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Fears of Amazon squeezing suppliers by raising fees to ship low-cost goods
来源： 编辑：编辑部 发布：2018/04/10 14:49:36
AMAZON is striving to create more profitability out of online shopping orders in a push to curb shipment losses by blocking orders of low-priced items and raising shipping fees for consumer goods suppliers, Bloomberg reports.
The e-commerce giant deducts transport costs from payments for bulk orders from suppliers.
Since its shipping costs have dramatically risen in recent the years, Amazon is attempting to shift these costs more to its suppliers and specifically target low-cost items that are heavy and expensive to ship, including beverages and nappies, New York's Business Insider reported.
Additionally, the e-commerce giant is planning to make it more difficult for shoppers to purchase single, low-priced items, such as toothbrushes or soap, to encourage them to add these items into a larger purchase.
Some personal care and health items on Amazon are already restricted as "add-ons," or items that can only be purchased with a basket size of US$25 or more. However, the company is planning on designating more items as "add-ons" by expanding the category to include health and beauty products that cost less than $7.
Shipping costs reached $20 billion in 2017 for the e-commerce giant, up 31 per cent year on year in the fourth quarter alone. Although Amazon has been working to optimise its fulfilment network through a string of initiatives, like extending order cut-off times to eliminate split shipments, its shipping costs are still growing in the double digits.
Experts warn, however, that Amazon risks alienating its suppliers by increasing fees. The company is already known for demanding a great deal from its suppliers during negotiations if they want to remain major suppliers on the site. It's previously increased the portion of freight costs suppliers take on or persuaded them to purchase more ads on the site, for example.
The e-commerce giant deducts transport costs from payments for bulk orders from suppliers.
Since its shipping costs have dramatically risen in recent the years, Amazon is attempting to shift these costs more to its suppliers and specifically target low-cost items that are heavy and expensive to ship, including beverages and nappies, New York's Business Insider reported.
Additionally, the e-commerce giant is planning to make it more difficult for shoppers to purchase single, low-priced items, such as toothbrushes or soap, to encourage them to add these items into a larger purchase.
Some personal care and health items on Amazon are already restricted as "add-ons," or items that can only be purchased with a basket size of US$25 or more. However, the company is planning on designating more items as "add-ons" by expanding the category to include health and beauty products that cost less than $7.
Shipping costs reached $20 billion in 2017 for the e-commerce giant, up 31 per cent year on year in the fourth quarter alone. Although Amazon has been working to optimise its fulfilment network through a string of initiatives, like extending order cut-off times to eliminate split shipments, its shipping costs are still growing in the double digits.
Experts warn, however, that Amazon risks alienating its suppliers by increasing fees. The company is already known for demanding a great deal from its suppliers during negotiations if they want to remain major suppliers on the site. It's previously increased the portion of freight costs suppliers take on or persuaded them to purchase more ads on the site, for example.