Amazon Adds 5% Fuel and Inflation Surcharge for Its Sellers
2022.04.13 21:11
© Bloomberg. A semi truck with the Amazon.com Inc. Prime logo travels along a road outside the company’s BHM1 Fulfillment Center in Bessemer, Alabama, U.S., on Saturday, Feb. 6, 2021. The campaign in Bessemer to unionize Amazon workers has drawn national attention and is widely considered a once-in-a-generation opportunity to breach the defenses of the world’s largest online retailer, which has managed to keep unions out of its U.S. operations for a quarter-century. Photographer: Elijah Nouvelage/Bloomberg
(Bloomberg) — Amazon.com Inc (NASDAQ:AMZN). will charge businesses that sell products on its website a 5% fuel and inflation fee beginning April 28, according to documents reviewed by Bloomberg, a first for the company.
The new surcharge, the latest sign of companies grappling with rising costs, will apply to U.S. sellers who use Fulfillment by Amazon, a service in which Amazon stows, packs and ships products on behalf of independent merchants. Amazon intends to notify sellers about the fee later Wednesday, according to a person familiar with the matter who asked not to be identified because the plans are private.
Inflation has skyrocketed in recent months, and gasoline prices have surged since Russia invaded Ukraine. Uber Technologies (NYSE:UBER) Inc. and Lyft Inc (NASDAQ:LYFT). each added fuel surcharges last month to offset the added costs.
In the email to be sent to Amazon sellers, the company said it has made big investments since the start of the pandemic to meet surging demand. Those include doubling capacity, adding 750,000 employees and raising the average Amazon warehouse employee wage to $18 from $15.
“Like many, we have experienced significant cost increases and absorbed them, wherever possible, to reduce the impact on our selling partners,” according to the email. “In 2022, we expected a return to normalcy as Covid-19 restrictions around the world eased, but fuel and inflation have presented further challenges. It is still unclear if these inflationary costs will go up or down, or for how long they will persist.”
For Amazon, the marketplace business represents nearly a quarter of sales. The company had seller services revenue of $30.3 billion in the quarter that ended in December.
(Updates with Amazon email in the fourth paragraph.)
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