Selling on Amazon can be a profitable business strategy. Not only does Amazon fulfill orders for you, but they also provide customer service to your customers. In order to avail of their services, you’ll need to pay fees to sell on Amazon FBA.
In this article, we’ll discuss the fees for becoming an Amazon seller so that you know what to expect before opening your seller account and beginning the seller’s journey.
Contents
Selling on Amazon Fees
Calculating Your Costs On Amazon
There is no one-size-fits-all calculation for the costs of selling on Amazon. The FBA fulfillment fees depend on a number of factors, including the types of products you sell and what type of seller you are.
It’s important that you have all of the necessary cost information so that you can include them in your business plan and choose the right prices for your products. This way, you can decide whether or not a certain product can be profitable.
Why Do FBA Amazon Fees Differ?
There are a few things that are different for each seller, which is why there is no one fee for every business.
Your costs can be affected by any of the following:
- Your location
- Production costs
- Landed costs
- Size and weight of product
- Inventory
You’ll also need to account for any time and effort it takes to build your business.
Amazon Seller Accounts and Fees
Once you figure out what products you want to sell, you’ll create an FBA account with Amazon. When you sign up, you’ll have two options for seller accounts:
Individual Seller Account
The Individual Seller Account is ideal for individuals who won’t be selling more than 40 items per month. If you’re a hobbyist or trying to create a side hustle, this is the ideal starting account for you until you can invest more time into the program.
With the individual account, you’ll be charged a $1 fee for each item sold.
Professional Seller Account
The Professional Seller Account is better for businesses that will be selling more than 40 items each month. The cost is $40 per month, which can be more cost-effective if you’re able to sell tons of items each month. If this is your full-time job, this account can be extremely beneficial for you.
Other Amazon Fees
On top of your monthly dues or per item fees, the platform also charges a variety of different fees that you should keep in mind when calculating your costs.
Amazon Referral Fees
A referral fee is charged for each listing and will depend on the product category that it’s in. The fee can be anywhere between 6% and 45% of the product price, with an average of about 15%.
You’ll also be faced with a minimum referral fee of $1 or $2, depending on which product category you’re in. This minimum will apply when the percentage calculation of the fee is lower than the minimum referral fee.
Further, if you’re selling media products, Amazon will also charge you a Variable Closing Fee, which is a flat fee on top of the Referral Fee.
The Amazon Referral Fees based on category can be found below.
Amazon Device Accessories: 45%
Baby Products:15%
Books: 15%
Camera and Photo: 8%
Consumer Electronics: 8%
DVD: 15%
Electronics Accessories:15% on the first $100, 8% thereafter
Furniture and Decor: 15%
Home and Garden (includes Pet Supplies): 15%
Kitchen: 15%
Major Appliances:15% on the first $300, 8% thereafter
Music: 15%
Musical Instruments: 15%
Office Products: 15%
Outdoors: 15%
Software and Computer/Video Games:15%
Sports: 15%
Tools and Home Improvement: 15%
Toys and Games: 15%
Amazon Fulfillment Fees
When it comes to fulfillment, you can choose to fulfill your orders yourself with FBM (Fulfilled by Merchant), or Amazon will do it for you with the FBA. Fulfilling the orders yourself will not cost you any extra, other than the normal packaging, shipping, and customer service expenditures.
However, it’s highly recommended that you take advantage of the Amazon FBA, which will take care of everything for you and reduce the need to hire employees.
The FBA fulfillment fees include the following:
- Pick and Pack: These fees cover the labor involved in choosing and packing your products at the Amazon warehouse.
- Weight Handling: Shipping costs will depend on your products’ weight.
- Monthly Storage: Storage fees are charged per cubic volume, with extra charges for long-term storage.
- Unplanned Service Fees: These fees are applied in the event that your product packaging doesn’t comply with Amazon’s rules and regulations.
- Return Order Fee: If products are returned, a fee is applicable for the following categories: apparel, watches, jewelry, shoes, handbags, sunglasses, and luggage.
- Removal Order Fee: If you want to remove items from the warehouse, you’ll have to pay this fee.
Advertising
When it comes to having your products sold on Amazon, you’ll have to let your customers know that products are available there. This means you’ll have to spend time and money advertising so that people know where to find your products.
With Beau’s Amazon FBA course, you can learn how to become profitable on Amazon FBA even without any advertising!
Learn How to Sell on Amazon FBA
Don’t let the potential fees stop you from becoming a successful entrepreneur on Amazon. In Beau’s course, he’ll discuss the Amazon FBA fees, and you’ll discover how to build a profitable business that will far surpass anything you shell out to establish it.
What has been your experience selling on Amazon? Let us know in the comments!
