Amazon India hikes logistics fee and listing charges for sellers

In a move to improve its business margins in India, e-commerce major Amazon is revamping its seller commissions across its product categories.

The e-commerce marketplace has decided to increase charges on logistic fee, promoting lightning deals and item listing charge beyond 1 lakh items per seller.

The categories where commissions would be increased include watches, luggage, shoes, beauty products and mobile phones while commissions cut would be applicable on home furnishing, sports items, fashion jewellery, handbags and musical instruments, among others.

The changes range between 0.5% and 2% across categories. At present, Amazon charges a commission of anywhere between 3% and 25%. The changes will reportedly be effective from May 23.

Talking about the changes Gopal Pillai, vice-president of seller services at Amazon India said that business structure changes are made keeping inflation in mind. We are making these changes after taking sellers feedback, Pillai was quoted as saying to ET.

In India, Amazon has more than 4.5 lakh sellers offering over 150 million products on its platform. Sellers on the marketplace at present pay a fee per order, referral fee, and separately incur shipping costs, monthly warehousing fee and pick and pack fee as per the mode of fulfilment.

Earlier in March, home-grown e-comm firm Flipkart has increased commissions charges on western wear, kurtis, innerwear, smartwatches, blazers, and waistcoats. The increase in commissions ranges between 6.5% and 15%.

E-comm marketplaces are constantly trying way to improve their business margins and expand business through structural changes. The government last year brought new FDI policy for e-comm firms barring them from selling exclusive products from companies where they own a stake and from owning more than 25% of vendors.

Meanwhile, the new structure changes in commission are yet to get any reaction from sellers. As per experts observing the space, this may lead to a backlash from the sellers.