Amazon asks sellers to send it more stuff
Amazon is offering its third-party sellers discounts on storage fees as part of its plan to fulfill speedy shipping promises.
According to Business Insider, Amazon now offers a 75% discount on storage fees at its warehouses in exchange for storing best-selling items there.
This would enable Amazon to offer more items on its Prime one-day delivery service. The company recently announced that it would be reducing its speedy two-day shipping policy down to one-day.
If the plan works as expected, these merchants will sell more stuff and Amazon will be able to promote a large selection of one-day shipping inventory, reports CNET. Plus, consumers will benefit from faster shipping of more products.
Amazon’s third-party marketplace has become one of the most profitable areas of its business. Sales from these sellers now make up for more than 58% of the physical gross merchandise sold on Amazon, growing from $0.1 billion in 1999 to $160 billion in 2018.
CEO Jeff Bezos commented on the success of this arm of the business in the company’s annual letter to shareholders in April. “To put it bluntly: Third-party sellers are kicking our first party butt. Badly,” he said.
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