Amazon India Tweaks Commission For Sellers, To Reduce Cash Burn

Amazon India has revamped seller commissions around half of its product groups, In a move aimed at cutting subsidies, Improving business margins and rationalizing costs, While continuing to give incentives for high-growth categories.

Even the e-commerce giant has additionally raised logistics fee structures, Increased prices for boosting lightning prices and introduced a product listing charge over 1 lakh items per vendor.

Although the new encouraging arrangement is very likely to face backlash from several sellers, Industry observers say it is in line with steps taken from the e-commerce company to restrain cash burn and decrease incentives it gave sellers to scale up the company.

“Business is not constant, Business construction varies, Margins change and retaining inflation into consideration while taking vendor feedback, We’re making these changes,” Said Gopal Pillai, vice-president, Seller solutions in Amazon India.

Amazon said, On May 23, It might increase commissions and cut commissions on home furnishing, Sports items, Fashion jewelry, handbags, and musical instruments. Broadly, The fluctuations vary between 0.5% and 2% over groups.

Both the companies are revisiting seller fees and price structures every six months. They have been revising rates based on the categories they would like to develop and fill gaps in merchandise selection. Amazon India has over 4.5 lakh sellers offering over 170 million products on its own platform. Sellers select and pack, And incur monthly warehousing commission, Shipping costs and pay a predetermined fee per purchase, Referral commission fee depending upon the style of gratification that they select on the marketplace.

Amazon has marginally increased its weight-handling fee because of its FBA and Easy Ship business and has raised the cost of listing on its”Lightning prices” page, Which will be its most visited webpage giving vendors a high exposure.

Amazon said its top quantity record cost of Rs 0.50 per item a month will guarantee much better visibility in the market.

The Company has, However, Offered zero fulfillment fees for items around Rs 20,000, Pick and package cost for items onto its Fulfillment produced some price deductions.

This is a service where the seller permits Amazon to manage customer support, Shipping and packing, and stores products in Amazon’s fulfillment centers.

“We expect to build on this as our vendor’s advancement on the trip of growing their business by selling to millions of consumers around India,” Pillai said.

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