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5 Amazon Fees You Should Know About
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It’s evident that selling on Amazon is certainly not cheap. However, when sellers join the dynamic, ever-evolving environment that is the Amazon marketplace, they unlock the potential to drive revenue that can far outweigh these costs.
Here’s a quick rundown on some of the fees you can expect to pay:
Monthly Subscription Fee
Before we dive into the nitty-gritty costing details associated with selling product on Amazon, sellers need to first distinguish what plan they will be selling under — Professional or Individual. Amazon’s Professional selling plan is available for a monthly subscription fee of $39.99. This is the plan geared towards eCommerce businesses that sell more than 40 items a month. The Individual selling plan is for those who sell fewer than 40 items per month and has no monthly fee associated; individuals instead pay $0.99 per item sold, plus other selling fees which vary by category.
When sellers use FBM, Amazon shipping rates apply to media products and are based on product category and the shipping service that the buyer selects; that fee is then passed on to the seller. Typically, Amazon sets the shipping rates for BMVD (books, music, video, and DVD items). However, Professional account sellers who have updated their shipping platform can now set their own, custom shipping rates for BMVD products.
FBA-Specific Fulfillment Fees
When sellers use FBA, they are charged an order fulfillment fee (which includes order and weight handling fees and pick/pack fees), storage fees, and optional service fees.
- FBA order fulfillment fees vary by category type, product size tier, and calendar month that the order is placed in.
- Monthly storage fees are charged for all items warehoused in an Amazon fulfillment center, based on the seller’s daily average volume of inventory and the calendar month.
- Long-term storage fees are charged for all items in fulfillment centers for six to 12 months and 12 months or more, per cubic foot of inventory. If sellers decide to have Amazon return the stale inventory to them or dispose of it themselves, there is a per-item cost associated.
For all of these reasons, sellers must carefully consider whether FBA is worth the cost.
Amazon sellers pay a referral fee on each item sold, ranging anywhere from 8% to 45%. Items in various categories have a per-item minimum referral fee and sellers pay the greater of the referral fee or the per-item minimum referral fee. For all products, Amazon deducts the applicable referral fee percentage calculated on the total sales price, excluding any taxes calculated through Amazon tax calculation services. A full list of referral fees by category can be found here.
Refund and Closing Fees
For each media item that is sold, Professional Sellers also pay a variable closing fee. Media categories include books, DVDs, music, software, computer/video games, and video game consoles. Additionally, if sellers refund a customer for an order that has already been paid for, Amazon will refund the seller the amount of the referral fee the seller paid for the item(s), minus the Refund Administration Fee, which is the lesser of $5 or 20% of the applicable Referral Fee. Amazon gives the example that if a seller refunds a customer the $10 total sales price of an item in a category with a 15% Referral Fee, the Refund Administration Fee will be $0.30 ($10 x 15% Referral Fee = $1.50).
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