Selling your goods on Amazon is a fantastic method to boost sales and expand your company. But people frequently forget that it costs money, which causes them to have overstated expectations for profits.
There are expenses you should be aware of before beginning to sell on Amazon. They come in the form of different selling and subscription fees, and these expenses can quickly build up to a substantial sum for your company.
We have compiled a list of the most significant Amazon Selling Fees to provide you with a quick overview. These costs vary from vendor to vendor and from product to product. Thus, to determine whether selling on Amazon will be beneficial for you, you’ll need to conduct your individual calculations and consider your unique circumstances.
Here Is The List of Fees Associated With Selling on Amazon
Here is the list of How Much Does It Cost to Sell on Amazon here.
1. Selling Fees
Amazon offers two different selling options: Individual and Professional. The individual plan is primarily for people who just infrequently desire to sell. It is perfect for people who wish to sell less than 40 items in a month. There are item-by-item costs; there is no subscription charge.
Professional sellers typically choose the Professional plan. There is no per-item cost, only a monthly subscription fee. It is perfect for businesses that wish to sell more than 40 items in a month.
- Basic Selling Plan:
Cost – $0.99/item sold
Referral Fees – Additionally, you will be charged a referral fee for each item sold. This varies depending on the item category, which ranges in percentage from 6 to 45%. The charge is based on the buyer’s overall payment for the goods, which takes into account all applicable taxes and customs charges. In most categories, there is also a per-item minimum referral fee of 0 to $2.
Variable Closing Fees – All Media products have a set closing cost of $1.80.
The Basic Plan is excellent if you’re just getting started with Amazon, but costs can mount up rapidly. Consider the Pro Selling Plan instead if you anticipate selling over 40 items each month.
- Professional Selling Plan:
Cost – $39.99/month
Referral Fees – Similar to Basic Plan.
Variable Closing Fees – Similar to Basic Plan.
Fulfillment By Amazon (FBA) Fee
The prices you pay will all be based on the sort of order you place if you’re selling through Amazon FBA. For instance, you will be required to pay Amazon extra to complete a larger order.
There is a monthly storage fee associated with FBA because it enables you to entrust order management to Amazon’s warehouses. From January to September, you’ll pay $0.75 per cubic foot, and from October to December, $2.40 per cubic foot.
Remember that there will be extra fees if your product is kept in the FBA warehouse for more than a year.
Imp Note: FBA fulfillment fees have been subject to a 5 percent Fuel and Inflation Surcharge as of April 28, 2022. Future changes may be made to this surcharge.
Fulfillment by Seller (FBS) Fee
The Fulfilled by Seller service on Amazon allows sellers to fulfill their own orders, in contrast to FBA. Its key advantage of FBA is that its fees are less expensive.
FBS allows Amazon sellers to choose their own shipping costs. Another advantage is not having to worry about paying any warehousing or storage fees.
FBS fee for Individual Selling Plan Holders: Individual plan sellers use standard shipping costs defined by Amazon for all goods. It’s crucial to price things in a way that ensures you’ll make a profit because individual sellers are required to ship orders at the specified rates even if the postage credit is less than the overall shipping expenses.
FBS fee for Professional Selling Plan Holders: Professional plan sellers control their own delivery costs. When a buyer purchases your product, Amazon credits your account with the same amount as the delivery cost. Remember that the wholesale price, which includes the item price, shipping costs, and any gift-wrapping fees, is used to determine the total referral fee.
FBA Fulfillment Fee Light & Small:
The light and small program provide reduce fulfillment cost on some qualified items, which allows you to pass the saving of your customers. Fee units come with packing and picking of your order, product return, customer services, shipping, and handling.
Product Return Fee
It happens frequently that a customer will order one of your products and then return them. As an Amazon seller, You will be responsible to pay for any item the client returns
Product Refund Fee
If you provide a refund to a client for an order for which you have already been paid, Amazon will deduct the appropriate refund admin charge, which is between $5 or 20% of the referral fee (whichever is lesser) from the amount of the referral fee you paid for the item(s).
Inventory Fee
Along with monthly inventory storage fees, using an Amazon fulfillment center—which is an option for sellers using FBA or Multi-Channel Fulfillment—may result in additional costs such as long-term storage fees and removal order fees.
High Volume Listing Fee
Amazon imposes $0.005/month per eligible listing when you have a large number of live, non-media listings that have not sold in the previous 12 months in order to fund categorizing expenses. Amazon however waives the cost of the first 100,000 listings.
Additional Costs You May Incur
Other than the above-mentioned primary costs, There are other costs that may come across your way if you are selling on Amazon. Again, these costs will totally depend on your unique needs and approach to amazon selling. Here are they:
- Advertising Costs: As an Amazon seller, you will want to spend money on advertising and expand your reach as much as you can to generate more purchases. Amazon guarantees that spending just $10/day helps you increase sales. The CPC rate is lower than other platforms. However, it will take a lot of research to ensure which advertising strategies work best with your target population.
- Product Photoshoots: You can’t post poor-quality images when you manage your Amazon store. it is crucial to have high-quality product images to attract customers and increase sales. Professional picture shoots will be included in your budget as an investment to help your online products stand out. Your goods need to be shown off in a variety of ways in your photos so that the customer can clearly see them and judge them from a professional standpoint. Images of poor quality won’t effectively convey a high-grade offering.
- Seling Tools: If you wish to survive in this cutthroat competition, you need to stay ahead of your competitors and analyze the ongoing and upcoming trends on Amazon. With tools like Jungle Scout and Helium 10, you can do just that and make the most out of your Amazon journey. Buying these tools is one more additional yet very important investment.
Shipping Credits
If you are a professional seller attaining your own orders, you will get shipping credit from Amazon on each sale to up your cost, but the most important thing is how much it really prices to ship your products.
A business which selects standard shipping fees officially allows setting the cost. If Amazon set it below then this is going to be your profit limit.
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Conclusion: How Much Does It Cost to Sell on Amazon (2023)
Avoid Allowing these Amazon Selling Fees to Destroy Your Profits
It is clear from tallying up the aforementioned expenses that selling on Amazon is not inexpensive. Selling costs might quickly eat up any remaining profits if the product you’re selling is situated in a market that is extremely competitive.
Don’t be demotivated, Amazon can be a terrific location to generate money if your product is in a specialized market or can bring in a good margin. Use Helium 10 or Jungle Scout to determine what will work best for you and make enough to cover all the expenses and book profits!