GROWTH IS NOW IN CLEAR SIGHT​ | Contact Us

The Cost of Running a Seller Central Amazon Business

Are you interested in selling your product as a seller on Amazon? Or are you currently selling on Amazon and looking for additional information on the costs and fees associated with selling as a 3P seller? Today we break down the costs of selling on Seller Central and how that impacts your profitability and ability to grow your business. In this blog we will cover the following costs to selling on Amazon:

  1. Professional Plans vs Individual Plans

  2. Referral Fees

  3. FBA Fulfillment Fees

  4. Inbound Transportation Fees (FBA)

  5. Hidden Fees (Our favorite!)

Professional vs Individual Selling Plans

There are 2 options in setting up your seller plan on Amazon – a Professional Plan and Individual Plan.

PROFESSIONAL

  • Cost $39.99 + additional selling fees

  • Add new products to amazon

  • Grow your business with FBA

  • Apply to sell in additional categories

  • Save time creating listings in bulk

  • Manage inventory with feeds, spreadsheets, and reports

  • Increase selling efficiency with API integration

  • Set your own shipping fees for non-media products

  • Engage shoppers with on site advertising tools

  • Run promotions including free shipping

  • Add multiple users to your account

INDIVIDUAL

  • Cost $0.99/item sold + additional selling fees

  • Add new products to the Amazon catalog

  • Grow your business with fulfillment by Amazon

  • Must sell less than 40 items per month

Category Referral Fees

Aside from the monthly fees, all sellers need to consider their category referral fees. These fees are similar to a commission you pay Amazon for them allowing you to list on their platform and typically range from 8-15%. Some categories have higher referral fees, and others lower – it is dependent on the category you sell products in, and the price you sell your products at. For example the baby category fees are:

  • 8% for products with a total sales price of $10.00 or less

  • 15% for items with a total sales price greater than $10.00

  • With a minimum referral fee of $0.30

See full schedule of category fees using this link.

FBA Fulfillment Fees

Amazon’s Fulfillment By Amazon (FBA) option means that you will ship product to Amazon and they will leverage their fulfillment centers to process and ship orders to the customers purchasing your product on Amazon. FBA also gives your listings the ever sought after Prime badge. Using Amazon’s FBA network will allow you to hold less inventory at your location, deliver to Amazon’s shopper in 2 days, and free up valuable customer service time. Amazon manages the customer order experience from start to finish.

This, however, does mean you will be assessed fees on a per order basis. In order to get the best idea as to how much FBA will cost you, Amazon provides a great tool called the FBA Calculator which you can find here. Here is how to use the FBA calculator:

  1. Locate the ASIN (Amazon Standard Identification Number) – typically starts with “B0”

  2. Enter the ASIN in the search bar

  3. Fill in your ‘Item Price’

  4. The cost of shipping the product to Amazon – we typically calculate this at $0.25

  5. Cost of the product

  6. Click ‘Calculate’

**Note: you can also see what the cost of fulfilling this by merchant is under the “Your Fulfillment” column.

See full schedule of fulfillment by Amazon fees using this link.

Inbound Transportation Charges:

Inbound transportation fees are assessed when ship product to Amazon for FBA shipments (either parcel, LTL, or FTL), and use Amazon’s Partnered Carrier Service. These fees are simply shipping charges to get your product to Amazon’s warehouse. You are able to choose your own carrier or network of discounted rates, but we always recommend using Amazon’s partnered carriers.

Hidden Fees (Most common)

There are many hidden fees that are assessed, and not very easy to understand or find descriptions for with selling through Amazon and their FBA program. ClearSight Consulting helps all of our clients manage the understanding of the ever complex FBA accounting. Feel free to contact us today for more information. Here are some examples of the additional and hidden fees that sellers will encounter.

  • Monthly Storage: estimated monthly inventory storage fees for each ASIN of your inventory in Amazon fulfillment centers. Calculated based on average cubic feet.

  • Coupon Redemption: $0.60 for every redemption

  • Shipping Holdback: referral fee charged on the shipping that is completed by you as a fulfillment by merchant

  • Gift Wrap Commission: fee you pay when your customers choose to get their products wrapped in gift paper and a card sent with the package.

 

CONTACT CLEARSIGHT CONSULTING TODAY TO ASK MORE QUESTIONS ABOUT THE COSTS OF SELLING PRODUCT ON AMAZON. FEEL FREE TO FILL OUT THE FORM BELOW, AND ONE OF OUR MARKETPLACE SPECIALISTS WILL GET IN CONTACT WITH YOU WITHIN 24 HOURS DURING THE WEEK AND 48 HOURS ON THE WEEKEND. THANKS!

 

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on pinterest
Pinterest
Share on tumblr
Tumblr
Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn

Leave a Reply

Your email address will not be published. Required fields are marked *