Hello EBO’ers!
(That’s short for E-BusinessOnliners, and if you’re reading this it means you’re part of this community!)
Just wanted to write up a quick article about something I encountered this weekend with Amazon FBA. I have a PL (Private Label) product that has been selling really well. Depending on the selling price we typically net around $10/unit after all Amazon fees and landed cost of the product.
This weekend I was updating an Excel spreadsheet that I use to track some profitability and I wanted to get my Net Sale amount from the FBA Calculator. I entered my current selling price and was shocked that instead of clearing $10, I was only getting $4. My FBA fees had literally DOUBLED.
I panicked for a moment thinking this was a glitch with the FBA calculator so I started reviewing my payments and sales history and my heart just sank. The fees doubled and I was barely making any money.
I have seen that Amazon fees would be increasing in February so I started adding up the various fees and it became apparent to me that the reason my fees doubled was because my product was being treated as “Oversize”. The problem is … my product is NOT oversize.
The next step I took was to check my product’s ASIN product detail page on Amazon. Everything looked correct except the shipping weight, which was one full pound heavier than it should be. I went into SellerCentral and edited the product and all of the dimensions and both the item weight and shipping weight were accurate. I honestly could’t understand how this could happen as we are Brand Registered and the only seller on the item.
Thankfully, I was able to open an urgent support case with Amazon and had them verify our product’s dimensions in the warehouse. In less than 24 hours they had it fixed and the fees were back to normal. However, based on my payment reports, it appears that I was overcharged “oversize” FBA fees since mid-December. Amazon has committed to refunding us for that excess.
It’s pretty scary that this could happen without any warning or notification. It’s yet another reason that you have to constantly monitor your FBA costs, fees, lost and damaged inventory, and Amazon refunds. There are a few programs out there that will do this automatically for you. AMZSuite is one that I used for a while but discontinued the service when they switched to a $79/month fee. Currently, I’m using Refunds Manager – it’s monitors my FBA inventory and gets me reimbursed when Amazon feels to credit us for returns, restocking fees, damaged or lost items, oversize charges, etc. They don’t charge a monthly fee, but keep 25% of the amount recovered.
Bottom line: pay attention to what’s going on. These mistakes can happen all the time and will cost you a lot of money.
Happy Selling!
Fred
