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

This user has validated their user name. by: Ming the Merciless

Thu Jan 24 20:14:01 2013

Amazero will squeeze sellers as much as they can get away with just like ebafia does.

Less international sales for the noise means more international sales for Amazero.

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

by: Ebay Seller-Ebay Buyer This user has validated their user name.

Thu Jan 24 22:08:21 2013

Amazon now is acting like ebay?  The spokesman was mum?  How stupid is that?  Goodbye to millions of international sales as American sellers cannot raise their prices $3 or they lose their American sales. Not good to see Amazon taking some of Ebay's stupid pills. Ebay surprisingly has made some good moves for sellers the past year

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: elpereles
Web Site

Thu Jan 24 23:07:38 2013

I don't sell in Amazon, but the I sell International and ship by USPS. The International 1rst Class Package and the Flat Rate are high. If I get an International buyer after this increase will be a surprise.  

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: Sales Smith

Fri Jan 25 00:01:15 2013

Amazon... Ebay.. it doesn't matter. Now that the postal service has raised their prices so much, we're discontinuing our international sales campaign.

I could see the rate increase as warranted if the service was improving but there has been no mention of that.

As any experienced international seller knows- the postal services offer poor to sloppy service at best. Add customs who doesn't scan or feel any obligation to help with showing the parcels location and you're at increased risk of a poor buyer experience.  

Considering the frequent issues related to lack of location scans, big postage increases can only hurt international sales.

It's time to focus more on domestic sales and forgo the international.

It's sad how the big venues want to increase international sales but don't support the increased costs, hassle or risk for their merchants to supply their products there.

We're out.

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

by: CK2 This user has validated their user name.

Fri Jan 25 01:31:41 2013

Here are the USPS postage mailing price changes for January 27th, with details in bureaucratic speak:

http://www.prc.gov/Docs/85/85329/Notice%20CP2013-3.pdfR>
This
link/address will be to a 160± pages document with every price change, domestically and internationally, for all classes of mailings, including retail and commercial bade/plus pricing, insurances, flat rates, and optional services.

I just bulk edited all my eBay listings, removing all international shipping. Kept the upgraded international exposure, seeing what overseas interest will be once I quote the new prices.

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

by: CK2 This user has validated their user name.

Fri Jan 25 01:33:01 2013

Here is the link again:


http://www.prc.gov/Docs/85/85329/Notice%20CP2013-3.p
df

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

by: FREDDY This user has validated their user name.

Fri Jan 25 09:44:21 2013

Stopped using International - including Canada - to long to get package there plus rising cost. Not worth it anymore especially with new rates. I am putting the additional time effort in USA sales. Amazon is not fair with shipping cost - I don't believe they ever have.  The cost the buyer pays is okay, however the cut Amazon takes is HUGE. Think maybe AMAZON is PUSHING for FBA only???? Especially for international shipments - only thing that makes sense. If you sell on Amazon and want to include international - then you will have no choice but FBA route. I can understand this as a smart business move. - Might back fire - only time will tell. Small 3rd party will be hurt in the meantime.

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

by: TAK This user has validated their user name.

Fri Jan 25 09:47:02 2013

International has always been a pain to me and we stopped two years ago.  I haven't missed the paperwork and lost package hassle, and Lower stress compensated for  the loss in sales.

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

by: Moonwishes This user has validated their user name.
Web Site

Fri Jan 25 09:58:50 2013

After getting sometimes 20% or more of my sales via international sales on ecrater, Seeing what I will have to bump my shipping up to is ridiculous. Does the usps really think that they were going to make MORE money off this scheme? No, I think it will backfire and backfire badly on them. I'm still undecided on how to deal with this increase and if Amazon doesn't lift it's rates I'll be in the doghouse there as well. Not sure why the OP was referring to increasing prices $3, My international rates will be going up by $6 or more. I can't see anyone except someone desparate for my goods, paying that much. I do think that if Amazon doesn't increase the rates, I will have to turn off international shipping with them until they do. It is frustrating  trying to figure out what to do and how to do it to make te best sense for our business.

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

by: Red Ink Diary This user has validated their user name.

Fri Jan 25 10:45:07 2013

''Amazon gives Marketplace sellers only a part of the fees it collects from buyers for shipping costs''

Not so. I think a word or two escaped from this sentence.

Amazon gives sellers the entire shipping fee charged to buyers BUT shipping charges are fixed by the marketplace in certain categories  and those charges may not cover the actual costs of shipping.

For example, domestic mail, the 4 pound hardback behemoth of a book I recently purchased cost the seller $3.73 in postage for media rate. I was charged $3.99.

If he had been shipping it to the UK the most economical rate would be standard, First Class International Parcel at a cost of $27.30 and no clue as to delivery time. Amazon would allow him to charge $18.49 for standard speed and expect it to arrive in a timely manner.

That is the heart of the problem.

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

by: FREDDY This user has validated their user name.

Fri Jan 25 11:19:23 2013

@RED INK....$3.99 FOR SHIPPING - AMAZON FVA FEE IS 1.35. THEREFORE SELLER GETS $2.64 FOR SHIPPING. $3,37 PLUS DC FEE WHICH IS REQUIRED BY AMAZON AND EBAY.(MEDIA RATES)   THAT IS FOR A 4 LB OR LESS BOOK. THAT IS THE OLD PRICE - DO NOT HAVE NEW PRICE FOR USPS YET. SO RIGHT OFF THE SELLER LOST MONEY ON SHIPPING.  

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: Ric

Fri Jan 25 12:39:39 2013

We discontinued International selling long ago, eBay saw to that when they began allowing buyers to file claims and receive refunds even though it was obvious orders were sitting in customs waiting to be inspected and released.

We made the decision not to participate in the eBay hosted give your merchandise away to a foreigner games which are cosponsored by PayPal, and have no intention of resuming international sales anytime in the immediate future.


I believe USPS has calculated significant loss of International shipments into their new pricing structure which is why prices are skyrocketing. In other words they anticipate a decline in International shipment volume and their new pricing is designed to offset a portion of that expected lost volume.

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

by: tmooreseller This user has validated their user name.
Web Site

Fri Jan 25 14:47:18 2013

I do not use eBay or Amazon for sales. I sell direct or through Etsy. Last year I tried offering free shipping to all destinations in order to get sales and was burned by one shipment overseas which cost more to ship than the sales price of the product. Since then I have been forced to charge a flat rate up to a certain total of sales, free after that. It does not appear to matter to buyers that shipping rates are high. If it's not free they won't buy it, no matter where they are. Thanks to the onerous regulations established by the big box retailers, and the customs charges put on top of the shipping fees, I'm not going to be selling international again until Congress rescinds that stupid regulation about paying into a pension fund for employees the USPS is not likely to hire anytime soon. That is what is forcing them to jack up rates into the stratosphere. Get rid of that, and the USPS will probably be more than willing to lower rates to a reasonable level.

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.

Fri Jan 25 17:47:47 2013

acale back?  it hasn't been practical to sell books internationally for years.

what i want to know is when they are going to raise dowmestic shipping.  it costs $3.05 to send a 2lb media package, amazon gives $2.75.  i've been eating the usps raise for several years now.

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: Ming the Merciless

Fri Jan 25 19:52:50 2013

I think it's important to keep in mind that when these venues make policies that result in ANY risk for their sellers and then refuse to share in the risk that those policies create that sellers must rebel and refuse to cooperate.

When Amazero and ebafia see major decreases in out bound international orders that policies might become more reasonable.

Sellers have and will continue to express their opinion about unfair and unreasonable ebafia policies by leaving taking their repeat customers and buying power with them.

The same thing will happen to Amazero.

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

by: TomH This user has validated their user name.

Sat Jan 26 09:11:53 2013

@FREDDY
''Think maybe AMAZON is PUSHING for FBA only???? Especially for international shipments - only thing that makes sense.''

I think that is part of it. Amazon is opening more FBA locations in Europe and it is not impossible to send your items to a warehouse in Europe and sell via FBA.

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: Ina

Sat Jan 26 09:18:53 2013

Early reports coming in that Amazon has raised the credit for books - let us know what you're seeing!

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

by: TomH This user has validated their user name.

Sat Jan 26 11:00:16 2013

@Ina
''Early reports coming in that Amazon has raised the credit for books - let us know what you're seeing!''

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.

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: Ina

Sat Jan 26 12:04:16 2013

Thanks, Tom!

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

by: Digmen1 This user has validated their user name.
Web Site

Sat Jan 26 14:41:31 2013

I would not sell on Amazon as I don't like what I hear about them.
But a lot of people here in NZ buy from them.
And yes the continued rising in postal charges must/will/does have an effect on online sales.

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