Welcome to the new year, where changes abound. Among those changes, of course, are all kinds of financial changes, thanks to the new tax laws. While new laws such as that don’t necessarily impact your company directly, there’s that good old “trickle-down effect” which means prices everywhere are about to change.
Amazon is a company that is often hit hard by any kind of federal regulations, and so changes will be reflected in fees they charge to third party merchants. If you use FBA (Fulfillment By Amazon) for your company, you need to be aware of some of the changes in their fees for this year. (Note: Changes noted below reflect only the U.S. market.)
The main change you will see in the fulfillment fees is that the same fee applies year round, as opposed to changing in October. Here’s what’s coming:
Small standard fee – $2.41
Large standard fee (under 1 lb.) – $3.19
Large standard fee (over 1 lb.) – starting at $4.71
Small oversize fee – starting at $8.13
Medium oversize fee – starting at $9.44
Large oversize fee – starting at $73.18
Special oversize fee – starting at $137.32
Clothing will incur a $.40 per unit additional fee.
Dimensional Weight Calculation
Due to a change in the industry standards, calculating the dimensional weight for an item will be done differently. The dimensional weight will be calculated by taking the unit’s volume (length x width x height) and dividing it now by 139 (as opposed to previously dividing by 166). Finding this number is only needed for large standard as well as all oversized items.
Changes above will take effect as of February 22, 2018.
The good news is that smaller businesses may not be affected by these new regulations. Not changing at this time:
- Inventory Fees
- FBA Small and Light
- Multi-Channel Fulfillment (other than the change to dimensional weight, as noted above.)
Some of the rates above note an increase, while some show a decrease in the rates. However, Amazon is committed to providing this valuable service to their sellers. To this end, they have made the following improvements to the FBA program in 2017:
- Fast, free shipping, including same day and one-day Prime shipping.
- International selling tools that make it easier to sell across North America, Europe, and Japan.
- Access to product sales and SKU performance.
- Their new Inventory Performance Index, which uses your sales data to recommend steps to help increase your sales.
In light of these changes, is using FBA still the right option for your business? Many factors play a part in this decision. Check out this post to help you decide. Then ring in the new year with more money in your pocket!