First Published: June 26, 2018 By Othmane Sghir.
DataHawk is a web-based Amazon Analytics Tool that combines a Keyword Ranking Tracker, a Product Tracker, a Market and Keyword Analysis tool, and a Product Research engine. This is a blog post where we share a basic introduction of Amazon FBA program and where we outline how it can be leveraged notably through using DataHawk. Our software comes with a free plan and advanced paid plans for sellers, vendors, and agencies of all sizes.
This article cover the fees related to selling on Amazon including FBA Fees, and outlines how to use the Amazon FBA Calculator.
When selling products online on Amazon, mastering your costs is paramount.
Many Amazon sellers are losing money or not making enough profits because they chose the wrong product and miscalculated their expected profits.
You should keep your Amazon FBA calculator close by and rely on it at all times to optimize your margins. Many differences in a product characteristics such as its weight, dimension, selling price, or category can make a big difference and help you save money while increasing profits at the same time.
Before you become a professional seller on Amazon and make the transition to FBA, you will have to understand the pricing structure, advantages, and fees of selling on Amazon and using the Fulfillment by Amazon or FBA program.
Today we are going to explain all the fees that come with selling on Amazon through the FBA program to help you become more profitable, while guiding on how to best use the Amazon FBA Calculator.
There are three main fees related to selling on Amazon:
If the product you're selling is currently listed on Amazon, you can use one of its identifying numbers such as its ASIN (Amazon Standard Identification Number), its UPC (Universal Product Code), or its EAN (European Article Number) to look it up on the Amazon FBA Calculator on any of the following links, hence getting instant access to the expected costs and resulting profit related to selling it on Amazon:
The Amazon FBA fees calculator includes costs for lots of different parts of the fulfillment service. This includes:
Below, we'll be covering all of those in addition to other general non-FBA fees.
First, wen it comes to the "Selling on Amazon fees", Amazon offers two selling plans:
The Professional plan costs a $39.99 monthly subscription fee on top of per-item selling fees, called referral fees, that are dependent on their category - see next section.
However, if you plan to sell fewer than 40 items a month, the Individual plan may be a better fit for you as no monthly subscription fee is tied to it. Instead, Individuals pay $0.99 per item sold plus referral fees. There are additional benefits to using the Professional plan though:
|Seller Account Type||Individual||Professional|
|Per Sale Closing Fee1||$0.99||N/A|
|Use of feeds, spreadsheets, and other tools to load inventory||No||Yes|
|Access to order reports and order-related feeds||No||Yes|
|Earn top placement on product detail pages||No||Yes|
|Sell in 20+ open categories||Yes||Yes|
|Apply to sell in 10+ additional categories||No||Yes|
|Customize shipping rates||No||Yes|
Read more: Selling on Amazon pricing page
Referral fees on Amazon are also known as the commission fees that sellers need to pay on each item sold on Amazon. Amazon is one of the biggest shopping platforms online and millions of people visit this marketplace every day, giving sellers the ability to instantly reach their customers and start selling products. It is then only natural that sellers pay those commissions on each sale in exchange for this higher reach of high-intent purchasers.
Indeed, if you decided to create your own ecommerce store, it would take you years to market it properly and get all of those visitors. Since Amazon provides all of these benefits to their users, they consequently charge commissions to their sellers. For most product categories, the Amazon referral fees are fixed at 15% of each sale and every seller needs to pay them, while most of them range from 6% to 18%, excluding some exceptions.
Referral fees table:
|Categories||Amazon deducts the greater of the applicable referral fee percentage or applicable per-item minimum referral fee.|
|Referral fee percentages||Applicable minimum referral fee (applied on a per-item basis unless otherwise noted)|
|Amazon Device Accessories||45%||$1.00|
|Baby Products (excluding Baby Apparel)||15%||$1.00|
|Camera and Photo||8%||$1.00|
|Cell Phone Devices||8%||$1.00|
|Electronics Accessories||15% for the portion of the total sales price up to $100; and 8% for any portion of the total sales price greater than $100||$1.00|
|Furniture & Decor||15%||$1.00|
|Home & Garden (including Pet Supplies)||15%||$1.00|
|Major Appliances||15% for the portion of the total sales price up to $300; and 8% for any portion of the total sales price greater than $300||$1.00|
|Software & Computer/Video Games4||15%||--|
|Sports (excluding Sports Collectibles)||15%||$1.00|
|Tools & Home Improvement||15%, except 12% for base equipment power tools||$1.00|
|Toys & Games||15%||$1.00|
|Unlocked Cell Phones||8%||$1.00|
|Video & DVD4||15%||--|
|Video Game Consoles4||8%||--|
|Categories Requiring Approval||Referral fee percentages||Applicable minimum referral fee|
|3D Printed Products||12%||--|
|Automotive & Powersports||12%, except 10% for tires and wheels products||$1.00|
|Clothing & Accessories||17%||$1.00|
|Collectible Coins||See Category Requirements for referral fees.|
|Entertainment Collectibles||See Category Requirements for referral fees.|
|Fine Art||See Category Requirements for referral fees.|
|Grocery & Gourmet Food||15%||--|
|Health & Personal Care (including Personal Care Appliances)||15%||$1.00|
|Industrial & Scientific (including Food Service and Janitorial & Sanitation)||12%||$1.00|
|Luggage & Travel Accessories||15%||$1.00|
|Shoes, Handbags & Sunglasses||15% for products with a total sales price of up to $75 18% for products with a total sales price above $75||$1.00|
|Sports Collectibles||See Category Requirements for referral fees.|
|Watches||16% for the portion of the total sales price up to $1,500; and 3% for any portion of the total sales price greater than $1,500||$2.00|
Amazon also charges its FBA sellers for fulfillment and this includes shipping, packing, and storing products that users are selling. Of course, you will have to pay these fees only if you are using Amazon FBA.
The FBA program alleviates the hassles of fulfillment and logistics for sellers. Whenever you have a customer buy a product from you through Amazon, the Amazon staff has to pick your product in one of the many fulfillment centers they have where they decided to store it, they then have to pack it, and finally ship it to the end customer while also supporting returns.
All of these warehouses are scattered around different states in the US, and around the world while being packed with millions of products. It takes a lot of logistics and management to take care of these items and deliver them to the right customers. This is why people need to pay the fulfillment fees to compensate Amazon for their troubles.
FBA fulfillment fees consist of two components:
Fees are further broken down into two types of fees categories depending on the product characteristics:
Only products in new condition that measure 16 x 9 x 4 inches or less, weigh 15 ounces or less, and are priced $15 or less qualify for Small and Light FBA fees pricing.
Small and Light FBA fees pricing table:
|Order type||Fulfillment fee||Small and Light|
|Items priced less than or equal to $5.00||Order handling||$0.80 per order|
|Pick & Pack||$0.75 per unit|
|Weight handling (unit weight + packaging weight)||$0.11 per oz (up to 15 oz per unit)(round up to the nearest whole oz)|
|Items priced greater than $5.00 and less than or equal to $15.00||Order handling||$1.00 per order|
|Pick & Pack||$0.75 per unit|
|Weight handling (unit weight + packaging weight)||$0.11 per oz (up to 15 oz per unit)(round up to the nearest whole oz)|
On Small and Light pricing, fixed fees include order handling, which is always either $0.8 or $1 depending on the product price that ought to always be under $15 though, and comes with every single order as an operational fee. There’s also the pick & pack fee of either $0.75 or $1.06, which includes finding items, packing them in boxes, and properly labeling them for the customers they are intended for.
The variable fees on the Small and Light pricing include weight handling which varies depending on the weight of a product.
This means that on Small and Light pricing, you should expect a minimum of $1.6 and up to $$3.2 ($0.8 + $0.75 + 0.15 oz * $0.11 for an item with a weight of 15 oz) on items with a price lower than or equal to $5, in other words, FBA fees will represent 32% to 64% of your $5 item's selling price. Were you selling a $15 item, you would be paying $1.9 to $3.4 in FBA fees.
In standard-size and oversize pricing, the FBA pricing structure is somehow simplified as the order handling and pick & pack fees are merged into one single and tiered size fee that depends on the size of the product, or, more precisely, on its dimensional or volumetric weight, also called DIM weight.
Indeed, the outbound shipping weight outlined in the pricing tables below is to be calculated for each unit by adding the packaging weight to the greater of the unit weight or the dimensional weight. DIM weight is used to calculate the shipping cost of bulky yet lightweight packages (think of a large bag for instance). In other words, if your package is taking up a bit more space than the weight the package captures in rates, you will pay for that additional space.
The dimensional weight in lbs. is calculated by determining the cubic size of the item and dividing it by a divisor. The formula used is where the divisor depends on if the shipment is domestic or international.
UPS and Fedex US domestic divisor for instance is 139 while USPS divisor is 194 to shipments going to Zones 5-9 in the US. To compute your volumetric weight, use this great DIM weight calculator from Shipping Easy.
Standard-size pricing table:
|FBA fulfillment fees (standard-size)|
|Small standard-size (1 lb. or less)||Large standard-size (1 lb. or less)||Large standard-size (1 to 2 lb.)||Large standard-size (over 2 lb.)|
|Fulfillment fee (Year-round rates)||$2.41||$3.19||$4.71||$4.71 + $0.38/lb. above first 2 lb.|
Clothing items, however, incur an additional $0.40 per-unit fulfillment fee regardless of size tier.
The above pricing applies to domestic and international orders.
Oversize pricing table:
|FBA fulfillment fees (oversize)|
|Small oversize||Medium oversize||Large oversize||Special oversize|
|Fulfillment fee (Year-round rates)||$8.13 + $0.38/lb. above first 2 lb.||$9.44 + $0.38/lb. above first 2 lb.||$73.18 + $0.79/lb. above first 90 lb.||$137.32 + $0.91/lb. above first 90 lb.|
The above pricing applies to domestic orders only.
|Fulfillment fee||Small and Light (item priced less than or equal to $5)||Small and Light (item priced less than or equal to $15, but more than $5)||FBA (small standard-size non-media)|
|Order handling||$0.80 per order||$1.00 per order||$2.41 per unit (up to 1 lb)|
|Pick & Pack||$0.75 per unit||$0.75 per unit|
|Weight handling(unit weight + packaging weight)||$0.11 per ounce (up to 15 oz per unit)(round up to the nearest whole oz)||$0.11 per ounce (up to 15 oz per unit)(round up to the nearest whole oz)|
Storage fees include the services of storing and maintaining products within the fulfillment centers. They are are based on the daily average volume (measured in cubic feet) for the space your inventory occupies in fulfillment centers. Storage fees are divided into two categories, depending on the required time of storing:
Inventory storage fees are paid monthly and are typically charged between the 7th and 15th day of the month following the month the fee applies to. Each month, you calculate how many items you stored within their fulfillment center and pay the adequate price for that storage space.
Additionally, you should bear in mind that the prices for November and December are higher given its a high-velocity sales period with constrained warehouse space.
Again, this is a fee where your product's volume is paramount.
Inventory storage fees pricing table:
|January - September||$0.69 per cubic foot||$0.48 per cubic foot|
|October - December||$2.40 per cubic foot||$1.20 per cubic foot|
These fees are paid twice per year. They include all products which were stored for at least six months within the fulfillment center. These fees have two tiers, the first one is $11.25 per cubic foot for all items that have been 6 or 12 months in the fulfillment center since the last inventory cleanup. The other one is $22.50 for all times that were in the storage for 12 months or longer since the last inventory cleanup.
The long-term storage fee is in addition to the monthly inventory storage fee. Fees are not charged if a removal order has been submitted prior to the fee being charged.
|6 to 12 months||$11.25 per cubic foot|
|More than 12 months||$22.5 per cubic foot|
To calculate cubic feet from inches:
Example: A unit measuring 47" x 12" x 10" divided by 1,728 = 3.3 cubic feet.
Since there are so many sellers on Amazon and efficient warehouse space management is essential, Amazon has decided to measure sellers performance and favor those that perform well.
After all, it’s not in their interest to store countless items that aren’t being sold and take up so much valuable space that could be used better by other sellers. This is why they’ve added the Inventory Performance Index which is a Key Performance Indicator (KPI) based on how well you keep popular products in stock, maintain healthy inventory levels, and fix listing problems.
|Score less than 350(Six weeks before the current quarter ends AND at the end of the current quarter)||Score of 350 or more|
|Storage limits||Updated quarterly||Unlimited|
|Monthly Inventory Storage Overage Fee||$10 per cubic foot over the storage limit||Not applicable|
The seller’s score can go from 0 to 1k and you need a score of at least 400 puts if you want to have unrestricted storage and all the benefits. Having a lower score than this would mean that you need to improve as a seller. Amazon hasn’t revealed exactly how they calculate the scores, but some factors that definitively affect it are sell-through rates, excess inventory, current in-stock inventory, and stranded inventory.
Amazon fees are a complex matter that's paramount to master if you want to succeed selling on Amazon, and doing your homework by computing products detailed fees is essential before sourcing and purchasing them from your suppliers.
As part of your Product Research process, you can leverage DataHawk not only to get product launch ideas, but also to instantly unveil their related Amazon fees, including FBA fees and referral fees.
To give DataHawk a try, Check our Pricing page for more details and pick which plan you'd like to try out. To quickly get started, enter your email in the form below to open your DataHawk Free account.