New long-term storage fees


#1

the new long term storage fees coming every month. has nearly killed my business.
bi-annually made sense and I was willing to put up with it because annualized it was going to be manageable .

now it would be cheaper for me to rent warehouse space locally for what they will charge monthly.
am I under standing this correctly? if I was charged 2000 annually,will now be 12000 annually? that I.s unsustainable. Is amazon trying to run off small fba sellers?


#2

Amazon does not want items that won’t be sold quickly (in less than 6 months). You will need to stop that behavior and only keep enough inventory for less than 6 months (better to be less than 3 months). Either restock more frequently or keep some staging storage to restock when appropriate.

It no longer makes any financial sense to keep a year’s supply of stock at Amazon.

Dave


#3

Amazon created the LTSF because sellers were sending in to many of the same item that sat around collecting dust.

Many sellers did not get the clue and continued to send in to many of the same item that sat around collecting dust so Amazon created the monthly LTSF. Should most of the blame fall on sellers that use Amazon as a warehouse instead of using it as a Fulfillment Center?

If sellers do not get that clue, they really won’t be happy with what Amazon comes up with next.


#4

You got it.

My big beautiful warehouse costs less to maintain than a year’s previous LTSF. And is a much better investment.

If you sell media, guessing from your username, then I would say FBA is not for your products. It’s for stuff that moves like lightning in vast quantities. I know FBA is good for some products, even if it’s less good than ever, but it’s not good for media items at all.


#5

No, you won’t. The fees are charged every month now, but it’s a smaller amount per charge than was charged when it was every 6 months. The total annual cost has increased, but it is now divided by 12 instead of 2; so you’ll see your total cost go up, but not by a factor of 6. In fact, an item that sits from Jan to Feb the following year (so would get charged twice under old system) will pay only a little more total under the new. However, if it sells in January, you will have been charged for most of what would have hit in Feb, so the new system will cost you more.
Also note that with the new fees, once it passes 12 months, the fee is a minimum of 50 cents PER ITEM;so if you are selling smaller items, the new fees after 12 months can be substantially higher.


#6

I have to disagree with that. Certainly, the old model of 'ship it in and forget about it" doesn’t work anymore, and those who specialize in rare or other long-tail items won’t do well with FBA, but if you are selective about which items are sent in for FBA and which ones you either don’t source, or do as MF, then it can work very well at a very reasonable rate.
My last month’s storage fees, regular and LTSF combined, were less than 1% of my sales. For a large seller than can justify a “big beautiful warehouse”, that may be an issue, but for many sellers, I don’t think it is a problem.


#7

The math is tough, because under some scenarios you can actually save on LTS fees under the new structure. (For example, if you remove/sell items at 7 or 13 months.)

But it looks like your worst-case scenario is roughly double the LTS fees for leaving items for extended periods of time. (This assumes you aren’t hit with the 0.50 minimum).


#8

My attitude is colored by the harrowing ordeal of unexpectedly losing BB eligibility. Believe me, that changed everything. I’ve had the lowest price on hundreds of items and haven’t been able to sell them because my offers are invisible. I never thought something like this would happen to me. I still don’t know why it happened – I have ideas, theories, but no absolute explanation. And Amazon could care less. It’s like reading some of the horror stories on this forum – they’re shocking, and to rest easy you think “well it never happened to me there must be some other side to the story that the OP isn’t sharing.” Then, this happened to me.

If it hadn’t, would I still have some stock in FBA? Probably. I loved FBA. I love the margins it makes possible. But I’d already been scaling down my FBA dramatically in the year before – rare and collectible stuff gets ruined, long-tail gets charged too much, and so on. I bet I could identify some books that would still be worth trying. FBA-only would not be an option anymore – too many of the kind of books I sell are either way too long tail or way too collectible.

I would like to build my Amazon inventory back up to respectable levels, and when you pass the starting gates of a few thousand items then staying on top of FBA fees & storage quickly gets too hard to manage, at least for me. I’m not even that large of a seller – yet. People have talked about how many books you need to make x amount of money, but I don’t know if you can easily compute that. It depends on what the books are and what they’re priced. But I know in my experience that in order to make enough solid cash to be comfortable you need at least 4-5k active listings. But even with the same books and the same prices, this number would differ for other people in other situations.

Anyway, you’re the only person I know who is talking about still FBA’ing books. I think that’s great and hope it works out incredibly for you – and I hope you share your experiences on here as time goes by. I’ll be interested to hear how it goes. I always believed in FBA bookselling. Darn it I was good at it. I’m so rattled by what happened to me that I don’t think I could ever bring myself to send a single SKU into FBA again.If you lived close by I’d give you my stash of avery labels & FBA packing supplies.


#9

what are the coming up with next?


#10

But all these fees make holiday planning pretty dicy! In the past, I sent in my inventory in early October to avoid the last minute holiday rush. (I didn’t want to be the guy who’s inventory was sitting in a truck in the parking lot during Black Friday.)

I know my inventory will be sold by January, but I also don’t want to face storage fees for October.

So what do I do?


#11

I know quite a few sellers IRL who are doing at least some, if not all, of their business FBA. But my guess is that they are too big to have time to post on the forums! :wink:

Anyway, in the short time that I’ve been here, it’s certainly changed, and as you point out, many books are not suitable for FBA anymore (if they ever were). I may have the slight advantage of being fairly new, so didn’t have some of the old expectations, and still small enough to adjust and keep up with the changes. But I think one thing is certain; it’s no longer appropriate for the seller who wants to list and forget about it.

On the bright side, if more people leave FBA, it can only help me!

Sorry to hear about your BB issues; I can imagine that making a huge difference. Hope whatever the Ama-gods have against you they get over soon.


#12

I wish they would. I see many clearing out, some like @2swellguys already out, and some of the older more established megas still selling as if nothing is going on. The ones i still see active are selling popular books & bestsellers. I think FBA still has a place for those kind of titles.


#13

The change in LTSF should not affect you at all, if in fact you sell out in under 6 months. The increase in regular storage fees is slightly higher than last year, although a lot higher than during the rest of the year. I don’t think that there is any change in the fees that should affect your business model, assuming it worked for you last year.
And for the little bit of fees paid now, think of it as insurance to not be “That guy”. Besides, some people are already shopping for the holidays.


#14

As others have stated, Long Term Storage fees do not affect you until your items have sat unsold for SIX MONTHS. If you can sell out your items in less than 3 months, ship as much as you can sell. The monthly fees are a bit higher, but that may not be a serious problem. The Q4 monthly rate is $2.45/cuft. Just be aware of that. Ideally having stock arrive into inventory just in time is the goal, but with delays in delivery and receiving, it can be more challenging.

Dave


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