Amazon To Hit Sellers With 5% Fuel and Inflation Fee

Amazon is the latest company to implement a plan to combat soaring fuel costs: charge sellers on its giant e-commerce platform an inflation tax.

To compensate for rising fuel costs, Amazon will charge sellers a 5% fuel and inflation fee that will go into effect on April 28, according to Bloomberg, citing a person familiar with the matter.

The surcharge will apply to sellers who use Amazon’s massive network of fulfillment centers across the US to sell goods. Fulfillment centers handle the logistics of getting goods to consumers’ doorstep but take a massive network of fuel-guzzling planes, trains, trucks, and vans for the e-commerce company to deliver on its two-day promise.

Amazon is expected to inform sellers about the fee later today. The added fee comes as inflation remains at levels not seen since the early 1980s, and gas prices are at record highs… Russia’s invasion of Ukraine exacerbated inflationary pressures on companies…

We’re sure once sellers are informed about the inflation tax, there will be an angry response from them. Sellers are likely to pass on the tax to consumers.

As Bloomberg reports, Amazon merchants were already grappling with cost-related fee hikes that took effect in January and averaged 5.2%.

“Consumers will lose,” said Dan Brownsher, who runs Channel Key, a Las Vegas e-commerce consulting business with more than 50 clients selling products on Amazon.

“Amazon already raised fees in January, so sellers will have to raise prices.”

Amazon is far from alone as airlines are raising ticket prices, Uber and Lyft last month added fuel surcharges, and FedEx and UPS have raised prices, mostly though surcharges that vary by package type.

Source: ZeroHedge

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