalia. Mylar bags are also smell-proof, which make them suitable containers for marijuana and other illegal substances. 🤔

    Mixed Reactions From Sellers

    The general sentiment among sellers regarding this vague policy is confusion. Amazon didn’t even specify whose “regulatory requirements” they are following in implementing this ban and why. Some sellers believe Amazon is simply looking out for itself and lessening its risk for legal issues arising from the misuse of the product.

    Other sellers think the government is to blame for this sudden ban, while some sellers see this policy as illogical, asserting that banning these bags is not the solution to drug abuse and that how people choose to use these bags is completely up to them.

    A few sellers have also expressed their concern as to which product will be targeted next by Amazon. 🚨

    In 2018, seemingly innocuous products like Safe Cans (for hiding small items like keys), Stash Car Key Safe (with a secret pill box), and boxer shorts (with secret pockets) were removed from Amazon UK, because some buyers reportedly used these items to smuggle illegal drugs into festivals. 😓

    With that in mind, if you’re selling products cleverly designed to store small valuables, you may want to evaluate your catalog and perhaps hold off sending too much inventory to FBA to protect yourself from paying hefty removal fees should Amazon suddenly decide to ban them in the future.

    Related: Amazon Compliance Reference Tool to Ensure Products Meet Requirements

    Reduce Losses Due to INR Scams with Amazon’s Signature Confirmation

    Amazon Offers Signature Confirmation to Minimize Lost Orders

    Have you ever issued a refund to a false Item Not Received (INR) claim? 🤔

    INR scam, or Lost Parcel scam, is when an abuser submits false claims for a refund or replacement order – for example, claiming that the product they bought online did not arrive (although it did), which gives them a reason to ask for a refund.

    Unfortunately, sellers bear the cost of refunds and/or replacements. And to add insult to injury, abusers may also leave a negative review, which can put a ding on their Order Defect Rate report.

    So, to help reduce lost parcel claims, Amazon launched a new service called Signature Confirmation.

    Starting June 23, 2022, you can pay for this service in Buy Shipping when you choose shipping for items at risk of being reported as “lost” or “not received”.

    Signature Confirmation Core Capabilities

    • Amazon spots orders that qualify for signature confirmation by assessing the value of the item ordered, delivery issues, and delivery address.
    • Orders that are likely to be reported as lost will show up on your account’s Manage Orders page > Order Status > Signature Confirmation Recommended. This recommendation feature comes free of charge.
    • Should you decide to follow Amazon’s recommendation, an additional fee, between $3 and $6 per order, will be applied to your shipping cost to cover the implementation of the service.
    • Signature-confirmed orders reported as INR or lost parcel will undergo additional checks by Amazon. If the buyer can’t prove otherwise, he or she won’t get a full refund or replacement order. However, if a refund is granted without your involvement and you disagree with Amazon’s decision, you may file an appeal to resolve the issue.

    Downsides of Signature Confirmation

    While Signature Confirmation serves as an extra layer of protection from abusive claims, some sellers think that Amazon’s current shipping services already provide the coverage they need for delivery issues.

    With rising shipping costs and Amazon fees, it is perfectly understandable why some would be reluctant to pay for another service. Unless, of course, the buyers themselves feel the risk of loss justifies the cost of the additional signature confirmation fees.

    However, a few sellers are worried about receiving complaints or negative feedback from customers who don’t want signature confirmation on their orders, either because it is inconvenient (delivery point might be too far from home or they weren’t at home) or it prevented those with malicious intent from carrying out their INR abuse scheme, so they might retaliate by leaving a 1-star rating. Although you can do something about the negative feedback, Amazon may still refuse to delete it.

    What the eComm giant could do to deal with this fairly is to:

    • Give sellers the option to cancel orders identified as high risk without it affecting their account health.
    • Set a specific minimum dollar amount for orders that must have signature confirmation to ensure seller INR protection so as not to require signature confirmation on lower value items.
    • If a buyer is identified as a high risk, obligate them to pay for signature confirmation.
    • Automatically notify high-risk buyers of their signature confirmation requirements. This way, sellers won’t have to message them directly and risk sending/receiving messages too late, causing an upset buyer and ultimately negative feedback.
    • Protect sellers from INR claims and negative feedback without the need for appeal.

    There’s no denying that the new service could benefit third-party sellers, in that it would help reduce INR claims by identifying high-risk orders and allowing them to add signature confirmation to those orders. 👏

    However, it is not cheap and it doesn’t 100% protect you from customers who might blackmail you with negative feedback if you refuse to remove signature confirmation. Your metrics might even take a hit if you cancel orders. 😓

    Until these concerns are addressed, it would be best to limit the use of signature confirmation to extremely high-value items for added protection.

    Amazon Implements Size Normalization to Ensure Consistency Across Detail Pages

    Amazon Size Standards To Ensure Consistent Quantity

    In yet another move to provide customers with a more consistent shopping experience, Amazon has standardized the size and quantity information format for several product types.

    Size Normalization

    What is Size Normalization?

    It is about making sure that data types like the size and quantity information of a particular product sold by different sellers are organized to appear similar across all search and detail pages, i.e., each data type has the same content and format.

    As a result, it reduces inconsistencies and buyer confusion that usually lead to cart abandonment. After all, there’s a saying that goes, “the confused person never buys.” 👌

    So, the thought process behind this is that size normalization may help to increase sales, and would create a more positive customer experience.

    It could, however, have the opposite effect on your sales if you are priced high within your market. I personally know that I often use the price per quantity, i.e. price per ounce, etc, to help inform my own buying decisions, so as a consumer, I do see this as a good thing but can see, as a seller, how it might cut both ways.

    How Size Normalization Works

    Amazon applies normalization rules to your products to reformat “Size” details whenever possible.

    Suppose there are two sellers who have listings for the same quantity of soda. However, each seller uses a different value on “Size” – one offer being 24 Count and the other 24 Count (1 Pack).

    In that case, Amazon’s Size normalization rules will instead identify (and display) the more accurate information based on this formula:

    ’unit_count’/’number_of_items’ + < unit_count.type >
    +
    (“Pack of” + number_of_items)

    Therefore, if Unit Count = 24 Count and Number of Items = 1, Amazon will determine the size value as “24 Count (Pack of 1).” This standardized version of the ‘Size’ for this product will be visible to buyers.

    Make sure to update the quantity information for all of your products to prevent Amazon from removing “Sizes” that don’t conform to the new format or appear inaccurate.

    👉 Go to Size Normalization FAQ Page to learn how to update your products with the required attributes.

    Why Amazon Wants You to Lobby Congress: What Is S.2992?

    Amazon Urges Sellers To Oppose The American Innovation and Choice Online Act

    When corporate tech giants like Amazon come directly to the sellers to try to get them to lobby Congress for or against something, it’s time to take a closer look at their ulterior motives.

    With every piece of news that comes from Amazon, I always like to ask, “What’s in it for them?”

    Well, this one had my alarm bells blaring! 🚨

    I had to dig into all the dirty details of this news announcement, so here’s what’s happening and what I think is really going on… 🕵️‍♂️

    What is The American Innovation and Choice Online Act (S.2992)?

    Passed by the Judiciary Committee on January 20, 2022, The American Innovation and Choice Online Act is the newest antitrust legislation with bipartisan support (Republicans and Democrats sponsor a bill together for the common good). It targets Big Tech firms, such as Amazon, Meta (formerly Facebook), Apple, and Alphabet (parent company of Google) for potential antitrust and consumer choice violations.

    The bill is sponsored by Senate Judiciary Committee Antitrust Subcommittee Chair, Senator Amy Klobuchar (D-MN), and full committee Ranking Member, Senator Chuck Grassley (R-IA).

    It is also co-sponsored by Senators:

    • Cynthia Lummis (R-WY)
    • Lindsey Graham (R-SC)
    • Josh Hawley (R-MO)
    • Steve Daines (R-MT)
    • John Kennedy (R-LA)
    • Cory Booker (D-NJ)
    • Richard Blumenthal (D-CT)
    • Mark Warner (D-VA)
    • Dick Durbin (D-IL)
    • Mazie Hirono (D-HI)

    The fact that S.2992 is a bipartisan effort co-sponsored by an ideologically diverse group of Senators is a sign that there’s a growing momentum in Congress for antitrust violations to be punishable under federal law (if enacted).

    The bill poses a challenge to the ecosystem business model of Big Tech firms that encourages users to utilize an interlocking suite of products or tools owned by the same company. In a report released by the Judiciary Committee, it showed that these tech giants regularly conduct anti-competitive practices to maintain monopoly or control over their respective industries.

    A good example would be Amazon accessing and exploiting your seller data to create and launch competing products for their own brand. 😓

    To Whom Does the Bill Apply To?

    S.2992 applies to any “website, online or mobile application, operating system, digital assistant, or online service” that:

    • Allows a user to generate or interact with content on the website
    • Facilitates online selling among third-party sellers or customers, e.g., Amazon
    • Or, one that enables user searches that show huge amounts of information, e.g., Google

    But as of June 2022, the current draft is only limited to the biggest online platforms, also known as covered platforms, with:

    • At least 50 million US-based monthly active users (or 100,000 US-based business users)
    • Annual US net sales greater than $550 billion
    • Tech platforms that serve as a “critical trading partner” for its business users

    Therefore, this bill would certainly apply to Amazon, Apple, Alphabet, and Meta.

    What Happens When it’s Passed into Law?

    If enacted, federal antitrust agencies, Federal Trade Commission (FTC) and Department of Justice (DOJ), would have the authority to enforce the violations below and issue injunctions and penalties against the guilty party.

    Under the bill, it would be unlawful to give “preference to the products, services, or lines of business of the covered platform operator over those of another business user on the covered platform in a manner that would materially harm competition,” the Justice Department explained.

    For instance, Amazon could be found in violation of this law if they had algorithmically placed their branded products in more prominent places in the platform or if Amazon was found guilty of stealing your supplier information to create a knock-off version of your product.

    The bill could also prohibit Amazon from exploiting the Buy Box feature, which they could use to promote their own products and directly compete with resellers. Many of us have been affected by the online retail giant essentially breaking its own rules to maintain dominance in the marketplace that they currently share with us.

    Clearly, both wholesale and private label sellers feel the hurt of Amazon’s anti-competitive behavior. But if the bill is passed into law, it would potentially squash that. This could be one of the biggest reasons why Amazon would want to call out for sellers to lobby against it – though, it may be against sellers’ best interest and in Amazon’s interest more than not. ⚠️

    Under Section 3: Unlawful Conduct, the bill would also create the following violations:

    1. Limiting another business’s products or services to compete against the covered platform’s. This means Amazon cannot apply their policies unfairly against sellers that rely on the platform to do business with customers. For example, if a new private label brand was eating into Amazon’s market share, the bill would prohibit them from selectively implementing some policy to ban it from the marketplace.
    2. Carrying out the covered platform’s Terms of Service (ToS) in a discriminatory way among similarly situated business users. We had a competitor “review stacking,” which means they were adding (completely unrelated) reviews from “dead products” to their own product listing. For a kitchen product, there were reviews about dog leashes, DVDs, books, and even exercise equipment that were added to the listing. Not only did this increase the total number of reviews on the listing, it also changed the total star rating from 4 to 4.5 stars!

      The seller was essentially stealing sales from us by lying about his review status. 🤦

      We reported this violation numerous times and each time the seller would get the reviews stripped and then a few days later, his listing would be “stacked” all over again. He would never get shut down for violating ToS, and it was a vicious cycle. And yet other sellers’ listings were suspended for much less inflammatory violations.
    3. Restricting the capacity of business users to utilize different platforms’ hardware, software features, or operating systems. This provision most likely applies to Google and Apple with their suite of interoperable devices. For example, Apple AirPods are fully interoperable with iPhones through a chip that supports Siri, a communication feature that’s exclusive to the Apple ecosystem, and Bluetooth. Via Bluetooth connection, Samsung, Sony, and other smartphone brands are fully interoperable with AirPods. However, according to tech expert Aurelien Portuese, 1st-party devices (AirPods to iPhone) will always be more interoperatable than 3rd-party devices with operating systems. Therefore, under this bill, other smartphone manufacturers could use interoperability issues with Apple and Apple refusing to open up their platform to make 3rd-party devices more interoperable, as potential grounds for litigation. Unless perhaps, the restriction is absolutely necessary (see #6), e.g., to protect Apple’s trade secrets and patented technology.
    4. Conditioning access to the platform or preferred status or placement on the platform on the purchase/use of other products or services offered by the covered platform that isn’t exclusive to the covered platform itself. This violation could impact Amazon’s Prime shipping, a service that makes FBA products eligible for free 1-2 day shipping. The bill would mandate the eComm giant to allow other carriers to fulfill Prime orders. Amazon says such a mandate would make delivering on their 1-2 day shipping promise “difficult” and “potentially impossible in practice,” possibly because they wouldn’t have full control over carriers outside of their own shipping network.

      But then again, Seller-Fulfilled Prime already exists for those who are not using FBA, so Amazon is full of it if they are trying to claim opening up Prime to other carriers would be a tragedy.

      Last time I checked, the Seller-Fulfilled Prime program was still operable and has not been canceled. If it had been canceled due to lack of success, then, there might be an argument to be had there. The sheer fact that Seller-Fulfilled Prime is still in operation is essentially an admission that this point can actually be adhered to. In my view, this is a disingenuous play from AMZ to try to gain support from sellers. 🙄
    5. Using internal data obtained from the activities of a business user, including interactions with customers, to boost the sales of the covered platform’s own products. According to the National Association of Wholesaler-Distributors, Amazon gathers vast amounts of competitively sensitive data from third-party sellers, including product details and transaction data around product prices and customer information. The eComm giant then exploits this sensitive data to launch their own competing products to undercut sellers on the platform.
    6. Restricting or prohibiting users from uninstalling applications that have been pre-installed on the covered platform or changing default settings on the website that geared customers or users towards products offered by the covered platform, unless necessary.
    7. Retaliation against business users or customers who raise concerns with antitrust authorities about any potential violations.

    If found guilty, the violator could face a financial penalty of up to 15% of its US revenue. 😲 No wonder Amazon and other Big Tech CEOs themselves have descended on Washington recently to influence the members of Congress to oppose the bill, CNN reports.

    Supporters of the Bill

    Bill sponsors, industry groups, and other supporters of S.2992 argue that the antitrust legislation would address many long-held problems with tech companies allegedly committing restrictive, self-preferencing practices online.

    It would also ensure:

    • Entrepreneurs and small businesses still have the opportunity to succeed in digital markets (Sen. Klobuchar)
    • Large online platforms and other tech companies will be held accountable if they behave in a discriminatory manner (Sen. Grassley)
    • Help level the playing field for small business owners, i.e., prohibiting Big Tech from using the intel data they collect from users on their websites, apps, or platforms to create unfair competitive advantages. (Sen. Lummis)

    By combating these anti-competitive practices, covered platforms and their business users would be able to provide customers with better user experience and more product offerings with competitive prices.

    Groups and Critics Who Oppose the Bill

    Amazon, Apple, and other pro-tech groups such as the Information Technology and Innovation Foundation (ITIF), Chamber of Progress, TechNet and the Computer & Communications Industry Association oppose the bill – as expected, so no surprise there!

    The opponents of the bill argue that it is:

    Vague and overly broad with multiple ill-defined legal terms
    For example, covered platforms are allowed to take “narrowly tailored” actions as an affirmative defense, which means the restriction committed was reasonably necessary for legal reasons, to protect user privacy and data security, or to maintain or improve the “core functionality” of the platform. However, the term “core functionality” isn’t well-defined in the bill. This could lead to disputes as covered platforms develop or already have existing products and services that they may claim are “core” to their business model.

    Rushed
    Industry groups have argued that S.2992 has not received the traditional hearing process that other antitrust-related bills have in the past (e.g., giving the members and the public an opportunity to debate the impacts of the bill before advancing it to the floor for the Senate to vote for its rejection or approval).

    Carl Szabo, Vice President and General Counsel at NetChoice said that “rather than opening the floor to public input, the bill’s sponsors rushed through legislation. Lawmakers should stop this backroom wheeling-and-dealing and instead take the input of economists, experts, and businesses to better understand the impact of this rushed legislation.”

    This is something that I personally can’t disagree with. It is unfortunate that if the bill passes, it may embroil Amazon in a world of unnecessary legal battles that we may see the financial brunt of. But if it fails, I wonder when we might ever find another chance to advance some of these pro-seller actions.

    Still, both majority and minority floor leaders took advantage of the bipartisan support (thus getting a 16-6 vote) for the bill to pass it during the committee markup, the final step a committee takes to push the bill to the Senate chamber.

    It will hurt American consumers
    The Chamber of Progress recently said that the bill would “break popular consumer products,” specifically Amazon Prime, as it could become illegal due to the bill prohibiting Amazon from giving preference to those sellers who use their services–for example, displaying a Prime badge on certain products could create an unfair advantage over non-Prime items. (But, again, Seller-Fulfilled Prime should be able to combat this argument.)

    To influence the public and lawmakers, the industry group has also been running an online ad saying “Senator Klobuchar wants to erase Amazon Basics,” according to Reuters. However, if Amazon was not worried about Amazon Basics not “playing fair” they wouldn’t be running these ads. This is a sure sign that we have Amazon’s number when it comes to their true motives toward lobbying sellers against this bill. 😏

    A representative from Amazon wrote that the bill also threatens to destroy two of the things consumers love the most about Amazon:

    1. The wide selection of products with low prices made possible by opening the eComm platform to third-party sellers. However, this argument does not hold water, as the bill doesn’t seem to aim at the heart of the 3P sellers, but rather Amazon’s own offerings. As previously discussed, the bill would prohibit Amazon to prioritize their own store branded products that they typically offer at cheaper prices. Unless, of course, this is a veiled hint that Amazon would rather become the sole seller on the platform.

      If that was the case, I’m sure this could create one hell of a vacuum that would splinter Amazon’s business to (1) another buying platform that included 3P sellers and (2) Amazon would become nothing more than a giant Amazon brand website. It is an empty threat by the online retail giant, but an interesting road to hypothesize down.
    2. The promise of fast, free shipping through Amazon Prime. Again, FBA isn’t the only way to offer Prime shipping. Seller-Fulfilled Prime also offers 1-2 day shipping, unless Amazon suddenly stops offering this program to force sellers to go back to using FBA. But wouldn’t that be considered an anti-competitive behavior under the S.2992 bill?

    Amazon reps also claim that putting these restrictions on only the biggest covered platforms gives “preferential treatment to other large retailers that engage in the same practices.”

    They argue that the bill targets only one retailer, Amazon, by requiring an annual US net sales of at least $550 billion to qualify for regulation. Therefore, it would not cover Walmart and Target. But perhaps, that’s likely the point. I personally haven’t heard of Walmart and Target doing what Amazon has been doing. Perhaps when they get closer to the $550B mark, they’ll start thinking about taking the dark turns that Amazon’s been winding down. However, IMO, it would be good to lower that threshold to rope them in as well.

    Many Sellers Refuse to Rally Behind Amazon’s Call to Oppose the Antitrust Bill

    Dharmesh Mehta, Amazon’s Vice President of Worldwide Selling Partner Services, took to Seller Forums to encourage everyone to reject the antitrust legislation that could “harm small businesses, American consumers, and Amazon.”

    However, the lobbying didn’t appear to go as intended. Many sellers replied to the announcement saying they support the bill. 👏

    Third-party sellers account for 60% of Amazon’s total retail sales. But in the last few years, they’ve expressed frustration over the fees they pay to sell on the platform, fear of being suspended for little or no reason, and the platform’s inability to eliminate returns scams and bad actors (e.g., fake reviews and listing theft).

    No wonder many sellers felt the need to take back control by supporting a bill that could shake up Amazon. 💪

    • “Yes, I’m going to oppose that Amazon will be prohibited from undercutting, manipulating the buy box, and instituting restrictions on certain listings that unfairly bar me from selling an item. Yup, writing to my senator right now.”
    • “Any informed seller is going to support massive action taken against Amazon in the antitrust arena. I am personally sick of the condescending posts by Amazon management directed at us. We are not morons and know how to read and think for ourselves.”
    • “This bill is 100% pro seller. I am definitely going to call my representatives and ask them to please pass the bill! It is not going to jeopardize our ability to sell on Amazon. It’s going to give us sellers a fair shake and restrict Amazon from purposely prioritizing their products over ours. Amazon is trying to do to us what they did to those who wanted to unionize.” 👌
    • “If Amazon wants my support, it will have to level the playing field, be fair, be honest and most of all be good to its workers and sellers. I oppose this email because it urges sellers to go against the creation of laws that will help level the playing field. I support better laws for Amazon, Amazon Workers Unions and Sellers.”
    • “As much as we love Amazon, there must be regulation and oversight at some point. If this is passed it doesn’t mean 3P sellers will be hurt, but that Amazon and big tech cannot favor themselves 100% of the time. Small businesses struggle to keep up with low costs offered by big box stores so anyone agreeing S. 2992 is a good thing is looking out for small business and their fellow sellers. Big tech should not be favored 100% of the time.”

    But obviously, not every seller expressed support for the bill. Two commenters said that the proposed legislation could hurt them just by jeopardizing the marketplace.

    • “I can’t predict the future, and so neither can the gang in Washington. I can tell you that this bill is bad news for Amazon, bad news for Amazon customers, and if you think that doesn’t mean bad news for Sellers, then you must not be a third-party Seller.”
    • “I understand the sentiment, but being permanently put out of business would probably hurt you more. There is a time and place to air our grievances with Amazon. They deserve it plenty. But this is not that time. Let’s not cut off our nose to spite our face.”

    Another seller believes that Amazon isn’t really against S.2992.

    • “Read the post and read it again. Bottom line is Amazon wants the law to also cover its physical competition – WalMart. That may be a fair criticism, but stop the hysterical nonsense. Ironic to see Amazon whining about a law intended to prevent it from unfairly taking small seller data to create competing products to wipe out the small seller is bad because it doesn’t prevent WalMart from doing the same.”

    You can read the entire discussion here.

    Playing the Waiting Game

    There are faults with the proposed law and it’s not black and white but there are serious reasons for AMZ to be concerned and they absolutely aren’t altruistic. This law could be a major shake-up and none of us can say whether that would be in a good or bad way. 🤔

    But the idea that Amazon would shatter their cash cow – third-party business – is a naive one. While they are threatening it, they know that to do so would destroy them, too.

    It could mean more fees funneled down to us sellers to try to squeeze some of us out, though. Anyone who understands economics even a little bit knows that costs trickle down and any costs Amazon incurred would likely find its way down to us and to consumers, but would the benefits outweigh the risks? Who knows. 🤷

    In closing, the bill is fundamentally good for 3P sellers, but there’s not going to be a clean line on this thing.

    We’ll have to take the good with the bad if this ends up passing and, maybe only one thing is for certain, it’s going to make for an interesting time if it does.

    If that’s the case, I suggest we all buckle up!

    New EPR Compliance Obligations for Amazon Germany Begin July 1st

    EPR Compliance For Selling On Amazon Germany

    This announcement is for UK/EU sellers with listings on Amazon.de (Germany). 🇩🇪

    In a move to comply with the upcoming changes to the Extended Producer Responsibility (EPR) Packaging Law in Germany, Amazon has started checking seller compliance with this environmental policy. 👀

    Effective July 1, 2022, all packaged goods distributed in Germany, including those available for purchase on Amazon.de and other eComm marketplaces, must be registered in the LUCID Packaging Register. This process enables you to put your product packaging (see infographic below) into circulation and share the costs of recycling them.

    Previously, this registration requirement only applied to sellers subject to system participation, a process that requires them to enter into an agreement with a Producer Responsibility Organization (PRO) who will collect their packaging from customers and take care of its sorting and recycling for a fee.

    ⚠️ IMPORTANT: If you fail to register, your listing will be blocked on Amazon.

    Note: As of June 15, 2022, the eComm giant has already started blocking non-compliant listings to ensure it doesn’t violate the amended EPR Law that comes into force on July 1st. You can view your listing status on your account’s Manage Inventory page>Inactive (Blocked). Read on to learn how to become EPR-compliant.

    What is EPR?

    EPR is an environmental protection strategy to reduce waste from a product and its packaging by making all producers, including online sellers or importers, responsible for the entire life cycle of the packaged goods they sell, from introduction to the market through to disposal, including waste collection and recycling of cartons, bubble wraps, foam fillers, among other packaging materials.

    How to Comply with the EPR Packaging Law?

    EPR guidelines differ by product category: (1) packaging and (2) Electrical and Electronic Equipment such as batteries. This article focuses on your compliance requirements for packaging, which under Germany’s updated EPR law, you must:

    Register in the LUCID Packaging Register

    Register as a “producer” and enter the requested information to get a LUCID number. You can do this process yourself through this link (free of charge) or sign up for a paid service called Amazon Solutions for EPR Compliance.

    After completing registration, you will receive a LUCID number that you’ll need to submit to Amazon (see Step #2). You’ll also need this registration number to enter into a system participation contract with a PRO in Germany, if necessary (see Step #3).

    Again, a PRO is a company who will act on your behalf to administer an EPR-compliant waste recycling program, including calculating the costs incurred for the collection, sorting, and recycling of your product packaging.

    Send Your LUCID Number to Amazon

    Once registered, make sure to submit your LUCID number to Seller Central.

    Amazon may also contact you for further verification or additional information. For instance, if your packaging is subject to system participation, a representative may reach out to validate your LUCID registration details.

    If Required, Enter into a System Participation Agreement

    In Germany, packaged products that accumulate as waste with consumers after use are subject to system participation.

    If you’re responsible for items that are subject to system participation, you need to pay a fee for the recycling of your waste materials. The rates depend on the type of packaging material (typically a few cents per kilogram).

    Work closely with your packaging suppliers, FBA representatives (if fulfilling via FBA), and PRO to accurately identify your packaging volumes. Consider using this Packaging Volume Calculator to determine your fees.

    ⚠️ IMPORTANT: If system participation is required, packaging volume and fee calculations may take a few of weeks (up to 20 days for some sellers). Amazon also needs 5 business days to verify your LUCID registration details during this process. So, if you haven’t registered yet, act now to prevent getting your listings blocked.

    Conversely, if your packaged goods are not subject to system participation, you don’t need a system participation contract. However, you’ll still need to register in LUCID.

    Read this checklist to learn more.

    Report Your Packaging Volumes

    Send your packaging data reports and pay fees to your designated PRO regularly.

    Go to EPR Requirements: Packaging in Germany for more details.

    Final Thoughts

    ♻️ Compliance with the EPR Packaging Law is a move toward more sustainability in eCommerce. It is going to be an added expense that your business will have to absorb or offset elsewhere. I suggest checking out our master carton calculator to see if there are ways you can optimize efficiencies elsewhere to help to recover profit in other parts of your business to make up for the added costs of EPR.

    It may also be a good time to see if reducing your product packaging can help to reduce your potential PRO fees.

    On the brighter side, the EPR law helps to lessen your environmental impact, and can also offer good business opportunities. Marketing your product as eco-friendly can help you to stand out among your competitors, thereby attracting new (eco-minded) customers and potentially driving more sales.

    Related: Is Amazon Climate Pledge Worth it For Sellers?

    Software Updates For June 2022

    Amazon Inventory Software Updates June 2022

    Continuing to be the best inventory management software is our passion! We’re always open to your suggestions and to making our tools more useful for you. With that being said, here is what is new and improved this month. Let’s dive in!

    🥳
    NEW RELEASE

    Granular Automation of Seasonal Sales Spikes

    SoStocked new automated seasonal spikes feature

    The new automated seasonal spikes feature is officially up and running, available to all accounts. You find it in your Forecast page under the forecasting settings.

    With this feature, you can set automatic seasonal ups and downs month to month, bi-weekly, or even weekly, based on past sales curves. SoStocked will find the annual average daily sales for the product, indicate which time periods extend above or below that average, and then you can input trend settings above or below those projections.

    Did you launch a new product and you have no month to month sales pattern data on which to base your sales projections? No problem! Select historical seasonal trends for other products within your catalog and use those same trends for your new product. Group together multiple seasonal product trends for more intricate forecasting. Our new seasonality feature will find an average of that grouping to apply to your new SKU.

    You can also set different seasonality for each marketplace separately, US, EU, etc. to create the most accurate forecasting for every product in every marketplace.


    COMING SOON

    SP-API – Amazon Far East Marketplace Integration

    SoStocked AU

    You might have heard about this new API around the Amazon community. Just in case you don’t already know what it is, here is a brief explanation.

    First, API stands for Application Programming Interface. In layman’s terms, this allows 2 applications or softwares – like SoStocked and Amazon – to talk to each other.

    SP-API is a new type of API for Amazon. The SP part stands for Selling Partner. SP-API is the next generation or new version of API for Amazon. They have been using MWS (Marketplace Web Service) for years and now they are launching SP-API as an evolution of MWS. The new SP-API is needed for SoStocked to connect with the newer marketplaces such as Australia, India, Japan and Dubai.

    Here at SoStocked, we are ready for the new global API. Our international currency and exchange rate options (find out more here) along with this new SP-API, will create a streamlined SoStocked experience for selling across the globe.

    We have been patiently (or not so patiently) waiting for Amazon to do what they need to do to allow us to integrate with the new SP-API system. We heard positive confirmation that they have a deadline to get this done by July 31st. So get ready folks, it’s almost here!


    COMING SOON

    Shopify Integration

    It has been a lot of work getting all of the details aligned to integrate Shopify into our system. But the SoStocked development team has continued to work with our beta testers to get this platform into action. There have been some major changes to the software on the back end that will support the new SP-API coming up as well as integration with Shopify and other stores, so you will be able to track sales, shipments and inventory levels for your off-Amazon forecasts too! So stay tuned!

    ⚡️
    MICRO UPDATES

    Subtle Improvements to Make Your
    Forecasting Easier

    SoStocked - MICRO UPDATES

    🛠 Tool Tip Definitions For All Columns On The Inventory Page.
    Tool Tips are the little grey boxes that pop up and tell you what each feature means. Now on the Inventory Page, every column has a Tool Tip so you can take any guesswork out of your reporting. Simply hover your mouse over the column title and the Tip will pop up and tell you what the column means.

    Tool Tip Definitions For All Columns On The Inventory Page

    💵 We Added Cost Per Unit and Shipping Costs Columns and Filters to Work Orders Page
    On the Work Orders page you can turn on columns for Shipping Cost and Cost Per Unit. You can also sort through your Work Orders quickly by using newly added filters to find any items with a specific cost per unit or Shipping Cost.

    SoStocked Cost Per Unit and Shipping Costs Columns and Filters to Work Orders Page
    SoStocked Work Orders page

    ☝️ Upgraded Entire System Framework To Improve Performance
    This is like saying that we just released the new iPhone 15 pro. This new system framework will help the SoStocked system to more seamlessly integrate the next exciting improvements coming down the pipeline.

    💨 Improved Document Export Speed For Reports
    Get all of the reports you need in a hurry without unnecessary export time. Because ain’t nobody got time for that!

    🔥
    ICYMI: FEATURE SPOTLIGHT

    Vote For or Add New Suggestions

    SoStocked Vote For or Add New Suggestions

    Vote For or Add New Suggestions For Our Future Updates Using Upvoty
    We have a new tool for future development using an app called Upvoty. It allows you, the user, to vote for, add or expand upon new suggestions for our future updates.

    This is vital for our development because as we grow, we get a ton of suggestions. We have to be systematic and democratic about what we assign our developers to, otherwise, they will be “chasing squirrels” and we could miss vital updates and features.

    One of our most important resources is you, the seller, and your feedback is extremely valuable to us. Having an organized approach to feature updates by gathering your insights into what is most important to you and exactly how you’d like the features to work means we can build it right the first time and you can more quickly improve your inventory, logistics and profitability processes.

    To participate in the future development of SoStocked:

    1. Log into your SoStocked account
    2. Using the account menu button on the lower, left, go to “Development Roadmap” and click.
    3. This will open a new tab where you can vote for your favorite new features, or create a new request.

    WATCH THIS HOW-TO VIDEO

    We have combined Warehouses and Prep Centers functionally as the same type of vendor for simplicity
    For ease of use we combined warehouses & prep centers into one vendor type. This will make your lead times and tracking much more simple. It takes away unnecessary additional columns and any eliminates guesswork out of creating lead times.

    SoStocked combined Warehouses and Prep Centers

    Need more information?

    1. Send Message: We typically reply within 2 hours during office hours.
    2. Schedule Demo: Dive deeper into the nuances of our software with Chelsea.
    3. Join Live Upcoming Webinar: New to Amazon inventory management? Learn three inventory techniques you can implement right away.

    Amazon Adjusts Fees For Remote Fulfillment With FBA

    Amazon Adjusts Fees For Remote Fulfillment With FBA

    US NARF sellers, brace yourselves for another fee adjustment! 😁

    Those who participate in Remote Fulfillment with FBA, also known as North America Remote Fulfillment (NARF), will see a rate increase starting June 30, 2022. This move is in response to the rising costs of storage, fulfillment, transportation, and customer service across the US, Canada, and Mexico.

    😤 The new fee adjustment will also include dimensional weight (DIM weight) to reflect the latest FBA fee structure. This means the greater of the unit weight (aka actual weight) or DIM weight will be utilized to determine your shipping weight and fees for all product size tiers.

    Updates to the Remote Fulfillment with FBA Fees

    The Table of Fees below shows the latest fee changes:

    Canada

    Based on the new fee structure, here’s how DIM weight pricing will impact your margins.

    Let’s assume your large standard size product only weighs 3 lbs, but the dimensional weight is 9 lbs. In that case, you are going to be charged CAD $13.90 + $0.80/lb above first 3 lbs (x6) or CAD $18.70/unit. Before the update, you would only have paid CAD $12.79/unit.

    So, with DIM weight pricing, you’re paying Amazon CAD $5.91 (approx. $4.70 USD) more than you’d paid previously. 😦

    Mexico

    Using the previous example, shipping a large standard size unit that weighs 3lbs, but the DIM weight is 9lbs is now going to cost you MXN $224.07/unit versus the previous rate of MXN $159.70 (based on unit weight), a MXN $64.37 increase – or approximately $3.30 USD.

    Although Amazon says that these rate adjustments are not above industry-average increases for fulfillment services, we all know that being charged based on DIM weight is quite a big deal for sellers with thin margins. 🤔

    And as we’ve previously reported, some sellers within our SoStocked community have reported seeing their FBA fulfillment fees climb by $1 per unit. One seller even saw a 94% increase in fulfillment fees. So, if you’re already dealing with slim margins, increases like these can quickly make your products unprofitable.

    Related: How to Increase Your Profit Margins

    Beware of Automatic Enrollment in Remote Fulfillment With FBA

    Amazon may start automatically enrolling sellers into its Remote Fulfillment program. 😦

    On the news announcement page, some sellers reported receiving a notification about “Automatic Enrollment in Remote Fulfillment” on the Seller Central home page with the option to opt out before the service goes live.

    If you don’t opt out before the start date, your products will most likely become available for sale on Amazon.ca (Canada) and Amazon.com.mx (Mexico), which means added fees!

    This auto-enrollment might be a gradual roll out, but it’s crucial to be aware of these things as early as now. Forgetting to opt out of a paid service you don’t need or want could result in Amazon eating into your profits, which is pretty similar to what’s happening with their aging inventory removal services.

    In case you’re not aware, Amazon has recently increased their removal/disposal fees, and in April, they said that they will automatically dispose of aging inventory to make room for Prime Day. What’s suspicious about this is that around the same time Amazon raised their removal order fees, they also applied stricter automatic removals, including adding an additional surcharge on aged inventory. 🤔

    Overall, Amazon FBA fees continue to climb despite many sellers reacting strongly against the price hikes. I recommend implementing some profit recovery strategies to protect your margins, if passing those fee increases on to your customers isn’t an option right now. 💪

    Make sure to also read our blog posts that mention these profit recovery strategies to learn more.

    Related: Master Carton Calculator to Optimize Packaging and Reduce Shipping CostsFBA Fee Calculator to Calculate ProfitabilityInventory-Minded Marketing for Amazon SellersHow to Reduce Excess Inventory

    Amazon Removal Order Fees Get More Expensive

    Amazon Inventory Removal Order Fees Get More Expensive

    In case you missed it, Amazon recently adjusted its Removal and Disposal Order Fee Structure in response to the rising costs. 😩 The price increase took effect on January 18, 2022, but it kind of slipped through the crack for some, as sellers were all up in arms over the impacts of the new FBA dimensional weight fulfillment fees on profit margins. So, that gave a really good distraction to the removal and disposal order fee adjustment.

    💡 Let’s shed some light on the significant changes we’ve seen in the new removal order fee structure, which actually go hand-in-hand with the new FBA fulfillment fees changes.

    First, let’s take a quick look at this side-by-side comparison of the old and new removal order fees.

    As you can see, the updated fee structure is fairly straightforward. There’s a column for size tier, shipping weight, and the corresponding rates – the same details we’ve had years before, except prices have obviously increased at the rate of between 44%-61%. Still, you can come into the page and easily understand the costs associated with removing your inventory from FBA, right? Not so fast!

    We wanted to take a closer look because we had a suspicion all wasn’t as it seemed, and, sadly, we were right.

    According to the FBA Removal Order Fees page, Amazon uses your product’s Size Tier to calculate your removal or disposal fee per unit.

    For removal orders, there are only two product size tiers – Standard Size and Oversize/Special Handling Items.

    Here’s where it gets a bit sneaky. Each tier is based on unit weight, product dimensions, and, you guessed it, the dimensional weight of your packaged item. Amazon now factors dimensional weight (DIM weight) into its product measurement categories, a change that directly impacts your removal order fees, which is quite a big deal. And unfortunately, disposal fees are also charged in the same way.

    DIM weight pricing is applied when the product’s DIM weight is greater than the unit weight. Packaged items with larger dimensions occupy more trailer space, which carriers could use to fit in more boxes, so they wanted to be compensated for that. That means you’re essentially paying for the amount of space your package takes up when the DIM weight is greater than the actual unit weight.

    Suppose your standard-size product weighs 3 lbs, but the DIM weight is 6 lbs. In that case, you’re going to be charged $1.51 + $0.63 per lb above 2 lbs (x4) based on the new fee structure. 😦

    Here’s a quick calculation:

    $1.51 + ($0.63 per lb x 4) = $4.03 per unit removed

    With dimensional weight in this example, you’re paying $1.89/unit more than you would pay just using unit weight.

    Indeed, removal fees are getting much more expensive!

    Before the price increase, it would have only cost you $0.67 + $0.35 per lb or $1.02 to remove a standard-size item based on unit weight. That is an almost 300% increase in removal fee costs! 

    The fact that they rolled this out at the same time as releasing the new DIM weight fulfillment fee structure that made so many products unprofitable and then made it so painful to remove that inventory is pretty mind-boggling!

    Another thought is that they may be pushing sellers to use liquidation versus removal as the fee structure certainly incentivized that course of action. More on that below.

    This is also another reason for sellers not to send all of your new product inventory to FBA immediately. If you are not confident that you will be able to sell through that inventory, holding the bulk of it at a 3PL may be the best move for you. Perhaps that’s exactly what Amazon had in mind with this policy change, making it unbelievably uncomfortable for you to hold dud inventory at FBA. Restructuring your inventory strategy just got that much more vital.

    Bottom line is, being charged based on DIM weight could lead to a considerable cost increase for some sellers.

    Within the SoStocked community, for instance, some sellers have reported seeing their FBA fulfillment fees increase by $1 per unit. One seller even reported a 94% increase in fulfillment fees. These types of increases are quite substantial for sellers with slim margins.

    Think Twice Before Removing Your Inventory

    If you have enabled automatic removal of your aging inventory, you might not be aware of the new rates that Amazon is charging you. Interesting that around the same time Amazon increases the removal order fees structure, they also implement more stringent automatic removals. 🤔

    Amazon is just whittling away at our profit every way they can. First, these dimensional weight changes. Then, they hit sellers with a 5% fuel and inflation surcharge in April. A few weeks later, they implemented a surcharge on aged inventory. ⚠️

    These fee increases are getting out of control. Unfortunately, it’s these tiny little things that will end up really taking a bite out of your profits and making some products unprofitable.

    So, before going through removal orders or automating your inventory removals, make sure you’re aware of these new fees so you can run some numbers first. Sometimes, it makes more business sense to try to recover some profit by liquidating your dead stock rather than just shipping it back to you.

    Profit Recovery Strategies

    If your excess units or slow sellers are still in sellable condition, consider the following profit recovery options:

    • Running a flash sale such as Amazon Lightning Deals or Amazon Outlet Deals
    • Liquidating slow sellers through the FBA Liquidations Program, which only charges $0.25 to $1.90 (+ $0.20 per lb above first 2 lbs) processing fee per unit, plus 15% referral fee.

    However, if none of these options are worth the effort, then your next best move is to create a removal or disposal order for your excess inventory.

    Other Ways to Keep Costs Low 💰

    If you need to cut costs to offset the added Amazon fees, try to rethink your packaging and shipping practices. It would be best to keep your product packaging compact by downsizing your jar sizes, vacuum sealing to size-down bulky items or in other ways reducing packaging size in order to achieve the smallest dimensions possible.

    Then, use our Master Carton Calculator to find your optimal carton and pallet load capacity per order to reduce shipping costs across several different facets of your supply chain.

    And if you’re planning to replace your slow sellers with new, more lucrative products, use our FBA Calculator to determine their profit potential. This calculator includes the 2022 Amazon Fulfillment Fees Policy to calculate DIM weight and select the greater of unit weight or dimensional weight, thereby ensuring the accuracy of your fee calculations based on the latest Amazon policies.

    Related: Inventory-Minded Marketing for Amazon SellersAmazon Restock Limits Tips and Updates6 Causes of Amazon Unfulfillable Inventory and How to Fix Them

    Amazon Implements Surcharge on Aged Inventory Starting May 15th

    Amazon Surcharge On Aged Inventory Starting May 15 2022

    ⏰ Time to move your slow sellers out of Amazon FBA!

    Effective May 15, Amazon will impose an additional storage fee on inventory that has been sitting in its warehouses for 271-365 days. This surcharge will be applied on top of your regular monthly storage fees. Previously, aged inventory fees were charged after 365 days, so this 271-365 day fee window is a new, unwelcome addition for sellers.

    Here’s how the aged inventory surcharge will bring about more fees (and burden):

    The fee increase may seem small, but when combined with the recent fulfillment fee changes and 5% fuel surcharge, the total costs could be large enough to put an uncomfortable dent in your profits.

    With less than 2 weeks until the new surcharge hits sellers, it’s probably best to either put your excess units on sale or use Amazon’s FBA Liquidations Program to recover 5%-10% of its average retail price.

    Although you won’t be able to recoup all of your money, liquidation is better than having your excess inventory disposed of or returned to you at an extra cost if you have no means to sell them on other eCommerce platforms.

    Most importantly, adopting a system we call Inventory-Minded Marketing can help you to ensure you do not have overstock emergencies at day 271.

    Moving forward, try to minimize your storage costs by keeping an eye on all your SKUs in Amazon, specifically slow sellers. Consider using the new Manage Inventory Health report (formerly known as the Inventory Age Report) or your SoStocked dashboards to efficiently manage your FBA inventory. They all provide more up-to-date information than Amazon’s previous reporting systems, namely the Inventory Health, Inventory Age, and Excess Inventory reports, all of which had up to a 10-day data delay.

    The Manage Inventory Health report offers a consolidated view of your:

    • Sales in the last 7, 30, 60, and 90 days
    • Shipment statuses (Working, Received, and Shipped)
    • Storage volume and type
    • Estimated monthly storage and long-term storage fees
    • Aged and excess units

    Go to the Manage Inventory Health overview to learn more.

    Pro tip: If you’re using SoStocked, you can also create your own Amazon Liquidation Dashboard, Overstock Dashboard and Amazon Slow Sellers Dashboard within the software to identify old products that are costing you in storage fees so that you can liquidate or boost sales into a viable range.

    Software Updates For May 2022

    Amazon Software Updates for May 2022

    It’s been a busy second quarter so far and there’s no slowing down here at SoStocked! See what new features have been released this month and what we have in store for you coming soon. Let’s dive in!

    🥳
    NEW RELEASE

    View Your Total Lost Sales Due to Stockouts

    The truth hurts, but it will also set you free and help you make more money! SoStocked now has a dashboard where you can view the total lost sales due to stockouts in the past 365 days. You can also see the total lost sales by region or marketplace to find where exactly there may be logistic issues that need to be resolved.

    It works by taking the product’s current Adjusted Velocity and the Stockouts in the last 365 days and multiplying it by the retail price you have listed under the product details page.

    🥳
    NEW RELEASE

    Consolidated Activity Logs with Dashboards

    With this new feature you are able to see a chronological log of changes made to your products, orders and warehouse inventory levels in one easy-to-use dashboard.

    In the image below you’ll see the consolidated logs complete with adjustable columns and filters. Go to the Settings page and find the setting entitled “Logs”.

    Activity logs have been available in SoStocked however you had to go to different places to view the activity logs for that specific area, for example, to see inventory changes for a warehouse you had to go to the vendor, open the vendor detail page and click “View Activity Logs” these same logs are still available now and you can find the details laid out here.

    In this activity log you have access to all activity logs throughout the site in one place, rather than having to click around the account you can leverage the filters to see the specific data you want to track.

    🥳
    NEW RELEASE

    See Your Future Predicted Sales Graph As Part Of Your Forecasting

    Now you can view what your predicted future sales will look like in a graph format on the Forecast page. This graph takes your current Adjusted Velocity and adds in all Lightning Deals and Seasonal Spikes. With this view you can be proactive and make adjustments in advance with your inventory-minded marketing team to keep your graph on an upward trend.

    🥳
    NEW RELEASE

    In Beta, You Can Try It Now!
    Granular Automation of Seasonal Sales Spikes

    If you are interested, you can try the new Automatic Seasonal Spike using coefficients, meaning your historical seasonality will be represented and you can then adjust each time period against that historical data.

    You’ll be able to control seasonal ups and downs month to month, bi-weekly, or even weekly. SoStocked will find the annual average daily sales for the product, indicate which time periods extend above or below that average, and then you can input trend settings above or below those projections.

    Did you launch a new product and you have no month to month sales pattern data on which to base your sales projections? No problem! Select historical seasonal trends for other products within your catalog and use those same trends for your new product. Group multiple product seasonal trends for more intricate forecasting. Our new seasonality feature will find an average of that group to apply to your new SKU.

    You will also be able to set different seasonality for each marketplace separately, US, EU, etc. to create the most accurate forecasting for every product in every marketplace.

    If you want to test out the beta seasonality tool just email us at helpme@sostocked to request entry into beta.


    COMING SOON

    Australia API

    We have had our software ready for Amazon’s new API system allowing for the Australia API for a while now, we’ve just been waiting on Amazon to allow us to integrate with that system. The good news is that Amazon now has a deadline to get this completed and we will have full integration with Australia, Saudi Arabia and The United Arab Emirates by July.


    MICRO UPDATES

    Subtle Improvements to Make Your
    Forecasting Easier

    SoStocked - MICRO UPDATES

    New and improved inventory snapshot has more data available for filing taxes and the ability to filter by warehouse and region for a cleaner, more user-friendly look.

    For those selling in multiple marketplaces, you can now filter by each marketplace so that all data is fully separated by corresponding marketplace.

    You can now sort the column Days Left (FBA + Inbound) on the Inventory page by ascending or descending order. Get to those emergencies faster!

    SoStocked - sort the column Days Left (FBA + Inbound)

    If you deal with bundled products, you are aware that SoStocked used to automatically choose a supplier, making things cumbersome when sorting by supplier. Now you can choose the primary supplier for bundled products. Go to the Product Detail Page of the bundled item and find “Primary Supplier” under the “Supplier Pricing” section.

    ⚡️⚡️⚡️ Improved Order Tracker Load Speed & Resolved Receiving Bugs ⚡️⚡️⚡️

    Our team has been working hard to handle the slow load speeds on the order tracker and has resolved bugs to improve the functionality of unit receiving when orders have arrived and are closed.

    🔥
    ICYMI: FEATURE SPOTLIGHT

    Some Updates and Features
    You Might Have Missed

    New-MCC-Metric-Imperial-Feature

    NEW Free Carton/Pallet Calculator Tool: Optimizing your carton dimensions and pallet configuration to reduce your total cartons and pallets per order and increase profitability. Dive into this free tool here.

    Edit HTML copy and improve Amazon description formatting and compliance with our easy-to-use Amazon HTML converter. Start converting here.

    Amazon FBA Calculator with NEW Dimensional Weight Calculated: Factor FBA fees (including dimensional weight), Cost of Goods, PPC and freight costs to calculate profitability. Got a new product idea but not sure if it will make 💵 💵 💵 ? Stop guessing and use this tool instead.

    Find missing FBA shipments with the new Fetch and Update tool. Practically overnight, Amazon created a new shipment status called “Ready to Ship” that does not correspond with current webcode. So our developers conquered the challenge and created a new tool for you to be able to pull any missing “Ready to Ship” shipments. You simply input the missing FBA shipment ID that you are looking for, the tool searches within your Seller Central, finds the shipment and loads it into your FBA Shipments page within SoStocked in seconds. See how it works.

    Need more information?

    1. Send Message: We typically reply within 2 hours during office hours.
    2. Schedule Demo: Dive deeper into the nuances of our software with Chelsea.
    3. Join Live Upcoming Webinar: New to Amazon inventory management? Learn three inventory techniques you can implement right away.

    Amazon Updates Their Age-Restricted Bladed Products List

    Amazon Updates To Age Restricted Bladed Products

    Heads up, UK sellers! More bladed products may no longer be sold through FBM (Fulfilled by Merchant) starting May 19th. ⚠️

    Amazon recently announced that bladed items needing age verification listed within the updated Offensive Weapons Act 2019, such as chef’s knives and kitchen knives, and sold through the merchant-fulfilled channel will be banned from their listings effective May 19.

    Part 3 section 41 of the Act defines a bladed product as an item that is or contains a blade, and that can cause grave physical harm to a person, including cutting a person’s skin. The Act also prohibits the sale and delivery of knives to persons under 18, which means an ID and a signature on delivery may be requested if the recipient appears to be a minor.

    A concern has been raised regarding the issue of Amazon erroneously flagging fake bladed products like plastic toy swords as restrictive blade products. There is a fear that additional listings of plastic bladed items may also be suspended based on this policy update.

    Banning age-restricted knives from being sold through FBM may be Amazon’s way of being extra cautious (and forcing you to switch to FBA), knowing that they can’t fully rely on a seller’s ability to execute age checks on delivery. However, FBA itself isn’t exactly following proper delivery protocol. 🤔

    Another issue that was raised is Amazon already seems to be violating their age verification on delivery policy by leaving bladed products ordered via FBA at a buyer’s door. With this new shift in their requirements, we can only hope the eComm giant will be more careful in carrying out their own policy moving forward. 🤞

    In closing, if you are currently selling bladed products through FBM, make sure you check out the listing guidelines for bladed products to view the complete list of age-restricted bladed items.

    New Product Dimension Attributes for 255 Product Types

    New Amazon Product Dimension Attributes 255 Product Types

    Heads up! 👋

    Amazon recently notified sellers via email that it has updated the dimension attributes for 255 product types.

    The eComm giant relayed that starting April 26, we have 30 days to update our old product dimension attributes to the new attributes. These updated attributes are also specific to product types.

    For instance, sellers of baking pans must now provide the following information:

    • Depth (front to back)
    • Width (side to side)
    • Height (base to top)

    Another example is vehicle tires. But as you can see below, this type of product has a different set of required attributes from the previous example:

    • Diameter (measured across the center of the tire from one end to the other)
    • Section width (tire’s width from sidewall to sidewall)
    • Aspect ratio (the height of the sidewall measured from wheel rim to top of the tread, typically expressed as a percentage)

    What Happens After the Grace Period?

    The old attributes will be removed and we’ll be required to input the new attributes when we update or create ASINs.

    We will also be required to add any missing values or details that may not have been updated due to issues with formatting.

    Thankfully, package dimensions and fees are not affected by this update.

    What’s In It for Us?

    It’s common for Amazon to periodically change its information about a unit’s dimensions to reflect updated measurement systems. But more importantly, it allows them to provide customers with more accurate data to find and compare multiple items based on their own size requirements.

    So, keeping your items’ dimensions up to date can make them more discoverable on Amazon and can help with the buyer’s decision process, which means more sales. Additionally, it can also help reduce customer returns.

    Go to the Updated Product Dimension Attributes FAQ page for more information and the full list of product types.

    Related: Amazon Launches New Dashboard for Returns Performance

    New Shipping and Storage Changes Coming to Amazon

    New Amazon Shipment Dashboard and Storage Type for Sellers

    Amazon just made two announcements recently regarding shipments and storage. While the announcements are region-specific for now, we often see rollouts to other selling regions soon after.

    1. Shipment Performance Dashboard

    The first announcement is for US sellers. The eComm giant rolled out a new dashboard called Shipment Performance to help you:

    • Compare your shipping Key Performance Indicators (KPIs) to Amazon performance targets.
    • Use the insights from your KPI analysis to fix shipment issues.
    • Track overall logistics performance.
    • Manage your FBA shipments more easily.

    Click here to access the dashboard.

    This should add a new layer of analysis to spot and correct issues along the supply chain which is something we love. Being able to, for example, identify mislabeling, unscannable barcodes, or unplanned prep, could be signs that your supplier or prep center should have more attention to detail to avoid these issues.

    With more monitoring of issues like these, though, it does open up the possibility of more Performance alerts and penalties. The dashboard indicates suspensions could be triggered due to shipping issues, though we hope this mostly refers to improperly labeled products. It is just another thing to be aware of.

    While the dashboard is not without its early bugs and leaves us with unanswered questions for now, we hope this dashboard proves insightful for your inventory team.

    2. New Storage Type: Extra-Large

    This announcement is for sellers in the UK.

    Beginning April 18, a new storage type will be available to UK sellers: Extra-Large (XL), which is in addition to the Oversize storage type.

    According to Amazon, it will automatically reclassify your FBA products that qualify for the XL storage type. A separate FBA quantity limit for XL and Oversize inventory will also be determined based on:

    • Sales history
    • Sales forecasts
    • Amazon fulfillment center capacity

    The Extra Large inventory category will be for items larger than Oversize.

    Oversize items become items with the longest side at or over 45cm, median 34cm or above, and the shortest at 26cm or more. Weight is 11.90kg or more.

    Extra Large will be either longest side at 175cm or more or unit weight 23kg or higher OR longest side 120cm or above and weight 15kg or more. Confusing to wrap your head around and the devil is in the conjunctions.

    Understanding what category your products fall in will likely make a difference in fulfillment fees, but that is yet to be defined because Amazon did not say how the new storage type will impact the current FBA fulfillment fees.

    Initial thoughts though, we can’t help but grit our teeth imagining it will bring about more fees, not less as it has in recent developments we’ve experienced with dimensional weight and the fuel surcharge. Watch for any future announcements on this. We will be sure to keep eyes peeled as well.

    Read the news announcement for more information.

    Amazon Hits US & EU Sellers With Fuel And Inflation Surcharge

    New Amazon FBA Fuel and Inflation Surcharge For Sellers

    Starting April 28, US sellers who use Fulfillment by Amazon (FBA) will see a (hopefully) temporary 5% fuel and inflation surcharge amidst surging prices. 😫 EU & UK sellers will also get hit with a similar 4.3% fee increase beginning May 12, 2022.

    The additional fee will apply to apparel, non-apparel, dangerous goods, and Small & Light items, squeezing sellers and further eating into the profits. 🤦‍♀️

    Amazon mentioned that the current FBA costs, inclusive of the 5% fuel and inflation surcharge, remain significantly less than alternatives. The surcharge is also subject to change, which could mean lower fees in the future. 🤞

    However, some sellers believe that even if prices go down, the surcharge will not go away, and we tend to agree with them. History tells us that a tax (or surcharge), once implemented, can be difficult to revert.

    So, Amazon should just call it for what it is: a price hike. 🤔

    This is not the first Amazon gut-punch of 2022. The new dimensional weight factor saw fees increase overnight for many sellers, some as much as 94% or more! Couple that with this 5% fuel increase and sellers are really getting hit hard.

    In addition, even if you’re not affected by dimensional weight fees, when you factor in the current FBA fulfillment fee, which is roughly 5.2% higher than last year’s rate, and other expenses, the overall cost increase per unit could be potentially huge for many sellers, specifically those with already-slim margins.

    Sellers will either have to remove unprofitable products from Amazon or pass the cost increases to their customers to compensate. It would also be wise to run some numbers using our Master Carton Calculator Tool to see if restructuring your shipping practices can increase your profit margins.

    Read the news announcement for more information.

    Related: New Dimensional Weight Fees Placing Further Strain on Profit Margins

    Software Updates For April 2022

    Amazon inventory management software updates for 2022

    It’s our goal to build the best inventory software out there. Nearly every week, SoStocked is rolling out new features that you have been asking for.

    With that in mind, I’m excited to introduce you to the new SoStocked newsletter, where you can find out what’s new, what’s improved, and what’s up next. Let’s dive in!

    🥳
    NEW RELEASE

    SoStocked Can Now AutoGenerate Purchase Order and Work Order Number Settings

    Set up naming conventions to indicate how you would like your PO or WO numbers to generate with options like time, date, and vendor name, and SoStocked will automatically generate a custom number for each Work Order or Purchase Order you make.

    In the Inventory Settings, turn on the “Auto-Populate PO Numbers” option and “Auto-Populate Work Order Numbers” option and build out your naming conventions to improve PO/WO efficiency and consistency. Learn how it works here. More ➜

    🥳
    NEW RELEASE

    New Multi-Dashboard Reports (All Accounts)

    Now you can download multiple inventory, PO, or Work Order dashboards for ALL of your connected accounts simultaneously!

    If you have multiple SoStocked accounts, or simply need to download multiple reports at once, you can now save time by downloading your dashboards in one swift action through the new Agency Report – Multiple Dashboard export within the Bulk Export/Import page.

    Select inventory dashboards from all of your accounts to quickly and easily do analyses or send reports to other departments, such as sending Inventory-Minded Marketing reports to your marketing team.

    With this feature you can select dashboards like Inventory – Warehouse Levels, Inventory – Slow Sellers, PO – Drafts, WO – FBA Shipping plans, and pull the dashboards for your multiple accounts in one single download. See how it works here. More ➜


    COMING SOON

    Granular Automation of Seasonal Sales Spikes

    You’ll soon have the option to turn on an Automatic Seasonal Spike using coefficients, meaning your historical seasonality will be represented and you can then adjust each time period against that historical data.

    You’ll be able to control seasonal ups and downs month to month, bi-weekly, or even weekly. SoStocked will find the annual average daily sale for the product and you can put in trend settings above or below that average.

    Did you launch a new product and you’re not sure what to put in month to month? No problem! Find historical seasonal trends for other products within your catalog and set that same trend for your new product. Group multiple product seasonal trends. It will find an average of that group and you can apply that.

    You will also be able to set different seasonality for each marketplace separately, US, EU, etc. To get the most accurate forecasting for every product in every marketplace.


    MICRO UPDATES

    Subtle Improvements to Make Your
    Forecasting Easier

    SoStocked - MICRO UPDATES
    The Days Until Stock Out field was updated

    The Days Until Stock Out field was updated – This metric on the Forecast page has been updated to make things more clear for you. The small grey number is the number of days you will remain in stock based on your average daily sales, not including any inbound shipments and the large emboldened number is the number of days you will remain in stock at FBA based on current FBA inventory on hand and on order direct to FBA.

    New filter! Filter for products with a specific Days Until Stock Out number.

    Filter for products with a specific Days Until Stock Out number

    Seasonality can be repeated annually.

    Seasonality can be repeated annually

    ⚡️⚡️⚡️ Website Speed and Loading Speed ⚡️⚡️⚡️ We’ve worked long and hard implementing several different measures to increase the speed of SoStocked so you can save even more time on your weekly inventory tasks.

    🔥
    ICYMI: FEATURE SPOTLIGHT

    Some Updates and Features
    You Might Have Missed

    Edit Currency in Purchase Orders or Change Global Default Accounting Currency. SoStocked is used across the globe so we made it possible to accommodate all currencies used for your accounting with the new default currency feature. You can change the default currency for your entire account from your Inventory Settings. And for your Purchase Orders going to suppliers worldwide, you can edit the currency per vendor or per PO! See here ->

    Improved Stockout Calculation Algorithm on the Forecast Page
    We just made your Adjusted Velocity even more accurate by giving you the option to turn on a new stockout tool. The tool has always been able to adjust your daily sales velocity to compensate for zero sales days or partial sales days during stockouts and partial stock-outs. However, what happens when an entire PERIOD is a stockout? For example, let’s say you are out of stock for a full 7 days? The updated stockout algorithm will AUTOMATICALLY disable that period and recalculate your adjusted velocity based on the in-stock periods. Then, once you have been in stock again for that period, it will AUTOMATICALLY turn back on.

    This makes it much easier to assign the stockout tool to many products across your entire catalog, without having to remember to find those products or forecasts with stock-out periods and turn them off. SoStocked will do that for you! Read here to find out more ->

    Pull Updated Product Details on the Inventory Page.
    Have you changed or added a product image since you first uploaded SoStocked? Or maybe it’s in a new category? Now SoStocked can pull the updated product details onto your inventory page. Always keep your SoStocked catalog up-to-date and easy to navigate with this new feature.

    Need more information?

    1. Send Message: We typically reply within 2 hours during office hours.
    2. Schedule Demo: Dive deeper into the nuances of our software with Chelsea.
    3. Join Live Upcoming Webinar: New to Amazon inventory management? Learn three inventory techniques you can implement right away.

    Emerging Amazon Marketplaces: UAE and Saudi Arabia

    Reach New Amazon Customers In Middle East UAE Saudi Arabia

    US sellers can now expand into the Middle East through Amazon United Arab Emirates (UAE) and Kingdom of Saudi Arabia (KSA). 🚀

    Amazon has released a video selling guide that presents the cliff’s notes on the logistics, language and payment structure of selling products on Amazon within the Gulf region. It also explains the opportunity that awaits sellers who would take up Amazon’s offer to join these marketplaces.

    Both UAE and KSA are becoming a magnet for eCommerce businesses.

    According to Boston Consulting Group and Meta Platforms, Saudi Arabia’s eCommerce market is set to reach $13.3 billion by 2025 as an increasing number of customers shop online more often now than they did pre-pandemic and as more products become accessible to large audiences, with apparel, electronics, and appliances as top sellers.

    UAE’s eCommerce market is also expected to balloon to $8 billion in 2025, mainly due to customers and businesses turning to online marketplaces for their needs, according to Gulf News. Online shoppers will also keep purchasing from international eCommerce platforms (specifically Amazon’s non-UAE sites), which presents another business opportunity for US-based sellers.

    Overall, being an early adopter of these emerging marketplaces can have an upside advantage as far as capturing the market early, although we know there are some barriers to entry that must be dealt with.

    Luckily, the eComm giant offers the following benefits to make your launch in KSA or UAE fast and easy.

    Selling on Amazon.ae (UAE) Benefits

    • Amazon.ae, including all listings and communications with customers, is available in English, with the option to also have an Arabic page.
    • Sell online without the need to secure a UAE eCommerce license, which means less paperwork and fees.
    • Receive payments in US dollars directly to your US bank account.
    • Logistics solutions include FBA.
    • Gateway to five other countries: Kuwait, Oman, Bahrain, Qatar, and Jordan

    Pro tip: While the language is 100% English, the option to also auto-translate your listings into Arabic is a nice feature. However, auto translating to another language doesn’t usually do the trick very well, as it doesn’t catch the right usage of words, best keywords, or colloquialisms. For this reason, I recommend hiring a translator that does custom translations for sellers using locals like Jana Krekic’s team at YLT Translations.

    Selling on Amazon.sa (KSA) Benefits

    • Language is 100% English, but you can auto-translate the pages into Arabic.
    • FBA is available.
    • No eCommerce license to set up an online store in KSA is required.
    • Payments are processed in USD.

    Selling on Amazon.sa (KSA) Benefits

    While FBA is available in both countries, it seems that sellers would have to send inventory to FBA in Saudi Arabia and UAE separately.

    Deciding Between KSA and UAE

    If you can’t decide between KSA and UAE as your next market, Jana Krekic, founder of YLT Translations, who has been translating for sellers in the UAE for some time now, says Saudi Arabia doesn’t seem to be as popular a marketplace for Amazon sellers to adopt but that UAE is becoming quite popular.

    This is probably because of UAE’s openness to international business. Gulf News reported that Shaikh Hamdan Bin Mohammad Bin Rashid Al Maktoum, Crown Prince of Dubai, had implemented strategies to accelerate eCommerce growth by minimizing the overall cost to operate online businesses by 20%, including the costs of storage, returned products, VAT on transportation, and customs duties.

    Another reason to expand in UAE is its strategic location. According to the International Trade Administration, the country serves as a gateway to other hubs in the Gulf region, which creates lucrative opportunities and makes it an attractive market for exporters. This also explains why Amazon.ae serves as a better springboard for 5 other Arab states than Saudi Arabia.

    All this into consideration, UAE is shaping up to be a pretty good marketplace opportunity for sellers.

    Visit Amazon Global Selling to learn more.

    Free Amazon Master Carton Calculator Tool To Optimize Your Packaging

    We’re proud to introduce our new free Amazon Master Carton Calculator tool to optimize your packaging, reduce shipping/handling, and storage costs for increased profitability.🚀

    We call it profit optimization across the supply chain. It means maximizing your units per carton and per pallet to disburse carton and pallet fees across as many units as possible. 

    By shipping and storing fewer total cartons and pallets, you can find yourself saving a ton on freight & storage costs, and other expenses. 

    Take our free Master Carton Calculator Tool for a test drive to find out how much of your profit you can recover with simple carton and pallet reconfiguration.

    • Calculate how many units you can fit per carton and pallet
    • Determine your potential per carton and per pallet savings
    • Print a Comprehensive Packaging Blueprint and Savings Report
    • Provide the blueprint to your supplier to start saving on your next order

    Learn moreMaster Carton Calculator Tool 

    In these crazy times, when it is getting harder to make a profit, let alone have the cash flow to scale quickly, packaging optimization is a game-changer for your company’s profitability. 💪

    Amazon and EIT Climate-KIC Offer Financial Boost to Sustainable Startups

    Amazon Sales Doubled for Climate Friendly Pledge Products

    This announcement is for UK and EU startups who are building physical products with ecological impact in mind.

    Amazon has recently reported that sales of Climate Pledge Friendly items in the UK and EU have doubled in January 2022 (versus the same month last year), a strong indication of growing demand for sustainable products. And if this trend continues, it can only mean one thing: more and more buyers seeking out goods with eco-friendly packaging and reduced carbon footprints.

    So, to provide customers with more sustainable products, Amazon has teamed up with EIT Climate-KIC (the European Institute of Innovation and Technology Climate Knowledge and Innovation Community) to help eco-minded startups scale fast by offering them a short-term growth program and £30,000 in grants and credits.

    Amazon Launchpad Sustainability Accelerator

    This startup accelerator offers 12 weeks of expert-led training and mentorship along with a bespoke curriculum to help early-stage companies face the challenges of starting and growing a sustainable business.

    Selected startups will also use the Climate Impact Forecast tool to measure and improve their environmental impact. Additionally, they will be given an opportunity to network with other like-minded founders, as well as access to office space in Amazon’s headquarters in London.

    Financial Boost

    Aside from the 12-week growth program, selected startups will also receive:

    • $25,000 worth of AWS business support credits
    • £10,000/€12,000 equity-free grant
    • £5,000/€6,000 sponsored advertising credits to help boost revenue
    • Free account management for 12 months

    They may also benefit from their products being featured on the Amazon Launchpad storefront.

    How to Apply

    Sustainable startups who meet the following key eligibility requirements are encouraged to apply:

    • Stage: Early-stage companies
    • Product: Eco-friendly physical products that are beyond the prototyping stage
    • Location: UK, Switzerland, or Economic European Area (European countries, including Iceland, Norway, and Liechtenstein)
    • Themes: Amazon is looking to work with startups who can help make it easier for customers to find and purchase sustainable products. Examples include reusable everyday items, environmentally-friendly gadgets, sustainable apparel, recycled and upcycled materials/products, and more.

    Click here to start your application.

    Why Is Amazon Adamant in Pushing Climate Pledge Initiatives?

    The move to launch a 12-week sustainable startup growth program with EIT Climate-KIC may be Amazon’s attempt to improve their climate change strategy to continue positioning themselves as a climate leader. During the launch of The Climate Pledge in 2019, founder Jeff Bezos said: “​​We want to use our scale and our scope to lead the way,”, framing Amazon as a role model for sustainable development.

    However, a 2022 study by the New Climate Institute, a group that evaluates the integrity and transparency of companies’ climate pledges, showed that Amazon’s climate initiatives lack transparency and many of their reports of climate progress have been unsubstantiated. Reveal News’s Center for Investigative Reporting also reported that the company is undercounting their carbon footprint.

    If that’s the case, the eComm giant is likely failing to meet its own targets on reducing carbon emissions – they hope to reach net-zero carbon (achieving the balance between the amount of greenhouse gas emitted and the amount eliminated from the atmosphere) by 2040.

    So, perhaps, one way to improve their environmental impact is by enticing more sustainable startups to join Amazon through growth programs and monetary grants. This move will allow them to expand their catalog of Climate Pledge Friendly items and attract more eco-minded consumers while trying to reduce their carbon footprint.

    Why Should You Apply for Amazon’s Sustainability Accelerator?

    1.  Receive Expert-Led Training and £30,000 in Grants and Credits

    It’s no secret that it can be costly for small businesses to build new green products or switch to green. This is why Amazon and EIT Climate-KIC have included financial incentives and expert guidance.

    When measuring your company’s carbon footprint, you have to look at the carbon that goes into making your products (using a lot of energy, water, or petroleum generates considerable amounts of greenhouse gasses) and the emissions that will end up in the planet’s atmosphere when people use and throw them away (e.g., products that consume a lot of power to run and are non-recyclable are less sustainable).

    So, in most cases, big investments in green technology (e.g., developing recyclable and renewable raw materials for your inventory) are needed to minimize overall environmental damage. This is also why green products are usually more expensive, but the good news is that…

    2.  Consumers Will Pay Premium for Eco-Friendly Products 

    More than a third of consumers from around the world are willing to pay more for sustainable products and services, according to a recent study. People are starting to actively seek out these kinds of products because they’ve become more aware of the state of the environment through social media and video blogs.

    For instance, #climateemergency, a stream of content that educates people about the devastating impacts of global warming and frames the environment’s poor condition as a global issue that affects all of us, has got many American adults spending more time thinking about the climate crisis than they did before the pandemic. This also motivates them to buy from stores that are actively minimizing their environmental impact.

    Simply put, a growing awareness about climate change combined with a desire to take action on environmental issues is heavily influencing consumers’ buying decisions.

    If you’re thinking about building a new sustainable product or switching your business to green, now is the time to do it.

    But if you’re concerned about the costs, and you’re just planning to sell on Amazon anyway, you can start by simply reducing your product packaging.

    Amazon’s Compact by Design

    Compact by Design is Amazon’s own Climate Pledge Friendly certification program. It aims to identify (or badge up) products with less packaging. For example, reducing excess air from snack pouches can create smaller unit dimensions, making them more efficient to ship. Resizing your product packaging can help reduce product size and weight, resulting in more efficient shipments and, thus, lower carbon emissions.

    Note: Those that qualify for Compact by Design will receive a “Climate Pledge Friendly” badge and will appear in Amazon’s dedicated sustainable products page, making it easy for customers to shop sustainably. Read Is Amazon Climate Pledge Certification Worth It For Sellers to learn more.

    Smaller Unit Weight and Dimensions Can Lead to Lower FBA Fulfillment Fees

    Effective March 31, 2022, Amazon FBA fee changes will apply to UK, France, Italy, Germany, Spain, Sweden, Netherlands, and Poland stores.

    Part of this fee change involves subjecting small oversize, standard oversize, and large oversize products to dimensional weight pricing, aka DIM weight pricing. Amazon will use the greater of the unit weight or DIM weight of your oversize product to determine your fulfillment costs. If the dimensional weight is greater than the unit weight of the item, then the DIM weight is utilized to calculate the price.

    The downside of that is being charged based on DIM weight can lead to a significant price increase for some sellers. A few sellers in our community have reported an increase in fees by over $1 per unit.

    Check out the table below to see the upcoming size and weight tier changes. Also, scroll down this page to see the updated fees.

    To reduce or avoid DIM weight fees, shrink your product packaging and boxes as much as possible. Talk with your supplier and 3PL to figure out a way to optimize your packages, including carton and pallet load capacity. Optimizing your carton and pallet efficiency can help to cut per unit costs to help offset any added fees you may now be paying due to DIM weight fees.

    With dimensional weight pricing, the bulkier your packaging, the more you end up paying in shipping and storage fees. Therefore, it’s crucial to reduce your package sizes and cost per unit wherever possible.

    Related: New FBA Fee Calculator With Dimensional Weight Factor

    Final Thoughts

    Overall, going green creates both opportunities and challenges for businesses. But as consumers start to change their lifestyles to fight climate change, and as Amazon stays committed to going net-zero carbon by 2040, companies who’ll answer the people’s call for sustainability transformation will be able to protect their long-term success and profitability.

    Related: Is Amazon Climate Pledge Certification Worth It For SellersMaster Carton Calculator to Optimize Packaging and Reduce CostsNew Dimensional Weight Fees Placing Further Strain on Profit Margins

    Qualify for Rebates and Free Liquidations with the Updated FBA New Selection Program

    2022 Amazon FBA New Selection Program Updates

    Here’s another opportunity for US sellers to save a little bit of money.

    In April 2020, Amazon started to offer free monthly storage, removals, and returns as part of their FBA New Selection Program.

    A year later, they updated the program to add oversized items to their list of qualifying products, extend the free monthly storage benefit from 90 days to 120 days (apparel and shoes category only), offer $200 in sponsored advertising credits, and allow eligible sellers to use fee waivers for an unlimited number of new-to-FBA ASINs.

    Many sellers seem to benefit from the FBA New Selection Program. So, Amazon has included even more benefits this 2022!

    Pro tip: If you haven’t heard of this program, read Amazon FBA New Selection Program 2021 to learn more.

    Let’s take a closer look at the updated program details.

    1. 5% Rebate on Sales

    This incentive applies to eligible new ASINs enrolled in the Brand Registry. Yes, you must be listed as a brand owner on Amazon’s Brand Benefit Eligibility page to qualify for a rebate.

    You could use the rebate to reduce the fulfillment fees for the following:

    • Oversize products. Enjoy a 5% rebate on sales of up to 30 units per new product for up to three months.
    • Standard-size products. Get a 5% rebate for the sale of up to 50 units per new product for up to three months.
    • Apparel and Shoes. Earn 5% rebate on sales of up to 100 units per new product for up to four months.

    2. Global Enrollment

    No separate registration required for each of the Amazon stores you’re selling in. Just sign up for the program once and the benefits will be applied automatically across your stores. Amazon will determine this based on your merchant ID and the FBA warehouses you’ve shipped your new ASINs to.

    3. Free Liquidations

    Need to remove aging inventory? Take advantage of Amazon’s free liquidations offer to be able to recoup up to 10% of your eligible ASIN’s selling price. Free liquidations will be available for:

    • Oversize items. Liquidate the first 30 units of each new-to-FBA oversize ASIN within 6 months after the first inventory was received by Amazon.
    • Standard-size items. Use free liquidations to remove the first 50 units of each new-to-FBA ASIN within 6 months after the first inventory was received by Amazon.
    • Apparel and Shoes: Liquidate the first 100 units of each new-to-FBA ASIN within 6 months after the first inventory was received.

    Amazon will also automatically liquidate eligible ASINs that made no single unit sale in the first 180 days, at no extra cost.

    Eligibility Requirements

    To qualify for the program, you:

    • Must have a Professional selling plan
    • If you’ve been assigned an Amazon Inventory Performance Index score, your score must be 400 or higher

    New professional sellers will be registered automatically in the FBA New Selection Program and entitled to the program benefits.

    In addition, both new and existing professional sellers must make sure their new products are eligible for the program. Used items and media products are not accepted.

    If you’re not sure if your product is new to FBA across Amazon stores, use the FBA product search tool.

    Click here to enroll in the FBA New Selection Program.

    Pro tip: Discover other ways to save money by reading Amazon FBA Calculator ToolMaster Carton Calculator to Reduce CostsHow an Amazon Seller Saved $150K or by joining my free Inventory Management and Logistics live webinar.

    New Dimensional Weight Fees Placing Further Strain on Profit Margins

    Amazon Raises FBA Fulfillment Fees For 2022

    We knew that an increase in FBA fulfillment fees was coming since Amazon does this yearly. However, we didn’t expect to see dimensional weight fees on the list because the eComm giant was so quiet about it. Apparently, dimensional weight pricing will now apply to Large Standard-Size products if the dimensional weight is greater than the unit weight. 🤔

    When reading through the 2022 US FBA Fulfillment Fee Changes page, Amazon seems to be attempting to bury the lead with dimensional weight being tucked away in the footnotes as something that doesn’t exactly stand out, even though we believe it’s the most important change to the new fee structure.

    Being charged based on dimensional weight could potentially be a huge cost increase for some sellers. In fact, some within our own SoStocked community have already seen their fees increase by over $1 per unit, which is quite significant.

    Read on to learn more about the impact of Amazon’s dimensional weight pricing on sellers’ profit margins.

    Dimensional Weight Now Used for Large Standard-Size Items

    According to Amazon, the greater of unit weight or dimensional weight will now be utilized to determine the shipping weight for all Large Standard-Size units, apparel not included.

    Unit weight is the actual weight of an item, including its packaging. Dimensional weight (or DIM weight) is the amount of space a package takes up relative to its actual weight. DIM weight is calculated by multiplying the length, width, and height of your unit, then dividing that by a standard DIM divisor.

    A DIM divisor is a number set by FedEx, UPS, and other carriers that represents the volume of a package allowed per unit of weight. For dimensions in inches, Amazon uses a DIM divisor of 139 for units subject to DIM weight pricing.

    Amazon DIM Weight Pricing Sample Calculation

    Let’s say you’re shipping an iron to FBA with the following measurements, packaging included:

    • L (in) = 12.6
    • W (in) = 6.6
    • H (in) = 5.5
    • DIM Divisor: 139

    (12.6” x 6.6” x 5.5”) ÷ 139 = 3.29lbs or 4lbs (rounded up) DIM weight

    Now, let’s find out how much it would cost you to ship an item that weighs 4lbs (assuming that your item’s DIM weight is greater than its actual weight).

    Before January 18, 2022January 18, 2022 onwards
    Size tierShipping weightFulfillment Fee per unitSize tierShipping weightFulfillment Fee per unit
    Large standard6 oz or less$3.47Large standard6 oz or less$3.54
    6+ to 12 oz$3.646+ to 12 oz$3.77
    12+ to 16 oz$4.2512+ to 16 oz$4.52
    1+ to 2 lb$4.951+ to 2 lb$5.14
    2+ to 3 lb$5.682+ to 3 lb$5.79
    3+ lb to 20 lb$5.68 + $0.30/lb above first 3 lb3+ lb to 20 lb$6.13 + $0.30/lb above first 3 lb

    Based on the new table of fees above, you would be charged $6.43 per unit ($6.13 + $0.30/lb above first 3lbs), approximately a $0.45 increase from last year’s rates.

    If you’re selling that product for $15 apiece, that leaves you with a $8.57 profit before other costs, such as production costs, shipping cost from China to US, and advertising. This change could eat significantly into your profit margins, especially if you’re selling a low-priced product.

    This could also make it difficult for you to stay competitive in the market, as you would be forced to increase your selling price in order to recoup your investments. Unfortunately, doing this might turn some customers away.

    It’s also important to note how Amazon classifies Large Standard-Size:

    • Any product that is 16oz. with its longest side 15 inches, shortest side 0.75 inches, and its median side 12 inches is considered Small Standard-Size.

    Beyond that, any unit that does not fall within the Small Standard-Size category and is 20 lbs or less with its longest side 18 inches, shortest side 8 inches, and median side 14 inches is considered a Large Standard-Size. So, anything with a side that exceeds the given dimensions might get bumped into oversize classification, which means even higher shipping costs.

    What You Can Do

    With DIM weight being one of the main factors that influence today’s fulfillment fees, now’s the time to reassess your packaging.

    Achieve the smallest dimensional weight possible by:

    • Keeping your packaging compact
    • Removing extra inner packaging materials that can make boxes unnecessarily large, such as excessive amounts of foam or bubble wrap

    Keeping your packaging compact will allow you to fit more units into your cartons. And if your shipments take up less space and weigh less, that also means carriers will be able to load more cartons into their trucks and planes, leading to lower shipping costs.

    Additionally, reducing or eliminating excess packaging materials is also an excellent way to introduce more sustainability to your products, as less waste will end up in the ocean or landfills.

    This DIM weight pricing, in fact, is in lockstep with some of Amazon’s other initiatives and policies that point towards encouraging sellers to reduce their packaging. This is further supported by the fact that they launched the size-conscious Compact by Design initiative within the Climate Pledge Certification program, which aims to certify products that meet their sustainability standards. These policies encourage or even force sellers to get more creative with keeping their packaging compact.

    Another way to keep your costs down is by checking your fees and running some profit calculations to make sure your products are still profitable. We’re currently building a tool to help you with this. We will let you know once this tool comes out, so stay tuned!

    What Else to Expect

    Amazon will hit every product size tier and category with a fulfillment fee increase, specifically the following:

    Core FBA fulfillment fees (apparel excluded).
    Calculating the shipping weight for all Large Standard-Size items will be based on whichever is greater between the unit weight and dimensional weight. Small Standard-Size units will use unit weight.

    FBA fees for apparel.
    Amazon implements up to a 10% increase for apparel items in the Clothing & Accessories category.

    FBA fees for dangerous goods.
    Amazon has separate fulfillment fees for dangerous goods that need special handling and storage. Visit the FBA Dangerous Goods (Hazmat) Program or Dangerous Goods Identification Guide for more details.

    Dimensional weight pricing will also apply to all Small Oversize, Medium Oversize, and Large Oversize units when DIM weight is greater than the unit weight. This is a bit tricky as it doesn’t seem to be the case toward the top of the post, but when you scroll down to the Calculate the Shipping Weight section, you’ll find more information listing this.

    The recent fulfillment update also includes some changes to the maximum weight limit for products in the Small and Light (SnL) program. Amazon will now allow eligible products priced at $8 or less weighing up to 3 lbs (used to be 12 oz max) into the program. The per-unit FBA fulfillment fees start as low as $2.35 (Small standard) to as high as $4.94 (Large standard).

    New US FBA Fulfillment Fees Break Down

    Based on the fee changes listed on this page, the percentage increases for all standard and oversize categories range from 2% to 12%, not factoring dimensional weight into the equation.

    Items in the small standard category will see an increase of 8%. For example, smaller items will see a $0.22 increase, and larger items will see a $0.27 increase.

    Overall, expect to see the following percentage increases:

    • Approximately 4.8% average increase for standard-size items
    • Up to 7.5% increase for small standard-size items
    • Up to 2.8% increase for small oversize items
    • Up to 10% increase for apparel items
    • Approximately 8% and 12% increase for medium and large oversize items, respectively

    The fulfillment fee increases may seem small, but these changes could be pretty steep for some sellers with slim profit margins. This could put them in a difficult situation where they may have to either drop their less profitable products or increase their prices, thereby risking a significant decline in sales. Sellers will weather this storm as they do any other, but it’s definitely time to reassess your catalog for bulky and lower-margin items.

    Go to the 2022 US FBA Fulfillment Fee Changes page to see the complete list of updated fees.

    Related: Amazon FBA Calculator: Factor FBA Fees to Calculate ProfitabilityAmazon Climate Pledge Certification and Freight Forwarder Fees Checklist

    Amazon Closing Shipping Loopholes May Wreak Chaos for Some Sellers

    Amazon Closing Shipping Loopholes May Wreak Chaos for Some Sellers

    In what could be seen as another classic play to close loopholes, Amazon has announced another change to their shipping policies.

    Effective April 1st, 2022, if you are found to be sending shipments into FBA that were already canceled or deleted, those shipments could be rejected at Amazon and your FBA shipping privileges could be suspended.

    This policy update seems to specifically target dubious sellers who may be trying to skirt restock limits guidelines by using canceled or deleted shipments to send more inventory than the limits allow, knowing full well that Amazon will still accept them. 

    But with this update, it would, in effect, prohibit that from happening.

    However, it potentially opens up a bigger issue in that sellers with valid reasons to cancel or delete shipments may also get suspended, albeit through no fault of their own. For example, they may need to change their approved shipping plan because of errors in quantity, content, or other information.

    Luckily, according to Amazon, sellers may make small changes to their shipping plans, such as adjusting their shipment quantity by up to 5% above or below the original amount. Otherwise, incomplete shipments or incorrect information in your shipping plans could lead to additional processing times, which could cause delays in your inventory’s availability on Amazon.

    Also, keep in mind that Amazon automatically closes shipments after 90 days, which could be a big problem for some sellers (not just the sneaky ones) as getting inventory from overseas into Amazon these days can sometimes take 45-60 days or longer due to slowdowns in the supply chain.

    Other Actions to Stay Compliant with the Updated Shipping Policy

    Be sure to avoid:

    • Removing some of the shipments from your approved multi-destination shipping plan.
    • Sending shipments along a different route.
    • Using illegible FBA box ID labels.
    • Failure to ensure all shipments in your multi-destination shipping plan are delivered to Amazon within 30 days of receipt of the first shipment. This means if you have a shipment plan with three destinations shipping from overseas directly into FBA, Amazon requires that within 30 days of receiving the first shipment, the other two should arrive at their fulfillment centers as well.

    Note: While one or more shipments may arrive late due to your carrier losing them and finding them later or other mishandling issues, these are rather exceptions and not the norm. Communicate with your carrier to ensure your shipments are delivered on time and in the correct quantity.

    If you’re unable to send additional shipments due to non-compliance, connect with an Amazon representative and provide a solid plan of action to reinstate your shipping privileges.  

    Read “Deleted, Misrouted, and Incomplete Shipments” for more information.

    Amazon Removes “Tons” of Supplement Offers Due to Non-Compliance with New Product Requirements

    Amazon Removes Dietary Supplement Offers Due to Non-Compliance with New Product Requirements

    📢 Heads up, dietary supplement sellers!

    Amazon has reportedly removed many dietary supplements offers due to product compliance issues. 🤯

    On Amazon’s forum page, one seller said that Amazon just pulled a ton of their products from the site, including their best seller. They also didn’t receive any notification that they needed to provide required documentation for the affected products.

    According to the forum moderator, Amazon announced on November 2021 that they had implemented additional compliance documentation requirements for weight loss and sexual enhancement products. According to Amazon, these goods may contain potentially dangerous substances that might cause serious health issues if not tested properly. Sellers were given approximately two months to comply.

    Affected sellers who wish to continue selling these products will need to meet Amazon’s additional compliance requirements.

    It is important to note that sellers who find themselves in the unfortunate position of having their supplements listings or offers removed must work fast to get compliance and to be reinstated. Amazon is not pulling any punches. Those who have products in suspension must get reinstated or create a removal order to recover their inventory or it will be automatically disposed of within 30 days, which could mean significant losses for some sellers.

    Product Compliance Reference Tool

    Effective January 10, 2022, Amazon is no longer accepting products that do not meet their documentation requirements.

    You can use the Compliance Reference Tool to help you understand your import and/or export compliance obligations in the country you want to ship from or sell in.

    Simply search your product by keyword or product type to find the compliance content associated with it. Then, connect with service providers who can assist you with meeting your compliance requirements.

    Click here for more information.

    Related: New Documentation for Supplements Required to Avoid Listing Removal and Amazon Product Compliance Reference Tool

    UPDATED: Claim Reimbursement for Losses Caused by Amazon

    Claim Reimbursement for Losses Caused by Amazon CSBA Reps

    UPDATE 07/28/2023: Attention sellers, there might be money owed to you for eligible returns reimbursements.

    There are specific Amazon policies regarding customer returns and refunds tied to those returns. If a return does not meet policy guidelines, you as the seller are eligible for a reversal of the refund Amazon charged back to your account.

    Applicable policies include Amazon reps mishandling your customer returns and refunds or customers duping you for some money in return scams. More on that below. While the below feature article talks specifically about seller-fulfilled items, these returns policies apply to all returns Amazon handles.

    Assuming that Amazon automatically issues reimbursements to your seller account when errors occur would be a mistake. 🚩

    In reality, the responsibility lies with you to identify any errors and initiate the proper claims. Unfortunately, many sellers face the challenge of lacking the time to thoroughly investigate these issues, let alone keep detailed records of them. 

    Neglecting to closely monitor your Seller Central account could mean missing out on the money Amazon owes you. If you’re a large seller or an aggregator, chances are, you could be losing thousands of dollars every year due to these unclaimed reimbursements, which can hurt your bottom line.

    There’s a variety of audit and recovery services like Seller Investigators (SI) available to aid sellers in claiming Amazon reimbursements for overcharges and lost, missing, or damaged inventory. These companies use an Amazon-compliant and transparent reimbursement process to make claims and ensure a high success rate.

    However, until recently, there was no service that offered reimbursement for the reversal of customer refunds. 

    Seller Investigators just launched a service that helps sellers to do just that. It is powered by Proprietary Refund Search Engine and with dedicated recovery specialists who keep files and follow up on refund reimbursement claims.

    SI also announced an Orders and Returns Tracking feature specifically for auditing and recovering potential losses incurred due to Amazon issuing refunds for products that customers haven’t returned, acceptance of incorrect or damaged items for returns, and situations where refunds are credited after the designated return period has elapsed.

    The claims window starts 60 days after the return is filed and as far as 18 months. 

    For many sellers, these issues are the hardest to track and prove. That’s because Amazon may automatically refund customers despite the fraudulent nature of their return requests and the amount of paperwork involved to appeal Amazon’s decision can be offputting in exchange for the funds recovered.
    Engaging with an experienced audit and recovery team who knows Amazon’s reimbursement policy, will allow sellers to stand a better chance of getting reimbursed.

    In a time when profits are being squeezed from all sides and Amazon fees are at an all-time high, recovery of every cent possible is crucial. Returns reimbursements present one more way to do just that.

    This announcement is for US sellers who participate and pay for Customer Service By Amazon (CSBA), a service where Amazon handles customer service on the seller’s behalf for their seller-fulfilled orders.

    Sellers who use the CSBA program are now eligible for Sellers Assurance for eCommerce Transactions (SAFE-T) claims. This allows sellers to appeal unjustified refunds that Amazon reps issued to customers.

    Here’s a list of scenarios where you may be eligible for reimbursement:

    • The customer said they did not receive the item, but you have proof.
    • The customer sent back an item in poor condition or an item with parts missing.
    • The customer returned an item that was not what you sent.
    • The customer requested a free replacement via the Online Return Center. You shipped a replacement unit, but the customer sent back an incorrect item or the original item was not in sellable condition.
    • Amazon issued a return for an item that was already outside of the return window when the customer asked to return it.
    • The return reason is marked as “Customer Fault” in Return reason codes for prepaid returns.
    • Amazon determines that the customer repeatedly abused Amazon’s return or refund policy and the seller was not at fault. File a reimbursement request with evidence of how the customer abused Amazon’s refund or return policy.
    • Amazon determines that a refund to a customer was due to an Amazon error and you were not at fault. File a reimbursement claim with evidence of Amazon’s error.

    Once submitted, Amazon will review your reimbursement request. A decision will be made based on Amazon’s CSBA refund reimbursement policy.

    Sellers Fight Tooth and Nail to Get Reimbursed

    It’s no secret that Amazon’s top priority is to provide buyers with the best customer service possible. When buyers return items to sellers, Amazon ensures they get an automated refund.

    The problem is that some scammers can take advantage of refunds. These dishonest customers can collect refunds before sellers know what they returned. Some scammers have even bought expensive items from Amazon and request refunds while returning items that are far cheaper or not what the seller sent. Some have also returned products in used or damaged condition.

    Of course, the above scenarios are eligible for reimbursement, but Amazon does not make it easy for sellers to get reimbursed. Many appeals are denied, no matter how much proof sellers provide, based on the comments posted to the news announcement page.

    Even if sellers do get reimbursed, they may not get full reimbursements but may get some lesser amount that is sometimes not enough to even cover the return shipping cost that they are obligated to pay. One seller reported also that when they filed 3 claims for new books that were returned in “torn and creased” condition, Amazon only reimbursed them 15% of the total price.

    No wonder some sellers resorted to billing fraudulent customers directly and referring them to collections if they don’t pay. However, others wouldn’t suggest this, as suing customers over disputes is against Amazon’s Terms of Service.

    Bottom line is, sellers may have to fight tooth and nail to get reimbursed for Amazon-initiated returns. And in order to ensure they recover a larger amount of money for a single order (over $5,000) Amazon recommends they buy third-party insurance, which means another expense that will eat further into profits.

    Check out Customer Service by Amazon Refund Reimbursement Policy to learn more.

    Related: Amazon Overhauls Its A-to-Z Guarantee Policies To Streamline Damages Claims

    UK Launches Export Support Service to Help Businesses Sell Goods Abroad

    UK Government Launches Export Support Service to Help Businesses Sell Goods Abroad

    Good news for Amazon sellers in the UK! 👏

    The UK government recently formed its own Export Support Service team to better guide businesses on exporting post-Brexit.

    With this service, you can now call or send inquiries to the government online about any of the following:

    • Selling goods into new markets
    • Necessary export documentation
    • Export rules and restrictions for a specific country where you want to sell your goods or services

    But… They Might Not Have All the Answers

    There are certain exporting issues that are unique to eComm businesses in general, mainly depending on the:

    • Business model (e.g., business-to-business, business-to-consumer, or business-to-business-to-consumer.)
    • Export methods used (e.g.,when selling goods abroad, the exporter may export the product directly to a foreign market without using a middleman to make arrangements for them. This is called direct importing. In contrast, they may also appoint agents or distributors to represent their company and products abroad, aka indirect exporting.)

    And when you throw Amazon’s FBA system into the mix, things can quickly become more complicated. Some sellers speculate that the UK government doesn’t know how FBA really works. So proceed with caution as you may not be able to get sound advice from representatives who don’t truly understand your business model.

    On Amazon’s news announcement page, one commenter pointed out some FBA-related issues that the export service team might have a difficult time answering:

    • Required paperwork for selling abroad – There are so many factors that impact the amount of required paperwork for selling goods abroad through Amazon, such as the documents necessary for sending inventory from the UK into fulfillment centers in EU, Value-Added Tax (VAT) accounts in new countries, product compliance, and so on.
    • Rules for a specific country where you want to sell goods/services – The UK government will only advise people on what applies to the UK. Unfortunately, they cannot solve problems in the destination country.

    In addition, even if sellers do comply with all the new procedures, it’s still inevitable for customs and receivers (the party responsible for accepting export goods into the EU) to make errors, leading to overcharges, loss of goods, product returns, and bad customer reviews–problems that the government’s new service probably no longer cover.

    That said, manage your expectations when contacting the export support team for your cross-border selling concerns. Be sure to still do your own research or reach out to Amazon for more information. You may also consider reaching out to other service providers, such as HelloTax that specialize in UK/EU VAT compliance.

    Ask a Question by Phone

    The UK export support team will try to answer your questions right away. If they don’t know the answer, they’ll reach out to you within three (3) working days.

    • Telephone: 0300 303 8955
    • Textphone: 18001 0300 303 8955
    • Monday to Friday, 8am to 6pm (excluding public holidays)

    Ask a Question Online

    The export support team will respond within three (3) working days. They might also ask for more information.

    Click here to get help selling goods or services abroad.

    Related: Brexit Inventory Management

    Three SoStocked Software Deals For New Years (Now Thru January 7, 2021)

    New Years Amazon Sellers Deals SoStocked

    Grab one of these New Year’s deals through January 7th to help streamline your inventory management in 2022…

    🔥  DEAL #1: Get 2 accounts for the price of 1. This is only for new customers and must be used by the same customer for their own additional seller account and can’t be transferred to friends. Email [email protected] if you’re interested.

    🔥  DEAL #2: Save 20% when you upgrade from a monthly plan to an annual plan. This could be a nice tax write off before the end of the year 😉 Email [email protected] if you’re interested. If you’re a new customer, automatically claim your deal here.

    🔥  DEAL #3: Get a 30-day free trial to try SoStocked. We don’t offer free trials so this is kind of a BIG deal! It’s hard to offer trials because we meet 1-on-1 with new customers to make sure they’re set up correctly. Claim your free trial deal here.

    Important Update To Restock Limits And IPI Threshold

    Important Amazon Update To Restock Limits And IPI Threshold

    Some good news on the Amazon restock limits and storage volume front.

    On December 21, 2021, Amazon made an important announcement regarding recent increases they made to restock limits for some sellers, with a promise for more increases in the new year.

    They have also lowered the IPI threshold from 450 to 400 which they say means that less than 10% of sellers will now have storage volume limits. Read More

    Use Amazon’s Delivery Promise Tool To Monitor Your FBM Performance

    Delivery Promise Tool To Monitor FBM Performance

    Recently, Amazon highlighted their Fulfillment Insights dashboard with its feature for monitoring your Delivery Promise to customers versus your actual delivery times.

    Why is this important? As more and more sellers are venturing into Fulfillment by Merchant for the first time due to the storage restrictions imposed by Amazon, monitoring delivery performance becomes increasingly important, especially as it can have a negative impact on your Account Health and certain privileges can be revoked or suspended due to poor performance in this area.

    This tool will not only allow you to ensure your account’s good health, but will also be a way of reviewing the ongoing performance metrics of your third party fulfillment center(s).

    It is a great way to see whether your fulfillment centers are doing their job and hitting the mark and will allow you to identify and correct problems before they become damaging. Whether correcting those problems means adjusting your Delivery Promise (range of days for delivery) or finding a new fulfillment partner, a keen eye on this metric should be worked into your normal routine.

    Read more about how this feature works along with other delivery suggestions from Amazon on the Amazon Seller Forum.

    Amazon Storage Limit Updates

    IPI Storage Limit Updates Amazon Seller News

    You may have recently received an email similar to the one I did stating that if your score is 450 or above, you will no longer be subject to storage limitations. This means you won’t have storage limitations for standard-sized products, oversized, clothing, or footwear starting January 1st, 2021. Restock quantity limits are still going to be restricted.

    In my opinion, not much is changing for most sellers. Sellers with oversized products could experience considerable relief but most other sellers won’t notice much. That said, we do have to pay attention to what is happening. We are starting to see restrictive quantity limits go up incrementally.

    In the fall of 2020, we all had relatively decent limitations and could send in 3+ months’ worth of inventory. In December, we saw that cut-down, at times as low as five weeks or lower. I’ve already seen it start to climb back up in my account to over 60 days of stock, so it is beginning to move in the right direction, but you still might encounter these limitations.

    If you’re interested in finding out whether you have an IPI score of 450 or above, you can find it on your Seller Central dashboard under the Inventory Performance Dashboard. You can also review your storage limitations there at the bottom of the page. Just click “Storage Volume” to expand it upward and see how much you’re using in each of the different storage segments.

    If you have storage restrictions, this may significantly affect you, especially if you have oversized items. However, if you have standard-sized products, it may not be that substantial of a change. We are starting to see the quantity restrictions move back up in a positive direction.

    Hopefully, we’ll see that continue to improve and become less restrictive. Even so, I don’t think it’s going to go back to the way it was before. I think Amazon is more interested in being a distribution center than a storage center and wants Amazon sellers to improve their inventory management and take more responsibility for that side of their business.

    If you want to improve inventory management, join me on a live webinar, I host twice a month discussing things like Restock Limits, NARF, Brexit, inventory planning, etc. Whether you’re using SoStocked or a spreadsheet, the techniques we discuss are essentially the same.

    New And Improved Amazon HTML Editor + HTML Converter Tool

    New Amazon HTML Converter Editor Tool Features

    Bookmark the NEW and IMPROVED Amazon HTML Editor and HTML Converter tool for the next time you update product descriptions.

    As someone who has owned an Amazon copywriting agency since 2018 and has struggled for years with sub-par HTML editors, this is a tool that has been a labor of love, created to make our jobs as listing builders much, much easier, and faster.

    Three main ways to use the tool:

    • CONVERT Amazon HTML you paste from Seller Central
    • CLEAN messy Word Doc HTML into clean Amazon HTML
    • CREATE descriptions from scratch with a no-code editor

    Then… apply RULES to transform the text into Amazon-friendly HTML with the click of a button.

    For example…

    • Turn bullet list HTML into Amazon friendly dashed or asterisk lists
    • Convert bold HTML tags to all UPPERCASE letters
    • Replace paragraph HTML tags <p> with AMZ-friendly line break tags <br>
    • And more

    👉 Watch the quick video tutorial and give it a try!

    Send Holiday-Themed Emails To Amazon Followers Through December

    Now Send Holiday Themed Email Templates To Your Amazon Followers

    As you probably know, Brand Owners registered in Brand Registry can email their Amazon followers using the Customer Engagement tool.

    What you might not know is that the Customer Engagement tool allows you to create holiday email campaigns now through December 31.

    Shoppers don’t always know what to get their loved ones so use the holiday-themed templates as an opportunity to assist customers in preparing for the holidays. Like suggesting creative, corny, cool, heartfelt, or funny gift ideas.

    Create a themed campaign by selecting the theme from the Email subject drop-down menu, then creating your campaign, as usual, using the Customer Engagement tool.

    Step-by-step instructions can be found here:
    https://sellercentral.amazon.com/help/hub/reference…

    And keep an eye out for more themed campaigns as Amazon continues to release templates for other special occasions.

    Borrow Up To 100K With The Amazon Community Lending Pilot Program

    Amazon Lendistry Community Lending Pilot Program

    Amazon has teamed up with Lendistry, a minority-led Community Development Financial Institution (CDFI), to launch the Amazon Community Lending Pilot Program.

    Together, the goal is to support the growth of minority-owned small and medium-sized businesses (SMBs) from low-to-moderate income areas by making funding options more accessible through non-traditional methods (i.e., online lending).

    Business owners from the Hispanic-Latino and African American communities in the US are highly encouraged to apply. Funding is also available to individuals from investment areas designated by the CDFI.

    Features of the Community Lending Program

    The financing program gives SMBs selling on Amazon access to loans of up to $100,000, which borrowers can use for various business purposes (see below). Monthly repayments can be spread out over two years with 8% to 9.9% Annual Percentage Rates (APRs).

    Benefits of the Community Lending Program

    • Access working capital to fuel business growth
    • Cover costs associated with staffing and operations
    • Buy or replenish inventory
    • Invest in product research and development
    • Boost marketing efforts
    • Leverage Lendistry’s one-on-one consulting, webinars, and on-demand educational classes

    How to apply?

    Check your eligibility here. Or, visit Amazon Lending for more information.

    Amazon Has Worked To Smooth Out Climate Pledge Certification

    In July of 2021, when we initially reported on The Climate Pledge Friendly Certification, the application process was challenging. For example, there wasn’t a form for applicants to fill out to receive a Climate Pledge Friendly badge.

    Since then, Amazon has worked to smooth things out. According to Amazon’s new Climate Pledge Friendly Certification Guide, you can apply for certification in three different ways depending on the type of product you’re selling.

    Learn how to apply and see if the program makes sense for you by reading our Amazon Climate Pledge certification article.

    Updated: Amazon Compliance Reference Tool To Ensure Products Meet Requirements

    New Amazon Compliance Reference Tool

    12/06/2021 UPDATE : In their latest news announcement, Amazon says that at this point, the Compliance Reference Tool doesn’t include dangerous goods, food products, or chemical products. That explains the zero results for chemical substances-related keywords I’ve mentioned in the article below. Though, Amazon says they will add more products or new categories in the next six months, they didn’t say what exactly, so we’ll keep our eye out for future updates.

    Amazon has recently released a new Compliance Reference Tool to aid sellers in understanding their import or export compliance obligations in the country they want to ship from or sell in.

    It also provides information on whether a product (e.g., baby products, toys, or those that contain lithium batteries) is subject to certain Product Assurance requirements. This tool will also keep them in the loop about any changes in the requirements associated with their products.

    This should be a welcome addition to many sellers who have, in the past, felt blindsided by out-of-compliance issues and suspensions. The new Compliance Tool may help them to better navigate the complexities of selling within certain categories.

    How It Works

    1. Look up compliance content that’s relevant to your product using a keyword or product type. Then, read the associated help content to gain a better understanding of your compliance obligations.
    2. Connect with service providers who can assist you with meeting your compliance requirements.

    The Caveat

    A fair warning, though; while this tool aims to be useful, what happens when it doesn’t return results for certain keywords?

    Some sellers have reported receiving zero results when they used keywords related to pesticides (e.g., microbial and anti-bacterial), hazardous materials, arsenic, and lead. Although on the tool’s help page, it says you should try a new keyword from the dropdown list if you receive a “no related product type found” error message. But that would make things quite difficult for sellers who don’t know what other keywords or product types they should use to get to the compliance content they need?

    This limitation also makes some sellers wonder if the tool is actually working or is still under beta testing to help Amazon see how many users will use it, and maybe from the searches made by those users, build out a list of products or materials they should include in their database.

    Feel free to test it yourself here: Compliance Reference Tool.

    Related: Mistakes to Avoid When Shipping to Amazon FBA

    Distribute Your Inventory Across Multiple FCs At No Extra Cost

    Distribute Amazon Inventory Across Multiple FCs At No Extra Cost

    This announcement is for the US marketplace, however, we have been able to find that there is a in the UK so this program seems to be rolling out in UK/EU as well.

    In an attempt to speed up fulfillment without raising shipping prices, Amazon has rolled out its Box-Level Inventory Placement Program to help sellers (and partner carriers) streamline the shipping of their SPD shipments across multiple FCs at no extra cost.

    What is Box-Level Inventory Placement?

    Box-Level Inventory Placement is a method for splitting eligible products into multiple box groups, with each group sharing the same destination address. Eligibility for this program is based on the box content information that you provide. In addition, box-level placement only applies to shipments shipped through Amazon-partnered carriers.

    How Does it Work?

    This may sound like the same thing we are all used to with the usual 3-location shipments, and Amazon’s own announcement of this program was very vague and even the seller comments noted a lack of clarity and downright confusion with what the announcement actually means, but read on for what we believe this new program entails based on Amazon’s own descriptions.

    If your inventory is eligible, “Multiple Destinations” will show up under the “Ship To” tab in your FBA shipping plan. You can then create and track your shipments as you normally would.

    This is where it gets a little muddy and time will prove the accuracy of this. When you make your eligible shipment under Box-Level Inventory Placement and Amazon-Partnered Carrier Program, instead of, for example, sending your inventory to a CA receiving center, then waiting for FC transfer to send some of that inventory on to Nevada, then New Mexico, it would just go to these locations directly from your 3PL warehouse at no additional cost. Although, again, be aware that Amazon’s news announcement doesn’t explicitly say this! 🤦

    Also, on Box-Level Inventory Placement’s info page, it says that Amazon works with their partner carriers to essentially handle your shipments essentially for no extra cost. It is hard to say for sure, but from what we can interpret, instead of waiting for inventory to check-in at the receiving center, only to be then shipped again to other parts of the country, they may instead have you ship your inventory directly to more fulfillment center locations at no additional cost.

    What this means about the FBA Inventory Placement Service–a service that FBA charges a per-item service fee for and which allows you to send inventory to 1 FC instead of three. Whether this program will continue to operate in light of the new Box-Level Inventory Program is unclear.

    Another Way to Reduce Shipping Costs?

    What I believe that this Box-Level Inventory Placement is saying is that even though you will pay for SPD shipments as if they are going to one single destination, they will actually be split into multiple, let’s say six destinations for example.

    The idea is that your costs would be reduced as you’d be paying for one shipment but getting five, in this example. And because your inventory is initially being split up to more FCs than just the normal 3 or, in some cases 1, that shortens the amount of time before all inventory officially becomes for sale, as it would reduce or cut out the FC Transfer delay. It makes much more sense for everyone involved so long as the costs make sense. Instead of sending inventory to California and get checked in, only to have some of it go to Nevada and then get checked in there again, it would simply go directly to Nevada in the first place.

    Also, this process would allow more transparency as you will be able track each of the shipments to each of the locations, adding more visibility than what we currently have with the FC Transfer process.

    While the program seems promising, there are still a lot of questions around how it really works. But it is something to test out and to be aware of as an option.

    Visit Box-Level Inventory Placement for more details.

    Related: How to Ship to Amazon FBA (And Speed Up Check-In Times)

    Beta Amazon Upstream Storage Program Eliminates Restock Limits

    New Beta Amazon Upstream Storage Program

    Amazon Upstream is a new Amazon program currently in beta for some sellers and should be rolling out more broadly in the new year.

    It is a low-cost bulk storage solution for shipping and storing FCL (full container) shipments to an upstream storage facility and then automatically moves units to Prime-ready FCs for replenishment as needed.

    Currently, this program is only available for Standard Ocean shipments from China to the U.S.

    Learn about the benefits and drawbacks (and there are drawbacks!) of the Amazon Upstream Storage Program.

    Amazon Hikes Referral And FBA Fees For 2022

    2022 Amazon News About Referral and FBA Fee Increase

    This week, Amazon announced that starting January 18, 2022, it would be adjusting FBA fulfillment fees to help offset its now-increased operating costs. Although Amazon pointed out that these fees are still an average of 30% less costly than if sellers attempted to fulfill their own orders, the fee increase is still extremely high, at around $0.22 per unit.

    To soften the blow, Amazon padded its announcement with a long preamble highlighting that, despite the hardships of COVID, it has more than doubled its U.S. fulfillment capacity, increased its employee starting wage, and is building new services such as the Brand Referral Bonus, Search Analytics Dashboard, and Product Opportunity Explorer. In addition, it announced that it would be increasing the FBA New Selection program’s benefits, and launching the New Seller Starter Pack in Q1 2022 to help sellers “kick start early sales.”

    Amazon also pointed out that U.S. sellers sold over 3.8 billion products in Amazon stores alone this year, with a growth of more than 200,000 new third-party sellers in the U.S. store – 45% more than last year.

    However, Amazon will get no empathy from sellers who have in the past 18 months been quite scarred by Amazon’s restock limits and made to outsource much of their storage to third-party warehouses, further increasing costs to sellers in the process. It’s rather more salt in the wound.

    If these fee increases see restock limits done away with as Amazon mentioned at their Amazon Accelerate online event back in October 2021, that will help to offset these fee hikes. If not, it just means less margins for sellers, making it more important than ever to find other ways to save on costs across the supply chain through diligent inventory management and smart shipping optimization.

    For more information on the fee changes, visit www.amazon.com/selling-fee-changes.

    Amazon Updates Program Policies

    Amazon Updates Program Policies

    Heads up! On 15th November 2021, Amazon announced that it plans to change its program policies concerning all European Amazon sellers using features or services covered by said policies. While the current information about these updates is fairly vague, they have gone on record to say that these updates will constitute significant alterations to Amazon’s policies, so you should make yourself aware of the changes accordingly.

    The following updates will come into effect starting on 30th November 2021:

    Amazon will be updating policies relating to its Multi-Channel Fulfilment (MCF) program, including clarifications pertaining to specific operational characteristics of the MCF program.

    Amazon will also be clarifying program policies for Account Health Monitoring; Category, Product and Content Restrictions; and Order Defect Rate so that they align with the Amazon Services Europe Business Solutions Agreement (BSA).

    Additionally, the following updates will come into effect starting on 15th December 2021:

    Amazon will add its current FBA required removals page to the list of program policies and update the policy to establish a shorter seven-day period (instead of the previous policy of 30 days) for sellers to remove FBA inventory that is unfulfillable due to its expiration date from Amazon’s fulfillment centers as soon as Amazon notifies sellers.

    Amazon notes that it is shortening the period of notice for expiration-dated products to stop products from expiring while sitting in its fulfillment centers, allowing Amazon to donate more inventory should sellers decide they do not wish to have it removed. Sellers should adjust their preferences for the automated removal of their unfulfillable inventory in their FBA settings accordingly.

    Finally, the following updates will come into effect starting on 10th January 2022:

    Amazon is updating its Amazon Renewed Programme Terms so that it reflects new mandates in the EU and UK relating to mobile phones, which require diagnostic tests that ensure all devices’ data sanitization (erasing data from the previous owner) and functionality standards are up to par. Moreover, Amazon Renewed sellers must produce official mobile phone test records when necessary to be submitted for periodic inventory audits.

    With these new policy changes coming into effect, you should familiarize yourself with the updates as Amazon begins rolling them out in the next month and a half.

    Amazon Increases FBA Capacity and Restock Limits

    Amazon Increases FBA Storage Capacity and Increases Restock Limits

    On November 8th, Amazon announced that additional FBA storage capacity for UK and EU sellers has now gone live.

    In 2020, Amazon increased the square footage of its fulfillment and logistics network. This year, it has opened 10 new UK and EU fulfillment centers, with 7 centers starting operations in September.

    With this increase in FBA capacity, Amazon says, sellers can expect to see an increase in their restock limits as well. Amazon encouraged its seller network to review and streamline inventory and optimize product selection in preparation for the upcoming peak demand season – including eliminating any inventory that hasn’t been selling well.

    Responses from FBA sellers on Amazon forums were a mixed bag. Some had indeed seen an increase in their restock limits, while others had seen no change yet. Many commented that while their restock limits had increased, their storage volume had remained the same, rendering the restock limit increase useless. Of course, those challenges would only face sellers whose IPI scores are below 450.

    Other UK sellers mentioned that they had already been blessed with unlimited storage prior to the update, but have their fingers crossed that Amazon won’t retract its new increased restock limits in the coming weeks or months. In its announcement, Amazon itself warned sellers that new waves of COVID restrictions and other unexpected events could force them to “adjust” their plan.

    On the U.S. side of things, sellers in the States saw a sudden decrease in their restock limits in September, with reductions ranging from 6% to 70%. However, since Amazon often launches policy updates in the EU and UK before introducing them in the U.S., stateside sellers may hope for an increase in their restock limits there as well in the near future. They even mentioned at their recent Amazon Accelerate event in October that the plan to get rid of restock limits altogether, though we aren’t holding our breath on the promise just yet.

    Pro Tip: View our Amazon Restock Limits guide for quick wins to improving your limits.

    Amazon Launches New Dashboard for Returns Performance

    Amazon Launches New Dashboard for Returns Performance

    Amazon has recently launched an up-to-date dashboard displaying Returns Performance to help sellers monitor their returns statistics as well as to proactively address problems for manually managed returns.

    The dashboard provides sellers more insight into their returns while focusing on three vital metrics for returns performance. These include:

    • Return requests that were approved over 24 hours ago: This refers to the number of requests manually approved over 24 hours from when the first request for return was received.
    • Return requests that are declined: Essentially, this is the number of requests declined by you, the seller.
    • Return-related customer contact rate: This metric will count one contact for each unique buyer requesting a return, irrespective of how many messages are sent by the buyer.

    All of these performance metrics contain details of the metric performance, metric definition, target threshold for each metric, policy information, plus an explanation of the importance of each metric.

    Amazon has simultaneously launched a Returns Analysis page, helping sellers to isolate and act on any listings that suffer from return issues. Additionally, by clicking Review Returns Performance, sellers can open a pop-up window inside the Manage Returns page, giving a summary of the metrics for returns performance.

    The End Of Rebates, Two-Steps URLs, & Other Search Rank Manipulation

    The End Of Rebates Two-Steps URLs Other Search Rank Manipulation

    Amazon has just made an unconventional announcement via one of its Forum Moderators (which we’ll circle back to in just a minute) to clarify the rules of its Seller Code of Conduct, which aims to combat the reportedly increasing amount of sales rank manipulation. Recently, Amazon noted that it had received many inquiries about its incentive policies, especially those related to driving buyer discovery and conversion through off-Amazon coupons and rebates made to drive purchases on its platform.

    Amazon continues to allow sales promotions that are offered directly upon the Amazon platform, such as deals, discounts, and coupons. However, the use of rankings boosting practices such as super URLs, two-step URLs, funnels, search-find-buy, rebates, or similar off-Amazon marketing incentives is in violation of the Seller Code of Conduct. As you probably know, the issue Amazon has with these types of promotions is that they falsely inflate rankings in Amazon search. Amazon’s claim as a reason for the enforcement is that it can be an abusive practice toward customers and other sellers, assumingly by creating a false sense of the popularity of the product and providing an unfair advantage over sellers not using these practices.

    Yet, what’s most interesting about this announcement from Amazon is how they decided to broadcast the message, which, as we mentioned above, was through a Moderator named ‘SEAmod’ on the official Amazon Forum, rather than its typical channel for seller announcements, which is called Amazon News. This has led to speculation from Amazon sellers that the company is gearing up for a major update to its Seller Code of Conduct policies, with rumors coming from those in Amazon’s inner circles that the company might announce the changes as early as next month to curb these types of infringements.

    New Carrier Tracking Requirements & Improving OOS Listing Discoverability

    New Amazon Carrier Tracking Requirements and OOS Listing Discoverability Updates

    As of November 1, 2021, all FBA sellers who create non-partnered carrier shipments will need to supply the name of their chosen carrier and a tracking ID should the carrier provide it, thanks to new requirements from Amazon, which it claims will help to improve the receiving process.

    This recent change is something that was announced for the European Amazon marketplace but US sellers should be prepared to see it roll out in their region soon after as Amazon often seems to launch policy updates in EU/UK before pushing them stateside.

    So, if you’re an FBA seller using a non-Amazon-partnered carrier for your shipments, you will need to provide carrier information and a tracking code prior to the shipment arriving at the fulfillment center. On the other hand, if you make use of Amazon’s Partnered Carrier program or Amazon Global Logistics, these changes will not apply since Amazon will generate the tracking code for you.

    Concerns from FBA sellers on Amazon forums have noted that providing such information could be a very time-consuming task with large inventory lists. Parcel shipments will require a tracking ID for every box, while full-truckload and less-than-truckload shipments require a freight progressive number (PRO, or progressive rotating order number) for every shipment.

    A PRO number is a 7-10 digit number used to track shipments as they progress through the delivery process. Without getting in the weeds on how tracking numbers work, the PRO is a part of the actual tracking number. It will be generated by and you can get it from your carrier. It will appear on the shipping labels. For clarity’s sake, have your carrier indicate to you your PRO number to submit to Amazon.

    Find more information on these tracking obligations at Track your shipment (Shipping Queue).

    Amongst all the headaches of having to provide tracking information are one or two shiny, bright spots. Amazon asserts that these new tracking policies will allow it to avoid delays on the receiving end, thus making the inventory available to customers faster. The way we can foresee this to be possible is that it could help with workload and workflow planning if they know what is scheduled to arrive when.

    Additionally, when you supply your tracking numbers, your inventory may qualify for In-Stock Head Start. If this is the case, your product will show as Active on the Manage Inventory page and, even though your items that are not currently in stock, if your shipment is close enough to arriving its listing may be live and listed for sale on Amazon since the platform will have access to tracking information for your in-transit shipments.

    This feature has long been available for Amazon Partner Carrier and Amazon Global Logistics users but has not been a feature for those opting for other shipping solutions until now.

    You can submit the tracking information via the Track Shipment tab on the Summary page found in the shipment workflow. Alternatively, you can provide the details through Amazon Marketplace Web Services. For the fastest receiving times, ensure you have mapped the tracking codes for parcel shipments to the correct FBA box ID label on each box.

    It’s important to note that Amazon will monitor the defect rate of your missing tracking info for every shipment, which could affect your Amazon business should you not fulfill these new obligations.

    Just another hurdle to climb on the jungle gym that is Amazon.

    Amazon Releases Free Product Research Tool Named ‘Product Opportunity Explorer’

    New Amazon Product Research Tool Named Product Opportunity Explorer

    To satisfy unmet customer needs, Amazon has recently introduced “Product Opportunity Explorer,” a new product research tool that helps third-party sellers identify innovative new items to launch and sell on its website.

    It is hinted at but not fully clear whether sellers will be provided with more detailed data on product niches that Amazon does not have current offerings for. Access to more of Amazon’s internal search data might provide knowledge as to which areas are being underserved on Amazon and this very well could be a means for Amazon to provide third-party sellers the opportunity to launch products within that space quickly. This would be a smart move on Amazon’s part as it would help third-party sellers to develop and launch products that buyers are not finding on the marketplace currently.

    Empowering Sellers with Advanced Capabilities

    The Product Opportunity Explorer is an excellent addition to any seller’s marketing arsenal. While it seems, at face value, to be an Amazon version of the tools that many AMZ software marketing suites have been offering for years, our hope is that it will provide more actual internal data that has not been wholly available to us previously.

    This new tool intends to help sellers discover new market opportunities by providing valuable insights into what shoppers are truly searching for, visiting, and purchasing (and not purchasing) on Amazon itself.

    It also provides rich information on a product’s search volume, pricing trends, past sales, and growth potential. This way, sellers can efficiently gauge and assess its potential on Amazon, i.e., whether or not it will gain customer traction.

    Once a new product is ready for launch, sellers may opt to join Amazon’s FBA New Selection program to qualify for free product removals, return processing, and monthly storage for all new-to-FBA parent ASINS for a limited time. Keeping costs low while launching a new product will help sellers improve their margins during the early sales period.

    Eliminate Guesses from Growth Strategy

    Product Opportunity Explorer gets its data straight from the source (Amazon). So, the insights it provides are based on what customers actually want and need rather than making educated guesses, which many third-party tools do.

    Therefore, Amazon’s product research tool helps take the guesswork out of discovering which new products to sell. And since all the data sellers need for their research comes from a single location, it makes the job less time-consuming, allowing them to come up with new offerings more efficiently.

    Of course, we take everything with a grain of salt as it is an Amazon tool and we’ve found often that non-Amazon tools have been much more accurate, workable, and user-friendly. At the same time, this is a search data-driven tool and the source of the data being Amazon means that this tool has a higher likelihood of being a valuable resource.

    Time will tell, but it is certainly an intriguing and interesting new development that we hope will benefit the seller community well.

    Rollout Plan

    Available for free in Seller Central, Amazon’s product research tool is currently in testing mode, with plans to make it accessible to all sellers in 2022.

    New Documentation for Supplements Required to Avoid Listing Removal

    New Amazon Food Supplement Safety Requirements

    As more and more questionable food supplements come onto the market with claims that they can support weight loss, improve memory and attention span, or enhance sexual performance, Amazon further reins in the supplements niche. As if automatic listing suspensions when you use mysterious restricted terms weren’t bad enough, get ready to submit to more rigorous compliance.

    In late September 2021, Amazon began requesting that sellers in the UK and EU who list certain high-risk food supplements submit compliance and safety documentation for products that fall within these sub-categories. Primary focus seems to be within the sexual enhancement and weight loss segments but, in true Amazon fashion, we do not have a complete list of those under fire so all sellers in food supplements should be prepared and should also skim their listings for anything that might push them unnecessarily into being flagged for those categories.

    It has always been the case that products sold on Amazon’s platform must comply with national and international laws and its own policies for compliance and safety. But it seems Amazon is increasing the regulation, verification and enforcement of these products. This could be a good thing for some sellers in that it could help to thin the competition and make it more difficult for bad actors to enter the space. On the other hand, we can be certain that some good sellers will fall within the crosshairs and suffer from these updated policies.

    Amazon’s new legislation dictates that sellers who wish to continue trading these kinds of supplements will now need to provide documentation that they have been manufactured according to national healthcare standards, which differ from county to country. To find out more about which requirements are necessary for each county, Amazon suggests reading these guidelines. In addition, you can visit Seller Central and Vendor Central to view the compliance status of listings and to upload new documentation.

    While these policy changes only affect sellers of food supplements in certain categories, Amazon has reminded all sellers of food supplements and grocery category products to ensure that their listings comply with its latest food and food supplement regulations.

    Amazon will provide sellers with a 60-day grace period to get up to speed with the new rules, but any food supplements product listings that fall into the high-risk categories that are not accompanied with the required documentation are subject to removal as early as November 2021. Supplements usually tend to have a big boost in January due to New Year’s Resolutions so make sure you are prepared to avoid such disasters.

    Amazon Inventory Deadlines For Q4

    Amazon Inventory Deadlines for Q4 2021

    UPDATE: Amazon just moved up their Christmas inventory deadline to December 2nd instead of the December 11th deadline they had initially mentioned in an earlier announcement. The dates quoted below have been updated accordingly.

    Make sure that you don’t run out of stock this holiday season by preparing your inventory for Q4 well before Amazon’s deadlines.

    To avoid missing any opportunities and to offer your customers the best discounts and deals without interruption, be sure that all your inventory reaches Amazon’s fulfillment centers before the following dates:

    • November 15th for Black Friday/Cyber Monday, meaning your inventory should be ready to send by mid-October.
    • December 2nd for Christmas, meaning your inventory should be ready to send by early November.

    One way to prepare for the holidays is with an inventory and logistics checklist. With factors like the lingering effects of the COVID-19 pandemic causing worldwide labor shortages in production and logistics sectors, plus the recent typhoons, floods and ongoing power cuts in China, the global supply chain is fraught with delays, so making sure you are on the ball with your delivery timelines is crucial.

    Another thing you can do to get ready for Q4 is to create a calendar with FBA holiday selling dates. Your calendar should include all the US national holidays, and you should add blackout dates that might affect your Amazon business. Alternatively, you can simply download our Blackout Days Calendar and use this information to add supplier blackout dates to your SoStocked account.

    If you need any further information on getting ready for holidays or selling dates, you can also read Amazon’s guidelines here, or if you want to learn more about what Amazon’s deals your products qualify for, head over to their deals page.

    Delivery Time Accuracy With New Amazon Shipping Settings Automation Tool

    New Amazon Shipping Settings Automation Delivery Time Accuracy

    Amazon has released a powerful new tool for sellers that it calls Shipping Settings Automation (SSA). This tool is specifically geared toward Merchant-Fulfilled and Seller-Fulfilled Prime shipments. It lets you create shipping templates quickly to provide your buyers with more accurate delivery estimates per region.
    Plus, thanks to this new feature, you won’t need to calculate shipping times for each region manually anymore because SSA will do it for you automatically. It does this by using your warehouse(s) location, the buyer’s location, and up-to-the-minute information from the carrier(s) you use. Essentially, this saves you time as it eliminates the need to update your shipping templates with accurate details. Read on to find out more about how it works, how you can use it to your advantage, and what to watch out for when using the settings.

    Who can use SSA, and what are the benefits?

    As of now, SSA supports automated delivery times for domestic self-fulfilled standard shipping, including expedited one and two-day deliveries, as well as Seller-Fulfilled Prime. It comes as no surprise that buyers want fast delivery times, so having a tool that allows you to provide customers with the most accurate information is something you should seriously consider adding to your seller arsenal. Even if your delivery times are a little longer, giving your customers precise transit times will go a long way to improving buyer satisfaction by setting expectations, and in the long term, this should improve customer relations and potentially show up in more positive reviews for your Amazon business.

    As mentioned, SSA supports shipping region automation for domestic Seller-Fulfilled Prime one and two-day deliveries as well. This is especially significant as you must hit Amazon’s delivery speed targets to remain in the Seller-Fulfilled Prime program.

    One more benefit SSA offers is that it can reduce the occurrence of over-estimation for delivery times. So often, sellers err on the side of caution and relay to their customers longer delivery times than what it will actually take for the product(s) to arrive. With SSA’s automation settings, the delivery times you promise your buyers will be much closer to the actual speed of delivery. Accurately predicting faster delivery times could mean the difference between the customer adding to cart or bouncing.

    Are there any requirements to use SSA?

    If you want to take advantage of SSA, you have to use the carrier selected in your settings, so make sure you’re happy with your shipping service provider before you set things up. Alternatively, you can opt for “Buy Shipping” to choose through Amazon any carrier that meets customers’ expectations.

    Bear in mind that Amazon will be monitoring your delivery performance, and if it notices that you are not meeting the requirements, Amazon might add time to the delivery promise your customer sees.

    To get started with SSA, go to the Shipping Settings and edit your current shipping template, or start from scratch by creating a new shipping template.

    This feature could be a great competitive edge over those not quick enough to implement as we move into the holiday season especially as FBM becomes more necessary with restock limits.

    China’s Widespread Power Cuts Further Strain Global Supply Chain

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    If there isn’t already enough going on to disrupt the global supply chain, you can now add power cuts and forced electricity rationing throughout China to the list.

    It seems like one supply issue after another, and we’re still dealing with backlogs thanks to the past typhoons and flooding that swept across the nation and forced port, terminal, and warehouse closures, not to mention the still present disruptions thanks to COVID.

    All of these factors have put further strain on production and logistics, and as Amazon sellers work to get their last Q4 shipments out of the country, these electricity supply issues couldn’t have come at a worse time.

    Due to the significant increase in lead times that will be created by this problem, suppliers are even beginning to encourage sellers to get their Q1 inventory orders sent in as soon as possible so it can ship before Chinese New Year.

    The power restrictions and supply issues result from government orders aimed at reducing energy consumption, part of China’s greater plan to enforce tighter environmental regulations, coupled with the fact that coal prices have reached record levels, making it impossible for many power plants to run a profitable business.

    Government Push For Energy Targets

    Word has it from state-run newspapers that many local governments have ordered the curbs on electricity use so as not to miss the targets laid out by the Chinese Communist Party in Beijing regarding emissions intensity and energy reduction. These rules imposed by the CCP are an attempt to make China fully carbon-neutral by 2060.

    These recent curtailments come after the nation’s chief economic planner identified nine provinces last month that had increased energy intensity over the first six months of 2021, amid a rapid economic recovery witnessed in China after the peak of the pandemic.

    So far, the cuts have been felt in over ten provinces, with commercial powerhouses like Guangdong, Zhejiang, Jiangsu being some of the worst affected. Many of China’s major production companies are based in these regions, and news sources in China reported that several of these businesses had gone as far as to declare the impacts of the power shortages in filings with stock exchanges.

    It is advisable for sellers to reach out to their own suppliers for updates on lead times and whether their production has been affected. Some of our personal sources in China share that this may become more widespread across the country in coming months so all sellers should be prepared. We have also learned that some factories have had to supplement their power sources with generators. Judging by these hardships, plan for not just lead time increases but possibly cost increases as well due to the economic shifts all this will likely create.

    Coal Prices Hit Record High

    Meanwhile, as electricity demand has risen, so has the price of coal, and with the government austerely regulating electricity prices, coal-fired power plants are unwilling to operate at a loss. In fact, coal prices are now at an all-time high, making business unprofitable for several of the country’s largest power plants, with many drastically reducing their power output, leading to supply issues in many provinces.

    Since China still relies heavily on coal, with more than half of the country’s power coming from the combustible energy source, we should prepare for a rough time on the supply chain ahead if these gaps do become more prevalent and expand into more areas. If that does occur, the effects of supply issues could be more severe than even the previous power limitations that hit many parts of China over the summer. Developing more flexibility along your supply chain and finding backup suppliers may become more important now than ever.

    New Changes To Removal Of Aged Inventory

    Automated Removal of Aged Inventory Changes

    In preparation for the holiday rush, Amazon has recently updated its Automated Removal of Aged Inventory.

    The update broadens the scope of said service and introduces a value-recovery option. You can now enable automatic removals for the following types of inventory and opt to liquidate them at the same time:

    • Inventory that’s left sitting in Amazon warehouses for over 12 months and likely to incur long-term storage fees.
    • Inventory that has remained unsold for 6 consecutive months and has been in Amazon for over half a year.

    Prior to the update, Amazon only accepted automatic removal of unsellable inventory (products returned by customers in bad condition) and inventory that was subject to long-term storage fees.

    The recent move is most likely an attempt to allow more room for popular products this Q4 to brace for another eCommerce-driven holiday sale period and to create a more streamlined way of sellers clearing out old inventory systematically. Adopting this feature could help improve your IPI score and minimize holding costs.

    Meanwhile, the newly added value-recovery option allows you to liquidate aging inventory through Amazon’s FBA Liquidations Program. You could recoup 5% to 10% of your product’s selling price by liquidating inventory while avoiding long-term storage fees. The net value recovered should appear in your account 60 to 90 days after the liquidation order is submitted. You’re not going to make a lot of money for sure, but it’s still a better option than simply disposing of your products.

    However, if liquidation is not the right option for you, consider creating a Removal Order to have your items sent back to you instead. Simply adjust your Automated Fulfillable Inventory settings and input your return address.

    Regularly check your Manage Inventory Health page to identify aging inventory or slow sellers before they start incurring additional storage costs and affecting your IPI score. For more tips, check out this article: Excess Inventory: Why It’s Bad and How to Reduce It?

    Amazon Egypt Now Open For Business

    Amazon Egypt Marketplace Now Open For Business

    With its launch on September 1, Amazon Egypt became the e-commerce giant’s 20th global marketplace, while its new Fulfillment by Amazon (FBA) logistics center in the country is the first of its kind in Africa.

    Until now, the leading online shopping platform in Egypt was Souq.com, which Amazon had acquired for $580 million back in 2017. However, as witnessed with Souq stores in the United Arab Emirates in May 2019 and Saudi Arabia in June 2020, Amazon has completely rebranded the localized platform to fall in line with its internationally recognized user interface now operating as Amazon.eg.

    Egypt is an emerging e-commerce market with approximately US$4 billion in annual trade, and trends over the last decade indicate that the market is expanding rapidly. Thus, Amazon sees now as the right time to establish a foothold in the country by putting down roots and growing its brand.

    As part of the rebranding, Amazon has migrated all existing Souq accounts to its new platform, meaning its users will still have the same login details and information like payment credentials and delivery addresses; even their wish lists have been moved across. In addition, all the familiar product categories will be available on the new site, meaning Eqyptian shoppers will enjoy the same conveniences as those in other countries.

    “Today marks a proud day for Souq.com and Amazon, a day we have been working toward since the two companies came together,” commented Omar Elsahy, Country Manager of Amazon Egypt. “Amazon.eg brings together Souq.com’s local know-how and Amazon’s global expertise, something we believe will be of significant value to customers across Egypt. We’re only getting started, and we will keep innovating in ways that are meaningful to our customers, as we remain laser-focused on providing them with exceptional service, fast delivery, and great prices and selection on millions of items.”

    Amazon Egypt’s local competitors include Nigeria’s Jumia and the UAE’s Noon, and compared to other countries where Amazon operates, the Egyptian market is relatively small. However, when combined with the above-mentioned Amazon stores in the United Arab Emirates and Saudi Arabia, the region becomes rather lucrative. Plus, as is often the case, the early bird gets the worm, and sellers who get their foot in the door first will find considerably less competition than they are used to in markets like the U.S. and Europe, so you may want to brush up on your Arabic!

    As of now, Prime isn’t available in Egypt, but all orders on Amazon.eg directly from Amazon or sellers using FBA over 350 EGP ($22), will qualify for free shipping. Nationwide delivery is said to take no more than 1-2 business days, while deliveries within the Cairo – Giza – Qalyubia metropolitan area only take 1 day.

    Why Have Amazon Sellers Suffered a Significant Drop in Restock Limits?

    Amazon Sellers Are Suffering Significant Drops In Restock Limits

    Many sellers have seen sudden restock limit decreases of up to 70% despite strong sales!

    What’s going on?

    There’s been chatter among sellers and influencers about Amazon revising restock limits in the US marketplace. The restock limit reductions reportedly range from 6% to 70%, putting affected sellers at risk of going over the limit earlier than expected – or suddenly being pushed over limit with this new drop.

    For instance, one seller saw a 10% decrease on Monday, August 30th, and another 25% decrease a few days later. Others weren’t so lucky and suffered a huge blow with a 70% restock limit reduction overnight!

    Why is this happening?

    There could be many reasons why this is happening. Many speculate that Amazon is simply overwhelmed right now, so they resorted to pulling the “Oh, shit!” lever on FBA sellers.

    As we all know, Amazon’s algorithm calculates inventory limits using various factors. But every so often, they will lower sellers’ max inventory capacity considerably without warning.

    One particular time that they did it was in May. And the reason behind that move was to help speed up check-in times before Prime Day.

    If Amazon tends to reduce restock limits before key selling dates, we have good reason to think that the decreases we see today are part of their plan to:

    • Restrict the volume of shipments coming in this month to accelerate check-in times before Q4.
    • Conserve warehouse space to accommodate the expected inventory influx of certain products and categories to meet customer demand this holiday season. If your restock limits have been dropping despite good sales, look into your utilization percentage and quickly move excess inventory to free up storage space where possible.

    It seems the recent decreases are not based solely on sales performance metrics, which explains why some top-performing sellers are also affected.

    Underlying Causes

    If we dig deeper into why Amazon’s pulling the lever again, we’ll find that continuing pandemic repercussions may be a culprit: current global supply chain problems, warehouse labor shortages, and skirmishes, and possibly even Hurricane Ida may all be factors at the root of our restock limit issues.

    It is likely that Amazon is still dealing with the backlogs left by recent slowdowns at China’s terminals and labor disruptions due to typhoons and COVID. And let us not forget the ripple effects of past supply chain disruptions (Suez Canal, driver shortages, etc…) that are still being felt. Therefore, Amazon is, perhaps, trying to avoid overwhelming their warehouses further with too many shipments before Q4.

    None of them are within our control as sellers, which is frustrating. But that doesn’t mean we can’t do something about it.

    Here’s a couple of tips to overcome lower restock limits:

    1. The Golden Rule in avoiding stockouts: Don’t let anyone have all your stuff! 

    In more familiar terms: Don’t put all your eggs in one basket. There’s a lot of uncertainty right now, from sudden restock limit decreases and port shutdowns to warehouse labor disruptions. Having a backup plan – or several – is more critical now than ever.

    If Amazon rejects your inbound shipment because you’re suddenly over the limit, but you don’t have a backup warehouse or fulfillment center, you’ll stock out and lose sales. Having a third-party fulfillment center allows you to switch to FBM quickly and continue fulfilling orders from there. This also helps to maintain your restock limits while stocked out at FBA, as we’ve covered in our comprehensive Amazon restock limits article.

    You also need a backup plan for your import/export and warehouse to FBA logistics. If you put all of your newly manufactured inventory on one boat and that boat gets stuck at port for 3 weeks, your stockout risk is high. But if you have held back an inventory reserve with your supplier that you can air freight in case of such an emergency, you can avoid stocking out while avoiding expensive air freight if your ocean shipping goes to plan. This is also known as CYA: Cover Your Ass.

    Similarly and commonly, if you are used to sending all of your inventory LTL from warehouse to FBA and Amazon neglects to check it in for 4 weeks (it’s been known to happen), what do you do? In that case, if you reserve some inventory at your 3PL, send a smaller amount or inventory Small Parcel Delivery (SPD) as loose cartons get checked in faster than LTL.

    Making contingency plans like this provides you the flexibility you need within the chaotic conditions under which we’re selling.

    2. Run flash sales

    As mentioned earlier, Amazon wants to relieve its overcrowded warehouses. So, they’re likely using excess inventory and utilization percentage as influencing factors for calculating restock limits and really forcing sellers to trim the fat in every way possible before the Q4 crush.

    If you suffered a significant restock limit decrease due to overutilization, use excess inventory to run flash sales. This tactic will help you clear up needed storage space and improve your sales velocity and sell-through. Alternatively, consider liquidating your excess inventory if you’re in an emergency situation and don’t have the time to run a flash sale.

    The bottom line is: there are things you can do to be more prepared for situations like these the next time they come around.

    The thing you should not do is abandon your focus on sell-through and proper inventory management practices that improve your IPI score and restock limits just because every now and then Amazon itself throws those rules out the window.

    That would be like giving up on successful PPC and ranking strategies because every now and then Amazon suspends a best seller.

    Keep doing the things that work, follow successful inventory management practices on Amazon, and prepare for those times when Amazon breaks its own rules. The game is always changing on Amazon. That is the only constant we can be sure of. Our job as entrepreneurs is to roll with those punches better than our competitors do.

    Have a backup plan, don’t let Amazon be your only distribution channel, and, finally, have a backup plan to your backup plan.

    SoStocked Prices Increasing After Friday, September 17th, 2021

    SoStocked Amazon Inventory Management Software Prices Increase September 17 2021

    UPDATE: We had so many people reaching out that we extended the price increase through Midnight on Monday, September 20th, 2021.

    But that’s it! After that, prices are going WAY up and the Unlimited Plan (Unlimited Orders, Unlimited SKUs etc…) and locking in grandfathered lifetime pricing is going away foreverGet The Unlimited Plan Here ➜

    If you’re still on the fence about signing up, attend our last minute group demo.

    ANNOUNCEMENT: SoStocked’s Amazon inventory management software UNLIMITED PLAN and locking-in LIFETIME PRICING is going away. 👋

    If you’ve been on the fence and haven’t yet signed up for SoStocked, NOW IS THE TIME. Seriously, prices are going WAY up, and I don’t want you to miss out when we flip the switch.

    This does NOT affect existing accounts. You will NOT see a price increase. HOWEVER, you might want to consider purchasing an ADDITIONAL account if you think you’ll need it in the future.

    All newly created accounts will be subject to the new pricing structure, whether registering an additional account, or a brand new account.

    Since our launch back in 2019, you’ve seen our prices steadily increase as we’ve released new features ⚡️ and beefed up our team 💪 of coders, customer support, and server infrastructure.

    Until now, we’ve had ONE unlimited plan 🔥 and have grandfathered customers into receiving new software features we released for the sweet deal of $79 per month.

    But that’s ENDING Friday, September 17th, 2021 at midnight.

    We’ve got BIG plans for Q4 and 2022. And with big plans come big expenses 💰💰💰.

    So we’ll be raising our prices and switching to a tiered pricing model based on the number of orders, SKUs, and feature upgrades.

    There will NO LONGER be an unlimited plan with unlimited orders, unlimited SKUs, and no getting grandfathered into big future feature releases. 🤯

    So if you (or your friends) are interested in creating new OR additional accounts, we’d be happy to honor our current pricing of $79/month for UNLIMITED orders, SKUs, and features thru Friday, SEPTEMBER 17TH.

    Jump on over and create an account

    Share this with a friend who might not forgive you if you don’t let them in on this sweet deal.

    Amazon Search Shadowban For Products That Violate Title Guidelines

    Amazon Search Suppressing Products With Titles That Violate Guidelines

    While most Amazon sellers are familiar with suppressed listings, which hide listings from shoppers that do not meet Amazon’s product information standards, many may not be aware of the search suppression Amazon imposes on listings with titles that do not meet its guidelines.

    What is Search Suppression?

    Think along the lines of what we see happening on social media platforms like Instagram, where posts are shadowbanned if a user’s content violates community guidelines or is deemed inappropriate in any way. Then, Instagram will hide or restrict that content without any warning or notification, and it means that the post won’t show up on other users’ Instagram news feeds, while the person who posted the content will be none the wiser.

    The suppressed searches on Amazon work in a very similar manner, and Amazon has gone so far as to state that it will hide any items sold under high-risk categories (those where Amazon is more likely to suffer from liability issues) with titles containing restricted keywords from searches.

    What is restricted remains somewhat ambiguous as Amazon tends to add new restricted keywords often without warning and only has a shortlist of restricted keywords on their official list, yet suspends accounts for many terms far outside that list.

    However, we do know that titles containing promotional keywords and phrases like “free shipping” or “100% quality guaranteed” are prime candidates for search suppression. So are those with non-readable characters, including emojis and titles exceeding more than the allowable character length, usually 200 but can vary per category or sub-category. Of course, titles not containing any product identifying information are equally likely to face the same fate.

    The tricky part with all of this is that Amazon, it seems, will likely never notify you when they have enforced search suppression on one of your listings, just as Instagram shadowban posts without a word.

    Product Types that May Be Suppressed from Search

    The complete list of sensitive categories on Amazon includes Alcoholic Beverage, Baby Product, Beauty, Cleaning Product, Consumer Electronics, Food And Beverage, Gifts And Occasions, Health Personal Care, Home, Kitchen, Luggage, Paper Product, Party Supplies, Pet Supplies, Prescription Eyewear, and Tobacco And Cannabis Products.

    If you have any listing that falls under these categories, you should be extra careful to ensure you have followed all of Amazon’s title guidelines for its US and EU marketplaces. 

    Why is Amazon Suppressing Searches Rather than Just Listing Suspensions?

    From our assessment, it seems that Amazon wants to remove accountability by hiding listings that shoppers are searching for if they deem a listing to violate its terms. Another part of their focus on Amazon customer experience being of the utmost importance.

    However, the product remains available to buy on Amazon, and sellers can continue to drive external traffic to their listing via other off-Amazon marketing strategies. Amazon would not want to miss out on a new customer and the traffic you may be sending to Amazon. They may allow you to make sales using your own traffic efforts to your own potential customers, but they don’t want you giving their current customers a potentially negative experience through misrepresentation of products or non-compliant titling.

    Search suppression is an interesting and potentially hard to identify, an issue that could make figuring out why you are not making more sales quite difficult. So knowing and adhering to this policy is important.

    If you want to find out more about search suppression and which of your ASINs may be affected, log in to your Seller Central account and open Inventory > Manage Inventory > Listing Quality Dashboard. 

    Your Amazon Posts Can Now Appear On Your Product Detail Pages

    Amazon Posts Can Now Appear On Your Product Pages

    Posts is Amazon’s new advertising tool that helps drive your brand awareness and increase the likelihood of product discovery and consideration by providing shoppers with a curated selection of lifestyle imagery via a shoppable news feed.

    While Posts is currently undergoing beta testing, when launched, the new platform aims to allow sellers to attract shoppers that have a genuine interest in their products. What’s more, Posts streamlines the shopping process by letting users click through from a brand’s feed directly to its product pages, all within Amazon’s mobile shopping app.

    Speculation from sellers currently using the beta version suggests that Amazon will roll out the full version of Posts in the next few weeks. Not only will it provide you with a new way of showcasing your products, but it will also help to increase your reach and develop a stronger brand identity by sharing your content with the right customers.

    Amazon has also begun testing new placement for these posts within your actual product detail pages, which they should be releasing more widely within the next few weeks. So not only will shoppers be able to discover your brand and products via Posts, but they would also be able to discover your content once they have found your product through traditional Amazon shopping methods. These Posts on your sales page could improve conversions significantly if intelligently used, as sellers can create content that shows the many benefits, features, and uses of their products, increasing appeal, and purchasing.

    By tailoring content for shoppers with specific interests, Posts lets you engage with the people who want to learn more about what you have to offer, affording you the opportunity to bring your brand to life. Whether you want to drive discovery or educate shoppers about your products, Posts gives you the chance to post as much content as you want for free, so you may as well take advantage of what it has to offer!

    Amazon Grade And Resell Program Rolled Out To Reduce FBA Waste

    Amazon Grade And Resell Program

    In a bid to reduce the negative environmental impacts of its e-commerce business model and stop perfectly good, returned items from unnecessarily becoming trash, Amazon has recently launched Grade and Resell.

    The new initiative, which is now live in the UK, makes it possible for third-party sellers to sell items that have been returned through Amazon’s network as “used.” In an effort to cut down on e-waste, the new program comes after independent investigations into Amazon’s FBA warehouses, which reported that Amazon had labeled millions of returned and unsold items for destruction.

    In an interview, an ex-employee from Amazon told ITV News, “From a Friday to a Friday, our target was to generally destroy 130,000 items a week. I used to gasp. There’s no rhyme or reason to what gets destroyed: Dyson fans, Hoovers, the occasional MacBook, and iPad; the other day, 20,000 Covid (face) masks still in their wrappers.”

    Meanwhile, the new program is still undergoing beta testing in the US and is running on an invite-only basis, but Amazon claims the service will be fully operational there by the end of the year, along with France, Germany, Spain, and Italy following in early 2022.

    So what does it mean for Amazon sellers? Previous to the launch of the Amazon Grade and Resell program, third-party sellers had the choice to donate the unsold items, or they would remain sitting on warehouse shelves until their eventual destruction. Either way, sellers would absorb the financial losses.

    But now, when a buyer returns an item, sellers can automatically funnel these items through Grade and Resell, after which Amazon will give the “used” item one of the following familiar ratings:

    • Used-Like New
    • Used-Very Good
    • Used-Good
    • Used-Acceptable

    Then, since everything works through Amazon’s existing warehouse infrastructure, third-party sellers can set pricing for the item based on Amazon’s rating and sell it just like they would a new item.

    While the program clearly benefits the environment as fewer items needlessly end up in landfills, some Amazon sellers remain cautious of the accuracy of Amazon’s grading system, which may result in negative customer feedback should the grading be incorrect or should Amazon resell items that are truly unsellable. However, the chance to profit from previously squandered stock means that some third-party sellers will likely be happy to see the changes implemented.

    Sellers interested in the Amazon Grade and Resell program can discover more about how it works, product eligibility, and fees here and should familiarize themselves with the terms and conditions of the program before enrolling.

    Amazon Overhauls Its A-to-z Guarantee Policies To Streamline Damages Claims

    Changes To The Amazon A To Z Guarantee

    Starting September 1st, Amazon will begin paying out up to $1,000 in damages should a customer suffer harm from any products or items sold on its platform, no matter who the Seller is. Amazon says it will work with Sellers and keep them informed every step of the way when a damages dispute is initiated, but no further details have been made public about the move at this time.

    Defective products can cause a lot of harm, and that harm can range from these $1,000 claims to amounts reaching into the hundreds of thousands. Nevertheless, when a product is sold on Amazon, Amazon is responsible for that product, and over time courts have been progressively deciding that Amazon should cough up the damages when a faulty item causes injury.
    Amazon claims that 80% of damages claims usually amount to $1,000 or less. However, the remaining 20% is at risk of being a much more considerable sum, so while for years Amazon has been susceptible to huge liability exposure, these moves are a likely sign that the company is trying to streamline its claims process and figure out a way to limit its threat to exposure.

    So, who is accountable for defective products? Regarding liability in terms of the supply chain of distribution, since every supplier, manufacturer, distributor, and retailer is on the hook for defective products, Amazon is by definition liable for the products sold on its platform. So, the $1,000 coverage could be a means of swaying consumers away from legal battles when the product in question falls into the 20% higher risk category.

    On the other hand, Amazon says not only will it pay this $1,000 regardless of who the original seller is, and if they step up or not, but it is also announcing plans to start Amazon Insurance Accelerator, an initiative to help smaller sellers get product liability insurance. This new scheme likely stems from the fact that Amazon deals with many third-party vendors that it doesn’t have complete control over. Therefore, it is encouraging any vendor to get that liability insurance if that seller sells at least $10,000 per month for 3 consecutive months on Amazon, meaning that while Amazon still remains legally accountable, it has the means to deflect that liability.

    Another noteworthy point worth covering under this overhaul is commingled inventory stored at Amazon warehouses. When numerous Sellers sell identical products from one location, the question of liability becomes somewhat ambiguous. But from a legal standpoint, Amazon is the distributor of these products, whether under the guise of Amazon or a third party, and remains liable.

    Looking at what we know so far about the updates to Amazon’s A-to-z Guarantee, it sounds like a move intended to keep the company out of court and to swing the narrative in its favor by offering shoppers an upfront settlement, when in fact, a legal claim might be worth far more than that.

    Now Factor Restock Limits Into Forecasts

    email is ready just to enter links where they are missing

    The new SoStocked software feature for factoring Amazon Restock Limits By Storage Type into forecasts is NOW LIVE!

    See how it works and how to turn it on in your SoStocked account, or click “Contact Us” in the bottom right corner to ask us a question.

    Not a customer yet? Book a live demo or sign-up for SoStocked and work with your onboarding specialist to get your inventory forecasting dialed in.

    Streamline Shipments With “Send To Amazon”

    Streamline Shipments With Send To Amazon Program

    Send To Amazon is a new streamlined shipment creation workflow for FBA sellers that saves you time by simplifying FBA shipment creation. Amazon claims that Send To Amazon improves upon its older Send/Replenish Inventory workflow with new technology and a refreshed user interface, but does the new experience really make life easier for FBA sellers?

    With the new system, you’re guided through a series of steps based on your decisions when creating shipments, but it’s important to note that the steps you see may vary based on your choices. To find out how beneficial the new shipment creation workflow is, let’s take a look at how it works.

    Box Content Information

    The first step in the workflow is providing box content information. Knowing the contents of each box allows Amazon to move your inventory rapidly through its network with minimal manual touches. Providing Amazon with accurate box content information also reduces the chances of boxes getting sidelined due to inconsistent shipment information, making your inventory available for sale faster.

    You provide box content information through reusable case-pack templates for inventory shipped in boxes containing multiple units of the same SKU (single-SKU boxes). These templates contain information on how your SKUs are prepped, labeled, and packed and are ideal for SKUs shipped with the same box configuration shipment to shipment. Each time you create a shipment in Send To Amazon, the box content information is automatically identified from your case-pack template. You can simply enter the number of boxes to add them to the workflow and avoid entering other specific details from shipment to shipment when you always pack, prep, and label an SKU the same way.

    If you’re packing more than one SKU in a box (mixed-SKU boxes), you’ll be prompted to enter the number of units of each SKU that you’re shipping. Once you have confirmed the inventory you want to send in mixed-SKU boxes, Amazon will determine which SKU can be packed together based on whether they require special handling at Amazon’s fulfilment centers. For example, SKUs considered to be hazardous materials (hazmat) cannot be packed with other SKUs since hazmat SKUs are shipped to special fulfilment centers that can safely receive them. You’re then prompted to provide box content information for each SKU group that can be packed together. You can directly enter the box weight and dimensions if you’re consolidating your mixed SKUs into one box. If you pack your inventory in multiple boxes, you’ll be prompted to upload your box packing details as a spreadsheet.

    Finally, you can ship both single-SKU boxes and mixed-SKU boxes simultaneously using Send To Amazon. As an example, if you normally sell fast-selling products on FBA and want to test customer interest with a few new products, you can create shipments with single-SKU boxes using the case-pack template for your fast-selling products, and create mixed-SKU boxes for your new products in the same workflow.

    Confirm Shipping

    The next step in the workflow is to confirm shipping. Once you’ve provided box content information, Amazon will determine where each box has to be shipped, ensuring that inventory is placed close to customers. Amazon then estimates carrier fees to ship your inventory as individual boxes using small parcel delivery (SPD) or as pallets using less than truckload (LTL) options based on shipping destinations and boxes. This enables you to make a well-informed decision regarding the shipping mode that works best for you.

    Whatever your shipping mode, you can choose to use an Amazon-partnered carrier and purchase your shipping labels from directly within Send To Amazon taking advantage of discounted shipping rates. However, you’re welcome to use any carrier you like to deliver your inventory to Amazon fulfillment centers.

    After confirming your shipping, you’re ready to label your boxes and pallets. Let’s first consider the small parcel delivery shipping mode. Each box that you send to Amazon’s fulfillment centers requires an FBA box ID label, identifying the box’s contents. If you’re using an
    Amazon-partnered carrier, a shipping label will be generated for each box in addition to the FBA box ID label. Make sure that the correct label is applied to the correct box. If you’re shipping pallets, an FBA box ID label will have to be placed on each box before you load it onto a pallet. Once the boxes are palletized, you’ll be prompted to choose your carrier and provide pallet details for each shipment in the workflow. After confirming pallet information, you’ll get four pallet labels for each pallet (one for each side of the pallet).

    When you’re done labeling your boxes and/or pallets, you’re ready to hand them off to your carrier and start tracking when your inventory is received at Amazon’s fulfillment centers. If you’re using a non-partnered carrier, make sure you provide a tracking ID for your shipments so that Amazon can prepare for their arrival.

    Out With The Old

    As to whether or not the new system will make your daily workflow any smoother, only time will tell, but it’s likely that Send To Amazon is here to stay, and the older system will eventually be phased out. For now, you can try using the new Send To Amazon shipment creation workflow and send your feedback to Amazon about your experiences at [email protected]. Alternatively, you can learn more about Send To Amazon here.

    Changes To Amazon Professional Selling Plan Fees

    Changes To Amazon Professional Selling Plan Subscription Fees

    Amazon has announced changes to the fees for its subscription-based Professional Selling Plan, which came into effect on August 1, 2021. The update affects sellers who have active listings across multiple countries and regions and use merged accounts.

    According to Amazon, Sellers with merged worldwide accounts will no longer be billed for their subscription in one lump sum but instead will have their Selling on Amazon Fee divided across whatever accounts they use globally. Furthermore, Amazon will now charge the fees in the corresponding currency of whatever country Sellers have Amazon stores, but the subscription fee charges will only be billed for months when Sellers have active listings.

    The good news is that no matter how many Amazon stores you have, the total amount for your combined monthly subscription fees remains capped at US $39.99/month per account (or the equivalent amount in other currencies). However, this amount is exclusive of any taxes, except in Brazil and Mexico, plus any fees for foreign transactions which may be charged by either your credit card issuer or bank, and it’s also worth noting that you might see these charges billed to accounts differently.

    As an example, if you have multiple Amazon stores across different countries in the Americas region, such as one store in the United States, one store in Canada, one store in Mexico, and another store in Brazil, you will now be billed for your Professional Selling Plan subscription in US Dollars (USD), Canadian Dollars (CAD), Mexican Pesos (MXN), and Brazilian Real (BRL) individually. Still, even with the updated subscription fee calculation method, the total amount charged each month will not go up, but rather it will help you monitor how much you are spending in each country specifically.

    Additionally, subscription fees for each store will no longer be billed on their registration’s “mensiversary” (a monthly recurring date of a past event). Instead, all of your subscription fees for your global stores will be aligned, meaning they will all be charged on the same day. In order to align Seller’s billing days, Amazon has said it will give a one-time-only extension on subscriptions at no extra cost where necessary.

    Automated Amazon Stranded Inventory Removal

    Automated Amazon Stranded Inventory Removal

    This announcement is for sellers with stranded inventory in Amazon’s UK and EU fulfillment centers. The eCommerce giant has recently released new automated removal settings to make it easier to fix stranded inventory post-Brexit.

    These new settings will allow you to:

    • Return your stranded products in the United Kingdom to a local address. The same rule applies to any inventory stranded in European countries. You can use a valid EU address that’s local to where you’re keeping your inventory.
    • Send your UK-stranded products to a local address AND discard any inventory stuck in a country in Europe where you don’t have a local address and vice versa.
    • Eliminate (dispose of) products stuck in both UK and EU fulfillment centers.

    If you have any stranded inventory that needs to be returned or disposed of, update your existing automated settings by following these steps:

    1. Sign in to your Seller Central account and open the “Manage Inventory” tab.
    2. Go to the “Fix Stranded Inventory” page.
    3. Select “Edit Automatic Action Settings.”

    Selecting “Edit Automatic Action Settings” will open another window on your screen where you can choose between “Return” and “Disposal.” You can also set the number of days (1 to 30) you’d like for Amazon to remove your stranded units automatically.

    What if your account doesn’t have a local return address saved? 🤔 In that case, Amazon will automatically choose “Disposal” as the default setting.

    But Amazon can’t just dispose of your stranded products without your consent. So you’ll need to log into your “Fix Stranded Inventory” page to change “Disposal” to “Seller Returns” or simply update your settings to your liking. And you have until the 15th of August 2021 to do so. ⚠️

    Suppose you still can’t secure a UK or EU return address. In that case, Amazon recommends joining its network of service providers to get in touch with someone who can assist you with shipping or storing your stranded inventory. Once you’ve connected with a reliable local provider, it’s up to you to negotiate rates, secure contracts, and finalize shipping schedules.

    Want to learn why products get stranded and how to fix them? Read about more “Amazon Stranded Inventory tips.” 👈

    Typhoon Wreaks Supply Chain Havoc On China’s Eastern Coast

    Typhoon Supply Chain Havoc Eastern China Amazon Sellers

    China is now battling the devastation of its second drenching as typhoon In-Fa made landfall this past Sunday, lashing major cities along its Eastern seaboard, including Shanghai, Zhoushan, and Ningbo, with torrential rain and gale-force winds.

    The news comes only days after reports of record-breaking rainfall in the nearby landlocked province of Henan, which caused destructive flooding in several parts of the region and disrupted logistics operations at a central air cargo hub in Zhengzhou.

    The latest effects of the typhoon caused further freight delays to distributors in China, as the downpour forced Shanghai’s two international airports, rail hub, and container port to close over the weekend.

    According to the city’s municipal Meteorological Bureau, Shanghai received over four inches of rain from Sunday to Monday, and the wind speed topped 72 mph. Typically, Shanghai gets around 4.7 inches of precipitation for the entire month of July.

    The storm prompted the closure of the seaport and airport in Ningbo, which, together with Shanghai, make up some of the largest distribution hubs in the world. With the clean-up well underway along China’s East Coast, most carriers expect normal operations to resume by Wednesday, 28 July.

    However, with a backlog of cargo waiting at several ports in the area, vessel berthing delays of four-to-six days are expected at Shanghai and Ningbo seaports, and shipping rates are expected to increase for the next couple of weeks as freight forwarders scurry to find limited outbound availability.

    Additionally, supply chains have been disrupted for the region’s many factories, including a complex in Zhengzhou where almost half of Apple’s iPhones sold worldwide are produced; hence its moniker “iPhone City.”

    While China has suffered from annual summer flooding and typhoons for millennia, the record rainfall in Henan coupled with the nation’s latest storm surge has provoked questions from meteorological experts about how cities in China could prepare themselves better for freak weather events, which they say are occurring more frequently and with increased intensity due to climate change.

    Country Of Origin Now Required For Amazon Products

    Country Of Origin Now Required By Amazon

    This announcement is for the UK, and we are not sure yet if the US marketplace and other marketplaces will soon follow. My guess is this might be specific to the UK right now as Amazon has pushed back on the COOL bill (Country Of Origin Labeling) in the past, which would mandate prominent disclosure of where a product is produced for all online retailers.

    The new Country Of Original requirement seems to be more of a response to BREXIT. In the wake of the BREXIT fiasco since the UK exited the EU in January 2020, which has led to complex trade issues along the Northern Ireland/Republic of Ireland open border, Amazon has responded by introducing a new County of Origin (COO) regulation for Amazon Sellers.

    This regulation update takes advantage of a largely unknown geographical and legal loophole, whereby Great Britain (GB) only constitutes England, Scotland, and Wales, whereas the United Kingdom (UK) also comprises Northern Ireland. However, while the root cause of the amendment stems from the debacle on the Irish border, Amazon has not openly admitted this to be the cause of the update. As such, the new rule acts as a blanket policy to all product listings regardless of where they are sold.

    From 22 August onward, Amazon Sellers will need to give the appropriate COO data for every listing in their shop. Amazon states that the new regulation aims to improve the quality of product listings and ensure that FBA Export orders transiting the UK-EU, which now includes the Northern Ireland/Republic of Ireland border, are not held up by customs or face other taxation issues, which it says will hopefully smoothen out deliveries and improve customer satisfaction. But, of course, the new rule does come at one significant expense. Namely, the time Sellers will need to spend going through every listing in their shops to add Country Of Origin info. Those with extensive inventories could find themselves spending countless hours sifting through several thousand listings to make sure they are all compliant.

    You might be asking, “What changes will the new requirement bring?” The update will have two direct impacts on listings and the Add a Product tool.

    First, Sellers must provide COO information for all new listings, or else the system will not allow the listing to be created. In order to choose the COO, there is a drop-down menu that provides a list of countries to select. Second, Sellers cannot make any edits to existing listings until COO information has been provided.

    What constitutes the COO may not always be clear when products are manufactured in different nations at different parts of the production process. According to the Rules of Origin outlined by the World Trade Organization (WTO) in Article 27, “Goods whose production involved more than one country shall be deemed to originate in the country where they underwent their last, substantial, economically justified processing or working in an undertaking equipped for that purpose and resulting in the manufacture of a new product or representing an important stage of manufacture.”

    In any case, when you are unsure of what data to provide for the COO, you can find further information at Amazon’s Providing Country of Origin help page.

    Prevent Customer Complaints By Putting Seals On Consumables

    Amazon Recommends Product Seals On Consumables Prevent Customer Complaints

    One thing all Amazon Sellers can probably agree on is that there’s nothing worse than receiving a customer complaint that could’ve been easily avoided.

    So, in a bid to cut down on unnecessary grievances, Amazon recently analyzed a broad selection of complaints from buyers, taking note of what left customers feeling dissatisfied, and found that many buyers mistakenly identify items as “used” if they are not sealed.

    This discovery suggests that even though Amazon Sellers supply customers with brand new, unused items, the lack of seals on certain products leads customers to believe that the products are not new.

    As a result, Amazon has recommended that sellers (especially those selling consumable products) make themselves fully aware of preventing product condition issues, paying particular attention to the information on broken or missing seals.

    Additionally, Amazon offers further help to understand complaints relating to product condition issues through this video which details how to avoid different product complaints linked to the condition.

    It should be added that #2 on that list is “Items that are dirty, soiled, or have hair, stains, odors, or other substances”. This has actually been a not uncommon issue as Amazon will, at times resell your returned products without sufficient inspection and products have been resold to customers with food stuck in it or even as wild as diaper products that have been soiled.

    This should not happen but it does. Thus it is important to note that, even if you are complying with the above, Amazon themselves may be causing these issues internally which you may have to deal with. This is something else to keep in mind if you are having problems with customer complaints.

    New Amazon Brand Referral Bonus Program For Amazon Sellers

    Amazon Brand Referral Bonus Program

    Amazon announced a new program that incentivizes sellers to advertise their Amazon product listings rather than their own websites through non-Amazon marketing channels.

    For example, Amazon would instead have you pay Instagram influencers to send traffic back to your product on Amazon–not to rival platforms where your product is listed.

    This move by Amazon is likely a response to the momentum Shopify has been gaining by partnering with the Google marketing ecosystem to extend sellers’ reach and Shopify’s expansion of its one-click checkout to ALL merchants on Google and Facebook. So what is the new program? Well, it’s NOT the “Amazon Associate” program for affiliate marketers. The new program is called the Amazon Brand Referral Bonus program, and it’s designed specifically for Amazon sellers.

    How does the program work? When you drive traffic that results in a sale on the Amazon platform for your brand, you will receive a referral bonus, which Amazon says averages about 10%. That referral bonus acts as a credit to your Amazon referral fees. Also, if customers buy anything else from your brand, you’ll receive credit if it falls within the 14-day click window. 

    You’ll have to decide if the Amazon Brand Referral Bonus program is suitable for your business model. For some, it might be a win-win because you won’t have to deal with the merchant fees, hosting headaches, and other operational headaches experienced in multi-channel e-commerce. 

    It doesn’t make much sense for other sellers who want to own their customer’s journey and expand customer lifetime value through upsells and future sales. You can learn more about the Amazon Brand Referral Bonus program here.

    Four New Certifications Could Qualify You For Climate Pledge Friendly Badge

    Amazon Climate Pledge Certification Badge

    These new certifications aim to provide badges for items across the beauty, household, and grocery sectors.

    Amazon continues to expand its Climate Pledge Friendly badge system with the addition of four new third-party certifications.

    Learn about the new certifications, plus the advantages and challenges of the Amazon Climate Pledge certification.

    Amazon IPI (Inventory Performance Index) Update

    Amazon July 2021 IPI News Update

    Amazon hints that they’ll soon be in a better spot with storage capacity and are set to provide an update to Amazon sellers regarding IPI (Inventory Performance Index) sometime this December. Read IPI Update: July 2021

    Potentially Lower Fulfillment Fees Spells Good News For Amazon Sellers

    Potentially Lower Your Amazon Fulfillment Fees

    In an encouraging move, Amazon has announced that sellers who create new offers then simultaneously store their FBA inventory across a broad selection of countries using Pan-European FBA could save up to 53% on their fulfillment fees. Sounds great, but how does it work?

    To learn more about how much in savings you can potentially make, Amazon suggests heading over to its FBA potential savings page in Seller Central, which details the methods applied to make the hypothetical savings. According to the information cited by Amazon, your maximum would-be savings can be calculated by making a comparison between the European Fulfilment Network fees and your local (current) FBA fulfillment fees.

    By applying the formula to your last 12 months of FBA sales, you’ll be able to differentiate the costs involved with each type of fulfilment to establish your capacity for savings precisely. However, it’s important to remember that, as noted above, savings only apply to new offers enrolled in the Pan-European FBA program.

    Big News: Sellers Can (Again) Contact Customers About Bad Reviews

    Amazon Sellers Can Now Contact Buyers About Bad Reviews Again Big News

    Amazon updated its Customer Reviews tool! Brand-registered Amazon sellers can now send direct messages to customers who left a 1-3 star review.

    It is under the BRANDS > CUSTOMER REVIEWS tab in Seller Central:

    Amazon Sellers Customer Reviews Tool Under Brands Tab In Seller Central

    If you do not have access to this feature, you have not been identified as a brand owner. Visit the Brand Benefit Eligibility page to identify as brand owner and gain access to Customer Reviews and your other brand-exclusive benefits.

    Sellers can reply to any product review with a rating of 3 and below:

    Contact Buyer About Negative Amazon Review Amazon News Update

    You can contact the buyer only when you are the seller for that order. If you’re not, you’ll see a message like this:

    Must Be Seller to Contact Buyer About Negative Review

    The message that you are able to send to the unhappy customer is a templated email that cannot be edited and can only be sent to the customer as-is. Example:

    Amazon Sellers News Customer Reviews Direct Message Template

    You are also able to send an email about issuing the buyer a refund or replacement. This email is also an email template that can’t be changed.

    Here is the official announcement from Amazon:

    Amazon Customer Review Tool Update News

    Amazon’s APRL Scheme Leaves Sour Taste In Sellers’ Mouths

    Amazon APRL Scheme Leaves Sour Taste In Sellers Mouths

    In a highly-debated move, Amazon UK has announced that as of 5 July 2021, all Amazon Sellers must offer customers a Prepaid Return Label or Returnless Refunds for items that fall under Amazon’s Return Policy. In other words, Amazon Sellers will have to cough up the fees to return items at the whim of customer demands for almost all of the items found on Amazon, with only a handful of exceptions that are exempt from the update. While Amazon claims this change of policy has come about as a result of listening to feedback from its customers, the backlash from Amazon Sellers has been significant.

    Dubbed Amazon Prepaid Return Label (APRL), almost as if a nod to April Fool’s Day, the new policy allows customers to initiate returns via Amazon’s Online Return Centre (ORC), which Amazon will automatically authorize. Customers will then receive a tracked Prepaid Return Label through APRL, while the postage fees will be immediately deducted from the Seller’s account as soon as a courier receives the item and scans the Prepaid Return Label. Customers will have the option of selecting Royal Mail or Hermes to ship the items back, but Sellers can at least breathe a sigh of relief that this feature is only (currently?) for domestic sales.

    Tracked Returns or No Returns

    Adding insult to injury for Amazon Sellers, the new rules also indicate that all Prepaid Return Labels must include a tracked shipment method, regardless of whether the customer ordered the item with tracked shipping in the first place. Amazon also went so far as to note that Prepaid Return Label may not be suitable for low-priced items, so Sellers have the option of selecting Returnless Refunds, allowing customers to keep the item and receive a refund without the need to return it. It looks like a win-win for customers, but these new regulations will surely hit many Amazon Sellers hard. And all this on the heels of the new restock limits policies pushing a lot more warehousing holding and handling fees back onto sellers.

    One shred of hope for Amazon Sellers is that they can apply for exemptions for items deemed as high-value, large-size, or those that require unique delivery methods, but the final decision still rests with Amazon as to whether or not it will be exempt.

    Amazon also noted that if Sellers wish to continue trading on its platform, their acceptance of this new program is obligatory, and as such, they should familiarize themselves with all of the policy’s terms and conditions as well as Amazon Buy Shipping Services.

    Blackout Dates: China’s Dragon Boat Festival

    Blackout Amazon Seller Supplier Dates China Dragon Boat Festival

    China’s Dragon Boat Festival will take place June 12th-June 14th, 2021.

    I recommend taking care of any China-related business beforehand because there will be potential delays due to factories closing for this holiday, also sometimes referred to as blackout days. Blackout days refer to periods where no production and shipping can happen, such as the Chinese New Year or China’s National Day.

    I also recommend adding blackout dates to your inventory forecasting calendars for these dates and other essential blackout dates so that you avoid any logistical headaches.

    You can anticipate blackout dates like the Dragon Boat Festival by talking to your vendors or looking at a Chinese calendar.

    China’s National Day takes place from the 1st through the 7th of October. You can also refer to the Chinese calendar for other holidays to ask your suppliers about and which may affect production and shipping so that you can set those dates well ahead of time.

    The SoStocked Blackouts feature allows you to easily factor blackout periods into your inventory calculations and tells you to either order more inventory or order earlier to account for the days when the supplier is unavailable to produce inventory.

    Amazon Global Program: Sell Worldwide With No Added Fees

    Amazon Global Program Sell Worldwide With No Added Fees

    Amazon Global Program: Sell Worldwide With No New VAT Accounts or Added Fees: Things have just gotten a whole lot easier for Amazon sellers when it comes to selling products internationally. By taking advantage of Amazon’s new global operation, products that are fulfilled by Amazon (FBA) can now be sold anywhere in the world without any extra charges.

    Sellers can now allow Amazon to purchase FBA items at the price the seller names, and Amazon will sell these products to international customers from the customer’s local Amazon marketplace. This means that the sale is registered as a regular domestic transaction for Amazon sellers and their customers. Meanwhile, Amazon takes care of all the logistics costs and handles all of the cross-border legwork.

    By enrolling in the program, sellers permit Amazon to add their products to other Amazon marketplaces around the globe, which translates the item information into the local target language and converts its price into the local currency, making it easier for customers to find and buy the products they want.

    Once sellers have enlisted, Amazon will sell products bought by international customers through the customer’s local Amazon marketplace, which is also used for returns. They will purchase the product from your current marketplace and arrange for delivery to the customer. For customers, it will be as if they bought the product locally.

    Yet, while the customer pays for the product in their local currency, sellers are still paid the set product price in their own currency, making it a win-win, with the added bonus of no cross-border transportation fees or new VAT accounts or VAT filings needed.

    It’s as if Amazon is acting as the cross-border drop shipper, listing your products in marketplaces where you don’t currently list or have VAT accounts and then buying them from you and selling them through these listings. Amazon takes care of the logistics and any VAT requirements within the new country of sale. You, of course, would need to handle any required VAT to your local country on your end for your sale to Amazon for this transaction.

    Amazon will only purchase products from the Amazon marketplaces where sellers have provided a VAT number in Seller Central. Then, when sellers receive an order through the global program, it will appear as a domestic order on the Manage Orders page within Seller Central, while the name of the customer will show as Amazon.

    There is no need for sellers to sign up as an Amazon supplier or vendor in order to join the program, and their account status will remain unchanged.

    Opting in is very straightforward and simply requires sellers to go to their Fulfillment by Amazon settings and click Enable where it says “Allow Amazon to buy my products to sell globally” for each Amazon marketplace they want to allow to sell their products.

    Sellers who decide to enable this feature should familiarize themselves with all the terms and conditions of the program.

    Set a Faster Default Handling Time

    Set Faster Default Handing Time For Seller Fulfilled Orders

     📢 Amazon has recently announced its new customizable default handling time settings for Seller-Fulfilled Prime orders!

    Effective May 25, 2021, sellers with professional selling plans can now set one-business-day lead times for their products—one day faster than the previous two-day handling times!

    With quicker estimated shipping times, you will be able to serve your customers better, and you’ll be more likely to be highlighted as the “Featured Offer” on Amazon’s product details pages. Therefore, leveraging this update could lead to increased customer satisfaction and sales. 💰

    But for sellers who don’t have the operational capabilities to pack and ship orders within one day or who can ship only a portion of their catalog within one day and need to adjust settings on a SKU by SKU basis, Amazon recommended selecting a longer handling time using:

    • Amazon Seller Central’s Inventory page for updating each single product on by one
    • Upload of Inventory Excel files for bulk catalog updates

    To change your product’s default handling time from two business days to one business day, follow Amazon’s step-by-step guide in this post.

    Amazon Product Description HTML

    Amazon Product HTML Banned

    Amazon announced that it would no longer display HTML tags on product detail pages after June 8th, 2021 in the UK and July 30th, 2021 in the US. Get the details plus a free tool to convert things to the new format for Amazon Product Description HTML.

    Amazon Prime Day 2021 Check-In Dates

    2021 Amazon Prime Day Check In Dates

    Christmas arrives early for some Amazon sellers! Yes, s-o-m-e. Because unfortunately not all countries will be having a Prime Day next month, and with valid reasoning.

    Typically held every July, the annual two-day discount event has been scheduled to take place in June. If you plan on selling internationally on Prime Day and have enough storage capacity to accommodate your incoming inventory (see Amazon restock limits update), be sure to send your inventory to your target countries by the dates below.👌

    Target Inventory Arrival Dates for Prime Day:

    • June 1: Australia
    • June 6: United Kingdom, Germany, France, Italy, Spain, Netherlands, Turkey
    • June 7: United Arab Emirates, Saudi Arabia
    • June 13: Japan
    • June 21: United States

    In other news, India and Canada will see no Prime Day action in June due to a high uptick in COVID-19 cases over the past few months, CNBC reports. 😟

    No rescheduled date for India and Canada has been offered yet. So watch for any future announcements.

    Check out the registration links below to start selling and shipping items globally on Prime Day 2021.

    Amazon 2021 MCF Fees and Features

    Amazon Seller News 2021 MCF Fees

    In response to the economic effects of the COVID-19 pandemic and what was undoubtedly a challenging year for most, Amazon decided to lend its sellers a hand in December 2020 by postponing its annual fee adjustments. Additionally, Amazon absorbed certain costs to support sellers through a challenging winter and help them get back on their feet after a few tricky and uncertain quarters.

    At long last, it seems like there is a glimmer of light at the end of the COVID tunnel. With what looks like a path to normality now set before us, Amazon has concluded that the time is right to announce its next US Multi-Channel Fulfillment (MCF) fee adjustment, due to take place on June 1, 2021.

    What are the Key Changes for 2021?

    The 2021 US Multi-Channel Fulfillment fee changes include measured increases in fulfillment fees, in line with the industry average of about 3%, to reflect changing fulfillment, transportation, and storage costs.

    Furthermore, Amazon has given sellers the option to block orders from being shipped by Amazon Logistics for a 5% surcharge. This change results from the fact that sales channels like eBay and Walmart prohibit Amazon Logistics, so sellers will be able to block this shipping method at the account level within the FBA settings or on individual orders.

    Starting in June, most MCF product size tiers will be aligned to the Fulfillment by Amazon tiers, and there will be a new Small standard size for products weighing 2 oz or less. Also, Amazon plans to remove expedited and priority shipping speeds on large oversize and special oversize products.

    Amazon to add Sellers’ Top-Requested MCF Features

    Firstly, Amazon claims to have improved on-time shipping for customer orders, although shouldn’t they have already done that? The company says standard-speed orders for in-stock inventory are now shipped out within two business days of order creation and expedited. Priority-speed orders are shipped out within one business day, so hopefully, this will improve MCF shipping overall.

    Secondly, sellers will have the ability to track through AfterShip, to ensure Amazon Logistics shipments are trackable on popular channels such as Etsy and Wish. Any MCF tracking number can be used to search on Swiship.com as well. These tracking numbers can be accessed via the Seller Central order details pages or Amazon’s tracking API. Moreover, sellers will have the choice to have the number sent to the customer automatically, so long as an email address is provided when the order is submitted.

    Thirdly, Amazon will use sellers’ MCF volume when calculating their Inventory Performance Index (IPI) score, which may help qualify for unlimited storage. If you don’t know your current IPI score, then head over to the Inventory Performance dashboard.

    The final significant update for sellers is the ability to sign up to be put on the waiting list for the beta test of the unbranded packaging and international shipping features.

    Do you think these updates are beneficial to your selling abilities? You can always let Amazon know what you think by dropping them some feedback at [email protected], and if you need any further information about the 2021 MCF updates, check out the MCF help page.

    2021 Amazon Restock Limits Update

    Amazon Restock Limits ASIN Level Limits Replaced With Storage Limits

    In the official news bulletin, Amazon announced: “Effective April 22, 2021, FBA products will no longer be subject to ASIN-level quantity limits. Instead, restock limits will be set at the storage-type level, offering you more flexibility in managing your shipments.”

    Learn some pro tips on how to handle this update in-depth article Amazon Restock Limits.

    CBP Announces New Customs Requirements For Low-Value Shipments

    Amazon Low Value Shipment Requirements

    In what seems to be a bid to curb Importer of Record (IOR) risks, the US Customs and Border Protection (CBP) has announced new guidelines for correctly shipping your inventory to Amazon fulfillment centers in the US. It has also been speculated by Amazon forum members that the new measures aim at reducing the number of counterfeit goods on Amazon, most of which originate in China.

    An IOR is a standard requirement for shipments of inventory that enter the United States from another country. However, Amazon, including its fulfillment centers, will not act as an IOR for any shipment of FBA inventory. This rule applies to all shipments of any size or value, regardless of origin and product. It’s essential not to leave this field blank on the customs entry form, as doing so may result in the shipment being refused and returned.

    Since the IOR is the entity or person in the destination country responsible for ensuring compliance requirements are completed and met, they become liable for any goods that pass through CBP. The IOR is accountable for customs clearance, product classification, and the payment of duties and taxes. They are also the entity liable for all risk associated with clearing the goods.

    Giving the correct information in the appropriate format ensures that goods imported to the US have a smooth transition through CBP. Additionally, merchandise owners who wish to take advantage of duty-free (Section 321 21) entry into the US need to supply information about their identity, such as their first and last name, or their company name, to CBP through the shipping manifest or customs entry form.

    To assist sellers, Amazon suggests that you use this format on all import documentation:

    • [Seller legal name] c/o FBA
    • Fulfillment center address

    If you’d like to learn more about how to properly format information about the merchandise owner in your customs documentation, we recommend reviewing CBP’s rules. Amazon has also stated that you should consult with your carrier or customs broker for further guidance about your shipments if you are in any doubt.

    There’s also a lot of helpful information to be found over at Amazon’s Guide to Delivering Imports.

    Five Seller Facts from Bezos’ Final Shareholder Letter as Amazon CEO

    Jeff Bezos' Final Letter to Shareholders As Amazon CEO

    Since 1997 Bezos has delivered an annual letter to shareholders. As of April 15, 2021, Bezos delivered his last as Amazon CEO. Here are some key stats Bezos disclosed that Amazon sellers might find interesting:

    • Estimated third-party seller profits in 2020 were between $25-39 billion
    • 2 million businesses sell on Amazon and account for 60% of Amazon’s sales
    • Amazon has 200 million Prime members, up 50 million in just 15 months
    • Shoppers complete 28% of purchases on Amazon in less than 3 minutes, and 50% of all purchases are completed within 15 minutes
    • Shoppers have more than 100 million Alexa devices

    Beyond the facts, Bezos also mentioned “Create more than you consume” to be successful in life. I love that. But, I think we’d all go broke as sellers if shoppers embraced that mindset. 😉

    All in all, it should be interesting to see what comes next with Bezos no longer being at the helm as of Q3. I know we’ll be curious to see and of course, we’ll keep you posted with any news that transpires.

    All ASINs Now Require Melting Temperature Attribute

    ALL Amazon ASINS Now Require Melting Temperatures Heat Sensitive
    image1

    Yep, you heard that right. ALL products now require this. 🤦

    Amazon announced on April 13th that ASINs require a melting temperature attribute regardless of whether they are sold via FBA or MFN.

    I’m sure the last thing any of us want to do is manually update every one of our ASINs. It’s not like we all sell candles, chocolate, and lip balm.

    It seems laughable to add melting points to things like shoes. What a Croc, eh? 😉

    Especially when customers could care less about melting points.

    I’m assuming Amazon must have a good logistical or storage reason for this. 

    The good news sellers only have to do this for NEW ASINs and any ASINs that they update moving forward.

    If your product isn’t heat-sensitive, you can select “No” from the drop-down. 🤷

    If you’re the unlucky few who have to select “YES”… get those Googling fingers ready. Hopefully, Wikipedia or the periodic table has the quick answer you’re looking for. 🤞

    RIP Early Review Program

    RIP Amazon Early Review Program

    Next up, it’s time to say “rest in peace” to the Early Review Program. The enrollment for this program has been closed, and the program has been canceled.

    Amazon believes that it has come up with other, more successful ways of getting reviews such as the “One Tap” reviews system. Using One Tap reviews, a buyer can only leave a star rating without actually writing a review. This system allows for more star ratings to occur without buyers having to fill out additional details like the review title and review text that was previously required.

    Then we also have Global Review Sharing. If you’ve got reviews in the UK, you’ll be able to share those reviews across multiple platforms so that all of the reviews across all Amazon platforms will benefit all of your marketplaces.

    One of the downsides of the Early Review Program’s cancellation is for those sellers launching new products. It may be more challenging to get those first reviews. If you find yourself in this position, I recommend still keeping your current review policies and systems in place, especially things like using the Request Review button. This will help to increase those reviews and the sales-to-reviews conversion ratio.

    Some seller tools have a Chrome Bulk Request Review extension. I would try this if you’ve got a lot of products or a lot of sales, and it’s going to take you a long time to work your way through all of those reviews. As long as they’re not giving you any trouble, keep any email follow-up sequences that you have in place to request reviews per terms of service.

    VAT Services Even When Outside EU

    Vat Services Now Available Beyond EU Amazon Seller News

    Amazon wants more sellers in the European Union (EU). To help support this goal, Amazon has launched a new program for Value Added Tax services (VAT – similar to sales tax in the US). If you are a business outside of the EU, you can now tap into the VAT services available for partners on Amazon.

    “Value Added Tax” is a tax on any goods that you’re selling on Amazon. VAT filings can be confusing if you’re unsure which countries you should be filing and paying taxes to.
    Because it can be so difficult to navigate these legalities and so expensive to move into new markets like the EU, many sellers haven’t made the leap from the US to the EU. Amazon is trying to bridge that gap by launching this free program with many perks to lessen the financial blow. This new program is free for the first year; I imagine it’s going to be a paid service after that.

    If you’re interested, move quickly because this free offer is only available through April 30th, 2021. If you’re considering getting into the EU, it would be a good idea to take action now before that window closes. This free program includes:

    • Free VAT registration
    • Free VAT filing for a whole year
    • Access to representatives who can answer questions as to where you should register.

    Within this program, you will also get a free European Union “EORI”, which is an “Economic Operations, Registration, and Identification number.” The EORI is the number assigned to your specific VAT situation. You can for the program register here.

    This VAT service might save you some money! Also, check out our FBA new selection program blog post to learn more about another program that incentivizes sellers by saving on fees.

    Unsuitable Inventory Policy

    Unsuitable Inventory Amazon Seller News

    The unsuitable inventory investigations policy is a brand-new policy that allows Amazon to request information from sellers to determine whether goods are counterfeit or illegal. Amazon will be asking for documentation from sellers on these products. If they find the documentation to be unsuitable or not presented at all, they could dispose of that inventory. In some circumstances, they could simply make it available for you to remove yourself.

    I can see some good and some bad in this. It’s a good thing that Amazon is cleaning up the marketplace and making it more trustworthy. Amazon buyers should feel more comfortable and safe, knowing that they’re not going to be buying a counterfeit product. It will also potentially protect us as sellers from the fraudulent hijackers that come onto our listings and say that they’re selling our product when they are not.

    The only potential downside I see to this is that Amazon has been prone to shoot first, ask questions never, and has also tended to get it wrong sometimes (i.e., the pesticide policy).
    Just a heads up, if you have a suspension that occurs for no good reason and Amazon is requesting documentation, this might be why. You can learn more here.

    Amazon’s New Automated Pricing Tool

    New Automated Pricing For Amazon Sellers

    Amazon is now instituting automated pricing. If you are a retail arbitrage or wholesale seller, this could potentially be excellent news for you.

    Some sellers use external repricing tools, which raise or lower your price based on the prices of others selling the same product, usually someone you’re sharing the BuyBox with, as well as other parameters you’ve pre-set. A repricer are a beneficial tool and can help to:

    • Increase your sales by increasing your price competitiveness
    • Earn you the BuyBox more often
    • Increase your conversion rates

    Amazon has now built its own tool, potentially allowing you to stop using and paying for your current Repricers, canceling some of those software fees. I recommend testing it out first. You want to make sure that it works the way you think it’s going to work before you cancel those services.

    For those who don’t know, here’s a little primer on how reprices generally work: you will start by building out “rules” around how high or low you are willing to go with your pricing and what your sales objective is, such as whether you want to focus on higher profit, for example, or more sales with lower profit, etc. If you’re using pricing tools, you’re familiar with pricing rules.

    One of the benefits of this tool is that if you’re using the Build International Listing tool, it will allow you to create pricing rules across multiple marketplaces. For example, if you sell in Mexico, Canada, and the US, and your pricing needs to be different for each country based on your profitability, you can create rules for each individual marketplace.

    Again, test it out. Amazon’s tools have tended to show bugs or faulty logic in the past, especially during early stages, so I’ll emphasize again that you want to make sure that Amazon’s automated pricing tool is working the way that you think it should work before you convert over. I would recommend doing a test to compare Amazon’s repricer tool to your current repricer tool and see if it’s working to your standards.

    A/B Testing Product Images Available

    New Amazon A B Testing for Product Images

    The next thing I want to bring up is the new A/B testing tool within Amazon. Under the Manage Experiments section in the New Brands tab in Seller Central, you can do split testing or A/B testing of certain elements of your listings. You can test titles, product images, and A+ content to discover what changes will earn you more conversion and sales.

    For sellers who have done this testing in the past, it has been crucial to test over one full week for accurate results because sales on a Tuesday can’t compare very well to sales on a Sunday, for example. Typically you’ll have higher sales one day of the week than another.

    For this new tool, however, that could be a thing of the past. Amazon has built their A/B tester by sending traffic to both tests equally within the same timeframe. What it is doing is sending 50% of the traffic to one side of the test and 50% to the other side, Amazon can then internally see what gets more conversion and better results.

    This way you can take a Tuesday and split the sales on a Tuesday, around the same time. Given this, you could potentially do split tests a lot more quickly because you’re splitting that traffic equally on the day of the same week and time of day so that you have more accuracy in regards to comparisons and you don’t have to do such long split tests to get accurate data. That’s pretty cool!

    In running successful split tests, start by changing just one thing. If you change a whole bunch of things at once, you won’t be able to tell what actually contributed to the increase or decrease that you get. For example, if you change the title and change the images at the same time, you won’t know which one produced the impact.

    Always change one thing before moving on, decide which one is the winner, and stick with it. Then move on to testing something else, and in this way, streamline your process as you identify which elements are going to be most successful for your brand.

    New Shipping Data Requirements

    New Shipping Requirements for Amazon Sellers

    The last thing I want to talk about is shipping. There is a new requirement that when you ship seller-fulfilled inventory that you now have to provide the carrier name. For instance, UPS, FedEx, USPS, or any other provider that you’re using for shipping out your seller-fulfilled inventory. Amazon will also soon be validating your tracking details.

    When you’re fulfilling an order, Amazon will look at the tracking information and make sure it’s valid and will show a warning if it gets an invalid tracking detail.

    There has previously been a loophole allowing you to put in tracking information that was not valid. Sellers might have done this if they weren’t getting their orders out within the timeframe Amazon requires. If you put some sort of tracking information in, you could trick Amazon into thinking you were sending orders faster than you were, which would allow you to avoid the bad marks you might get from Amazon for slow delivery. That loophole seems to now be being closed with this new requirement.

    Amazon, more times than not, eventually closes the loopholes. We want to take advantage of the good loopholes when we can, but a loophole like this is dangerous territory as it also affects the end buyer.

    Amazon “Review Commenting” Updates

    Review Commenting No Longer Available Amazon News

    As of December 16th, 2020, review comments have been removed. This means that when customers write reviews, sellers and other Amazon buyers cannot comment on these reviews. I think this is a disservice to customers and sellers alike.

    This new rule makes it difficult for us to contact our customers to address various issues if something goes wrong. Sometimes the only place we’re able to find unhappy customers is in the negative reviews. We can then contact them, apologize for the problem and offer to send a replacement or make things right somehow. It’s no longer possible to handle those issues through the comments section of your products.

    This is very unfortunate. It is worth a try for us to contact Amazon Seller Central with our opinion. We need to let them know that, at the very least, they should allow sellers to comment on these reviews. I can understand why Amazon wouldn’t want random customers commenting, but we need to show that we are taking care of our customers through our comments and interactions. Other customers will see those comments and be able to understand that there is someone there for them if anything goes wrong.

    Viral Launch published a brief article on this topic and gave some excellent tips about using your copywriting to either avoid a bad review or mitigate those types of damages. For example, there might be something in your copy that you have not adequately explained. If you’re not sufficiently explaining the product, customers may have a misconception about your product’s capability. Therefore, you may be giving them a wrong impression and be causing those negative reviews.

    Action Steps

    Get Amazon Seller News Updates

    I hope this report has been helpful to you! Let me know if there are other things that you would like for me to keep you informed about. I send out a weekly email on Fridays with five relevant news pieces that are going around the Amazon and eCommerce space. To get this email, sign up below:

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    We sift through 500+ articles weekly and email you the top five.

    In addition to getting weekly Amazon news, here are other action items to consider:

    1. Sign up for my webinar. I do a webinar on a weekly or bi-weekly basis in which I talk about inventory management best practices. You can learn what I like to call Inventory-Minded Marketing techniques. These techniques will help you to: avoid storage fees, avoid stockout costs, and make your money work better for you.
    2. Sign up for SoStocked, our Amazon inventory management software that helps you minimize stock-outs and maximize profits. It makes inventory management so much easier by organizing and streamlining your data.

    If I can help you in any way in reaching your 2021 Amazon goals, please reach out to me. I can help you decide which inventory, forecasting, and tracking settings you need to use in our software and the techniques you should have for your specific business to get things streamlined.

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