Many of you have likely already seen the Amazon announcement that they are delaying the new “low inventory” fee until May, introducing a bit of transition by charging the fee in April and then reimbursing those to the Seller as a practice run.
I thought these comments quoted from Dharmesh Mehta’s LinkedIn post were interesting…
Yeah, ok. After all the crap people put up with, this isn’t going to be the straw that breaks the camel’s back.
It might not break your camel’s back, but you can’t know what other people’s camels are willing or able to bear.
Because those businesses are entirely dependent on Amazon, they are more likely willing (or too trapped) to bear more than businesses who are not.As always, there’s no one way to find success on Amazon, and there’s no one way to get fed up with Amazon.
“Mass exodus” is hardly the right term though.
Whatever small % of sellers who leave will be replaced by others.
You are so right.
Placement Fees / Low Inventory Fees could most certainly break a camels back. The gyrations FBA sellers need to go through to ensure they aren’t taking a bath are ridiculous now and open sellers up to unforced errors due to unnecessary complexities.
Yea, we found a way around the placement fees but it’s not easy and our warehouse people aren’t happy about it and they could easily make mistakes. We also have to pay more internally for the excess labor / materials.
Not only that, our method (fee avoidance) opens us up to a whole host of issues:
There’s much more I am missing here but not in the mood to continue writing. Just wanted to make a point to @GGX
Maybe true, but how stable are those new Sellers’ businesses? 
Replacing old and turfed Amazon sellers might not be so easy, with current vetting requirements. OTOH, replacing US sellers with Chinese sellers is something Amazon has been doing for years.
And then there are the Pakis dropshipping from Walmart and Sam’s Club, registering their LLCs in Wyoming and all using virtual assistants to manage their Amazon “businesses.”
If push comes to shove they’ll loosen up the gatekeeping. That will lead to new problems of course, but it’ll keep the gravy train going for Amazon.
Maybe, maybe not…but either way, these sorts of fickle fees will still be there for new Sellers looking at FBA profitability, and they’ll be more likely to lose at the fee game because they will have no historical data to build upon, unlike @ASV_Vites, or no money to hire (legitimate, proven, experienced) FBA strategists.
I’ll quote this point again:
The fact alone that Amazon walked back immediate implementation–a rare occurrence, as we discussed when Amazon walked back possible new SFP fees in the fall–speaks NOT to them “listening to Sellers” (do I even need to call BS?) but to their own people and systems figuratively raising their hands to say, “Um…WTAH???”
This fee/structure is an Amacluster, they see that, and they are actually taking April as a try-on…not a transition.
There’s a good possibility they found a bunch of errors in how the fees were assessed. Hence the “trial free and rebate”
Some small sellers only sell “one-off” items. I wonder how it works for them when it comes to “low inventory fees” and the “placement fees”.
I quit FBA years ago and I am so glad I did. They never lost my inventory but with the stories on the NSFE it is awful how they are losing inventory or claiming the box was empty.
Placement fees - they would probably pay.
If it’s one off, there’s no history, so likely not going to be hit with low inventory fees.
Don’t believe everything you read. FBA has a well over 99% accuracy for us in our 7 year existence. Seller’s with problems, for the most part, did it to themselves with user error.
We are not unique. If you ship things in a sensible, logical manner, you’re not going to have a problem with FBA when it comes to lost / short counts unless the carrier loses it.
By sensible / logical - I’m referring to professionally packed full case packs for every item and separating shipments by ASIN. You gotta keep it simple for the simpletons that aren’t paid to think. Nothing against those that work at FBA. They might be geniuses but they are paid for speed speed speed.
there was actually a post on the NSFE about a seller who mostly sells Valentine and Easter merchandise.
He got a low inventory warning for Easter merchandise 2 days after Easter. There were 1000 units and FBA wanted 5000.
I don’t do FBA for reasons I have stated over and over again, but I have to wonder what will happen with the combination of “low inventory fee” and “storage fees”
Seems to me to be a way to get people to be forced to pay some fee for using FBA above the other fees.
I assume that Amazon made some half-baked attempt to factor in seasonal fluctuations that will both not work as expected and backfire causing anger, frustration, and ridiculous fees to a segment of sellers who can’t avoid them because they are based off broken logic.
So how are these “Pakis” showing Amazon a US credit card, a power bill, and receiving mail in Wyoming? How do the details of this con work? How do they do it?
This is not so bad - a highly specific “seasonal” item (Christmas, Easter, St, Swithin’s Day…) simply does not sell so much after the Holiday, and as low inventory fees are charged PER ITEM SOLD, this will not hurt our Easter Bunny seller. The 1000 units may run up an inventory fee, but they did that last year, too.
I agree 100%. I’ve been FBA only since day one, selling on Amazon for 8 years. I learned some expensive lessons along the way, but most of those were completely my fault. Instead of blaming Amazon, I adjusted how I do things to follow their rules as close as possible.
I looked back at the last 10 FBA shipments and only 1 out of 10 had any inaccuracy during check in. That one shipment with discrepancy was missing 1 unit out of 639 which comes out to .156% If I take the percentage of units for all 10 shipments versus that 1 issue, it’s .059%. I was also reimbursed for that 1 missing unit so I’m really not out anything.
Mistakes do happen but I’ve always had good luck getting Amazon to make their mistakes right. That said, if it’s my mistake, I took responsibility and accepted the consequences of my mistakes. I took every opportunity to chat with Amazon representatives calmly and respectfully. That alone seems to go a long way. Something to keep in mind.
The Pakistanis aren’t the only foreign nationals that have driven the boom in the Registered Agents industry over the last 20 years…
