India’s ecommerce sellers are heading into the festive rush with a growing cost burden. While Amazon India and Flipkart have cut commissions to attract more sellers, higher cancellation penalties, platform fees and logistics costs are denting their margins just as festive demand peaks. Meanwhile, subdued discretionary spending and rising logistics costs are adding to their woes. But what’s really happening? 

Flipkart’s Penalty Shot: Flipkart’s zero-commission push across fashion categories in July has nearly doubled seller onboarding. However, its new penalty structure charges sellers ₹30 for delayed dispatches and another ₹60 for cancelled orders, regardless of order value. This flat fee is hurting smaller sellers and low-value orders, taking the shine off its zero-commission model.

Amazon Plays Spoilsport, Too: The ecommerce giant has followed suit. It has revised its cancellation fee structure, linking charges to order value instead of slapping a flat fee. Amazon’s flat tier-based penalty for cancelled orders can go up to 10% of the order value for orders up to ₹10,000, falling to 8% for orders between ₹10,001 and ₹50,000, 5% for orders between ₹50,001 and ₹1 lakh, and 2% for orders above ₹1 lakh. An additional 18% GST applies to these charges.

Deliveries Turn Costlier: Rising logistics costs are also adding to the festive-season strain, with Amazon raising closing fees and Delhivery introducing a surcharge on D2C shipments. Flipkart is also considering a revision in seller fulfilment fees. Quick commerce is adding to the pressure, with frequent, smaller shipments increasing vehicle requirements and waiting times at distribution hubs.

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