Amazon raises logistics costs in Europe

Amazon has announced a cost increase for its multi-channel fulfillment service. The new rates will take effect for European sellers starting next April 7. According to the company, “the increase is due to the rise in operating costs due to inflation”. Specifically, in a advertisement published on its seller platform, Amazon has detailed that “package size and oversized category are affected by the price change, while envelope size will remain largely unchanged”. “Boost and pack tiers will continue to benefit from our recently introduced multi-unit discounts, which offer cheaper per-unit rates for multi-unit orders”the company has assured.

Amazon Fulfillment Pricing

In parallel, the prices of Fulfillment by Amazon (FBA), a service in which Amazon is responsible for storing, packaging and shipping the products, as well as managing customer service and returns, have also been adjusted. As reported internet wordseller fees have increased an average of 6.2%. Generally, the fba prices they are adjusted once or twice a year.

And it is that, Amazon more and more income is pocketed from those companies that rely on the marketplace to sell their products and reach more consumers. Currently, according to a study carried out by MarketplacePulse, the company is taking more than 50% of the income from sellers, compared to 40% five years ago. Typically, a typical Amazon seller assumes a 15% transaction fee (‘referral fee’), plus a 20-35% fulfillment fee and up to 15% more for advertising and promotions. However, the total fees vary depending on the category, product price, size, weight, and business model of the seller.

However, generic sources of Amazon explained to EcommerceNews that “The numbers presented in this study are not an accurate description of the cost of selling on Amazon.” “What is true is that the company is investing more than ever to support the growth of its commercial partners to help them increase their sales. We offer a wide range of services to expand your business and business partners can manage many logistics themselves. Sellers who choose to hire Amazon’s optional logistics or advertising services do so because they see added value for their business.”they apostilled.

Leave European distributors ‘offside’

With the aim of continuing to cut costs, now Amazon has also decided to remove European distributors from the equation of its businessso those who sell directly to Amazon warehouses will no longer be able to do so, unless they have exclusive rights to distribute a brand.

According to a document to which the CNBC at the end of last February, Amazon will cut its relationship with European distributors as of next April, when the period granted by the company for distributors to adapt to this new model ends. This is a major decision for distributors, who will no longer be able to sell products directly to Amazon. The only alternatives will be become third party merchantsthat is, acting as sellers selling on the platform but bearing all associated costs including logistics, or continue as distributors of a brand if they have exclusive rights.

job cuts

In early January, the company also announced the dismissal of about 18,000 employees. Amazon it began laying off 10,000 workers in November, but in the end the adjustment has been greater than expected. The layoffs have mostly affected the store divisions (Amazon Stores) and PXT, which is the company’s human resources area. The cuts amount to 6% of the workforceof approximately 300,000 people, and represent a quick turnaround for an entity that recently doubled its base salary cap.

amazon plus hill he 2022 with red numbers. The American company has been riding losses and closing with profits since about 2015 thanks to its business in the cloud. However, last year it recorded losses of 2,722 million dollars.

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