Amazon & Flipkart Seller Charges Increased: New Fees, Penalties & What Sellers Need to Know

Amazon and Flipkart have revised their seller charges and penalties ahead of the festive season. The new changes affect areas such as order cancellations, dispatch timelines, and other marketplace fees.

These charges can have a direct impact on the seller's margins. Although a single cancellation might not be that significant, many cancellations or undelivered dispatch times can add up over time.

This is where the importance of accuracy in inventory and order fulfillment becomes paramount for sellers. No longer will stockouts, late processing and late dispatch times have a direct cost. A consistent process for getting orders moving on time is necessary for sellers to avoid costs that they may be able to control.

Amazon and Flipkart have taken different approaches to these changes. Amazon's cancellation charges are linked to the order value, so the cost can increase with the value of the order. Flipkart's new penalties use fixed amounts per affected order, with the final charge depending on the dispatch or cancellation issue.

Amazon Cancellation Fees

Amazon has introduced a new cancellation fee structure for sellers who use Easy Ship and Self Ship. The fee applies when a seller cancels an order for reasons other than a buyer-requested cancellation.

Amazon can also charge the fee when it automatically cancels an order because the seller does not ship and confirm it within the required timeline. The cancellation fee now depends on the total order value, with different rates for different order-value slabs.

Amazon's New Cancellation Fee Structure

An 18% GST also applies to the cancellation fee.

Let's Understand This With an Example

The percentage can make a noticeable difference, especially for higher-value products. Here are a few examples:

For example, cancelling a ₹20,000 order would result in a ₹1,600 cancellation fee, plus ₹288 in GST. That brings the total charge to ₹1,888.

This is why inventory accuracy and timely order processing matter. When a seller cannot fulfil an order after accepting it, the resulting cancellation can now carry a direct cost.

Amazon Closing Fee Increase

Amazon will also increase its closing fees from September 7, 2026. The increase depends on the product value:

The fee increase applies across Fulfillment Centre, Easy Ship and Seller Flex.

The increased charges are small for an individual order, but high-volume sellers can see the additional cost add up across thousands of orders.

New Dispatch & Cancellation Penalties

Flipkart has introduced a new penalty structure for sellers when orders miss dispatch timelines or get cancelled due to seller-side issues. The penalty depends on what happens to the order after the Dispatch By Date (DBD).

The new penalty system is for sellers after their first three months on the platform. New sellers are not affected during this period.

The adjustments will mean that order processing becomes more vital for sellers. Failure to adhere to deadlines for dispatching products consistently can now lead to a direct cost, particularly during sales periods and holiday seasons where orders surge.

Why Flipkart's Dispatch Penalties Matter

The individual penalty may look small, but the total cost can become significant when the same issue affects a large number of orders.

For example:

• 100 affected orders can result in ₹3,000 to ₹6,000 in penalties.
• 1,000 affected orders can result in ₹30,000 to ₹60,000 in penalties.
• An order that misses its DBD and is later cancelled can attract a ₹90 penalty.

For high-volume sellers, preventing these issues is more cost-effective than dealing with them after they occur. Faster order processing, accurate inventory and reliable dispatch operations can help sellers reduce avoidable penalties.

While both marketplaces have increased the financial consequences of seller-side issues, the two fee structures work differently. Amazon's cancellation fee is linked to the order value, while Flipkart uses fixed penalties based on the type of dispatch or cancellation issue.

The difference matters depending on a seller's business model. Amazon's cancellation fee can have a larger impact on sellers selling high-value products, while Flipkart's fixed penalties can become costly when a high volume of orders miss dispatch timelines or get cancelled.

For both platforms, the common concern is the same: operational mistakes can now have a direct impact on seller margins.

Marketplace fees are only part of the cost for sellers. Operational issues such as inaccurate inventory, delayed processing and missed dispatch deadlines can now add further expenses. These problems often become more difficult to manage as order volumes grow.

Inventory Availability

When marketplace inventory does not match actual stock, sellers may receive orders for products that are no longer available. This can lead to cancellations and the additional charges that come with them.

Order Processing Delays

Manual picking, packing and order processing can slow down fulfillment, especially when teams handle a large number of orders. Delays can make it harder to meet the timelines set by marketplaces.

Dispatch Bottlenecks

Sales events and festive periods can bring a sudden increase in order volumes. If warehouse capacity does not increase at the same pace, orders can remain unprocessed and miss their dispatch deadlines.

Lack of Inventory Visibility

Managing inventory becomes more challenging when it is sold across multiple channels, including Amazon, a D2C website, and others. Sellers are more likely to over-order, have stockouts, and experience fulfillment delays without knowing where and when products are in stock.

Sellers cannot control every marketplace charge, but they can reduce many costs that result from operational errors. Better inventory management and faster fulfillment can help prevent cancellations, dispatch delays and other avoidable issues.

1. Maintain Accurate Marketplace Inventory

Keep the inventory shown on Amazon and Flipkart aligned with your actual available stock. Regular inventory updates can reduce overselling and help prevent cancellations caused by stockouts.

2. Set Faster Order Processing Workflows

Reduce the time between receiving an order and preparing it for dispatch. A defined process for picking, packing and order handover can help teams process orders faster as volumes increase.

3. Track Dispatch Deadlines

Monitor Amazon's shipping timelines and Flipkart's Dispatch By Date (DBD) for every order. Clear cut-off times and regular tracking can help identify orders that need immediate attention before they become delayed.

4. Keep Inventory Closer to Demand

Position stock closer to the locations where most of your orders come from. A well-planned inventory network can reduce unnecessary movement and help fulfil orders within the required timelines.

5. Consider Outsourced Ecommerce Fulfillment

As order volumes grow, managing storage, inventory and daily fulfillment in-house can become difficult. An ecommerce fulfillment partner can handle the complete process, from storage and inventory management to pick and pack, dispatch and returns, while giving sellers more capacity to focus on sales and growth.

Outsourcing fulfillment will not remove Amazon or Flipkart's seller fees. However, it can help reduce the operational issues that lead to avoidable cancellations, delays and penalties.

An ecommerce fulfillment partner can take care of key warehouse and order processing activities, including:

• Better inventory visibility across marketplaces and sales channels
• Dedicated warehouse operations for receiving, storing and managing stock
• Faster picking and packing to move orders through the fulfillment process
• Structured dispatch processes to help meet marketplace timelines
• Additional capacity during sales and festive peaks without building a larger in-house team
• Multi-channel inventory management across Amazon, Flipkart and D2C channels
• Returns handling to keep returned inventory moving back into the fulfillment cycle

For brands selling across Amazon, Flipkart and their own website, a centralized fulfillment operation can make it easier to maintain accurate inventory and consistently meet marketplace dispatch timelines.

The goal is not simply to outsource warehouse work. It is to build a fulfillment process that can handle growing order volumes without allowing preventable operational issues to eat into margins.

AAJ Supply Chain Management helps ecommerce brands manage storage, inventory, pick and pack, dispatch and returns through an integrated fulfillment setup. This allows brands to scale their marketplace operations while keeping day-to-day fulfillment more organized and predictable.

• Amazon's new cancellation fees vary by order value, making seller-initiated cancellations more expensive for some orders.
• Amazon's closing fee increase will add ₹1–₹3 to applicable orders from September 7, 2026.
• Flipkart's new penalties range from ₹30 to ₹90 per affected order, depending on the dispatch or cancellation issue.
• Sellers should look at the cumulative cost across their order volume, rather than treating each penalty as an isolated expense.
• Accurate inventory, faster order processing and reliable dispatch operations can help reduce avoidable marketplace charges.

The festive season can bring a sharp increase in orders. Reviewing your inventory, B2C warehouse capacity and fulfillment processes before volumes rise can help you stay prepared and avoid preventable operational costs.

Looking to streamline your ecommerce fulfillment? AAJ Supply Chain Management can help manage storage, inventory, pick and pack, dispatch and returns for your marketplace and D2C orders.