Dive Brief:
- Third-party sellers on Amazon will soon be subject to new fines if they violate the company's safety regulations for packages, CNBC reported.
- The new fines are aimed at merchandise sold by third parties, but shipped by Amazon, after an uptick in safety incidents involving third-party sellers — from two in 2009 to 42 in 2018 — at Amazon facilities, according to a CNBC investigation.
- Fees will be categorized as "unplanned service" charges, which is the same classification under which Amazon charges for expenses such as replaced barcodes or added packaging. A trial period testing the new fees began Nov. 29.
Dive Insight:
Products that present potential harm, such as rechargeable batteries, chemicals and aerosol cans, must be packaged correctly and in compliance with federal regulations, or they can cause harm to those that handle them.
Related worker safety issues have been in the news lately. Last week, 54 Amazon employees required medical treatment when a can of bear repellent was punctured by an automated machine at a warehouse in New Jersey. It's unclear if the product came from a third party seller, but this is exactly the type of hazard Amazon may be seeking to avoid with this move.
Third-party sellers are a significant part of Amazon's overall sales, increasing the likelihood that the number of these incidents would increase. In fashion alone, they make up 90% of the site's apparel offering.
In 2018, Amazon combined its retail and marketplace teams in an effort to standardize "the products, tools and services we offer to the brands and resellers that sell on Amazon, and have made some organizational changes as a result," the company said in a June statement. The move was largely seen as an acknowledgment that Amazon needed to take greater control of the customer experience on the marketplace of third-party sellers, since that side of the business has seen such rapid growth.
Charging for safety violations is an effort to both protect Amazon employees from unsafe conditions like leaking chemicals and unmarked harmful substances, both of which have been reported, and to ensure a good experience for the customer.
