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Amazon India rolls out damage allowance for sellers

08 May, 2017

Even as sellers on online marketplaces grow impatient over delayed payments and rising commissions, e-tailer Amazon India has rolled out for its vendors an allowance to cover potential damage during transportation.

“We have introduced damage allowance in Seller Flex for certain categories as part of our endeavour to continue providing a good seller experience on this channel,” an Amazon India spokesperson confirmed to VCCircle.

Under Seller Flex, vendors selling on Amazon can convert their warehouses into an FBA (Fulfilment by Amazon) warehouse. This gives them an opportunity to experience and avail themselves of Amazon’s practices around warehousing, inventory management, packaging, and shipping.

Earlier, The Economic Times reported that Amazon will pay the vendor a fixed percentage of the selling price of the product if it gets damaged in transit. At this point, the allowance will be available on categories like apparel, shoes, watches and luggage, the report said.

The All India Vendor Association (AIOVA), a group of 2,000 sellers, welcomed the move and urged other e-tailers to “follow suit.”

“This eliminates all the hassles which sellers used to face to claim reimbursement on time,” an AIOVA spokesperson told VCCircle.

Amazon’s move to compensate sellers for damage to products comes on the heels of its decision last month to hike commissions across categories. According to a report by the Financial Express, the increase in commissions was to the tune of 50-100%.

In November last year, Amazon had hiked commissions for several categories, including consumer electronic devices like smartphones, laptops and desktop computers, and reduced charges on large appliances like furniture and kitchen appliances.

While seller issues have been rampant across marketplaces, Snapdeal appears to be the worst-affected. Several sellers on the beleaguered e-tailer have complained against non-payment by the company over the last couple of years. In the latest such incident, Bangalore-based apparel-seller Rajdhani Cotton has filed a petition with the commissioner of police, Delhi against Jasper Infotech Pvt. Ltd, the company that runs Snapdeal, and its founders Kunal Bahl and Rohit Bansal.

In February, a group of sellers from AIOVA approached commerce minister Nirmala Sitharaman to complain against piling dues at the troubled e-commerce firm. According to the complaint, Snapdeal held Rs 300-400 crore in the form of outstanding dues and goods in transit/refunds.

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Amazon India rolls out damage allowance for sellers

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