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Amazon FBA Fee Increase (January 2022)

We all knew it was going to happen. We just didn’t know when it was going to happen.

Amazon officially announced that they will increase Fulfillment By Amazon (FBA) fees on January 18, 2022. Here are the most significant takeaways from these changes.

  • Amazon FBA fulfillment fees will increase by an average of 5% per sale
  • Amazon FBA storage fees will increase by 11% per month
  • Amazon long-term storage (LTS) fees are now called aged inventory fees

Yuck. (okay maybe that third change isn’t that terrible)…

However, despite how it may seem, these fee increases are not the end of the world. Unfortunately, we can’t change these fees, but we can help you avoid some of these fees.

What Is Fulfillment By Amazon (FBA)?

Fulfillment By Amazon (FBA) is a service Amazon provides to its sellers that includes storage, shipping, and packaging assistance. It’s a very beneficial service that gives Amazon sellers more flexibility and allows them to focus their efforts on other aspects of selling products online.

As you can probably imagine, FBA is not cheap, and as we mentioned before, Amazon is increasing its costs. However, many Amazon sellers find it to be a better option than storing, packaging, and shipping their products themselves.

How Do These Fees Work?

man-working-at-a-warehouse

Amazon charges FBA members multiple types of fees, including the following.

  • Standard Seller Fees
  • Fulfillment Fees
  • Inventory Storage Fees
  • International Shipping Fees

Standard Seller Fees

Amazon keeps 15% of the sale price whenever you sell a product on Amazon. 15% is the standard rate, but it can actually increase to as much as 18% due to some hidden refund fees.

Fulfillment Fees

FBA fulfillment fees will increase by an average of 5% starting January 18, 2022. We say an average of 5% because FBA fulfillment fees vary depending on the product you’re selling. FBA’s fulfillment services include picking and packing, shipping and handling, customer service, and returns. Fulfillment fees are cheaper for small-and-standard-sized products and more expensive for oversized items.

Inventory Storage Fees

FBA inventory fees depend on the calendar month, your daily average volume, and the amount of space (in cubic feet) your items take up. You will have to pay long-term storage fees (soon to be called aged inventory fees) on top of your regular monthly storage fees if you have products that have been in storage for more than 365 days. Amazon is increasing these their FBA inventory fees by 11% per month.

International Shipping Fees

As you might have guessed, Amazon will charge you international shipping fees for products that you ship internationally.

D8aDriven Can Help You Avoid Unnecessary FBA Fees!

Unfortunately, the only way to decrease your fulfillment fees is to a) stop using FBA and start storing, packaging, and shipping your products yourself or b) sell smaller stuff. Both of those options are probably out of the realm of possibility for many sellers. However… 

There is a silver lining!

D8aDriven’s FBA inventory management tools can help you avoid unnecessary inventory storage fees. Our Forecasting Tools predicts sales and inventory for up to 26 weeks in advance with nearly 99% accuracy, meaning you don’t need to send more products than you need to Amazon distribution centers. This tool helps you avoid paying storage fees for more inventory than you need to fulfill orders.

Additionally, our software uses AI to deliver weekly inventory recommendations, and our Revenue Dashboard gives you revenue breakdowns at the SKU level to help you weed out unprofitable products.

If you are interested in using data to avoid paying unnecessary (and costly) fees and make a name for yourself on the hyper-competitive Amazon marketplace, schedule a demo with us and take a look at our advanced data analytics and management software.

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