"Now is a good time to consider using PPC and start moving excess stock before the new weight dimensions kick in."
The 2023 FBA fulfilment fees for core FBA and Small and Light will take effect on 1 March 2023 for the UK, Germany, France, Italy and Spain. On 15 May 2023, the fee changes will take effect in the Netherlands, Sweden, Poland and Belgium.
These changes pose big possible fees, charges and infractions for any Amazon FBA seller. Please take time to read the various changes below which may dramatically impact your planning and fees in coming months. If you need help understanding how these impact you, please contact us.
FBA monthly storage fee changes
Effective March 1, 2023, monthly inventory storage fees will be increased for all standard-size products, excluding items in the dangerous goods category. This change will first be reflected in April 2023 charges for storage that occur in March 2023. The fee for dangerous goods and oversize products will remain the same.
Removal of separate fuel and inflation surcharge for standard items
In 2022, a fuel and inflation surcharge was introduced for FBA fees in the UK, Germany, France, Italy, and Spain, due to temporary cost increases. As economic conditions have progressed, these cost increases appear to be more permanent and standard FBA fee rates will be adjusted to account for these increased costs on a more permanent basis.
Effective from 1 March 2023, the separate fuel and inflation surcharge will be removed.
European Fulfilment Network fees will have adjustments with a 30-day notice period when the foreign exchange rate change between the British pound and the euro exceeds 5% on a monthly, quarterly or yearly basis.
Detailed fee changes can be seen here
Introduction of storage utilisation surcharge
Starting from May 1, 2023, Amazon will introduce a storage utilisation surcharge for the monthly storage fee. The surcharge will be based on the storage utilisation ratio, which is the ratio of your average daily inventory volume stored in cubic feet divided by the average daily shipped volume in cubic feet over the trailing 13 weeks.
Amazon will calculate the storage utilisation ratio on the last day of a given month. This means that for inventory stored in April 2023, Amazon will calculate the storage utilisation ratio on April 31 and apply the surcharges to the May 2023 storage fees.
Amazon will apply a single storage utilisation surcharge for inventory that’s stored in Germany, France, Spain and Italy, and a separate storage utilisation surcharge for inventory that’s stored in the UK. If you sell in the UK and other European countries, you will be charged no more than two different storage utilisation surcharges.
The surcharge will only apply for Professional sellers with a storage utilisation ratio above 26 weeks and for products outside of Clothing, Shoes and Bags. If you meet the criteria for the storage utilisation surcharge, the surcharge will be added to your base monthly storage fee and applied to the daily average volume for the space that your inventory occupies in fulfilment centres, resulting in a higher total monthly storage fee.
How is the storage utilisation ratio calculated?
To calculate the storage utilisation ratio, Amazon will divide the average daily inventory volume stored by the average daily shipped volume over the trailing 13 weeks and then normalise it by the number of weeks. The formula for the ratio is as follows:
(Daily inventory volume over trailing 13 weeks / Daily shipped volume over trailing 13 weeks) / (7 days in a week)
Amazon will calculate the ratio on the seller- and product-size tier level, which means that a seller might have one storage utilisation ratio for standard size and one storage utilisation ratio for oversize.
How can I estimate my storage utilisation ratio?
Amazon will provide a tool or a dashboard to help you understand your storage utilisation ratio ahead of the launch of the storage utilisation surcharge.
How is the storage utilisation ratio used in storage fee calculation?
Amazon will use the storage utilisation ratio from the last day of the month to determine the surcharge for the inventory stored during that month. For example, to determine the surcharge for June 2023, we will use the storage utilisation ratio from June 30.
If the surcharge is applicable to a seller, Amazon will add the surcharge to the monthly storage fee and then apply the fees to all products stored in fulfilment centres during the month.
FBA aged inventory surcharge
Starting from May 15, 2023, Amazon will increase the aged inventory surcharge (previously known as the long-term storage fee) for inventory stored in fulfilment centres between 331 to 365 days, and they will apply this surcharge to all product categories.
In addition, Amazon will introduce a new tier to begin the aged inventory surcharge for inventory aged 271 to 330 days on all products, except for items listed under Clothing, Shoes, Bags, Luggage, Jewellery and Watches. Amazon will continue to charge an aged inventory surcharge for units that we store for more than 365 days.
Introduction of dimensional weight for Parcel Size bands
Starting from 1 March 2023, you will be required to use the dimensions and unit weight of items to identify the size tier within all parcel size bands. To determine the weight tier, the greater of the unit weight or the dimensional weight will be used. The dimensional weight in kilograms is calculated as (length x width x height cm3) divided by 5,000.
This update is similar to changes that were made in 2022, when dimensional weight was introduced for all oversize products. This change will also apply to customer returns processing fees. Small and Light parcel size items will continue using unit weight for fee calculation.
New weight tiers for special oversize units
From 1 March 2023, new weight tiers will be introduced for special oversize units to better align fees with fulfilment costs. ASINs are classified as special oversize if they meet at least one of the following conditions: weight greater than 31.5 kg, length of the longest side is greater than 175 cm, or girth (length of the longest side + 2x width + 2x height) is greater than 360 cm.
Need help?
The 2023 FBA fulfilment fee changes in Europe will take effect on 1 March 2023 in the UK, Germany, France, Italy, and Spain. On 15 May 2023, the fee changes will take effect in the Netherlands, Sweden, Poland and Belgium. The greater of the unit weight or the dimensional weight will be used to calculate the shipping weight for all parcel size bands and oversize units.
Now is a good time to consider using PPC and start moving excess stock before the new weight dimensions kick in. For help, contact us any time.
“Aged inventory surcharge now starts from
271 days vs 331 days previously”
FBA Small and Light Program Gets a Makeover: What You Need to Know
Amazon has finally listened to seller feedback and there is a welcome increase in price eligibility threshold for Small and Light units and the introduction of new size and weight tiers.
The price eligibility threshold for Small and Light units will be increased from €11 to €12 in the France, Italy and Spain stores. In Germany, the threshold will increase from €10 to €11, and in the UK, it will increase from £9 to £10.
The maximum weight eligibility for large envelopes and extra-large envelopes will be expanded from 225 g to 960 g, and a new weight tier of 460 g in the standard envelope (33 x 23 x 2.5 cm or smaller) size tier will be introduced.
The new Small and Light fulfilment fee rates will come into effect on 1st March 2023 in the UK, Germany, France, Italy and Spain. Dimensional weight will not be used to calculate the shipping weight of Small and Light items that are in parcel size tiers.
Updated Return and Disposal Fees for Amazon FBA
Amazon increases return and disposal order fees starting March 1, 2023. The return fee per unit will increase for standard size items and oversize and special handling items, with the greatest increase seen in the oversize and special handling category for items weighing between 501g to 1000g. Where the return fee per unit will increase by £0.78.
Similarly, the disposal fee per unit will also increase for standard size items and oversize and special handling items, with the greatest increase seen in the oversize and special handling category for items weighing between 501g to 1000g, where the disposal fee per unit will increase by £0.95.
Will the changes for return and disposal order fees apply to orders placed before March 1, 2023?
FBA return and disposal fees are calculated when an order is placed, and they are charged at that rate when the shipments leave Amazon fulfilment centres. As a result, if a request is placed before March 1, 2023, but the inventory is removed or disposed of on or after that date, the new FBA fees will not apply.
Action: Ensure that you submit all your removal or disposal orders ahead of 1st of March 2023 to avoid increased charges.
Maximise Your Profits with Amazon's New Selection Program
Finally we are thrilled to share the news of the 2023 FBA New Selection programme changes with our clients. Amazon has announced that they will continue to update the programme in 2023 by providing improved benefits to eligible sellers.
One of the key changes is an increase in the free storage, free removals, and rebate benefits on up to 100 units per parent ASIN. This is a significant increase from the previous benefit of up to 50 units per parent ASIN, excluding clothing and shoes products. Additionally, the free storage and rebate benefits for eligible standard-size items will be increased from 90 days to 120 days per parent ASIN.
Another exciting change is the increase in the rebate from 5% to up to 10% on average for sellers who complete Brand Registry. This rebate will apply to eligible oversize items on up to 30 units per parent ASIN for up to 90 days, and for eligible standard-size items on up to 100 units per parent ASIN for up to 120 days.
These changes provide a great opportunity to increase their sales and profits on Amazon by taking advantage of the increased storage, removal, and rebate benefits. We encourage you to check eligibility and take advantage of these new benefits to grow their business on Amazon.
Other Amazon Changes
Unlock Increased Profits with Amazon's Extended Clothing and Accessories Referral Fee Promotion
Clothing and Accessories category, for items sold via FBA and Seller Fulfilled Prime the referral fee will be reduced from 15.3% to 7.14% on the portion of total sales price greater than £40. At this time, there’s no end date for the promotion, which was originally scheduled to end on March 31, 2023.
Amazon Introduces Changes to VAT Calculation Service
From June 30, 2023, for sellers opted in to VAT Calculation Service referral fee calculation will change. The referral fee will be applied on the item list price that seller provides, instead of the total sales price paid by the buyer, this change will lead to more predictable referral fees. This change does not apply to promotions such as Lightning Deals, vouchers or coupons, buy one, get one free and money-off, Amazon-funded discounts, and Prime Exclusive Discounts. For promotions, referral fees will continue to be charged on the total sales price paid by buyers.
Changes in the Car and Motorbike Electronic Accessories Category
Starting May 15, 2023, the referral fee for products in the Car and Motorbike Electronic Accessories category will be changed to the same as Electronic Accessories.
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