Amazon Fees

We always tell people Amazon will take about 25% off the top, so you’ll want to make sure your margins can cover the costs. Amazon has been increasing fees regularly for the past several years.

The professional account plan is $39.99 per month.

Referral Fees

Amazon has something called a referral fee.  This fee is a percentage of the total sale price of the item.  It varies by item but most products will be in the range of 15%.    

Fulfillment Fees

There are other fees associated with selling FBA. These fees will depend on your specific products and other Amazon criteria. Fees you can expect to see include storage, returns, Subscribe & Save, and other fees. 

The fulfillment fees, which are basically handling fees, are based on the weight and size of your product. You’ll find specifics about fees for your products in seller information on Amazon.

Advertising Fees

Ad fees will depend on your budget. Most advertising is cost per click and you can set a daily budget for campaigns.  You will need to allocate specific amounts to specific keywords and any time someone’s search includes one of your keywords they might see your ad.  If the customer clicks on your ad it will use funds from the daily budget. For example, you could have a budget of $10 per day and set the campaign to run for 2 months. 

If your daily budget runs out, it will stop showing your ad, and if you have any of the daily budget left over, it will add the remaining to the next day.   

Summary

As a general rule, you will want to make sure you can sell at least 40 items per month and you have a margin of at least 40% to cover Amazon fees. There are costs and fees to selling on the biggest online marketplace in the world. But with planning and knowledge, you can build your brand, expand your reach, and successfully grow your business.

Thanks for reading and if you’d like more information, contact us.