Amazon has slashed fees for third-party vendors selling apparel items on its platform that are priced below $20 as it tries to help its sellers compete with fast-growing Chinese fashion discount rivals Temu and Shein.

But the US e-commerce giant has angered sellers by introducing a low-inventory-level fee for standard-sized products, drawing criticism from people on its sellers forum.

Amazon typically charges a “referral fee” of 17 per cent to apparel product vendors. From January 15, that fee will be cut to 5 per cent on items priced below $15, and to 10 per cent on items priced between $15 and $20.

The company will also expand benefits as part of the US Fulfilled by Amazon (FBA) New Selection program, such as providing an average 10 per cent rebate on sales of eligible new-to-FBA parent products.

“As we look to 2024, we will implement a set of fee changes that continue to provide you with great value and allow us to partner together to offer customers amazing service while reducing our collective costs to do so,” the company said.

“After these changes, we expect that sellers will see an average increase of $0.15 in fees per unit sold; however, we also expect that there will be many sellers who will see a decrease in the average fees paid to Amazon per unit sold.”

However, in a move dubbed “insane” by at least two vendors posting on the Amazon sellers forum, the company will implement a low-inventory-level fee for standard-sized products from April 1. This will apply to sellers with consistently low levels of inventory relative to unit sales.

“Oh boy more hidden and convoluted fees,” one vendor posted beneath Amazon’s explanation of the changes. “I don’t know about selling anything beyond books on Amazon but this place just gets worse and worse for third-party sellers.”

“Get rid of low inventory storage fees,” posted another. “We work with supplements and groceries and there are always shortages! This will cause many sellers not to use FBA.”

However, Amazon says the new fee can be avoided by vendors maintaining inventory levels of more than four weeks of typical sales.

From Amazon’s perspective third-party vendors with low levels of inventory risk products being out of stock if there is a sudden increase in demand – a scenario that reflects badly on the platform where customers do not realize the item is a third-party fulfilled product.

In addition, the company will introduce an inbound placement service fee of 27 cents per unit for standard-sized products and $1.58 per unit for large bulky-sized items.