Hundreds of large Amazon sellers are boycotting the online retailer’s advertising platform on Wednesday to protest several recent policy changes.

Amazon published changes to how it pays out seller proceeds and collects advertising payments, while levying a temporary 3.5% fuel surcharge.

Some sellers are worried the policies will strangle their cash flow and say it’s another example of Amazon putting the squeeze on them.

For Amazon sellers, who account for over 60% of goods sold on the e-retailer’s sprawling marketplace, times would be tough no matter what right now.

The Trump administration’s high tariffs on imports have created a year of hardship, and the recent war with Iran has led to a spike in energy costs, further pressuring merchants to either raise prices on struggling consumers or eat the losses.

As if that’s not enough, Amazon is implementing a fresh set of policies that some sellers say build doing business on the platform increasingly untenable.

In recent weeks, Amazon has changed how it pays out seller earnings and collects payments for its advertising services. The business then published it would start charging merchants a 3.5% fuel surcharge to offset surging oil prices from the Iran war.

To some sellers, the moves represent another example of Amazon putting the squeeze on them.

“We’re running out of f—ing margin,” noted Michael Patrón, who runs an eight-figure Amazon business and frequently criticizes the company’s policies on his X account. “I think that’s why it keeps getting more and more frustrating.”

Patrón and hundreds of large Amazon sellers are boycotting its advertising platform on Wednesday to protest the recent policy changes that are strangling their already stretched bottom lines. 

The 24-hour advertising boycott is being organized by Million Dollar Sellers, a community of more than 700 members that collectively generate about $14 billion in revenue.

“Sellers have complained for years, but this feels different,” MDS co-founder Eugene Khayman stated in a post on X about the boycott. “The reason is simple: this is no longer just about irritation. It is about cash extraction.”

Amazon spokesperson Ashley Vanicek stated the recent changes to advertising payment methods and disbursements align “a modest subset of sellers” with practices already used by most of its merchants.

The firm remarked it introduced the fuel surcharge to partially recover costs that have been driven higher by rising oil and logistics prices.

Amazon’s third-party marketplace, launched in 2000, has grown to be a key pillar of its retail strategy. It hosts millions of sellers, allowing everyone from modest businesses that operate out of a garage to established brands to list their wares on the site.

Seller services revenue, which includes commissions, fulfillment, advertising and customer service support, has surged more than 400% since 2017.

In the fourth quarter, revenue in the unit grew 11% year over year to $52.8 billion and comprised roughly 42% of Amazon’s total sales for the period.

Cash crunch

Several sellers told CNBC they expect to raise prices Because of the temporary fuel surcharge, which takes effect April 17. The other policy changes threaten to tie up their cash, which could have more damaging consequences.

It could leave merchants unable to generate payroll or pay suppliers, and push them to take on more debt, Khayman remarked.

“The majority of sellers, it’s, you know, husband and wife teams, one employee, one assistant, kind of a thing where they get 3% cash back on their ad spend, which is probably their third-largest expense,” Khayman mentioned in an interview. “So you’re getting a large amount of wealth back on this, and they’re taking away that ability.”

Many sellers, especially smaller businesses, “live off of their credit card points” earned from purchases on Amazon ads, Khayman stated.

Earlier this month, Amazon declared it would begin automatically deducting advertising costs from some sellers’ earnings, rather than letting them pay using a credit card. The notice noted that if merchants’ proceeds couldn’t cover their advertising costs, Amazon would charge their existing payment method as a backup. The enterprise also offered sellers a $2,500 credit toward ad costs “to ease this transition.”

Amazon framed the move as being better for sellers’ “cash flow management,” but merchants stated it would likely have the opposite effect.

On Tuesday, Amazon proclaimed it would delay the ads payment change to Aug. 1 after it received feedback on the policy.

“Based on feedback we heard, we’re deferring this change until August 1, 2026, to give this group of advertisers more time to prepare,” the corporation wrote.

Breaking point

In mid-March, Amazon instituted a novel policy for some of its U.S. sellers that means it will hold onto sales proceeds longer. Sellers now have to wait to collect their earnings until seven days after products are delivered. Previously, Amazon paid out sale proceeds to merchants seven days after the item shipped to customers. 

The policy changes piled up, creating more anxiety for sellers.

“Combined with the payout delays, this creates MAJOR cash flow crunch,” Adam Runquist, founder of Heist Labs, which acquires e-commerce brands, wrote in a LinkedIn post responding to the ads announcement. “There is a breaking point with the increased fees and cash flow pressures — Amazon may soon be finding it.”

One seller, who has run a five-figure Amazon business for over two decades, mentioned the delayed payment policy will put significant strain on his firm, which was already struggling to pay its overhead costs.

“Amazon’s already taken all its capital out,” stated the seller, who asked to have their name withheld out of fear of retribution. “Whatever is left over, that’s our capital, and we’re not getting it. We’re getting it delayed.”

Amazon commented most of its sellers have been on a seven-day disbursement system since 2016. The enterprise stated it gave sellers who weren’t already using the system a six-month notice to allow them to prepare for the transition.

The policy gives customers time to receive their purchase, initiate returns and submit claims, Amazon commented.

Fee scrutiny 

The boycott is just the latest example of Amazon coming under scrutiny over the growing cost of selling on its platform. This also touches on aspects of bull market.

Amazon’s average cut of each sale crossed 50% for the first time in 2022, a third, according to Marketplace Pulse-party sector research firm, which cited a sample of sellers’ gains and deficit statements.

Seller fees are part of the Federal Trade Commission’s antitrust lawsuit against Amazon, filed in September 2023 and scheduled for trial in 2027, which accuses the organization of using anticompetitive tactics to maintain its e-commerce dominance, as well as stifling merchants on its marketplace.

Amazon has previously disputed the FTC’s claims, saying that its practices are superb for competition.

The business commented the findings from Marketplace Pulse are an inaccurate depiction of the cost to liquidate on the site because they conflate fees with the expense of optional services that some sellers purchase from the enterprise.

“We are committed to supporting the success of selling partners in our store and continue to help them achieve record sales year after year,” Vanicek noted in a statement. “We invest heavily in powerful tools, services, and programs to enable their business growth at a cost that is typically lower than alternatives.”

Charles Chakkalo, an Amazon merchant of 15 years, noted the recent policy changes amount to shortening some sellers’ cash flow from 90 days to “effectively zero.”

“I think this is simply Amazon squeezing out the processing fees they’re paying the credit card company,” remarked Chakkalo, who sells home and kitchen items and runs a newsletter for Amazon merchants. “And if the smaller sellers cannot handle this kind of charge, so be it. There’s a handful of other sellers that are going to try to generate it on the platform.”

Amazon has served as a launchpad for many businesses to tap into its massive customer base and has touted seller success stories in yearly progress reports, noting last year that independent merchants in 2024 netted an average of about $290,000 in annual sales.

It often refers to merchants as its partners. 

But, Chakkalo noted, the latest policy changes feel less like Amazon has a collaborative relationship with merchants and instead, one where they’re just “facilitators” for the business.

“It’s, again, a slap in the face. A reminder that, ‘Hey, wake up, this is not your business,'” he commented. “This is your business, subject to my reign.”