Amazon India hikes seller commissions across categories; increases refund fees

Amazon India has hiked the commissions on several categories on the platform, including beauty and personal care, baby care, automotive products, grocery, and medicines. The new rates will be applicable starting May 31, 2023.

The marketplace earns money by charging sellers a percentage of the final sale price (item price, including shipping charges) as commissions. It routinely revises the charges depending on market rates and takes 18% as GST charges separately.

The fee hike means consumers can gear up for the rising cost of items on the Amazon India platform, where sellers will price their items higher to offset high commissions.

Platform fees for over-the-counter medicines—generic medicines available for purchase without a prescription from a medical practitioner—rose the highest from 5.5% of the item price to 12% for items priced below Rs 500 and 15% for items priced above Rs 500, the company said on the seller page of its website.

Grooming and personal care appliances will be charged 9% for items priced above Rs 1,000, while sleepwear apparel will be charged 15% from 13% earlier for items priced above Rs 500. All categories under apparel, including innerwear, accessories, and ethnic wear, have also witnessed a revision.

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On the other hand, apparel and appliances categories have seen a decrease in commissions for items priced below Rs 500. However, the reduction is marginal and won't cause a significant impact on sellers, a seller listed on the platform told YourStory on the condition of anonymity.

Further, Amazon India has raised the cost of refunds borne by sellers. The new structure divides sellers into four tiers—basic, standard, advanced, and premium—based on the number of orders fulfilled, customer feedback, reviews, and returns. The previous structure had a single category of sellers.

Also, the ecommerce company has increased the cost of long-term storage of items—keeping inventory in Amazon-owned warehouses for more than 365 days—to Rs 40 per unit (1,105 cu.ft.) from Rs 30 per unit (850 cu.ft.).

"We value your feedback and strive to raise the bar of your selling experience, as well as customer’s experience on Amazon.in. We have made a few key changes to our fee structure. Please note, these changes will be effective from May 31, 2023, and they reflect our commitment to make Amazon.in one of the most preferred marketplaces for selling in India," the company said on its website.