
In 2024, Amazon announced changes to their fee structures and policies that ate into sellers’ bottom lines. From inventory and high return rate fees, to reimbursement and deferred transaction policy changes, sellers were often left scrambling to get their accounts in order to ensure compliance.
We’re recapping all of the major changes Amazon made to their fees and policy in 2024, and sharing how your brand can be prepared to comply with these changes in 2025 and be prepared for any new updates Amazon might release.
Amazon Fees & Policy Changes in 2024
Low-Inventory-Level Fees
In April 2024, Amazon enacted their new fee change to items that consistently have low inventory levels. Amazon noted that they would “only charge the low-inventory-level fee when the historical days of supply metric are below 28 days.” This change was applied at the parent-ASIN level, and is calculated by dividing your average daily inventory units by your average daily shipped units.
Inventory Placement Fees
Amazon’s new inventory placement fees, which went into effect in March of 2024, ended up impacting sellers day-to-day. Inventory placement fees existed before, but they were always optional, allowing sellers to pay in order to send SKUs to fewer facilities if they wanted to. With this update, however, sellers are now forced to pay for placements or have to pack boxes in a very specific way in order to avoid those fees. With the latter, it usually adds complexity to the warehouse packing process, oftentimes meaning more cost on that side of the process, regardless of avoiding the placement fees.
High Return Rate Fees
In June 2024, Amazon implemented their new returns processing fee, which impacted products with high return rates in all categories except apparel and shoes. The only other exception is if your product shipped less than 25 units that month.
This new rate is “the percent of your product’s shipped units in a given month that’s returned by customers over that month and the subsequent two calendar months,” according to Amazon. Theoretically, this would encourage sellers to either fix issues with their product or update their product title and description to reduce returns.
Lost-Inventory Reimbursement Policy Changes
In December 2024, Amazon announced that they were updating their reimbursement policy for lost or damaged inventory, beginning in March 2025. Rather than reimbursing sellers for the price the item would have sold on Amazon (minus the fees you would have paid on that sale), Amazon will now “reimburse you based on the product manufacturing cost of the affected inventory.”
Amazon does give sellers the option to provide their manufacturing costs (cost of goods, or COGs) to Amazon, theoretically allowing you to at least recoup what the lost product cost you. However, sellers typically hesitate to share this level of data with Amazon—in particular because Amazon has been known to compete directly with sellers.
If you choose not to provide your cost of goods to Amazon, they will provide an estimate for the manufacturing cost for you, based on similar products Amazon sells.
Product Title Listing Changes
We posted about this on LinkedIn, but at the end of 2024, Amazon announced that in mid-January 2025, they were updating their requirements for product titles. Now, product titles can’t:
- Exceed 200 characters
- Contain the same word more than twice
- Include certain special characters
If your listings don’t meet these new requirements, Amazon’s generative AI could update them automatically.
Deferred Transaction Policy
On November 1, 2024, Amazon announced that sellers would not receive their sales proceeds “until seven days after an order is delivered.” Now, in the payments dashboard, sellers would see their payment status as “deferred transaction” until the sale is actually processed.
This update caused a lot of problems with reporting, so it was one of the biggest changes sellers experienced in 2024—and since there’s still no good solutions, sellers are still experiencing challenges. This change was also rolled out in Q4, the busiest time of year for most sellers, who were seeing a lower amount than expected being paid out by Amazon due to this change.
Profitability was already a challenging aspect within Seller Central, with users having to piece together a true P&L. It’s been made even more confusing with this update, since they cannot tie sales back to order date or shipped date, and are left having to trust a new delivery date +7 days metric that isn’t visible or verifiable (at least so far).
How can Brands Optimize around These Changes in 2025?
Changes like these occur quickly with very little or no advance notice, which leads to a lot of stress for sellers.
Getting granular is critical. Dig into each element individually, and make business decisions to improve. Brands will just have to accept some changes as the new norm and cost of doing business, but it’s important they understand the why behind these changes.
Amazon Warehousing and Distribution (AWD) is a viable option to avoid the placement fee changes, as those fees are already included in AWD fees, and Amazon automatically optimizes those for sellers. Not only that, but AWD can act as an affordable warehousing solution, and automatic FBA replenishments can be set up as well.
Amazon will continue to iterate on the fees they introduced in 2024 and potentially add additional fees in 2025 to continue pushing for better use of their own warehouse space, as well as offsetting their own costs. Stay up to date with the latest Amazon updates by following Kapoq on LinkedIn!
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