🟧Understanding Amazon Selling Fees and Fulfilment Options
Amazon selling fees vary depending on the account type, fulfillment method, product category, and shipping. Track your business income and expenditure for free with CommerceNavigator.
Starting an eCommerce business has become easier. Many marketplaces have free tiers to help sellers get started at no cost, while eCommerce platforms provide tools to build your online store. Amazon is a popular place to kickstart your selling journey for free, but there are still some costs to plan for. Here, we'll discuss Amazon selling fees, fulfillment options, and other potential eCommerce costs along the way.
Can I Sell on Amazon for Free?
Technically, you can't sell for free on Amazon. But the individual plan allows you to create an account for free and only pay a percentage after you've sold your first product. This is great for first-time sellers or those who want to test a side hustle.
Amazon Selling Fees
If you’re new to selling on Amazon, the main fees are the referral fee (between 6%-45%), the $0.99 per item sold for individual plans (professional sellers pay $39.99 monthly instead), and FBA fees if you choose Fulfilment by Amazon.
Your total Amazon selling fees will depend on factors like:
Account type (Individual or Professional Plan)
Product category (Closing fees)
If you’re using Fulfilment by Amazon and how long it takes to sell
Product returns
Shipping costs
Amazon Seller Account Fees
Amazon has two account types – Individual and Professional. The accounts have different fees and features that suit each business model. Learn more about what you need to create an Amazon seller account.
Individual sellers don't pay a monthly fee but are charged $0.99 per item sold. Professional sellers don't pay per item sold but pay $39.99 monthly.
Amazon Referral Fees
All sellers pay Amazon a percentage of the overall price or a minimum amount for each item sold - whichever is greater. Referral fees are charged in addition to selling plan fees. Most Amazon sellers pay around 8-15% referral fees, but these fees can be as low as 6% or reach 45%. It depends on the product category and selling price.
For example, you'll pay a 45% referral fee on Amazon Device Accessories. Products in the Home and Kitchen, Lawn and Garden, Footwear, and Musical Instruments categories have a 15% referral fee.
Check Amazon’s Seller Fee Rates to determine what referral fees to pay depending on the product category.
Amazon Closing Fees and Shipping Rates
Amazon sellers pay a $1.80 closing fee per item sold in the Books, DVD, Music, Software & Video/Computer (BMVD) category. It is added to the referral fee. Professional sellers can set their shipping rates for BMVD products or offer free shipping. Amazon shipping rates apply to Individual account sellers.
For sellers with a high volume of active, non-media product listings that haven’t been sold in 12 months, Amazon charges a monthly fee of $0.005 per eligible listing. This cost is waived for the first 100,000 listings.
Fulfillment by Amazon (FBA) Fees
Individual and Professional sellers can use Fulfilment by Amazon (FBA) to stock, pack, and ship products to customers. There are two types of Amazon FBA fees:
Pick, pack, and weight handling: This covers all costs from packing to shipping.
Storage fees: This monthly cost covers storing your products in Amazon’s warehouse.
The product size also determines FBA fees. A fully packed standard-sized product must not exceed 18″x14″x8″ and must weigh below 20 pounds. Any item above these measurements is considered oversized. Most sellers will pay between $3.43 and $6.83 for FBA. Overall, it’s a good deal because you’d likely pay at least $8 if you’re shipping similar item sizes through the post office.
FBA Monthly Inventory Storage Fees
FBA charges monthly inventory storage fees that are more expensive during the October – December holiday season. Here's a look at FBA storage fees:
| Period | Standard Size | Oversize |
|---|---|---|
January – September | $0.75 per cubic foot | $0.48 per cubic foot |
October - December | $2.40 per cubic foot | $1.20 per cubic foot |
Fulfilled By Merchant (FBM)
FBM (Fulfilled by Merchant) is a fulfillment option where the seller assumes complete responsibility for inventory storage and order fulfillment. Sellers who use FBM do not pay Amazon storage or fulfillment costs because they manage their inventory. On the flip side, sellers must cover their own shipping costs.
Refunds
If you refund a customer for an order that has already been paid, Amazon will return the amount of the referral fee you paid for the product(s) minus the corresponding refund administration fee, which is the lesser of $5 or 20% of the referral fee.
For example, if you refund a customer $10, the total sales price in a category with a 15% referral, the refund administration fee will be calculated as $0.30 ($10.00 x 15% referral fee = $1.50).
Enter CommerceNavigator
Despite the different fees, many sellers still find it profitable to sell on Amazon. However, tracking all business expenses is essential so you don’t make losses or go into debt. You can do this with a simple bookkeeping software like CommerceNavigator. It helps you track all business and personal finances, including vehicle mileage, providing a complete overview of your income and expenditure. Learn how it works now.
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