As booksellers, we know success on Amazon relies on understanding and adapting to its ever-changing environment. Recently, two significant updates announced by Amazon – the introduction of Inventory Placement fees and adjustments to FBA fulfillment fees – require our attention.

Let’s break down both sets of changes and explore their impact on our businesses:

Inventory Placement Fees: New Costs and Strategic Solutions

Effective March 1st, 2024, Amazon is introducing new Inventory Placement fees to distribute inventory closer to customers. The fees will be distributed across two of the three Inbound Placement options. The third Inbound Placement option is being called Amazon Optimized Shipment Splits and will have no fees but could generate 4+ potential splits when creating batches.

Here are the three new Inbound Placement options to sellers:

1. Minimal Shipment Splits
2. Partial Shipment Splits
3. Amazon Optimized Shipment Splits

For book sellers, this translates to an average of $0.27 per unit for standard-sized books and $1.58 for bulky ones.

While Inventory Placement fees introduce new costs, the good news is:

• FBA fulfillment fees are decreasing! Standard-sized book fulfillment fees will drop by $0.20 per unit, and large bulky ones will see a significant $0.61 decrease starting April 15th, 2024.
• Books under $10 still enjoy an additional $0.77 discount.

So if the average book sold on Amazon’s marketplace by FBA sellers fits the standard size (15″ x 12″ x 0.75″) then sellers on average should only see an $0.07 increase in fees per book. That’s not bad at all considering historial fee increases from Amazon are typically in the 10-15% range.

Single Book Example

Let’s take a single book example and break down the pricing with the new fees.

This book falls within the standard size for Amazon and thus here is the Inbound Placement Fee calculation that comes directly from Amazon’s Rev Calculator:

According to Amazon, by default, sellers will be opted into the Partial Shipment Splits option unless they change this setting within Seller Central.

It is our opinion, that for book sellers, you will want to stick with this default placement option because it is the happy medium between the other two options in terms of costs and headaches.

Remember: Amazon provides a calculator to estimate fees for specific ASINs and units. Use it to make informed decisions.

While Inventory Placement fees introduce new costs, the good news is:

• FBA fulfillment fees are decreasing! Standard-sized book fulfillment fees will drop by $0.20 per unit, and large bulky ones will see a significant $0.61 decrease starting April 15th, 2024.
• Books under $10 still enjoy an additional $0.77 discount.

Conclusion:

While adjustments are occurring, it’s crucial to remember that Amazon remains committed to partnering with sellers for mutual success. By understanding the fee updates, implementing strategic cost-saving measures, and exploring new program opportunities, you can continue to thrive in the evolving Amazon landscape. Embrace the change, analyze its impact on your business, and adapt your strategies for continued success.