Amazon Drops Fees to 5% in Europe. The Reason? Shein and Temu

How Much Exactly Is Amazon Cutting

Referral fees for clothing and accessories will drop as follows:

• 5% (from 7%) for items up to 15 euros/pounds
• 10% (from 15%) for items between 15-20 euros/pounds

For comparison – Shein currently charges 10% in the EU and 12.24% in the UK. New sellers even get their first 30 days for free.

Why Amazon Is Doing This Now

Shein and Temu have significantly disrupted the European e-commerce market over recent years. They sell everything from home decor to vacuum cleaners at brutally low prices. Amazon still holds a dominant position in Germany, France and other countries, but competition is starting to eat into its market share.

The European e-commerce market is expected to hit 900 billion euros this year with 7% growth. Everyone’s fighting for that money now.

What This Means For Sellers

Amazon says it’s passing on cost savings to its sellers. In practice, if you’re selling cheap fashion items, your margins will improve. Or you can push prices even lower and compete directly with Shein and Temu.

The question is whether the fee reduction will be enough. Chinese competition has the advantage of ultra-low manufacturing costs and direct factory connections. Amazon realises this, which is why it’s targeting the cheapest segment – that’s where competition is fiercest.