Amazon is offering third-party sellers a reprieve — via more time and exceptions — as they adjust to a new product supply fee, according to an announcement Thursday.
The fee applies to standard-sized products with less than 28 days of inventory relative to historical demand. While the fee is already in place, Amazon started crediting sellers back in April if they incurred the charge, as a way to help them adjust. Originally, the credits were going to end April 30, but now Amazon has extended the credit period to last until May 14.
"We hope this transition period has helped you get more familiar with the fee and fee management tools," Amazon said. "We've seen that the additional time has enabled even more sellers to achieve healthy inventory levels and avoid this fee entirely."
Sellers will receive the credit by May 31, according to Amazon.
Amazon originally announced the fee in December as a way for the company to cover costs associated with improving delivery speeds and in-stock levels under its new regional fulfillment model.
Amazon's low inventory level fee, based on days of supply relative to historical demand
| Size | 0-14 days | 14-21 days | 21-28 days |
|---|---|---|---|
| Small standard | $0.89 | $0.63 | $0.32 |
| Large standard (Up to 3 lbs.) | $0.97 | $0.70 | $0.36 |
| Large standard (3 lbs. to 20 lbs.) | $1.11 | $0.87 | $0.47 |
Source: Amazon. Fee is added for all shipped units of eligible products.
In addition to extending the credit period, Amazon announced adjustments that aim to limit the fee's impact in situations where the seller has less control. The three changes to the low-inventory-level fee are:
- Starting May 15, the fee won't apply to products that have sold less than 20 units in the previous seven days. Amazon said this is due to greater unpredictability in managing inventory levels for low-volume products.
- Charges incurred because of "excessive inbounding and processing times" on Amazon's end will be credited back to the seller. For instance, charges in May due to excessive inbound delays will be credited back by June 15.
- Amazon will provide a time-bound exception on the fee for products featured as "Lightning Deals" and "Best Deals" during Prime Day 2024, which will take place in July. The exception applies for the four weeks following Prime Day, as inventory levels may fluctuate based on sales from the online shopping event.
"We are thrilled that Amazon is recognizing that post Prime Day, inventory levels could be low on promoted items and has implemented a grace period," said Hinge Commerce, an e-commerce consulting agency, in a LinkedIn post. "That was one of our biggest concerns regarding this new fee."
