FBA storage fees increase so much during Q4?

#1

Hi guys,

I received a message from Amazon about free inventory removal that included:

“On October 1, 2017, monthly inventory storage fees will increase from $0.64 per cubic foot to $2.35 per cubic foot for standard-size items and from $0.43 per cubic foot to $1.15 per cubic foot for oversize items for October, November, and December. For a limited time, however, you can remove inventory for free to avoid these previously announced fees”.

Do Amazon really raise FBA storage fees so high during Q4? That is about 300-400 percents!

The storage fee is 1417 USD for September and now 5,589.85 USD for October
#2

Yes. This is to force Sellers of low velocity merchandise to unclog the Fulfillment Centers.

A few years ago, many Sellers that used FBA during the --Christm-- Holiday Season were jammed up because their goods stayed out in the carrier delivery trailers - for weeks - on the FC property, instead of being received as saleable inventory. The inventory that was in the warehouses were of the cheap Chinese knock-off variety, which didn’t make the kind of money that everyone wanted.

Consider this scheme a Seller penalty for lax sales management.

#3

Yup. Basically its their way of saying “get your useless crap out of our fulfillment centers during our busy Black Friday, Christmas and Various holiday crunch”

So many sellers flood the warehouses with junk that never sells or sells at such a slow pace that although the seller is making money, Amazon is flooded with inventory.

Amazon wants you to only send int stuff that sells during these months so that they have room for their hundreds of thousands of items Amazon sells itself during the Christmas rush.

You will notice however that Fulfillment Fee’s are less. Only the storage fee is higher. So in other words, stuff that comes in and ships right back out will cost you less in storage, and then Amazon will drop the fulfillment fee a little.

Edited by: Strike 3 on Sep 19, 2017 3:46 PM

#4

One reason why Amazon does that is many sellers send in too large of quantities on an item and that is a poor selling item and it takes up shelf space that can be used for fast selling items. In the past, Amazon has blocked many sellers from sending stuff to the Fulfillment Center during the 4th quarter.

As Amazon gets more sellers, I expect the problem to get worse.

closed #5

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