Lots of chatter out there about Amazon’s latest venture, its Amazon Home Services offering that links consumers shopping for all sorts of home repair needs, including plumbing, electrical, landscaping, computer/television installation.
I think the service fee Amazon will charge participating trade folk for many business transactions they get through the service may prove to be a bit steep at 20%. When you drill down into Amazon’s website to the section entitled “Services Selling Fees,” you learn there’s a “Standardized Services Selling fee” of 20%, and other fees for what Amazon defines as custom and recurring services. Amazon does do a background check for any contractors who apply for the Services program, which seems to be a pretty neat idea.
While smaller companies may appreciate the added visibility will provide and the fact that Amazon will handle the payment end of the process through its service, I think many contractors will find the 20% cut that Amazon is taking on many services to be too big a bite out of their profit on a job.
I checked out Amazon Home Services in my zip code in the Kansas City area for electrical work and so far Mr. Electric, the nation-wide franchise of electrical contracting businesses was the only company listed.
Time will tell on how big Amazon Home Services will get.
