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Amazon prices likely going up with new ‘fuel and inflation surcharge’

Amazon prices likely going up with new ‘fuel and inflation surcharge’

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The 5 percent surcharge hits US sellers on April 28th

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Increased fees to sellers will likely be passed on to buyers.
Increased fees to sellers will likely be passed on to buyers.
Illustration by Alex Castro / The Verge

Amazon is looking to offset costs to third-party sellers in the US resulting from soaring inflation and fuel prices. The new 5 percent “fuel and inflation surcharge” for sellers that use Amazon’s fulfillment services will go into effect starting April 28. Since most items purchased off Amazon are from third-party sellers, you can expect these new costs to be passed along to shoppers.

89 percent of Amazon’s over two million third-party sellers use Fulfillment by Amazon (FBA) to leverage the retail giant’s supply chain, warehouses, and shipping operations, reports Jungle Scout research

“We will be employing a fuel and inflation surcharge for the first time”

“In 2022, we expected a return to normalcy as Covid-19 restrictions around the world eased, but fuel and inflation have presented further challenges,” said an Amazon spokesperson in an email to CNBC. “It is still unclear if these inflationary costs will go up or down, or for how long they will persist, so rather than a permanent fee change, we will be employing a fuel and inflation surcharge for the first time — a mechanism broadly used across supply chain providers.”

FedEx charges a fuel surcharge of 49 cents per unit while UPS charges 42 cents, according to CNBC. Amazon’s surcharge is 24 cents.

US inflation hit 8.5 percent in March while gasoline was up 48 percent since last year, according to a report from The New York Times.