Pay less on Amazon... E-tailer cuts seller fee

MUMBAI: Shopping on Amazon may cost less as the e-commerce giant is reducing a slew of seller fees, which is likely to translate into lower product pricing.

Shoppers with smaller budgets stand to benefit the most as the company is doing away with referral fees or commission charged to sellers for products across a range of categories priced under Rs 300. Those selling on e-commerce platforms like Amazon and Flipkart have to pay a commission to the platforms for each product sold.

Products within the Rs 300 price range make up for a large part of the consumption basket of households, said Amit Nanda, director, selling partner services at Amazon India. For the middle class, which has been bearing the brunt of high inflation, some reduction in prices can help them to spend a little more.

"We did an experiment (on seller fees reduction) in Sep last year. That worked. We have just carried it and taken that to full scale. It will enable more businesses to come on Amazon, the current set of sellers to sell more and they can also choose to pass on some of the benefit to the customers," Nanda told TOI.

Amazon has also slashed shipping fees (applies to all products) for all sellers bringing them down to Rs 65 (starting rate) from Rs 77, besides making some reduction in weight handling fees. The company expects that the changes which will come into effect from April 7 will boost the platform's seller network.

Analysts said that the move is partly driven by increasing competition from quick commerce which has already taken a large share of the grocery market from e-commerce and has now expanded to other categories. "The only way Amazon competes with quick commerce now is variety and pricing. By making changes in fees and offering more benefits to smaller sellers, it is trying to retain and widen its seller base for whom the quick commerce channel is becoming important," said Satish Meena, adviser at Datum Intelligence.

Amazon has launched its own quick commerce service but it is restricted to parts of Bengaluru as of now and the firm has been late to join the rapid delivery rush, the market for which is led by Zomato's Blinkit, Swiggy Instamart and Zepto. Amazon claimed that it is the highest-ever reduction in seller fees made in India.


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