Amazon double Add-On order value to £20
Amazon have updated their help pages confirming that they’ll be doubling the minimum order value from £10 to £20 to qualify for free Super Saver Delivery. The minimum spend for books will be £10.
At the same time they’ve doubled the minimum order value for Add-On items, also from £10 to £20.
It’s worth remembering that when the Add-On program was introduced the original Add-On order value had to be £20. This was reduced 6 months later in July 2013 to a minimum order value of £10 for Add-On orders. Now it’s been hiked back to the original level.
The impact of these changes will likely be felt most by sellers of low value items, if your products are classed as Add-On items customers will now have to spend at least twenty quid in order to purchase them. The good news is that when they spend that much they will at least be able to opt for free postage, but will customers be willing to buy enough products to round an order up to £20 just to buy a single £5 product?
Only time will tell and we’d be interested to hear from sellers of low value items on Amazon if you’ve seen a significant change in sales since 2013 when Add-On items were first introduced.
Setting aside Add-On items, Amazon buyers will still be able to complete orders with a total value of less than £20. They’ll just have to pay for delivery with first class being the cheapest option available. The other alternative is of course to cough up for Amazon Prime and receive unlimited one day shipping for free.
it is all changing, even the big one is running the numbers and realising that operating at single figure nett profits does not pay.
there is no such thing as free delivery
by applying free delivery when you spend more then x amount you can just about absorb the cost (depending on other attributes), but even then the critical fact remains, it is NOT free.
however this does make Prime even more attractive (but at what cost as that is subject to change)
long live the revolution x 2
What is the difference between Super Saver and Add On delivery?
Super Saver is a delivery option. If you buy more than £20 worth Amazon offer a slowish delivery for free in addition to standard and express delivery options. If you spend less than £20 you’ll still have standard and express delivery options.
Add-On items are not available to purchase on their own, but only as part of a larger order – now a £20 minimum total order value. Otherwise regardless of how much you’re willing to pay for delivery, Amazon won’t ship Add-On items by any method if you buy less than £20 worth.
Thanks for that Chris.
However on what basis do Amazon determine if a FBA item should be an ‘add-on’ (bad news) or can still be ordered for an extra shipping cost.
We have never found that clearly stated although we suspect it is price/weight/size related.
Anybody know if you can tell before you send something to FBA if it will be treated as an ‘add-on’ apart from sending them an initial test stock quantity?
Originally we figured out that Add-On items were generally beneath £5, however after a few months we saw Add-On items around the £7.50 level.
Like you we’ve never seen an official guide as to which items would be considered Add-On items as opposed to general merchandise.
When the original add on programme started it hit us hard. At that point we had 55,000 units at FBA which were low value items. Many fell into the ‘add on’ category. We had to raise the price but to no avail. Eventually we had to sell out and flip these over to merchant fulfilled.
Over the last year we have seen a decrease in the merchant fulfilled orders compared to FBA ones. We send anything which is royal Mail Packets sized to FBA as it’s cheaper for them to despatch.
We are now of the opinion that so many people have bought into Prime that they will just use that and take advantage of the free delivery so they are more inclined to buy from an FBA fulfilled seller.
This is all part of Amazon’s masterplan to get the vast majority of buyers on prime and kill off eBay at the same time (eBay is on it’s knees – a completely different topic you should also have) so therefore we are now starting to send SKU’s back into FBA to see if they outperform the merchant fulfilled ones.
I would agree as our merchant fulfilled orders are down a little year on year but we have never tried FBA and other factors do contribute to declining sales. The concern with FBA is that they eat into the profit margin significantly as their costings for fulfillment are somewhat higher than our own, but there has to be a balance of turnover and profit, it is no good making 100% profit if you only sell one unit out of hundreds or thousands held in stock.
The question is does FBA really deliver the level of sales volume increase to outweigh the drop in profits per sale and allow you to make more profit over a period of time compared to self fulfilled?
Amazon FBA reps would definately like you to believe it, i guess the only way to know is to try it.
We have found items falling into Royal Mail large letters format are cheaper for us to despatch (around 75p compared to maybe double that for FBA), however, if there is a growing reliance on Prime (and it appears Amazon are funnelling buyers into Prime) then it maybe the case that you can raise your price by the extra fulfilment price, still sell the same amount and not have to do the work yourself…….until they completely move the goalposts again !!
As you said you have been hammered by Amazon once before with the introduction of Add-on products.
The reality is that ecommerce moves so fast, and the ever growing number of Chinese sellers using FBA is damaging to British based businesses paying taxes, so the challenges are coming from all directions. We are seeing Chinese sellers copy our adverts but use FBA and that is a real challenge to compete with without using FBA ourselves, we have invested alot into our brand recognition but FBA is still a problem when there are “similar” products to ours on FBA. Sales can drop off in a matter of weeks if someone copies us but uses FBA, even if their product is rubbish they seem to do better just because of FBA. If Amazon want every customer to use prime then they will find ways to get 90% plus using it, you just have to look at what they have achieved and it tells you they will most likely get what they want.
I think FBA is becoming the norm now and we will have to do it just to compete. We looked at using FBA in other countries but it seems to be alot more expensive compared to our home UK market.
If it was easy selling online i probably would not do it, it might be frustrating or even costly when the goal posts change but it also keeps it interesting.
If the Chinese are copying your adverts you can complain to amazon and I think they will remove them but these are limes of ever shifting sand and I fear only the fittest will survive (ad even they may not survive solely on eBay).
I think you are right in that FBA is becoming the norm now. I started in 2009 and saw a 500% uplift immediately but back then it was about 60p for delivery and referral fees. It was ridiculously cheap. they also charged nothing for 3rd party channel fulfillments so i used to send all my eBay stock there and they would send it out for free. That only lasted for a few months though.