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Amazon wants out of the storage business

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This year we have seen quite a few changes from Amazon on their FBA program. Back in June we talked about the changes in storage fees nearly doubling fees right before the busy holiday season. Now amazon Is putting in new restrictions on sellers prohibiting those that have not shipped their first load to Amazon before October 10th from submitting any merchandise until after December 19th. The message from Amazon is becoming abundantly clear that their 90 plus distribution and fulfillment centers are maxed out on capacity and that they want out of the storage business. FBA from the beginning has been a game changing concept for ecommerce and has helped many small and midsized businesses compete on a global scale not previously available to independent merchants. But with its rapid growth and success have come some pitfalls that not even the retail giant could have foreseen. In their attempt to become the one stop shopping destination for everything in the world they have also become the world’s largest storage locker. Yes now they have everything in the world you could want but does someone actually want it? More troubling to executives at amazon is the question are we storing less desirable items at the expense of a sale on another more desirable item? The answer to this question sounds like a resounding yes based on these recent rate increases and restrictions to new sellers who may or may not have a good concept of how desirable their merchandise might be. Overall this may be a potential plus to the well-established FBA merchant expect to see less overall competition and hopefully(fingers crossed) the race to the bottom on price will not be as fierce this year. To new merchants blocked out of FBA this holiday season don’t give up, fulfill yourself. December 19th is not that long of a wait and as we have seen in previous years, just because the holidays are over does not mean consumers have stopped shopping.   


 

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