Amazon, one of the biggest online traders in India, has said that from 7th April onwards their sellers will be paying different fees on the company’s platform than those at present. According to a report, these shifts may lead to rising prices as to most used goods by customers, which they buy frequently on Amazon. We will dive in on the specifics and how the change can influence you today.

What are Seller Fees?

When you make a purchase from a third-party vendor on Amazon, the company charges that the online trader a fee for having made that transaction. Seller fee is the mark that belongs to this one. It is a percentage value of the total sales amount that is delivered to Amazon as a compensation for giving a platform and services that help to process the sale.

This is the seller rate that keeps Amazon going. The fulfilment centres, payment processing, dealing with customer services take from this fee rate, and in the end the sellers pay it, though, maybe, indirectly – in a form of somewhat higher prices on their part.

Key Changes in Fee Structure

Amazon has notified sellers that it will revise this fee structure from next month. Some of the key changes include:

  • Luxury beauty products like premium cosmetics will see fees increase from 5% to a tiered system going up to 10%.
  • Sleepwear category fees are being raised from 11-15% to 13.5-19%. 
  • Home improvement items will attract 13.5% fee compared to the earlier 9%.
  • However, fees are being reduced for some categories like baby apparel and electronics accessories.

Impact on Consumer Prices

While the changes seem nominal, a 1-2% increase in fees can impact product costs when sellers have thin margins. Many may pass this on to consumers, especially for high-volume bestselling items. 

For example, a moisturizer priced at Rs. 500 earlier may see a Rs. 5-10 hike. Similarly, appliances usually sold at low margins could see a slightly higher retail tag. Branded items from top sellers may absorb costs, but smaller sellers may find it difficult.

The Bottom Line

In summary, while one can likely still find deals, prices of certain everyday use products across categories like personal care, clothing, and home goods are expected to inch up marginally on Amazon post the fee revisions. Consumers may want to factor this in while making future purchases, and also compare with other marketplaces for best offers. Overall, a small price ripple seems inevitable from Amazon’s move to tweak its seller fee model.