How much does it cost to sell on Amazon?

Having a presence on Amazon can be a real plus for your business. This allows you to give your products extra visibility, or even just get started in e-commerce without too much worry. But you should keep in mind that there is a counterpart in exchange for all the benefits Amazon can offer you. This is how the famous US platform has chosen to impose a certain amount of fees and commissions on sellers. What are the costs for selling on Amazon? Is it worth it? Find the answers to your questions in this article.

How is Amazon paid?

To understand where these fees come from, the first thing you need to know is how Amazon compensates itself. If you have the list of all the fees Amazon charges, you will quickly understand how Jeff Bezos became a billionaire.

It’s kind of like Amazon’s business: the fees. It actually makes a lot of sense when you think about it. The platform has a certain visibility and a certain reputation, if you want to sell it, you pay a fee† Until then, nothing is rocket science. Amazon is a marketplace, or in French “market place”. This allows us to quickly draw a parallel with a market where you have to pay for your location to sell your products. We are clearly on the same principle here.

Only it’s not as simple as that. Yes we have to pay for a subscription to sell on Amazonbut in addition there is a lot of extra costs, which means that we are not only concerned with “paying for our location”. Already, in addition to the subscription, Amazon takes a commission on every sale. And, depending on the product you sell, Amazon has a more or less significant share. You should also keep in mind that you are dealing with minimal selling costs, which will put you at a huge disadvantage if you are selling items at very low prices.

Amazon is also reimbursed through advertising costs. That is, to sum up, some sellers pay more to be pushed forward than others. We can also count the different ones fees related to the FBA formula in which Amazon manages all the logistics of the products sold. Even if it costs them money to build warehouses, store your products and then ship them, they still cover their costs. Otherwise they certainly wouldn’t offer it.

Find out now in detail what costs you could incur when selling on Amazon. Some are mandatory, others only occur in certain situations (type of subscription, type of product, extra features, etc.).

Subscription / sales plan: pay for your presence on the Marketplace

Let’s start with the basic fee. Of course it’s about the subscription, without which you cannot publish your products† It is one of the pre-sale costs that is completely immutable† Whether you sell baby products or musical instruments, the price remains the same.

When you want to sell your products on Amazon, you can choose between 2 types of accounts: the Individual account and the Professional account. If you are a company with a minimum of goals and ambition, 99.99% of the time it is better to opt for the Professional plan. And if you are an individual, the individual account can be practical, but it remains very restrictive. These are the points that characterize these 2 types of accounts:

  • Individual: with this subscription you do not pay a monthly subscription, but you have a fixed amount to be paid per item sold† This is added to the classic selling costs that we will see later.
    €0.99 (excl. VAT) each
    – Less than 40 items sold per month
    – You do not intend to advertise
    – You do not intend to use deep sales tools
    – Possible to use FBA (very unprofitable here)
    – Many unavailable features
    In other words, there aren’t many situations where this plan is relevant or useful.
  • Professional: this is the type preferred plan if you plan to sell professionally, as indicated by its name. In addition to this monthly rate, all additional costs (sales and other) will also have to be charged.
    €39 (excl. VAT) per month
    – More than 40 items sold per month
    – Ability to advertise and access advanced sales tools
    – Ability to sell in limited categories
    – Improved referencing on the site
    – Unlocks all the features not available with the individual subscription (API, inventory management, batch offers, promotions, multiple users, custom shipping costs, etc…)
    In most cases, this is the plan that will best suit your business if you have serious goals on the platform. If you sell 400 products per month, you can tell yourself that this fee is only 10 cents per item.
Amazon’s Sales Plans

Cost of Sales: Amazon’s Commission

Now let’s move on to fees that are a little more complicated to discuss: sales charges. They are automatically added to the sales plan you chose when you created your account.

The subtlety of these fees, as we mentioned earlier, is that they depend entirely on the type of product you want to sell on the platform. The percentage varies depending on the products between 7.21% and 46.35%† That is, how variable it is.

You can consult them here.

According to shipping method: you choose, the cost of sales will not be based on this. Specifically, if you sell in FBA, that is, you send your inventory to Amazon for it to handle logistics, the percentage will be based on the item’s retail price.

Conversely, if you sell in FBM, ie you are the one who manages the shipment, the percentage will be based on the price of the item + the shipping costs.

You should also pay attention minimum selling fees imposed by Amazon on most categories. They can penalize you if you sell a product at a very low cost (for example: 1 or 2 €).

In each case, the reimbursement percentages per category and the categories themselves change regularly, so it’s worth keeping up to date with everything that’s going on. Here is the current schedule for selling costs on Amazon.

FBA Fees (Filled by Amazon)

You can choose to sell products on Amazon through their FBA system. In concrete terms, this means that you send them your stock, so that they can take care of it andthey take care of shipping, returns, etc… This is very useful if you don’t have the time or resources to do it yourself. In addition, your products are therefore eligible for Prime delivery, which can be a benefit to you when selling.

VThese are the costs you incur by selling by FBA (Fulfillment by Amazon)

  • Storage costs
  • Long-term storage costs
  • Postage costs
  • Removal Order Fee
  • Returns Processing Fees
  • Unexpected service charges
  • Optional Service Fee
  • Breakage/loss costs
  • Compensation costs

Let’s take a closer look at these fees:

Storage costs and long-term storage

Storage costs are unavoidable when you entrust your logistics to them. These charges will be billed to you mid-month following the month to which the charges apply.

They depend not only on the type of product, but also on the time of year where your products are stored. Prices are higher from October to December, probably because of the holidays. In France, it costs between €15.60 and €36 per cubic meter per month, depending on the time of year and the category (for non-hazardous products). Please note that clothing storage is slightly less than standard products, as with oversized products. For hazardous substances we are between € 25.75 and € 41.23 per month and per cubic meter (in France).

Storage Fees at Amazon FBA
Storage Fees at Amazon FBA

It is also necessary to planpossible long-term storage costs† We speak of long duration once your item remains in an Amazon warehouse for more than 365 days. Here we are confronted with very high costs, we advise you to sell your products for 1 year of storage. The price is € 175.10 per cubic meter per month, which is added to the basic storage costs.

Postage costs

From April 2022, a change in shipping rates and weight categories should be observed. It is not these rates that are taken into account here.

Shipping costs with Amazon FBA
Shipping costs with Amazon FBA

Processing fees for returns and refunds

In the event that a customer wishes to return a product sold in FBA, they have 45 days to do so. If this is done in time, it is the seller who is responsible for paying the return costs which are equal to the basic shipping costs.

If the customer wishes to be reimbursed for his item, Amazon then keeps 20% of the various costs† However, this amount may not exceed € 5 each.

Collection costs

Collection costs may arise if a product has to be repatriated to you. This can happen, for example, when a customer returns a broken product that can no longer be stocked. These vary depending on the weight of the item. For a standard size product you pay between 25 and 50 cents under 1 kg than 40 euro cents per kg. For a product that is too large, the price is set between 50 cents and € 3 under 5 kg, then 40% per kg.

Amazon FBA Collection Fees
Amazon FBA Collection Fees

You can also request the liquidation of the product, that is, its destruction. The price is the same as for standard size samples.

Breakage/loss costs

Occasionally, Amazon or one of its providers may lose or break your valuable product. It’s a very common thing in logistics. Either Amazon will offer to replace your product with another product with a similar reference, or they will reimburse you.

Other optional costs

In addition to the various “mandatory” fees we saw above, there are other types of fees, which are slightly more optional.

Closure of costs

For certain types of products there are so-called “closing costs”. They are 61 € cents each and apply to the following categories:

  • Books
  • Music
  • DVD
  • Video
  • Computer Games
  • Software

There isn’t really an explanation regarding these fees.

High volume costs

If you want to sell in very large volumes on Amazon, you will of course have to charge new costs. We’re talking here in SKU: “Stock Keeping Unit”. 1 SKU corresponds to the unique reference of a product, it is the code that defines it and allows stock tracking. If you import less than 1.5 million SKUs, you pay no fees. Above this figure you will be exposed to costs of approximately €0.0004 per reference.

Amazon Ads Advertising Cost

As we explained at the beginning of the article, it is completely possible to pay to improve visibility on the platform. There are different types of ads on Amazon, which operate on a cost-per-click basis. We see a certain similarity between the operation of Amazon Ads and that of Google Ads. Amazon is indeed a kind of search engine. Here are the different types of announcements possible:

  • Sponsored Products: Sponsored Products in Search Results
  • Sponsored Brands: Product banner in search results that highlight a brand
  • Sponsored View: Sponsored View on special spaces

You now know what you have to pay to have the privilege of selling on Amazon. If you have any feedback about these fees, don’t hesitate to let us know in the comments or on our social networks.

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