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At the end of last year, Amazon US released a notice on the update of sales commission and logistics fees. In addition to adjusting logistics and delivery fees and adding multiple charging items, the notice also reduced sales commissions for low-priced clothing products, causing an uproar in the industry. Now that the industry has not yet reached a conclusion on the pros and cons of this fee adjustment, Amazon has begun planning to implement it on other sites.
It is learned that this morning, Amazon Global Selling issued a major notice, announcing that it will expand the commission discounts for low-priced clothing on the US site to other sites , so as to work with sellers to provide consumers with more choices, including low-priced goods. ▲ The picture comes from Amazon Global Store According to the notice, starting from May 15, 2024 (local time), Amazon will provide discounts on sales commissions for low-priced clothing products in Europe, Japan, and Canada. The specific adjustments are as follows: UK: For clothing products priced below £15, the sales commission will be reduced from 15.3% to 8.16%; Germany, the Netherlands, and Belgium: For clothing products priced below 15 euros, the sales commission will be reduced from 15% to 8%; France, Italy, and Spain: For clothing products priced below 15 euros, the sales commission will be reduced from 15.45% to 8.24%; Sweden: For clothing products priced below SEK 175, the sales commission will be reduced from 15% to 8%; Poland: For clothing products priced below 65 Polish zloty, the sales commission will be reduced from 10% to 8%; Japan: For clothing products priced below 2,500 yen, the sales commission will be reduced from 12% to 8%; - Canada: For apparel products priced below 20 Canadian dollars, the sales commission will be reduced from 17% to 10%.
Overall, after the discount takes effect, the commission for low-priced clothing on multiple sites will be reduced to 5%-10% . According to reports, this morning, some sellers on the Canadian site received a related notification email: Amazon said it will reduce the sales commission for clothing products priced below US$20 on the site from 17% to 10% starting May 15, 2024 , and the sales commission for other product categories will remain unchanged. ▲ The picture comes from Zhiwubuyan However, it is worth mentioning that although Amazon stated in the notice that the previous reduction in the commission rate for low-priced clothing products in the United States received a good response, based on feedback from the industry, Amazon sellers still have mixed reactions to this fee adjustment.
In recent years, Amazon's rules have changed frequently. Sellers are struggling to adapt to the rules, and they are always unable to figure out Amazon's intentions. But as the saying goes: the cause is always clearly reflected in the results. Although Amazon just announced today that it will expand the commission discount for low-priced clothing to other sites, the US site has already implemented a reduction in the sales commission for low-priced clothing products since January 15, 2024 : For clothing items priced below $15, the sales commission will be reduced from 17% to 5%; For clothing items priced between $15 and $20, the sales commission will be reduced from 17% to 10%.
According to the results of the previous adjustment in the US site, some sellers believe that the reduction in sales commission is a favorable policy for clothing sellers who sell products priced below US$20: "The huge sales of wholesale low-priced clothing products must be very exciting." "The reduction in sales commission is good news for some clothing sellers." Survey data also shows that after the US site announced changes to sales commissions and logistics costs at the end of 2023, more than 80% of sellers said that their costs had increased. Only 17% of sellers saw a decline in costs due to selling low-priced clothing products. However, many sellers also mentioned that the reduction in sales commissions may, to some extent, exacerbate the already serious price war in the clothing category. Given that overseas market demand is still weak, some clothing sellers may reduce prices and reduce profit margins in order to cater to this policy in order to enjoy low commissions and grab market traffic. A clothing seller who sells higher-priced products once said that shortly after the policy of reducing sales commissions for clothing on the US site came into effect, his competitors suddenly slashed their prices, reducing the price of their products to less than $20, ultimately causing their traffic and sales to be halved. ▲ The picture comes from Zhiwubuyan Based on this, many sellers believe that the reason why Amazon lowered the sales commission for clothing products may be due to the still weak demand in the current overseas market, and on the other hand it may be to increase the weight in the competition with SHEIN and Temu, which are deeply involved in the clothing category. It is understood that according to foreign media reports, as of March this year, many of the same products sold on Amazon, Walmart, Temu and SHEIN platforms usually come from the same third-party sellers, and the seller overlap rate in the e-commerce market is continuing to rise: more than 50% of new sellers on Amazon and Walmart are from China, and some sellers have already or are about to settle in SHEIN and Temu. According to investigations, the sales prices of these sellers' products on Amazon and Walmart are usually the same, but thanks to the lower platform fees of SHEIN and Temu, the sales prices of the same products on SHEIN and Temu are usually lower. These same low-priced products have, to a certain extent, taken away some of the traffic from Amazon and Walmart. Previously, when Amazon adjusted the FBA rates for low-priced goods, industry insiders analyzed that although Amazon did not openly engage in a price competition with other platforms, it was trying to promote "low-price internal competition" among sellers through policy adjustments within the platform in order to maintain the operation of the low-price flywheel system. However, some sellers pointed out that Amazon has already turned into a red ocean in the fierce competition. Not only the clothing category, but any market may eventually turn into a price war. If you want to get rid of the low-price quagmire, you can only innovate or constantly build your own core competitive barriers. What do you think about this? Welcome to discuss in the comment area~
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