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To lessen the burden on warehouses, Amazon has been contacting its third-party sellers and encouraging them to ship items themselves rather than through its “Fu
by ilamont 7y ago
To lessen the burden on warehouses, Amazon has been contacting its third-party sellers and encouraging them to ship items themselves rather than through its “Fulfilled By Amazon” program, said people familiar with the matter. Sellers pay a fee to Amazon to be part of the program, and Amazon has spent years trying to expand this service. But with its delivery network taxed, the company is opting to forgo the fee in the interim, one of the people said.
The fee to participate in FBA via Amazon Seller Central is $40 per month. Eliminating that fee is a drop in the bucket to most medium to large volume sellers, who now have to contend with extra shipping costs if they ship FBM (M = Merchant) or the even more expensive "Seller Fulfilled Prime" in which seller is responsible for getting the goods to customers in two days.
What Amazon should be doing to encourage more FBM sales is reducing the per-item fees associated with each order, or adding other incentives.
Another side effect of having sellers ship FBM are millions of orders are going through the US Post Office instead of Amazon's transport network or UPS. The USPS needs that package revenue, with junk mail down sharply and some in Washington calling for the service to be privatized (https://www.vox.com/2020/4/12/21218151/usps-bailout-privatization-amazon-trump https://www.vox.com/2020/4/12/21218151/usps-bailout-privatiz...).
- moron4hire 7y agoWait, I don't understand. So sellers pay Amazon a fee to use FBA, Amazon wants to discourage FBA right now, so Amazon has removed the fee... thereby eliminating that miniscule barrier to using FBA?
- dannyw 7y agoThere is a small, nominal fee for FBM, Fulfilment by Merchant. This is distinct to FBA.
- moron4hire 7y agoSo they are dropping the FBM fee, not the FBA fee? That's not what the quoted text indicated. I can't read the article to see if the context changes the meaning.
- deleted 7y ago[deleted]
- woodrowbarlow 7y ago(i think) when OP says "eliminating that fee is a drop in the bucket", they mean that sellers who switch from FBA to FBM would no longer need to pay (eliminate) the FBA fee... but saving $40/yr isn't much of an incentive when you suddenly have to deal with all your shipping yourself.