Amazon FBA fees: how much, when, and what to pay Amazon
We have gone through the process of creating a business plan and calculating the profitability several times, so we can tell you how much, when, and what you will have to pay to the big brother.
*In this article, we will discuss Amazon fees for the FBA model.
Fees for sales
They are charged immediately after the sale of the product. In this category, there are two types of fees:
- Referral fee. Its size depends on the category, but in most cases, it is 15% of the purchase price. You can find the rates for referral fee here.
- Fulfillment fee (includes payment for order processing, acceptance, packaging, and delivery to the buyer). Its size depends on the size of the product and the time of year. Amazon has 8 categories by size, depending on the dimensions of the product (length, width, height, weight), and it falls into one of them. Thus, the amount you pay per unit of goods for each sale is determined. Rates vary depending on the time of year. In the pre-holiday months (October-December), they are lower.
Monthly fees
- Professional selling plan fee— $39,99
*If you have an individual selling plan, the fee structure is different: Amazon charges $0.99 from each sale, but you don’t pay anything monthly.
- FBA monthly storage fee (payment for storing goods in Amazon warehouses) – depends on the size of the product, its quantity (in cubic feet), and the month.
Irregular fees
- Long term storage fee: a fee for storing goods in Amazon’s warehouses for a long period of time. There are two rates: if the goods are stored for more than 6 months or 1 year. The amount depends on the size, quantity, and duration of the storage.
- Inventory Placement Service fees: a fee for distributing goods between different Amazon warehouses. It is charged after creating a shipment if the product is sent to only one warehouse, and Amazon distributes it to other locations (yes, the platform determines which warehouses to send the goods to, and it cannot be influenced).
- Removal fee: a fee for removing goods. There are three ways to dispose of inventory: destroy the product, send it to any address from the Amazon warehouse, or liquidate it. If the removal order is confirmed, you pay for each unit.
- Returns processing fee: a fee for organizing the return of goods. It applies if a buyer returns a product from a category for which Amazon offers free return shipping to the warehouse (categories include Apparel, Watches, Jewelry, Shoes, Handbags & Sunglasses, Luggage).
- Unplanned Prep Services: fees for unplanned services. They are charged if the product is improperly packaged or barcodes are incorrectly applied.
- FBA Label Service Fee: a fee for labeling barcodes. Each unit of product sent to an Amazon warehouse must have a barcode generated in Seller Central. If you do not want or cannot apply the barcodes yourself, Amazon will do it for you for only $0.20 per unit.
- FBA Prep Service Fees: a fee for packaging products. If you want Amazon to pack the product according to the requirements, you need to pay a certain amount for each unit of the product.
To calculate revenue per unit, pay attention to the first two types of fees – you cannot avoid them. Irregular fees are only charged in certain cases, but it’s better to be forewarned and forearmed.
And don’t forget about the wonderful tool – FBA Revenue Calculator.