Andrew Hamada covers Amazon's latest seller updates: MFN fees rising 3.5% in February, new FBA size tiers and regional hubs, a low-inventory penalty starting April, and apparel referral fees dropping to 5% for items under $15. Amazon also sued a fraud ring called REC for fake-refund theft and is removing fake negative reviews.
Questions this video answers
REC (an international fraud organization).
February 5, 2024.
About 3.5% (average).
A 4-ounce tier.
Failing to maintain at least four weeks of inventory relative to sales (start date stated in the video as April 1, 2020).
Chapters
Today we're covering FBA and MFN fee changes, updated listing requirements, fee reductions and more. Welcome back to the Amazon Analytics Insider. Let's get you up to date. Amazon recently filed a lawsuit against an international fraud organization called REC for stealing millions of dollars worth of products through fake refund schemes. REC allegedly tricked Amazon into processing refunds for products that were never returned using using methods such as bribing employees, manipulating tracking data and returning empty boxes. The lawsuit targets REC operators, former Amazon employees complicit in the scheme, and individuals who used REC's services. Amazon is also raising multichannel fulfillment fees for sellers by an average of 3.5% effective February 5, 2024. Amazon claims that this increase is still below average for other carriers. Fees for units under one pound will remain unchanged or decrease. Amazon is also introducing new size tiers, including a smaller 4 ounce tier and a larger tier to replace the oversized category. New FBA fees were also announced this past week. Amazon will soon charge sellers both for having too much inventory and too little inventory stored at FBA warehouses. The new low inventory fee will penalize sellers who don't maintain at least four weeks of inventory relative to sales starting April 1, 2020. This fee and others are said to be a result of Amazon's recent decision to decentralize its FBA network into eight regional hubs. Sellers will now be responsible for distributing their inventory to these hubs themselves or for paying Amazon to do it. The new fee structure is expected to raise costs for some sellers, but Amazon claims it'll also provide them with more transparency and control over their fulfillment costs. Amazon is starting to change the requirements for all new product listings except for items listed in the Media, Digital and Handmade categories. Information regarding what exactly is being changed has not yet been released, as these changes are expected to gradually roll out between December 11, 2023 and February 1 of 2024. As changes come out, sellers will notice them appear in the requirements list on the Add Products page and the Add Products via Upload functions. In response to competition from Shein, Amazon is also significantly reducing its transaction fees from 17% to 5% for clothing items priced under $15. For items between $15 and $28, Amazon is cutting its referral fee from 17% to 10%. More expensive items will continue to incur the original 17% fee. This reduction is intended to theoretically allow sellers to lower their prices by a few dollars while still maintaining their profit margin. However, even after the reduction, Amazon is likely to remain more expensive than SHEIN due to higher fulfillment costs and Shein's direct shipping model. We're ending today's updates with a bit of good news from the seller forums. This is regarding false reviews from bad actors. Multiple sellers have reported receiving alerts from Amazon letting them know that Amazon has deleted fake negative reviews on their listings that have been identified as being posted by other competing sellers. Amazon seems to detect these reviews independently, without sellers having to submit any documentation or requests. This is a great update and a problem that has been plaguing many sellers for a while and is especially important since Amazon has released their AI generated review summaries. Hopefully Amazon keeps this initiative and similar efforts a priority for the future. Thanks again for joining me for the Amazon Analytics Insider. 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 for more information on how to become an Amazon Data Expert.
