Amazon News: FBA Fee Changes and more I July 2023

We've got benefits for small business owners, changes in FBA fees, ad campaigns, going over budget, and much, much more. Welcome back to the Amazon Analytics Insider With Reason Automation. Let's get you up to date. First off, we're starting off on a high note with the fact that small business owners who also have prime subscriptions are now able to use those prime benefits for business orders by signing up for free Prime Business Duo plans. This provides them with quantity discounts, exclusive pricing and purchasing analytics. This is helpful because Prime Business Duo previously used to cost $69 a year, so the majority of our discussion today will resolve around FBA fee changes. Amazon's FBA service currently offers a small and light program. This allows sellers to pay lower FBA rates for products selling at less than $12 that are small in size and relatively lightweight. Sellers with qualifying items pay slightly lower FBA fees, with the only caveat being that shipping may be slightly slower than those of standard FBA shipping speeds. Amazon has ultimately decided, however, that customers prioritize faster Shipping more starting August 29th of 2023, the small and Light program will come to an end. Taking its place will be the low price FBA fees program. Previously, Items listed at $12 and under would be able to qualify. However, soon this amount will be able to be lowered to $10 and under for the new program, ultimately disqualifying many sellers that currently stand to benefit from the old program. Essentially, what this means is that if a product is enrolled in the new program and it sells for $10, sellers will actually need to pay about $0.30 more per item. However, items will receive faster shipping speeds. If a product is not enrolled in the new program and it sells for $10, sellers will pay about 77 cents less per item and items will receive the same consistent FBA shipping speeds. One slight upside to this is that items that qualify for the new program will not be subject to the 2023 holiday peak fulfill charge, which have been announced for October 15th of 2023 through January 14th of 2024. So in simple terms, Amazon used deceptive wording when announcing this to sellers. This is mostly disguised as something that's supposed to be helpful when honestly, it's just another FBA fees price hike for low ticket items. So now that we have a better understanding of Amazon's new discounted FBA fees program, we get the chance to hear what sellers have to say about it. Understandably, so many sellers in the forum are incredibly upset after hearing about Amazon's newly proposed initiative. Recent rises in inflation and fees have made it especially difficult for sellers to profit, and this new program only makes it harder. There is also no logical correlation between listing prices and shipping time, so lowering the price for entry into the program only makes it clear that it was meant to disqualify as many sellers as possible from receiving any potential benefits. This effort on Amazon's part can also be interpreted as the marketplace's attempt on addressing other e commerce competitors. Two new emerging competitors, both with a marketplace approach, are announced as Shein and Temu, both of which offer products at much lower price points with one to two week shipping time. However, rather than try to absorb the cost of competition themselves, Amazon is now trying to pass on this cost to their sellers and eventually to their customers. Sellers actually seem to be going against the grain of what Amazon wants them to do. In response to this post, many state that they intend to raise their prices because the new initiative will destroy any money that they were going to make on new shipment being received. Sellers intend on raising prices for items listed at more than $10 to adjust for the higher FBA fees. This cost will ultimately be passed down to customers, potentially leading them to other e commerce sites and instead Next we have the fact that a new talking point on seller pages includes the fact that many sellers report seeing significant increases in ad spend, with the amount being two to seven times more than their typical budgeted amount. One seller had their daily budget set to $250 only to be charged $500 each day for two months. This applies for multiple types of advertising being paid per click and sponsored products. So because of everything we talked about today, we have a few reports that we recommend focusing on. For seller sales, we recommend customer shipments and subscribe and save for inventory Detail tables we recommend fee payments previews. For financials, we recommend transactions Standard orders. For sponsored product advertising, we recommend sponsored product campaigns and sponsored product budget thanks again for joining me for the second edition of the Amazon Analytics Insider News column. The link to the full written version is available in the description box below. And while you're there, pay a visit to our Help center to take take a closer look at these reports and I can't wait to see you again every other Tuesday. Thank you.