The 1 Thing Crushing Your 2026 Margins (That You Can Fix This Week)

The one thing successful sellers do in December that unsuccessful sellers skip—and it costs them all year.

While most sellers focus on holiday sales and Q4 closeout, the smart ones are auditing their suppliers. Not next month. Not during Chinese New Year chaos. Now.

Because supplier problems that destroy your 2026 margins, tank your reviews, and blow up your inventory planning? They all start with decisions you make—or skip—in the next two weeks.

One 5-minute supplier audit before year-end can save you thousands of dollars and catastrophic Q1 headaches. Skip it, and you're locked into another year of late shipments, quality issues, and evaporating margins.

The sellers who audit in December negotiate better terms, fix problems before they compound, and grow. The ones who don't are still dealing with the same garbage suppliers in November 2026.

But supplier audits aren't the only critical item before year-end.

Here's what's inside this week:

Let's get into it.

2025 is the year AI became unavoidable. In our day to day conversations whether it’s ecom, business, politics, music, movies, social media, parenting, and even death and memorials.  If you aren’t yet using AI in your Amazon and e-commerce business, you are definitely falling behind.

If you're selling on Amazon Japan, expect fee changes in 2026—some good, some not so good.

The Good: Amazon is reducing FBA fulfillment fees for standard-size items (20-80 cm, up to 5 kg) by an average of 38 yen per unit starting April 1, 2026. Depending on your size tier, you could save anywhere from 3 to 55 yen per unit.

The Bad: Amazon is raising referral fees by 0.4% across all product categories for items priced above 750 yen. For example, if you're selling a 1,000-yen electronics accessory, your referral fee jumps from 10% to 10.4%.

The Ugly: Starting April 15, 2026, Amazon will charge an aged inventory surcharge of 20 yen per month for all items stored longer than 12 months.

Takeaway: Run your numbers now. The FBA fee reductions might offset the referral fee increase for high-velocity products, but if you're sitting on slow-moving inventory, those aged inventory charges will eat into your margins fast. Time to clean house or move that inventory before April 15.

Amazon is cutting fees across European marketplaces starting December 15, 2025. This one's actually good news.

FBA Fulfillment Fees: Amazon is reducing FBA fees by approximately €0.32 / £0.26 per unit across major European marketplaces. Not massive, but it adds up when you're moving volume.

Referral Fee Reductions: Clothing and accessories categories are seeing 2-5% cuts. For example:

What This Means: Low-price, high-volume sellers get the biggest margin boost. If you're selling clothing or accessories in the €15-20 range, your margins just improved significantly. This could also shift competitive dynamics—categories that were barely profitable might now be worth entering.

Takeaway: Re-run your pricing models for affected EU SKUs immediately. Update your repricing rules to account for the lower fees. If you've been on the fence about launching in EU clothing/accessories categories, this might be your signal.

Amazon Ends Commingled Inventory: No More Fake Products Shipped Under Your Name

Amazon is killing commingled inventory on March 31, 2026. This is legitimately good news for sellers who've been burned by counterfeits.

What Was Commingled Inventory? Amazon pooled identical products from multiple sellers into shared bins, tracked only by manufacturer barcodes. When a customer ordered, they got whichever unit was closest—not necessarily the one you sent. If even one seller sent fakes into the system, any seller could end up shipping that counterfeit to their customer.

Real Example: Exploding Kittens. The popular board game got hit hard by this. Counterfeit versions flooded Amazon with wrong card sizes (2.25" x 3.25" vs. authentic 2.5" x 3.5"), cheap materials, and terrible printing quality. The company even acknowledged on Amazon Q&A: "We have had multiple fans report being tricked into buying low-quality, counterfeit versions."

Even customers who ordered directly from the official Exploding Kittens seller could receive a fake game because of commingling. The manufacturer eventually found a partner to add holographic authentication labels to combat the problem.

What Changes: Amazon is shifting to seller-specific or manufacturer barcode tracking. Your inventory stays yours. You're no longer responsible for someone else's garbage.

Takeaway: Make sure you're using correct manufacturer barcodes (UPC/EAN) or Amazon FNSKUs. Audit your incoming shipments now. If you work with 3PLs, tighten up your tracking systems. This removes the risk of someone else's counterfeit ruining your account—but it also means barcode accuracy is now 100% your responsibility.

If you're already running a serious Amazon business, you probably don't have a strategy problem. You know what to do. The problem is doing it consistently as everything else scales.

PPC gets more complex. Listings need constant refinement. Backend tasks pile up. New channels demand attention. And suddenly, the founder becomes the bottleneck.

That's why I wanted to introduce VAA Philippines, one of our trusted partners. They train specialized Amazon and e-commerce VAs who work inside Seller Central every day, handling execution so founders can stay focused on growth.

Here's where their teams typically support sellers:

The goal isn't to replace strategy. It's to remove you from the weeds so the strategy actually gets implemented, daily, accurately, and at scale.

VAA Philippines is offering FREE Amazon Listing Audit or FREE PPC Audit for subscribers of this newsletter.

Book a discovery call here:
https://calendly.com/d/cw6k-4jj-spc/introduction-vaa-philippines-7fss-collab

As you may know, in my previous career, I was a sourcing director at a consulting firm in Shanghai from 2008 until 2017.   Having worked with hundreds of clients sourcing from China, one of the biggest mistakes sellers make is that they never formally review their suppliers. 

They just react to problems as they pop up—late shipments, quality issues, communication breakdowns. Then they wonder why nothing improves.

Here's the reality: if you can't measure it, you can't improve it. 

An annual supplier review forces you to step back, evaluate performance, and decide whether to grow the relationship or fire them.

The 3-Part Framework: Past, Present, Future

But Here's What Most Sellers Miss: You're Being Judged Too

Before you point fingers, take a look at yourself. Your suppliers are evaluating you just as much as you're evaluating them.

Are your purchase orders detailed and clear? Or do you just say "I want 500 pieces of that thing"? When quality issues arise, do you have specs in writing to refer back to?

Are you responsive to their emails? Do you pay on time? Factory bosses consistently tell me they prioritize buyers who communicate clearly and pay when they're supposed to. Cash flow matters to them—they have component suppliers, worker salaries, and rising costs to manage.

When to Keep vs. Fire a Supplier

Keep them if: Deliveries are on time, quality is acceptable, they're willing to make changes, and pricing is fair. In this case, reward them with larger orders and negotiate better terms.

Fire them if: Repeated quality problems persist despite warnings, orders are consistently late, they're unresponsive, or trust is broken. Work with them on a Corrective Action Plan first. If the problem continues or they're not cooperative, move to your backup supplier. (You do have a backup, right?)

Next Step: I've put together a free 5-minute supplier scorecard for newsletter subscribers. Use it to quickly evaluate your suppliers' performance and open the door to addressing problems, negotiating better pricing, and forecasting for next year.  This will work no matter where your supplier is in China, India, Vietnam, or anywhere.

Download the Free Supplier Scorecard

Gary
PS: You're auditing your suppliers before year-end. Why not audit your listings and PPC too? VAA Philippines is offering free audits to newsletter subscribers—Amazon Listing Audit or PPC Audit, your choice. Book now before slots fill up