Amazon European Sites Will Charge Return Processing Fees From October

As a third-party warehousing and logistics service provider, Shopv noticed that Amazon recently updated its charging policy for its European sites. Starting October 1, 2024, Amazon will impose a return processing fee on non-clothing and footwear products with a high return rate. This change will be implemented for the first time from January 7 to 15, 2025.

Amazon European Site Returns Processing Fee Change Guide

Scope of application

All returns on clothing and footwear. Products with a return rate above a category-specific threshold, except clothing and shoes. This policy applies to UK, German, French, Italian, and Spanish sites, but not to the Netherlands, Sweden, Poland, and Belgium.

Exemption conditions

Sellers who deliver less than 25 items per month do not need to pay return processing fees. Sellers who sign up for the Amazon FBA New Arrival Offer can enjoy a return processing fee waiver for up to 20 items per eligible parent ASIN.

Charges

The return rate thresholds for each product category will be announced on October 1, 2024 (European time). For apparel and footwear, there is a returns processing fee for each returned item. For non-apparel and footwear products, returns above the threshold will be priced based on the item's size class.

The return processing fee adjustment on Amazon’s European site will undoubtedly affect the operating costs of many sellers. We understand that this change may cause some pressure on sellers, but please note that Amazon’s new policies in the US are usually gradually extended to other sites. Therefore, we recommend that sellers pay close attention to Amazon’s policy developments in order to adjust operating strategies in a timely manner.

What impact will adjusting Amazon fees have on sellers?

Increased operating costs

Sellers now have to pay a fee (usually €2-4 per returned item) when buyers return products to Amazon fulfillment centers. This adds additional costs that sellers didn’t have to bear before, especially for items with high return rates.

The increasing importance of reducing return rates

With the introduction of this new fee, sellers must minimize product returns. Providing accurate product descriptions, clear images, and excellent customer service can help reduce unnecessary returns and related costs.

profit compression

Sellers’ profit margins may be squeezed due to returns processing fees.

Risk of sales decline

Items with a high return rate may be marked as "High Return Rate," which may influence buyers' purchasing decisions and lead to decreased sales.

Strategy adjustment

Sellers need to pay close attention to the return rate data on the returns control panel and adjust operating strategies according to the situation to maintain competitiveness and profitability.

Possible move to third-party logistics

Some sellers may consider turning to third-party warehousing and logistics services instead of using Amazon's Fulfillment by Amazon (FBA) program. This allows them to avoid Amazon's return processing fees, but it also means losing FBA benefits, such as Prime eligibility and Amazon's customer service.

Re-evaluate pricing strategy

Sellers may need to adjust their pricing strategies to account for the additional return processing costs, which can be offset by increasing product prices or offering partial refunds/restocking fees on returns.

While returns processing fees add a new expense to sellers, the impact can be mitigated by focusing on reducing return rates and carefully evaluating the trade-offs between using FBA or a third-party logistics service based on individual business needs and product categories.

Amazon’s new policy has caused dissatisfaction among some sellers. However, as a third-party warehousing and logistics service provider, we believe this may also be an opportunity for sellers to rethink their logistics strategies.

Charging return processing fees for Amazon, options for sellers

chemical product quality

Ensure product quality and reduce returns due to quality issues.

Improve product descriptions

Accurately describe the product, avoid exaggerated publicity, and ensure that the product description matches the actual product.

Provide high-quality after-sales service

Respond to and solve customers' after-sales problems in a timely manner, reduce negative reviews and possibly gain positive reviews.

Consider third-party warehousing, logistics and distribution services

Some sellers may consider turning to third-party warehousing and logistics distribution services to find more flexible and cost-effective logistics solutions. Third-party logistics can provide broader coverage and more versatile services.

Take advantage of the FBA New Arrival Discount Program

Amazon offers a return processing fee waiver for eligible items, which sellers can take advantage of to reduce fees.

Amazon’s return processing fee policy will prompt sellers to pay more attention to product quality, customer service and logistics efficiency, and may also prompt some sellers to explore third-party logistics services as an alternative.

Shopv provides flexible and cost-effective logistics solutions to help sellers manage returns and optimize inventory, thereby mitigating the impact of Amazon’s new policy. Our services cover a wide range and can adapt to the needs of different sellers, whether they need customized logistics solutions for specific goods or want to reduce overall logistics costs.

Additionally, Shopv offers a transparent fee structure and personalized customer service, ensuring sellers can easily manage their logistics needs while remaining competitive.

As Amazon’s new policy comes into effect, we encourage sellers to evaluate all available logistics options and consider partnering with third-party warehousing and logistics service providers like Shopv for more advantageous logistics solutions. We believe that by working with professional third-party logistics partners, sellers can better control costs, improve efficiency, and ultimately achieve continued business growth.