On November 17, 2022, Amazon made a silent announcement that had a huge impact on third-party sellers using the FBA (Fulfillment by Amazon) service. Starting from January 2023, Amazon is increasing its storage fees for storing products in its warehouses. This change will affect a large number of businesses, as nearly 60% of the items sold on Amazon come from third-party sellers.
As an Amazon seller, it’s essential to stay up-to-date with the latest policies and fee changes to keep your business running smoothly. In this blog, we’ll take a closer look at the new FBA storage fees, what they mean for your business, and how to prepare for the changes.
Increased FBA Storage Fees in 2023
Amazon is increasing its storage fees for both standard-size and oversize items stored in its fulfillment centers. The new fees will be in effect from January 1 to June 30, 2023, and are based on the volume of your inventory and how long it’s been stored in the fulfillment center.
For standard-size items, the monthly storage fee will increase from $0.75 per cubic foot to $0.80 per cubic foot. For oversize items, the fee will increase from $0.48 per cubic foot to $0.60 per cubic foot. These changes may seem small, but they can quickly add up for businesses with large amounts of inventory stored in Amazon’s fulfillment centers.
Impact on Your Business
The increased FBA storage fees will affect all third-party sellers using the FBA service, regardless of their sales volume or size. If you have a significant amount of inventory stored in Amazon’s fulfillment centers, the increased fees will significantly impact your overall business expenses.
It’s essential to plan ahead and make necessary changes to your business strategy to prepare for the increased fees. You may need to consider reducing the amount of inventory you store in Amazon’s fulfillment centers, optimizing your product pricing, or finding alternative fulfillment options to minimize the impact on your business.
Preparing for the Changes
To prepare for the new FBA storage fees, follow these steps:
- Review your inventory: Take a close look at the amount of inventory you have stored in Amazon’s fulfillment centers and the amount of time it’s been there.
- Optimize your pricing: Consider adjusting your product pricing to offset the increased storage fees.
- Consider alternative fulfillment options: If you have a significant amount of inventory stored in Amazon’s fulfillment centers, you may want to consider alternative fulfillment options, such as self-fulfillment or using a third-party fulfillment company.
- Plan ahead: Start planning ahead for the increased fees now, so you have time to make the necessary changes to your business strategy.
In conclusion, the increased FBA storage fees announced by Amazon in November 2022 are a significant change for third-party sellers using the FBA service. It’s essential to understand the impact of the changes and prepare your business accordingly. By reviewing your inventory, optimizing your pricing, and considering alternative fulfillment options, you can minimize the impact of the increased fees on your business.