Amazon Shakes Up Seller & Shopper Experience
Amazon is rolling out two major changes that impact both sellers and consumers. The company is discontinuing its FBA prep and labeling services, shifting operational burdens to third-party sellers. Simultaneously, it will now display import tariffs at checkout, a move seen as a political statement on trade policy.
The discontinuation of Amazon's FBA prep and labeling services, effective January 1, 2026, will eliminate tasks previously handled by Amazon, such as applying FNSKU barcode labels, poly-bagging, bubble wrapping, and bundling products. This operational shift aims to streamline fulfillment center operations and improve delivery times, placing the responsibility for these tasks squarely on sellers. Sellers who fail to comply with the new requirements risk shipment rejections, delays in inventory processing, and will not be eligible for reimbursement for items lost or damaged due to improper preparation. Shipments created before the January 1, 2026 deadline will have a grace period and still receive prep services even if they arrive after the cutoff date. A recent survey of over 500 Amazon sellers revealed that 64% expect this change to significantly impact their business, with 92% anticipating a rise in operational costs and 62% foreseeing increased logistical complexity. This has prompted over half of the surveyed sellers to consider changing their product assortment, often by dropping more complex items in favor of higher-margin products. The financial impact on sellers could be substantial, as Amazon's fees for these services ranged from $0.40 to $0.70 per unit for FNSKU labeling and $1.10 to $2.10 per unit for poly bagging. Sellers must now absorb these tasks in-house or hire third-party logistics (3PL) providers, who are expected to see a sharp rise in demand. Regarding tariffs, initial reports suggested Amazon would display these costs next to product prices, a move the White House called "a hostile and political act." However, Amazon later clarified this idea was considered for its low-cost "Haul" storefront but was never approved and is not happening. This clarification came after President Trump reportedly called Amazon founder Jeff Bezos to complain about the potential move. While Amazon will not be explicitly displaying tariff costs, sellers are still grappling with their impact, leading to price increases on some products and a reassessment of sourcing strategies away from tariff-heavy regions.
