Earlier this month, Amazon’s new warehousing configuration service fee officially came into effect, but it was enough to make sellers go crazy!

After the new policy came into effect, many reports of cool black-tech operations were heard in the industry that exempted the warehouse configuration fee to zero; one of them was to create shipments through a bug after ERP authorization, successfully achieving the goal of not dividing the warehouses and exempting the configuration fee.

However, yesterday, a large number of sellers received performance warnings from Amazon for using these black technologies.

I thought Amazon would stop here, but I didn’t expect that there would be two more pieces of bad news waiting for sellers: Amazon will start charging low inventory level fees and return processing fees!

Amazon Low Inventory Level Fee

In the fee update notice released by Amazon last year, in addition to the warehouse configuration fee that took effect on March 1, Amazon also added another fee item - a low inventory level fee.

According to Amazon's announcement, starting from April 1, 2024, Amazon will charge a low inventory level fee for standard-size products whose inventory levels are always lower than buyer demand (inventory levels remain too low compared to sales for a long time).

So how do we calculate this “historical supply days”?

In the Amazon backend, we can directly see the historical supply days data for each of our products.

We go to the Amazon backend and find "Amazon Logistics Inventory" in "Inventory".

After clicking in, you can see information such as the historical supply days for each product.

The historical supply days here refer to the indicator calculated by Amazon based on the average daily inventory quantity of long-term (past 90 days) and short-term (past 30 days) divided by the average daily shipment quantity of goods:

If you think the calculation here is inaccurate, you can also calculate it yourself. The calculation method is here.

Bottom line: If a seller maintains more than four weeks of inventory based on product sales, the low inventory level fee is waived.

In other words, starting from April 1, 2024, Amazon sellers need to pay more attention to the inventory status of the past three months and the past month to avoid falling into a low inventory or even out-of-stock situation, being charged low inventory level fees, and increasing costs.

Amazon Returns Processing Fee

Starting June 1, 2024, Amazon will reduce the return processing fee for products with high return rates in all categories except clothing and footwear.

How to calculate the return rate of goods?

Return rate: refers to the percentage of items returned by customers in a given month, compared to the items returned in that month and the following two calendar months.

However, starting from May 1, the average return rate can be directly viewed in the "Amazon Logistics Returns" section of Amazon's backend.

If the return rate of your own products is higher than this average return rate, you should be careful at this time, because Amazon’s fee is levied on products with return rates exceeding the specific return rate threshold of each category.

Moreover, products with high return rates will be labeled as "high return rate" by the seller, which means that the return rate of the product is relatively high. It is recommended that sellers check the product details and review information before placing an order;

Once a product is labeled as "high return rate", the conversion rate of the product may directly drop by 50%-80%.

In general, whether it is the previous warehousing configuration fee or the low inventory level fee and return processing fee that will soon take effect, they will have a certain impact on the seller's costs; next, sellers must think carefully about how to avoid these two upcoming fees!