Amazon FBA Feescreated on 2020, Feb, 27 20:00
One of the major questions that run through the mind of those planning to venture into selling on Amazon is related to the FBA fees. They often ask how much are the FBA fees? Asking this question is important, so is finding the right answer to the question before you proceed to start selling on Amazon.
Only when you know this can you have a rough estimate of how much you will be making after removing the fba fees from your total sales. Hence, we will be exploring information on how much Amazon fba costs and the effect it has on your sales.
Types of Amazon FBA Fees
The Amazon FBA fees have six different types; they include:
Referral fees are paid when you make a successful sale of product on Amazon fba. The amount earned is an estimate of the total cost of the product sold. This is also influenced by the category the product falls in, but normally, it will not be more than 15% of the overall cost of the product.
Variable closing fee
There is a flat fee that is charged on items that fall in some category. Products like books, DVDs, and other types of media products.
When you drop your products on the Amazon FBA fulfillment center, Amazon's fulfillment team will then pick your products, they pack the product, and ship them in the best way possible to the buyer of the product.
The FBA fees are designed to address all the cost that was incurred while sending your product to the buyer. One good thing about this fee is that it is massively cheaper than when you have to do the shipping yourself.
Individual seller fees
As a non-professional Amazon seller, you will be charged $1.0 on all Amazon fba products you sell.
Each month, as a professional seller on Amazon, you are expected to make a payment of $39.99. As a professional seller, you won’t be required to pay the $1 on each product sold. So, if you are sure you can sell up to 40 units in a month, then you should become a professional seller on Amazon. This will significantly lead to a reduction in the Amazon fba cost.
Amazon's fulfillment center has their own warehouse where they keep all products. In order to reduce the time the product spends in the store, you are charged a fee for keeping your goods. This is to ensure fulfillment by Amazon fees.
Do you think these fees are much? When you compare them with the amount you earn or will earn from the amazon fba sales, you will be surprised.
On every sale made on amazon, you incur two types of fees, the FBA fees, and the referral fees.
Amazon Referral Fees
When you sell on Amazon, you are expected to pay the referral fee for the items you are selling. For most of the categories, the referral fee, or minimum referral fee on each item will be paid by the seller.
As a starter, ensure you go for categories with 15% or lower seller fees. As such, you will have a reduction in the amount of Amazon fba fees that you are paying. Categories that charge higher have a very slim chance of selling well — categories like clothing, branding items, jewelry, etc.
Amazon Fulfillment Fees
Amazon fba fees refer to the charges you pay if you want your product to be picked, packed, and shipped to the desired destination. This often contains the shipping cost.
You can significantly lower the FBA amazon cost by selecting lightweight products that can be easily packed. The smaller and lighter your product, the smaller the amazon fba fees you pay (as low as $3.19).
Individual vs. Professional Sellers
You have the option of picking either the professional or individual plans. For the individual plan, it comes with no monthly subscription fees, but on every sale you make, a total of $1 is deducted, and if you make many sales each month, then you will be paying a higher subscription fee.
If you are sure that you can complete at least 40 sales in a month, you should go for the professional package since you will be required to pay just $39.00 irrespective of the volume of goods you are selling.
Amazon FBA Storage Cost
How does the fulfillment by amazon fees work? This is an essential question. To use the Amazon fulfillment center, you will pay for storage costs. With this plan, you won’t want to store your product for long in the inventory.