Amazon which is one of the biggest e-commerce companies in the Indian market has been adopting different measures to be the top player in the Indian market; it has been working hard to be the numerouno in each and every aspect surpassing its rivals like Flipkart. In the same series, Amazon India has lowered seller fees in categories such as furniture and luggage. The online retailer has reduced the commission it charges from its sellers across 22 categories including furniture, laptop bags and sleeves, home storage, eyewear, innerwear, luggage, wallets, backpacks, watches, etc. The fee revision will be effective from July 15.
Earlier, Amazon India had reduced seller fee in the month of April 2018. Under the previous change in the seller fee, the company has reduced the referral fees in over 30 categories, which ranged from 10 per cent to as high as 75 per cent.
Now again the company has made changes to its seller fee structure and this move can be seen as a strategy of the company to surpass its arch rival Flipkart which is aiming to be a big driver in the furniture division. In this recent change, in the seller fee structure, referral fees for several fashion products have been decreased. The seller fee for apparel accessories have been reduced to 15% from 20%, while the fee for categories such as furniture, has been reduced to 12% from 14%. The fee for luggage has also been reduced to 5.5% from 7%, while the fees for eyewear have been reduced to 8.5% from 16.5%.
The company has also reduced fulfilment fees and weight handling fees at its warehouses to promote sellers to ship locally and regionally, as it had announced in April. The fixed fee which Amazon charges from its sellers under the “Fulfilled by Amazon” programme has been reduced by 25 per cent on items priced over Rs 500, including shipping charges.
When asked on the recent change in seller fee structure, an Amazon India spokesperson said, “At Amazon, we have always believed in working backwards from sellers needs and make selling on our marketplace easier and profitable for them. In the recent fee change, we have reduced referral fee across 22 categories, have lowered fee across various components such as weight handling, pick and pack fee for oversized items to provide sellers the flexibility to reduce their costs of doing business on Amazon and serve the customers better.” He further added that our constant endeavour is to ensure that our rate card is optimum from a seller’s cost of doing business perspective.
Earlier in March 2018, Flipkart had also reduced its fees for sellers in categories such as fashion and books. It also lowered the fixed fee for a below INR 500 from INR 10 to INR 5. These frequent changes in the fee structure shows the competition between the two companies and none of them wants to miss any chance to attract more and more customers. Both the companies look aggressive and both of them want to push their sellers to provide them low-priced products.
Although Amazon has reduced the seller fee, the All India Online Vendors Association (AIOVA), which represents a group of online vendors selling on platforms such as Amazon and Flipkart, has showed its dissent on the matter. An AIOVA spokesperson said, “Such frequent, non-consultative tariff changes need to be regulated. It is not about Amazon but the entire ecosystem, which is unregulated.” The spokesman said it is not only about Amazon but every e-commerce company; he said there should be proper guidelines for the companies regarding such revisions in the seller fee structure.