Amazon on Wednesday said it will impose an average 5 percent fuel and inflation surcharge on merchants to warehouse and ship their products in the United States, in response to rising costs.
It
is Amazon's first such surcharge and follows months of higher wage and
labour-related expenses that have chipped away at the online retailer's profit.
Effective
April 28, Amazon will charge an average 24 cents more per unit it stores and
ships through its Fulfillment by Amazon (FBA) service. The surcharge, which is
not permanent, is "a mechanism broadly used across supply chain
providers," Amazon wrote in a message to merchants, which it shared with
Reuters.
"We have experienced significant cost increases and
absorbed them, wherever possible, to reduce the impact on our selling
partners," the message said. "In 2022, we expected a return to
normalcy as COVID-19 restrictions around the world eased, but fuel and
inflation have presented further challenges."
So far, Amazon has only announced a surcharge in the United
States, its biggest market. While sellers can avoid the higher cost by shipping
goods to customers directly, many rely on FBA for eligibility in Amazon's
fast-delivery club Prime.
Amazon said its fulfillment service "continues to cost
significantly less than alternatives." @ Reuters
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