As you know Amazon charges buyers a universal postal credit for UK orders, which for the most part is passed onto sellers. This payment is regardless of size or weight of an item. Now at one time you could make a small but quite worthwhile profit from postal credit even if the starting offer price is based at 1p.
Unfortunately, I fear, those days are long gone due to the ever-increasing postal charges year on year. Even taking into account Amazon’s increase to the postal credit (which now stands at £2.80 rather than £2.74), Royal Mail’s charges are just too high now to allow us to make any sort of reasonable profit from postal credit.
Many sellers, especially merchant sellers, are not only losing money on sales but are paying money out on top to cover postage charges, Amazon fees and the cost of actually buying the product to sell.
There has been much speculation by Amazon sellers, regarding another potential postal credit rise – although there’s been no sign of any increase as yet.
Perhaps Amazon is not interested in raising the postal credit? They may see it as a way to increase sales of Kindles, they may also believe it could boost uptake of its FBA programme.
I note with interest that eBay allow up to £4 postage and packing rates to sell books. This of course makes a great difference, as you can post heavier low value items and make a healthier profit. I’m not sure if Amazon will consider a rise of this type but would certainly be nice!
Of course, the real question is how competitive will Amazon be if buyers have to pay out more for lower value books? Personally if Amazon raises the postal credit to £2.99 and low value books are set at 1p, I cannot see buyers not paying £3 for a quality book delivered to their door, but this remains to be seen.
To counteract diminishing profits on low value books, I avoid listing weighty low value books. I try and concentrate instead on purchasing niche non-fiction with the potential to be sold for a premium price.
But the fact remains that the books most likely to resell are popular fiction. Buyers want to purchase popular fiction. However, I feel that unless Amazon do assist sellers, they may find sellers avoiding Amazon. It is in their, and your, interest to see at least a 19p rise – more if possible.
In fact this week I received an email regarding the possibility of a postal credit rise. It appears Amazon’s customer service team are being besieged with complaints regarding the postage credit. So, is there anything we can do to help persuade Amazon to increase the postage credit? Well it seems you may have an opportunity to voice your concern as the email below from Pam and Derek explains:
Here’s something interesting for you and your readers:
Had a long phone chat with an Amazon seller support chap the other day.
Apparently hundreds of sellers have complained about not upgrading the postal allowances. The people who make the decisions don’t seem to be the ones that face the complaints. I did, however get the following by email a few minutes ago (the bold text is mine):
“I am sorry to hear that our shipping policy was not satisfactory to you.
You can write to our Managing Director via his e-mail address:
Or, you may post him a mail to the following address:
So, if you are keen to persuade Amazon to increase the postal credit, then contact Amazon’s Managing Director, it may well make a difference.