Amazon Professional sellers received one extra gift from Amazon the week before Christmas: an announcement of several FBA fee increases that will go into effect on February 22, 2018 for U.S. sellers.
The eCommerce giant stated that “As in previous years, FBA fees in the US will be adjusted to reflect the changing costs of fulfillment, transportation, and customer service. We’re notifying you now to give you time to plan for these changes.”
They also announced that Fulfillment by Amazon storage fees (including long-term storage fees) are remaining unchanged for now, but hinted that these increases will be coming at some point in early 2018. A summary of the changes is outlined below:
Fulfillment fees for most product size tiers and weights are going up. Notably, Amazon is transitioning to one fee that applies to the entire year, so say goodbye to peak and non-peak fulfillment rates. Fulfillment fees are increasing anywhere from about 7.7% (medium standard size items) to about 16.6% (small oversize items). You can check out the full table of fulfillment fee increases and product examples here.
Dimensional Weight Calculation
Currently, dimensional weight is calculated as unit volume (length x width x height in inches) divided by 166. Amazon is moving to the same formula that FedEx and UPS use, which changes the divisor to 139. Items which are DIM-weighted (large, standard-size items weighing more than one pound and all small, medium, and large oversize items) will go up by an average of 23%. The dimensional weight calculations will also apply to sellers who utilize Multi-Channel Fulfillment.
How You Should Prepare for These Changes
- Run through your entire product line and figure out which items are DIM-weighted and which ones aren’t, and keep the new dimensional weight calculation in mind for future product additions
- Analyze how the new fees affect your margins
- Make price increases where necessary; an automated algorithmic repricer can help
- Be prepared for the storage fee increases that Amazon will announce in Q1 2018