|Sat Sept 17 2011 23:32:36|
Amazon Sellers Struggle with New FBA Storage-Fee Policy
By: Ina Steiner
Online merchants who use Amazon FBA to fulfill orders on their behalf began reporting what they believed were errors in how Amazon was charging them for its new storage fees.
Readers may remember the initial hubbub back in May when Amazon announced it would begin charging a new annual Long-Term Storage Fee of $45 per cubic foot for any units that had been stored in an Amazon fulfillment center for one year or longer.
According to Amazon's website, there are two Inventory Cleanup dates: August 15 and February 15. "Units in our fulfillment centers for 365 days or longer are charged the Long-Term Storage Fee once per year on either August 15 or February 15," according to the FBA FAQs.
But an FBA merchant told EcommerceBytes he believed Amazon was assessing fees on the 1-year anniversary of each individual ASIN, not twice a year (Feb. 15 and Aug. 15), as Amazon had stated would happen. And on the Amazon boards (here and here), a seller wrote:
"I was on the phone with fulfillment support this morning and they said they will charge on the anniversary date of each product and NOT on the two dates specified on the website of February 15 and August 15. I've been charged $435 two days ago and $217 yesterday. I imagine I will continue to get charged as my inventories hit the one year mark. Obviously, i'm pretty frustrated by this."
Other sellers disagreed that it was a policy change and said they believed the charges were made in error.
The seller later posted an update - it appears Amazon evaluated his inventory on August 15, but the system did not charge his account for the fees until the 15th and 16th of September. The customer service rep told him, "If these units are returned before October 31 we will be able to credit you back for the fees that were charged."
Some sellers are also perplexed in how Amazon.com is sending back their items. Amazon gave sellers an opportunity to remove slow-moving inventory from their warehouses to avoid paying Long Term Storage fees, reducing its removal and disposal fees. One seller said he pulled thousands of items from Amazon warehouses and is now receiving back his inventory from Amazon in shipments with 4 - 6 items per box.
The seller received at least 50 boxes already, and said, "I might well have 1,000 boxes coming to my house over the next week or three." Another seller said Amazon sent one toy via USPS Priority Mail that weighed 4 oz. and commented, "It seems like the only folks benefiting from the long term storage fees is UPS and USPS."
Another Amazon FBA seller warned her colleagues to count returns carefully - "I have already found both damaged items and missing items. And I only have a couple hundred to deal with," she wrote.
Using a fulfillment service is supposed to streamline merchants' operations, and with the holiday shopping season fast approaching, the fallout from Amazon's new Long Term Storage fees is one headache sellers don't need!