Amazon Brazil sacrificed revenue to gain scale. It waived all Fulfillment by Amazon (FBA) fees until December — the service where the company takes over storage, packaging and delivery — and opened its marketplace free to new sellers. Those who invest in ads can extend the benefit until January. The global retail giant is stepping up its game in Brazil.
The battleground is shipping, where Mercado Livre still calls the shots. In June, MELI cut the free-shipping threshold from R$79 to R$19 across almost its entire site and slashed shipping costs for sellers by up to 40%, going after low-ticket sales — Shopee’s turf, which already counts more than 800 global brands with initial fee waivers. Shein is pressing in fashion with its Xcelerator program, delivering in 5–7 days. TikTok, a recent entrant, launched with a 6% commission, waived during the first 90 days.
Subsidies have become the rule in e-commerce. The game is one of thin margins but deep pockets. Platforms bankroll the offensive with advertising. This is an arms race, powered by capital and technology. Amazon, MELI, Shopee, TikTok and Shein all have the scale to endure, even at the cost of burning margins in the short term.
For traditional retail, the battle is out of reach. Debt-laden and tied to physical stores, they can only stroll down the mall corridor while the war rages outside.