Amazon’s new FBA low-inventory-level fee went into effect today, April 1, 2024, but the marketplace has decided to give sellers a bit of a break after media picked up on sellers’ dissatisfaction. After the end of the month, Amazon FBA will credit sellers’ accounts for all low-inventory-level fees it charged them in April – but it’s a one-month reprieve only.
As we reported in December, in addition to paying storage fees if they have “too much” inventory stored at Amazon fulfillment centers, sellers who use FBA will now pay fees if they have “too little” inventory stored there thanks to the low-inventory-level fee. Amazon had stated in its December 5th announcement, “The fee applies if you carry consistently low levels of inventory relative to unit sales, as this inhibits our ability to distribute products across our network, degrading delivery speeds and increasing our shipping costs. Sellers can avoid this fee by maintaining more than four weeks of inventory relative to sales.”
Amazon executive Dharmesh Mehta explained in a post on LinkedIn today, “We have heard feedback from a number of sellers that they are uncertain about how, if at all, the new fee will impact their business. To help address these questions and ensure sellers better understand how or if the fee will impact them, we have decided to have the month of April 2024 be a transition period for which all of these low-inventory-level fees will be credited back to sellers.”
He said Amazon’s goal was to help sellers learn if they needed to make adjustments to avoid the fee; give them peace of mind during the transition month of April; and to “provide time for the majority of sellers to see that they will not be impacted by this fee, and for those that do incur a fee on some units sold, it will most often be a rare case.”
Cara Sayer of SnoozeShade commented on Mehta’s post, noting that as a seasonal seller, she’ll always have low inventory in out-of-season times and noted that weather impacts sales, adding, “It also seems unfair to penalise sellers at a time when we are all facing supply chain challenges that are completely outside of our control.”
Amazon provided details about the new fee in this December 2023 post. Sellers who use Fulfillment by Amazon should make sure they fully understand it.
