Who Bears the End-to-End Shipping Costs on Amazon?

Who Should Bear the Cost of Amazon's Final Mile Delivery?

In today's thriving e-commerce landscape, logistics costs remain one of the core concerns for both merchants and platforms. On a global e-commerce giant like Amazon, how to reasonably allocate the cost of final mile delivery is not only crucial for merchants' cost control but also directly impacts consumers' shopping experience. So, who should bear the cost of final mile delivery on Amazon? This question hides complex business logic and industry rules behind it.

Theoretically speaking, Amazon’s logistics model can be divided into two parts head-end transportation and final mile delivery. Head-end transportation generally refers to the process of transporting goods from suppliers' warehouses to Amazon's FBA Fulfillment by Amazon warehouses, while final mile delivery means delivering products from Amazon warehouses to consumers. In most cases, the cost of head-end transportation is borne by merchants, but theof final mile delivery is not so straightforward.

Merchant Perspective The Burden of Final Mile Costs

For third-party sellers on Amazon, the cost of final mile delivery is an undeniable factor. Especially in cross-border sales, final mile delivery often involves multiple countries’ logistics networks, which undoubtedly increases merchants’ operational challenges. For example, a Chinese seller selling products to the U.S. market, if choosing to use Amazon’s logistics services, the final mile delivery fee may be directly included in the order cost. Although this simplifies the logistics process, it also means merchants have to pay additional fees. Many small and medium-sized sellers are calling for Amazon to provide more flexible pricing solutions or subsidies to alleviate their financial pressure.

Platform Perspective The Importance of Optimizing User Experience

As one of the largest e-commerce platforms globally, Amazon always regards user experience as its core competitiveness. To enhance customer satisfaction, Amazon has invested heavily in final mile delivery, building a widely covered delivery network and launching value-added services such as Prime membership. However, these measures inevitably bring high operating costs. In this context, Amazon tends to pass part of the final mile delivery costs onto merchants to maintain profitability. After all, for the platform, the prosperity of merchants directly determines the health of the entire ecosystem.

It is worth noting that in recent years, Amazon has also tried to adjust its pricing strategy. For instance, at the beginning of 2025, Amazon announced higher delivery fee standards for certain high-profit categories and offered some preferential measures for low-profit categories. This adjustment shows that Amazon is striving to balance the interests of all parties and achieve a win-win situation.

Consumer Perspective The Need for Price Transparency

The ultimate flow of final mile delivery costs also profoundly affects consumers' immediate interests. When merchants raise prices due to increased freight costs, consumers naturally feel the economic burden increase; conversely, if the platform can effectively control logistics costs, it might lead to lower product pricing. More and more consumers are paying attention to the transparency of final mile delivery costs. They hope that the platform can clearly display the logistics cost details of each transaction so they can make wiser consumption decisions.

In fact, Amazon has realized this and gradually strengthened relevant information disclosure. For example, the platform requires merchants to label shipping costs on product pages and detail the specific amounts of various fees during the settlement page. Despite this, some users still believe that the current information disclosure is not comprehensive enough and expect more complete mechanisms in the future to ensure consumers' right to know.

Industry Trends and Future Outlook

With technological progress and intensifying market competition, the final mile delivery sector is witnessing unprecedented opportunities for change. The application of technologies such as drones, autonomous vehicles, and intelligent warehousing is expected to significantly reduce logistics costs and improve efficiency. Against this backdrop, Amazon and other e-commerce platforms may reassess their existing charging models and explore fairer and more reasonable solutions.

Some emerging third-party logistics companies are also gradually gaining prominence. Leveraging innovative service models and technological tools, they offer merchants more diversified options. For instance, a green logistics-focused company recently launched a carbon-neutral delivery plan targeting small and medium-sized sellers, aiming to help merchants reduce environmental impacts brought about by final mile delivery, and possibly reduce some logistics expenses.

In conclusion, theproblem of Amazon's final mile delivery costs is not isolated but involves a tripartite interest game among merchants, platforms, and consumers. Through continuous optimization of business models, strengthening technological innovation, and enhancing transparency, the goal of win-win results can truly be achieved. In the future, we have reason to believe that with the development of the industry, the sharing mechanism of final mile delivery costs will become more scientific and reasonable, thus driving the entire e-commerce ecosystem toward a more efficient and sustainable direction.