No matter if you are a veteran seller, or you are planning to sell on Amazon this year. By knowing how much money it will take to sell on Amazon, you will be able to spend your money wisely and make your Amazon business the most profitable it can be. In this article, BQool will provide you an infographic with an overview of the latest 2020 Amazon Seller Fees. First, let’s take a look at what seller fees are.
Monthly Subscription Fees
To sell on Amazon, you need to create an Amazon Seller account if you don’t already have one. There are two types of seller accounts:
- Individual Selling Plan: This plan is suitable for people selling fewer than 40 items per month. It’s free, but you will pay a $0.99 selling fee for every item sold. The individual plan is not available for Buy Box Eligibility, can’t offer gift-wrapping and have to upload listings manually, and also will be limited to certain selling categories including jewelry, art, food, luggage, shoes, handbags and DVD. See a complete list here.
- Professional Seller Plan: For sellers selling more than 40 items per month, this plan works best for you. Professional Seller Plan gives you access to selling to users outside the U.S., customize your shipping rates, bulk uploads, and more. It costs $39.99 per month.
Amazon charges both Individual and Professional sellers referral fees for every item sold. Referral fees are either a percentage of the product’s selling price, which ranges from 6% to 96% depending on the category or a minimum referral fee of $0.30. Amazon will charge whichever of these two is greater.
For example, if you sell a women’s hair clip for $1, Amazon will charge you $0.30 instead of a 17% referral fee, $0.17.
Besides, some categories like beauty products are charged in two tiers. If you sell lipstick for $15.00, you will pay 8% on $10 ($0.80) and 15% on $15 ($2.25), for a total referral fee of $3.05. You can find the full list of referral fees by category here.
Variable Closing Fees
Sellers also pay a closing fee of $1.80 per sold item under Media categories including Books, DVD, Music, Software & Computer/Video Games, Video, Video Game Consoles, and Video Game Accessories.
Amazon FBA Fees
Sellers can fulfill their orders including shipping, handling, storage, customer service, and product returns by themselves (FBM). Or you can ship your inventory to Amazon’s fulfillment centers, they handle your orders for you (FBA).
For FBM sellers, Amazon will assign shipping credits for every sale based on the category to help cover costs, and you must ship orders even if the shipping credit is less than actual shipping costs.
There are pros and cons to Fulfillment by Amazon and Fulfillment by Merchant. Many sellers choose FBA because they can save you a great deal of time on sending your prep and packaging, but you also have to pay for the service you use:
- Fulfillment Fees
FBA sellers pay Amazon Fulfillment Fees to cover the cost of Amazon picking, packing and shipping your orders. The fee is determined by the size and weight of your product. The product sizes are defined by Standard-Size, rates from $2.41 – $5.26 per unit, and Oversize, rates from $8.26 – 75.78 per unit; an additional charge may occur if the weight exceeds the maximum values listed. For complete details, visit here.
*US FBA and referral fee changes are coming on February 18, 2020.
- Monthly Inventory Storage Fees
Monthly storage fees are charged for storing inventory in Amazon’s fulfillment warehouses, which are determined by volume in cubic feet for standard-size and oversized items. And the fees break down into two periods:
You pay $0.69 per cubic foot for standard-size and $0.48 per cubic foot for oversized items between January and September and $2.40 per cubic foot for standard-size and $1.20 per cubic foot for oversized items from October to December as Q4 is particularly busy.
- Long-Term Storage Fees
Amazon performs inventory clean-ups on the 15th of each month. Amazon will charge $6.90 per cubic foot or a $0.15 per-unit Long-Term Storage Fees for inventory stored at Amazon for more than 365 days.
Refund Administration Fees
When you refund a customer, Amazon will charge you 20% of its referral fee or a flat fee of $5, whichever is smaller. For example, if you refund a customer the $10.00 total sales price of an item in a category with a 15% referral fee, your Refund Administration Fee will be $0.30 ($10.00 x 15% referral fee = $1.50).
Here is an infographic that gives an easy-to-understand overview of 2020 Amazon Seller Fees.
Wrapping this up:
Whether you choose Amazon FBA or FBM, you must take into account all the costs and times of running your Amazon business and still maintain profitability. Therefore, you need Amazon repricer to calculate your profits and ROI and help you win the Buy Box while protecting profit margins. BQool Repricer excels at helping sellers to win the Buy Box without cutting their profits to the bone. Once BQool Amazon automated pricing tool has helped you to obtain the coveted Buy Box, it will auto adjust your Buy Box price to maintain the Buy Box position to maximize your profit.