Increased by 3.5%! Amazon's multiple fee updates will take effect as early as next month

Amazon sellers, take note!

As Amazon makes changes to its supply chain services in 2025, sellers will face fee changes for several key programs, including BWP, Multi-Channel Fulfillment, and Amazon Warehousing and Distribution.

These updates reflect Amazon's continued investment in logistics and customer delivery speeds, but will also affect sellers' cost structures.

Starting January 15, 2025, Prime service fees for Buy with Prime orders will not increase, and fees for some large standard-size units will decrease. Amazon will continue to offer 1- to 2-day delivery services at rates comparable to the standard 3- to 5-day delivery fees offered by industry carriers.

Between October 15, 2024 and January 14, 2025, sellers will be required to pay additional fees to account for seasonal demand.

The average rate increase is 3.5% , which is lower than the average increase for industry carriers (5.9%). For shipments weighing 1 pound or less, the rate for standard delivery will remain the same.

For items shipped weighing more than 1 pound, the fee increase will vary based on the size and weight of the item. These changes will take effect on January 15, 2025.

Starting April 1, 2025, MCD outbound shipping fees will change from a flat fee to a distance-based fee. Shorter distances will be charged less, longer distances will be charged more, and inventory replenishment to Amazon will continue to be charged a flat fee that is not based on distance.

Amazon has renamed the consolidated rates to Amazon Managed Rates, which will continue to offer discounts on AWD storage and shipping fees, but will eliminate savings on handling rates. Sellers who maintain optimal inventory levels through automatic replenishment will receive a 10% discount, with rates as low as $0.43 per cubic foot.

Handling costs will be split into inbound ($1.35 per case) and outbound ($1.35 per case) charges, a net increase of $0.20 per case from the previous flat rate of $2.50. This will improve cash flow but may affect profits.

Amazon is updating the discounts available to sellers who choose Amazon Supply Chain Intelligence to include a 20% discount on Amazon Warehousing and Distribution Services storage fees and a 10% discount on Amazon Warehousing and Distribution Services shipping fees from Amazon Warehousing and Distribution Services to Amazon Logistics.

1. Cost considerations : For goods weighing more than 1 pound, costs may increase, so sellers need to evaluate their pricing strategy and cost structure.

2. Service Optimization : The reduction in Amazon AWD service fees also provides sellers with opportunities to optimize inventory management and reduce costs, especially in inventory replenishment and distribution.

3. Market competitiveness : In today’s sensitive market, sellers need to find ways to improve efficiency and reduce costs to remain competitive.

> Optimize product packaging and weight : Try to reduce the weight of products and packaging to less than 1 pound, and reasonably plan the size of products and packaging to avoid additional costs due to excessive size.

> Optimize inventory allocation : Take advantage of AWD’s auto-replenishment eligibility to enjoy smart storage rates and avoid additional charges for expired inventory.

> Leverage multi-channel efficiencies : Focus on shorter shipping distances to benefit from the new distance-based MCF fees.

> Explore LTL/TL Shipping : For larger shipments, LTL/TL shipping typically offers a lower per-pound cost over longer distances than small package shipping.

> Bundle BWP products to save on fulfillment fees : Combine multiple units into a single order to take advantage of reduced BWP per-unit fulfillment fees.

> Using Amazon Management Services : These services streamline operations while providing cost savings.

> Plan ahead and adjust prices : Sellers should understand the fee change rules in advance, make product cost budgets and logistics plans, and adjust platform prices according to the situation to cope with the upcoming fee adjustments.