The holidays are the biggest sales season. Yet, sellers must pay Amazon peak season fees. These are extra charges that Amazon will apply from October 15 to January 14.
In 2023, Amazon experienced a record-breaking sales number. They sold more during the holiday season than they ever have before. It’s no surprise that Amazon expects even bigger holiday sales in 2024.
Sellers should prepare for a busy sales peak! However, Amazon holiday sales come with a major issue: fees. These fees impact all sellers who use Amazon FBA for fulfillment. Amazon peak season fees are confusing, and budgeting for these extra expenses can be tricky.
Here’s your guide to the 2024 Amazon peak season fees, how to budget for them, and other holiday selling options.
What Are Amazon Peak Season Fees?
Amazon peak season fees are extra charges that Amazon applies to specific products. They only affect sellers who use FBA and only apply during the holiday season, starting in October 15 and extending to January 14.
These costs will cover Amazon shipping fees and the higher demands on transportation and fulfillment during the year’s busiest sales season.
Why Does Amazon Charge Peak Season Fees?
The holidays are the most profitable time of the year, but they come with many logistical challenges. The costs to process and ship orders add up, and sellers must bear the extra expenses.
Here are specific reasons why Amazon will charge peak season fees:
- Higher operational costs. Amazon will be managing a larger influx of orders, which will be more expensive. Some extra expenses they will incur include transportation and labor costs.
- More demand. As more customers make more purchases, Amazon will experience a higher influx of orders than usual. These sales spikes will impact fulfillment centers.
- Warehouse capacity. Besides straining warehouse workers and delivery drivers, Amazon must establish new protocols for managing the capacity at its fulfillment centers.
As you can see, Amazon peak season fees are necessary to accommodate a more demanding fulfillment process.
Amazon Peak Season | Dates and Deadlines
Do you plan on selling products on Amazon during the holiday season? If so, pay attention to sales dates and inventory deadlines to ensure a smooth holiday sales period.
These dates and deadlines include:
- Black Friday and Cyber Monday inventory deadline: Inventory must arrive at Amazon warehouses by November 2.
- Christmas inventory deadline: Inventory must arrive at Amazon warehouses by December 1.
- Black Friday: November 29
- Cyber Monday: December 2
- Holiday peak fulfillment fees: October 15 – January 14
Related content: Profitable End-of-the-Year Sales
Amazon Peak Season Fees for 2024
Fulfillment fees vary by product size. Amazon fulfillment fee sizes into different categories with corresponding fees:
- Standard: $2.50 – $3.00
- Large/standard: $4.00 -$5.00
- Large/bulky: $6.00+
These prices are general estimates. The product’s weight will also impact fulfillment fees since it’s more expensive to ship these products. Here are a few product examples and the peak season fees you can expect to pay:
Peak season fees may not be the only extra costs that sellers may pay. For example, there are also inbound placement fees.
How Amazon Peak Season Fees Affect Sellers?
Even though peak season fees improve Amazon’s fulfillment during the holiday season, these extra expenses can eat into a seller’s profits. Here are other ways that these extra fees may impact sellers:
- Pricing. Sellers must adjust their prices to make their ROI. For most sellers, this means raising their prices.
- Profit margins. Peak season fees impact overall profit margins. Sellers must account for these fees for their entire inventory and understand how to calculate their ROI.
- Inventory management. Sellers must adjust their inventory management to balance demand. Stock up on popular products in advance and manage your inventory capacity to order extra storage costs.
Related content: Get Ready for Q4 Sales
Tips to Manage Amazon Peak Season Fees
There are many actions that a seller can take to minimize the impact on Amazon peak season fees. These include:
- Adjust pricing. While sellers must increase prices to offset the damage of peak season fees, there are ways to accommodate the extra expenses while staying competitive. Increase prices―temporarily, of course―for more popular items as opposed to all products.
- Optimize past sales data. Look back on last year’s holiday sales to better predict your forecast for this year. Keep the right stock around for the most popular products.
- Don’t run out of stock. Always have enough inventory on hand and reorder more stock before you get too low. If necessary, reorder inventory automatically at a certain point. The last thing you want to deal with is negative customer interactions and lost sales.
- Use promotions. An effective way to stay competitive when increasing prices is by hosting sales and promotions. Offer special holiday discounts and offers. These discounts can boost your sales volume and amount, and the bite from the peak season fees won’t be as harsh.
- Use Amazon’s tools. Amazon offers many tools for sellers at no extra cost. You’ll especially want to use their reporting tools to track sales, trends, your inventory, and your overall seller performance.
- Don’t forget storage fees. In addition to peak season fees, sellers must also worry about storage fees with extra inventory. Make less popular items more competitive by running sales on them or keeping them at normal price.
- Keep up with Amazon fees. If you’re an FBA seller, you’ll pay a lot of fees. Stay updated with Amazon and any new fees or amounts that can affect your profits.
- Follow sales trends. Stay updated on sales trends so you know which items are most demanded and are selling the best in your niche.
Alternative Fulfillment Options for the Holiday Season
Using FBA can help you better manage the holiday season. But if Amazon FBA fees are eating too much of your profits, it may be better to choose another fulfillment method. Here are a few options.
Self-Fulfillment
With self-fulfillment, you manage every aspect of the fulfillment process. You’ll control everything from the inventory management to shipping, so no process goes unchecked. Plus, self-fulfillment gives you the opportunity to personalize many aspects of the fulfillment process.
That said, managing your own fulfillment is time consuming. You may suffer from high sales volume and constant order fulfillment, so it’s integral you set up a strong self-fulfillment process before starting this strategy.
3PL
Third-party fulfillment (3PL) is when you outsource your storage and shipping to another company. Unlike Amazon, which has its own processes, a 3PL company can meet your storage needs and sales volume.
3PL companies know the best shipping rates, saving you and your customers money. But like with FBA, you don’t have as much control when working with a 3PL firm.
Plus, working with a 3PL company takes a lot of time, since a lot goes into their planning. Compared to FBA, all sellers must do is send their inventory to an Amazon warehouse.
Other Marketplaces
Amazon isn’t the only marketplace you can use for the holidays. Walmart, Etsy, eBay, and Mercardo Libre are other popular examples. This strategy not only cuts down on your peak season fees but you’ll also reach more buyers.
That said, some of these marketplaces require you to use your own fulfillment. They also come with fees which may be just as expensive or pricier than Amazon. It’s best to use an Amazon FBA calculator and compare those costs to another marketplace’s.
Are Amazon Peak Season Fees Eating Into Your ROI?
The holidays are a profitable time for ecommerce sellers, but you must take Amazon peak season fees into consideration. These are extra charges that Amazon will apply from October 15 to January 14.
Did you use FBA for the holidays last year and Amazon peak season fees ate into your ROI? We can help solve your challenges. We can create a strategy for you to minimize the impact of peak season fees and grow your sales.
Author
Stephanie Jensen has been writing ecommerce content for seven years, and her copy has helped numerous stores rank on Amazon. Follow her on LinkedIn for more insight into freelance writing and creating high-quality content.
