New Delhi: Online shopping trend has been on the rise for the last few years with retailers providing lucrative discounts on the MRP and big e-commerce giants like Flipkart, Amazon, Myntra bringing amazing sale and offers to attract more customers. If you love to shop online and Amazon has been your go-to stop then there is some bad news for you as shopping on the e-commerce website is set to get costlier.
Amazon has been known for its exciting offers but the company has now decided to revise its sales fees and commission charges. New charges will be imposed on several product categories such as electronics and cosmetics with effect from May 31.
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E-commerce businesses like Amazon and Flipkart generate revenue by collecting commissions and other fees from vendors who sell their goods on their marketplace. According to Amazon, prices are always altering in response to the market.
“Marketplaces know that there will be a straight impact on pricing,” an anonymous seller was quoted as saying by ET. “Whatever is the change in commission, it is done more to change the behaviour of the seller. Marketplaces keep changing these rates based on what they want the consumers to see. So, if the commission goes up by two percent, naturally the prices also go up by two percent.”
For each item they sell in the marketplace, sellers must pay costs for inventory storage, shipping, and returns. Referral fees, long-term storage fees, reimbursements for returns, and Fulfilled-by-Amazon (FBA) pickup fees for sellers have all seen adjustments at Amazon.
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Categories To Be Affected
Here is a list of categories of products that are expected to be affected by the increase in charges. Amazon has decided to raise the seller fees on products like clothes, beauty products, groceries and medicines, among others.
There will be a significant increase in the fees for the return of the products. The seller’s fee for over-the-counter medicines is expected to swell from 5.5% to 12% for products worth Rs 500 or less. As for the items costing more than Rs 500, the seller fee will be 15%.
A company spokesperson said, “Seller fee revisions are based on a variety of factors, including market dynamics and various macroeconomic factors. For the time being, we have made changes to our fee rate card, which includes new fee categories and reduced fees in some categories.”
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For items that must be transported domestically, Amazon has reportedly hiked delivery costs by around 20–23 percent.
Meanwhile, Amazon alone laid off 18,000 employees in January as part of its cost-cutting measure. Now, the Seattle-based technology giant has decided to sack at least 500 employees in India in the Amazon Web Services (AWS), human resources, and support functions teams of the company, multiple people aware of the matter told Economic Times (ET).
The recent layoffs are part of the additional job cuts that Amazon CEO Andy Jassy announced in late March, impacting about 9,000 employees globally.
