Top 5 Amazon News for December 2022
Each month, we monitor Amazon news and updates to seize opportunities as well as to avoid potential problems before they become an issue for us and our clients.
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Here we share the top updates and news for December 2022:
1. Update to US referral and FBA fees starting January 17, 2023 (USA)
“(…) We continue to invest heavily in people, technology, transportation, and infrastructure to innovate on behalf of our selling partners. We do this while also working to be more efficient and manage our costs to serve you and customers, so we can provide an amazing service that is also a great value. Today, we would like to share the updates we are making to our U.S. referral and Fulfillment by Amazon (FBA) fees that will take effect on January 17, 2023, except where otherwise noted.
Referral fees will remain unchanged. These fees provide sellers with traffic from hundreds of millions of customers, an attractive shopping experience for customers, payment processing, fraud prevention, and much more. We will remove the following fee categories: Collectible Coins, Entertainment Collectibles, Sports Collectibles, and Collectible Cards. Impacted ASINs will be re-categorized to their most suitable product category, which may result in different (some lower, some higher) fees for those re-categorized products.
Earlier this year, we introduced a Fuel & Inflation Surcharge for our FBA fees for what we believed may only be temporary cost increases. These cost increases have not attenuated as quickly as we had hoped, so we will adjust our standard FBA fee rates to account for these increased costs and we will remove the separate Fuel & Inflation Surcharge at this time. These changes are reflected in the below summary.
(…) We will increase FBA outbound fee rates by $0.22, on average, which is below fee increases announced by other fulfillment and logistics providers. As part of this, we will introduce more granular weight tiers for FBA outbound fees (at the quarter and half pound level) to better align fees with shipping costs.
(…) We will reduce the returns processing fee rates for customer-returned products in the Apparel and Shoes categories by an average of $0.20 per return.
We will increase the monthly off-peak storage fee (January to September) for standard-size products by $0.04 per cubic foot and oversized products by $0.03 per cubic foot. We will increase Peak storage fees (October to December) for our non-sortable network by $0.20 per cubic foot, while those for our sortable network will remain unchanged.
We will introduce a storage utilization surcharge for sellers who have a high cube of inventory stored in our fulfillment centers relative to the cube of their recent weekly sales. We estimate this will impact approximately 7.5% of sellers who use the highest volume of storage relative to their sales volume. This change will take effect on April 1, 2023.
We will increase the surcharges applied to inventory stored between 271-365 days. Additionally, we will introduce aged inventory surcharges on inventory stored between 180-270 days, excluding products in the following categories: Apparel, Shoes, Bags, Jewelry, and Watches. These changes will take effect for the April 15, 2023 aged inventory assessment date. We encourage you to check your aged inventory and take action on these products. These changes will help drive more efficient use of our storage and create more capacity for sellers who are using space efficiently.
We will increase removal and disposal fees driven by increased costs of these services. Liquidation fees will remain unchanged. To learn how to configure your settings for automated liquidations or removals, go to remove inventory automatically.
We will lower fees for the U.S. FBA New Selection program. We will increase the rebate on sales for eligible new-to-FBA parent ASINs from 5% to 10% on average, increase the number of units eligible, and extend the time period of eligibility for certain benefits within the program. The rebate will still be applied for sellers who meet specific criteria. For more information, please visit: FBA New Selection.
We will reduce fees by expanding the Small and Light Program and increasing the item price for eligible products from $10-or-less to $12-or-less, enabling sellers to realize the program’s lower fees for more of their selection. For more information, please visit: 2023 FBA Small and Light fee changes.
These changes are designed to allow us to collectively better serve customers while ensuring that we continue to provide you with a great value relative to alternatives. On average, these fee changes are below those announced so far by other logistics providers. In addition, Amazon’s fulfillment fees will remain an average of 30% less expensive than standard-shipping methods offered by other major third-party logistics providers, and an average of 70% less expensive than comparable two-day shipping alternatives.”
ProMerit Tip: Many updates to fees have been published, so it’s a good time to go and check the category in which you’re selling, just to make sure you are taking everything into account. Each of these fees will have a direct impact on brand profitability, and bear in mind they may vary depending on the category. Pay close attention to inventory, where you’ll need to focus on storage utilization and storage time, as those variables will play an important role.
2. New feature helps you create and manage deals across Amazon stores (USA & Canada)
“Our new feature makes it easier to create and manage your deals across United States, Canada, Mexico and Brazil Amazon stores. You can now manage deals without having to sign in and out of store-specific Seller Central accounts to manage deals across United States, Canada, Mexico and Brazil.
With this feature, you can:
- View and manage all of your United States, Canada, Mexico and Brazil Amazon deals in the same Deals Dashboard .
- Filter deal recommendations eligible to run in United States, Canada, Mexico and Brazil.
- When creating a new deal, you can choose to schedule your deal to run in United States, Canada, Mexico and Brazil.
This feature is also available for Amazon stores in Europe, Middle East and North Africa, and Asia-Pacific.”
ProMerit Tip: The good news here is that it makes it simple and quicker to manage these deals from the same Dashboard. Eligible ASINs display automatically in the Deals dashboard, so you can see at a glance whether it’s up to date, and what deals you are able to generate. To configure a deal, you need to fill out some information and follow the required steps listed on the Amazon platform.
3. New sales-based financing to grow your business (USA)
“We’re excited to announce a new sales-based financing solution designed to give eligible sellers on the Amazon store convenient access to the capital they need to grow their business.
With a merchant cash advance from Parafin, your business can receive between $500 and $10 million for a fixed capital fee with a flexible payment schedule linked to a predetermined percentage of your business’s future sales until the funding is fully paid off. There’s no interest, no personal collateral required, and no late fees.
If approved, you can use these funds to cover any type of business expense including inventory management, payroll and hiring, marketing or new product and solution development.
The program is fully digital so you can quickly complete an application online and, if approved, get funds into your account in a matter of days, if not hours.
Go to Amazon Lending to determine if a merchant cash advance is the right fit for your business and to see if you’re eligible to apply. (…)”
ProMerit Tip: It’s worth considering these kinds of opportunities, and taking the time to view rates and all relevant details to make sure they fit with the brand’s needs. On Amazon’s lending platform, you can find financing options that require a simple application, with only a few additional steps. It is an invite-only program, which requires you to apply and get approved.
4. Brands: Download the updated A+ Content Best Practice Guide (US)
“A+ Content helps you encourage repeat purchases and potentially increase sales by 5%, by using rich content to showcase your brand story and product features.
If you need help getting started, or want to optimize your content, look no further than our A+ Content Best Practice Guide.
This complete guide to A+ Content covers the following:
- Understanding the available features.
- The benefits of using A+ Content.
- A step-by-step tutorial with images.
Tips on making the best use of your content space.”
ProMerit Tip: As you may have heard, A+ content is a great tool to tell your brand story, handle purchase barriers, refresh content and educate the public about your products. This guide is a good tool to refresh your memory, take notes on best practices, and implement what you think can be useful for your products. Always remember to pay close attention to the quality of the images you share on your listings, as they can help foster a great perception of your brand.
5. Update to tax values on Canadian seller fee invoices and credit note (Canada)
“From December 2022, your Canadian seller fee invoices and credit notes will show a single value for provincial sales tax (PST) collected, consolidating the PST and Quebec sales tax (QST) columns shown today. This will remove any potential confusion from the previously two separate values by instead using the location column (reflecting the taxing province) in combination with tax amount shown.
You will see this change starting in December 2022 for November 2022 transactions, when you generate new seller fee invoices – such as Selling on Amazon (SOA), Fulfilment by Amazon (FBA) and Advertising.
Seller fee invoices issued between January 2021 and November 2022 that include QST will be updated to the new format over the coming months. Once updated, you can download invoices from the Tax Document Library to update your records for tax recovery.
Canadian seller fee invoices issued before January 2021 won’t be changed.”
ProMerit Tip: As we all know, Amazon.com.ca collects and remits sales tax for SoA, Advertising, and FBA fees charged, when applicable. Fee taxability varies based on a combination of the type of services purchased, federal and provincial tax laws, and business information you supply to Amazon, among many other things. The news does not include specific changes to the fee amount you will be charged, but they will be given in a different way. It’s a good time to make sure you have provided all the information required and make any necessary updates, so you are not overpaying.
We hope this article is helpful for your businesses. Please note that the above announcements have been sourced from Amazon’s official channels as well as from some well-known business blogs.
If you have any questions related to our services, please contact us. Remember to sign up for our newsletter to receive more exciting news every month!