Roger FatatichAmazon fan, business developer, blogger, positive guy.
A Simple Guide to Amazon FBA Fees
Fees – the bane of every business. No matter what services you are checking out, it seems like fees are always the catch. Let’s face it, the fees could make a difference as to whether or not you can sustainably use a specific service for your business.
The same goes for selling business items on Amazon. Amazon FBA fees can quickly become overwhelming if you don’t know what you are looking at.
How Fulfillment by Amazon Fees Work
Fulfillment by Amazon is a service that Amazon provides businesses that sell items through their platform. Ultimately, you list your items available and Amazon takes care of the back-end processing that order for shipment and providing the service should something never make it or need returned.
The truth of the matter is the fees somewhat vary based on what you are selling and the volume of their sales. Other fees also differ based on your volume of sales and your business in general, depending upon the services you choose to utilize.
Amazon has become one of the largest web-based selling industries available. It seems like most people turn to Amazon to look for things they need (or don’t need for that matter). So, if you want to join the rush and start selling on Amazon, you need a good breakdown of the FBA Amazon fees to prepare yourself.
Amazon FBA fees is a broad category. Here are your primary categories of fees.
- FBA Fees
- Individual Fees
- Subscription Fees
- Sales (referral) fees
- Variable Fees
- Storage Fees
Most of these are self-explanatory but here is what you need to know about these fees. FBA fees and storage fees go hand-in-hand. You send your items to a warehouse so that Amazon can fulfill your orders. And Amazon charges you a fee for these services, down to Amazon shipping your product for you when it sells.
Individual fees and subscription fees also fall into the same window. Typically, you pay one fee or the other. Individual fees are $1 per sold item while subscription fees are a monthly subscription and eliminate the individual fee per item.
Otherwise, you can expect to pay a percentage of your profit as a fee for sales. This is a minimal fee. The variable fees are random fees that could apply to media-based items. Whether or not you are subject to these fees would be dependent on your sales categories.
What are the FBA Fees?
So, your question now is probably just how much are these Amazon FBA fees? Do they pay off? Whether or not the FBA fees are worth it is up to you. Amazon is providing an extensive service and if you sell quite a bit, you will most likely find it’s substantially worth the cost.
The fees are broken down based on the size of the package and the weight of the package. Amazon finds your items in their warehouse, packs them, ships them, and handles any necessary customer service or return process for said items.
The fees start as low as about $2.50 for packages that weigh 1 pound or less. Of course, there really isn’t a maximum for how high the fees can go. A large or heavy oversized package or something that might be awkward to manage could cost $150 or more for FBA Amazon fees.
Amazon fully discloses the details behind these fees to their sellers and potential sellers. Nothing is hidden and sometimes the fees may wind up being less than you expect in the end.
Is it Worth the Cost?
The Amazon FBA cost may seem overwhelming to you in nature at this point. Maybe you’re wondering if it’s really worth the cost. If you compare the costs Amazon FBA fees to platforms like eBay, you will find it’s not so bad after all.
These platforms are very different. They operate much differently. So far, eBay does not have a fulfillment service like that of Amazon. Although rumor has it that they plan to launch a similar service in the near future.
Overall, if you break down a fee comparison between the two, Amazon’s costs are substantially lower for consistent sales. And that includes Amazon fulfilling your orders as part of their service costs.