Amazon Starts Withholding Seller Funds

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Because of the US INFORM Consumers Act, Amazon has gone to great lengths to verify seller information. The company made the announcement last month and has since started withholding seller funds to compel compliance.

Amazon is giving sellers about a month to verify their information. It’s only withholding funds now, but it may cause sellers to lose complete access to their accounts soon.

Are you covered by this deactivation threat?

 

Seller Fulfilled Prime Will Reopen

woman on the phone checking her laptop

Amazon recently announced that it will reopen SFP enrollment this year, so those of you who want to take control over your inventory while enjoying the benefits of a Prime badge should sign up now.

Seller Fulfilled Prime was started in 2015, but enrollment has been paused because in Amazon’s opinion, SFP sellers were not meeting their standards.

Sellers have to go through a trial period before they can actually qualify for a Prime badge. Undoubtedly, Seller Fulfilled Prime has stringent requirements. These are just some of them:

    • Ship over 99% of your orders on time
    • Have an order cancellation rate of less than 0.5%
    • Use Amazon Buy Shipping Services for at least 99% of orders
    • Have nationwide delivery coverage for all standard-size products
    • Use ship methods that support weekend delivery and pick up (Saturday or Sunday)
    • Meet targets for 1-day and 2-day delivery promises

Triple the Amazon Seller Fees?

 
Amazon has taken pride in small business empowerment. However, it’s currently under scrutiny after a non-profit research organization released a report, revealing that the company’s income from seller fees have tripled in the past five years.

The report was prepared by SOMO (Stichting Onderzoek Multinationale Ondernemingen), otherwise known as the Centre for Research on Multinational Corporations.

photo of Amazon's logo on a building

The study reveals what most third-party sellers already know: it’s getting more expensive to sell on Amazon.

Amazon’s income from seller fees jumped from €7.6 billion in 2017 to €23.5 billion in 2022. Revenue from these fees has consistently increased despite the fact that there’s a small reduction in retail sales. This makes seller fees Amazon Europe’s second highest revenue source.

SOMO called Amazon’s “monopoly power” a “structural problem that needs a structural solution.” This is because although sellers have other options, e.g., sell on their own e-commerce stores, it remains to be the most visited online marketplace in European countries who have Amazon.

Etc.

 
In summary. Amazon is reportedly using AI to generate summaries of reviews to give buyers an overview of what customers like and dislike about the product.

Attention-based advertising. Yahoo is allowing advertisers to use attention units as a filter.

Breaking Google. European Union officials say Google’s ad business should be broken up to avoid conflict of interest.

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