Are you a seller of low priced products on Amazon? If so, you could be impacted by Amazon’s referral fee changes for all products priced at £2.66/€3.32 and below, due to be introduced from Thursday 9th October 2014. Amazon sellers pay a referral fee, based on the product category and on the total amount paid by the buyer for each item.
Jewellery and watch sellers
Under Amazon referral fee changes, from Thursday 9th October 2014 jewellery and watch sellers will have to pay a minimum referral fee of £1.25 per-item. However, all other product categories except books, music, videos, DVDs, software and video games, video games consoles, and grocery will have a £0.40 per-item minimum referral fee. Kindle Accessories products will have a referral fee of 45% with a £0.40 per-item minimum referral fee.
Lower priced items
It is important to note, that these changes only affect lower priced items. For example, in a category such as Sports and Categories, that has a 15% referral fee, a £0.40 per-item minimum referral fee only applies to items with a total sales priced at £2.66/€3.32 and below. Those items will now have a referral fee of £0.40, while items with a total sales price equal to or greater than £2.67 will continue to have a referral fee of 15% of the total sales price.
Chris Dawson at Tamebay suggests sellers of low priced products may adapt and start selling “product bundles rather than continue to sell products on an individual basis”. Are you a Amazon European seller? This article from Seller Central provides more details and examples of referral fees for Amazon European sellers.
Not all bad news
But it’s not all bad news, Amazon states that with effect from 9 October 2014, “the minimum fee for Electronic Accessories and PC accessories will be lowered to £0.40, and it will also apply to sellers under the individual selling plan”. Currently sellers pay a minimum referral fee on £0.50 per-item.
Sellers will be keen to examine their current prices to ensure they remain competitive in their marketplace. One of the ways you can do this is to use our repricing software, which comes with a 15-day free trial.
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