Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Thu Jan 24 2013 15:09:02

Amazon Sellers Set to Scale Back on International Shipping

By: Ina Steiner

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Online sellers are calling for Amazon.com to raise its shipping reimbursement rates as they face a major hike in the cost of doing business internationally. But with only 3 days left before USPS rates for certain international packages skyrocket, Amazon has remained mum.

"There has been no word from Amazon.com about whether they will increase the shipping reimbursement to cover these huge increases," wrote an EcommerceBytes reader. "Third party sellers on Amazon have thousands of listings that were calculated to the 2012 rates."

Amazon gives Marketplace sellers only a part of the fees it collects from buyers for shipping costs, and sellers are supposed to price their inventory accordingly.

But the discrepancy in domestic shipping rates versus international leave sellers with a dilemma: if they raise product prices to account for higher international shipping costs, they will price themselves out of the domestic market. If they keep product prices the same, they either take a loss on international orders, or must stop shipping internationally altogether.

A media seller on Amazon's discussion board wrote, "Unfortunately it isn't practical to raise the price each CD $3.50 to offset the rise in shipping costs. That would put the cost of what is now a $2 CD to $5.50 and then thinking someone internationally MIGHT buy it. That would kill domestic sales in the process. We'll just have to stop selling internationally if reimbursement is not raised."

Amazon.com spokesperson Erik Fairleigh said the company had no comment at this time about whether the company would adjust shipping credits.

The reader referenced above said the discussion boards are heating up with sellers worried about the consequences of the postal increases. "We are especially worried about what Amazon will do, or won't do, about the gigantic increase in USPS international shipping. The international flat rate priority mail envelopes, and light weight international parcels going first class, are seeing huge increases."

According to him, the rate increases that will affect booksellers the most include:

- Priority Mail Intl Flat Rate Envelopes to Canada is increasing from $12.95 to a whopping $19.95;

- Priority Mail Intl Flat Rate Envelopes to Europe is increasing from $16.95 to a whopping $23.95;

- First Class Package (one pound) Intl Service to Canada is increasing from $5.75 to a whopping $10.55.

Eric Nash, Director of Online Marketing for Stamps.com, said the new rates for First Class Package International Service (formerly First Class Mail International) are definitely going to shock many sellers.

"Costs are going up on average 58.6% for that mail class, but it can be considerably higher for specific price groups (Canada) under 1 lb. And as Amazon sellers have mentioned in the forum, without any increase in the shipping credit from Amazon, it can be tough to sell internationally for many items."

Nash said that even with the rate increase, however, USPS First Class Package International Service will still be the cheapest option to ship overseas for ecommerce sellers.

Higher shipping costs affect all online sellers, of course. As a reader pointed out in a recent Letter to the Editor, eBay sellers are also being squeezed by USPS rate hikes.

Comments (25) | Leave Comment | Permalink
Readers Comments

Perminate Link for Amazon Sellers Set to Scale Back on International Shipping   Amazon Sellers Set to Scale Back on International Shipping

by: mindelec This user has validated their user name.

Sun Jan 27 14:24:32 2013

"Yes they have. There is a statment in Seller Central dated 01/25/2013 to that effect. Standard International Shipment for Books: $16.95 up to 1lb.,
$23.95 over 1lb. "

bearing in mind that on the over 1lb credit they are actually only going to give you about $22.50. amazon is still keeping a step behind what the actual costs are...  a 2 lb package will cost either $24.15 or $21.74 depending on whether it is purchased online or not. and if the package goes over 2 lbs which often happens with hardcovers the price zooms up from there.

sorry amazon you still don't make it cost effective to sell books internationally.

domestic media mail just shot up to $3.17 with delivery confirmation on endicia, while amazon continues to give around $2.75.  how long will this be tolerable to sellers?

Perminate Link for Amazon Sellers Set to Scale Back on International Shipping   Amazon Sellers Set to Scale Back on International Shipping

This user has validated their user name. by: twentyjuan

Fri Feb 1 00:20:40 2013

I just canceled an order today to a customer in Japan. CD package weighs 5oz, cost to ship $11.48 / Amazon shipping credit 6.89, right! Not sure what the USPS is thinking, not sure what Amazon is thinking, this is going to significantly put a dent in international sales. Even on Ebay, I have had to raise my rates to compensate for this increase and eBay commission on shipping (eBay must be loving this) and already I've had but one international sale. Something else I have not seen mentioned on the boards here is what happened to me and I am sure lots of ebay sellers. All the sales made days pre-USPS rate increase, the customer was invoiced at the old rate, now I have to either cancel the orders, risk negative feedback, or ship at the old rate and eat the loss. The small independent sellers always get screwed!

Perminate Link for Amazon Sellers Set to Scale Back on International Shipping   Amazon Sellers Set to Scale Back on International Shipping

This user has validated their user name. by: Bidonmine

Fri Feb 1 07:08:17 2013

Amazon should split the foreign shipping so that we can choose Canada or All other countries. Then add the shipping credit as is appropriate for both.

Perminate Link for Amazon Sellers Set to Scale Back on International Shipping   Amazon Sellers Set to Scale Back on International Shipping

by: Frump This user has validated their user name.

Fri Feb 1 12:27:13 2013

Am I wrong in thinking that it's possible to upload a Shipping Overrides feed to set a different shipping rate? I know I've done that in the past on Amazon, though I've never tried it on media products. I have seen non-standard shipping rates in the video games category, which has a general fixed rate of $3.99, in the past though, so I figure it's something to do with that?

Perminate Link for Amazon Sellers Set to Scale Back on International Shipping   Amazon Sellers Set to Scale Back on International Shipping

by: hauntednapkin This user has validated their user name.

Tue Feb 5 12:51:50 2013

For what it's worth, I spent a total of an hour on the phone in two days attempting to get a straight answer from someone at Amazon and all they did was confirm that they had ''no intention of upping their shipping concession'' (insultingly, it did go up to $8.89) to match the 56% USPS postal hike for international CD orders. How does this help when a CD to Sweden that used to cost $5.48 to ship now costs $13.57? They're so (willfully?) out of touch with formats that they lump vinyl LPs in that same category and I can tell you for certain that it costs about $18 to ship one vinyl album to Australia. Of course we sell our vinyl exclusively on Discogs but also just unlisted any records we had left up on AMZ. I thought I would be smart and just toggle the international buyers option off but the next day the first order I got was from Belgium. The Amazon rep then said that toggling that off would only apply to inventory I listed AFTER the switch. They are defrauding sellers, plain and simple, they know it and nobody's losing sleep in their camp. Everyone needs to be made aware of this douchebaggery, so spread the word please!  

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