Amazon Selling Fees

by Alfredo on July 17, 2012

In a previous article, I wrote about the definition of Amazon’s Fulfillment by Amazon (Amazon’s FBA) and what selling on Amazon FBA was all about.

I gave you some examples of the many benefits to sellers (Amazon’s employees, facilities and services are now your employees, facilities and services), and the many benefits to your buyers – the foundation of your business (your buyers get to enjoy Amazon’s shipping specials, packing expertise, and 24 x 7 CUSTOMER SERVICE).

Selling on Amazon FBA Makes Selling Better

Selling with Ease on Amazon FBA

You no longer have to worry about missing a customer’s question sent in the middle of the night, and possibly losing the sale.  You no longer have to try to purchase quality shipping supplies in bulk to get the volume discount, or in the smaller quantities which may be more reasonable for your business, but which deeply dent your profit.  You no longer have to offer free shipping or lower cost shipping to compete with Amazon – you ARE Amazon!

I also mentioned that most experienced sellers, who previously sold their product using their own facilities and manpower, agreed that by selling on Amazon FBA, they recognized a significant cost savings.

The mention of Amazon Selling Fees, especially to new sellers, strikes a nerve – it’s understandable.  Don’t just brush them off as unjustifiable or unaffordable.  You might be passing up on a great opportunity.  And remember, you are getting value by paying these fees.  Amazon’s name brand, their services, their warehousing, their shipping speed.   Amazon has the most customers in the history of the world.  They are doing something right.

But you need to determine for yourself, for the specifics of your own business, the advantage of paying these Amazon FBA Fees.  You, as a seller, either have been, or will soon be, investing in your infrastructure with your money and your time.   You need to do your own cost benefit analysis to support your decision.  I cannot assist you in determining some of the costs associated with your particular business, but I can assist you by filling in some of the details of the Amazon Selling Fees.   This is an important decision and deserves some homework.

The fee structure for Selling on Amazon FBA  is as follows:

$39.99 per month for a professional seller (same for non-FBA and FBA sellers)

Plus…

  1. Referral Fee Percentage (15% of the sale price in most cases; ranges from 6-20%).
  2. Variable Closing Fee (ranges from 45 cents + .05 cents per lb. to a fixed $1.35).
  3. Order Handling Fee (ranges from $0.00 for media products to $1.00 for non-media products)
  4. Pick & Pack Fee ($1.00)
  5. Weight Handling ($0.37 per lb. (rounded up))
  6. Storage ($0.45 per cubic foot per month and $0.60 per cubic foot during the Holiday Season)

Here is an example purchase:

Amazon Fee Example Using Fulfillment By Amazon

Amazon FBA Example Fee

 

Storage fees are charge monthly for all inventory in FBA warehouses.

Focus on your ability to grow your business beyond your wildest dreams, accept that the Amazon FBA fees are fair, and with the right education, the fee structure will enable you to select products that will make you a great return on your investment.

Additional Resources:

If you are looking for the complete introduction to Selling on Amazon using the Fulfillment By Amazon Program, Click Here Now- Sell on FBA.

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What is Fulfillment By Amazon (FBA)?

by Alfredo on July 1, 2012

What is Fulfillment by Amazon (FBA)?

Fulfillment by Amazon (sometimes referred to as Amazon FBA or Amazon’s Fulfillment-By-Amazon (FBA)) allows you, the independent seller, to utilize the services, benefits, personnel, warehousing and even the brand association of Amazon to sell your own items.Fulfillment By AMazon

Think of it as stocking your items in their warehouse, utilizing their customer service as your own, having a company-full of pickers and packers at your disposal, and an IT person producing Seller Reports for you.   Work continues as you focus on finding better or more profitable product, or even continues as you vacation.

Your Amazon “employees“ work 24 hours a day, work on weekends and keep your sales and cash flow moving smoothly.   Your products will ship quickly and seamlessly, utilizing Amazon’s high quality packing standards.

Your customers can also reap the benefits of being an Amazon customer.  I’ll talk about some specific benefits to the buyer further on.

Sure, there are fees involved; however, the majority of sellers who once had brick and mortar facilities agree that these fees compare quite favorably with trying to fulfill orders on your own, using your own resources.

The Fulfillment by Amazon program has been received positively by the majority of sellers.  As a matter of fact, a recent survey of sellers conducted by Amazon.com stated that a majority (87%) of their respondents reported an increase in their unit sales – 61% stated an increase of 20% or more.

Increased sales and the time saved by having Amazon’s FBA program handle the details of your business for you accounted for 75.5% of the reasons that sellers joined FBA.

For new independent sellers, having the facilities and employees to begin your venture at a breakneck pace is more often a hope than a reality.  Usually, these sellers attempt to deal, mostly by trial and error, not only with the packing and postage of their products, but the warehousing, returns, customer service, inventory management, bookkeeping and sales tracking reports.   The ebb and flow of a normal sales business can toss these new sellers into a frenzy during the busy seasons, which usually results in poor service and very unhappy customers.

With Amazon FBA, you can begin your venture small and level up at a comfortable pace, to virtually limitless levels.  Or, you can break out of the starting gate at a run, knowing you have the support and services provided by Amazon to back you up.

Imagine having these tasks delegated to trusted employees, leaving you with the time to make better business decisions.

Now, let’s look at some of the specific benefits for your buyer, which end up benefiting you through higher sales volume.

 

Fulfillment By Amazon

Customer Ordering Conveniences

Your customers can use Amazon’s high-tech shopping cart features – such as making changes to orders prior to shipment, and tracking their orders and shipments.

 

Shipping Values

When internet sales were just beginning, consumers began looking online for values and product choices.  With shipping costs still at reasonable level, the decision to purchase online became a popular one.  Order at your convenience from a new wealth of product choices, and have your new item quickly show up at your door.

However, as shipping costs kept rising, an important factor in the buyer’s decision became the free or low cost shipping incentive.   Small sellers who strived to offer these incentives gave up too large a portion of their profit to compete successfully.  But, with Amazon’s Fulfillment-By-Amazon (FBA),

your buyers can take advantage of Amazon’s shipping values.

Amazon Prime members have unlimited fast shipping, such as FREE two-day shipping to street addresses in the U.S. The Amazon Prime membership is surging. You will reap the rewards because buyers are more likely to purchase from a seller that is part of Amazon FBA.

FREE Super Saver Shipping is another program that Amazon offers to buyers who spend over $25 on eligible products and ship within the USA. As an FBA seller, your products are eligible, allowing the buyer to save money and thus, making them more likely to add your product to their shopping cart. Even if your product is priced higher than non-FBA shippers!

 

Amazon Customer Special Services

Gift wrapping

24 x 7 Customer Service

Up to the minute countdown for One Day Shipping

 

Brand Association

Don’t underestimate the value of brand association to Amazon through the FBA program.  Amazon ranks among the top consumer brands for customer satisfaction and strict quality control, and now your buyers can feel the comfort of knowing their products come from Amazon, too.

 

This is Fulfillment by Amazon.

 

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Sell on Amazon FBA Free eBook

Selling on Amazon FBA the right way

by Alfredo on June 18, 2012

When I started selling on Amazon FBA, I was so excited and thrilled to jump right in and make money. Little did I know, there was so much knowledge that I did not yet possess. How would I setup up my business? What would I sell? Whats the most effective use of my time? How could I turn this into a real business with little startup cash?

After months of researching, learning, seeking out mentors, joining forums, I gained invaluable insights and experience, I eventually reached the success that I had long desired.

I decided that I would share my knowledge by creating a comprehensive selling on Amazon FBA business building system to share my knowledge with anyone that was willing to learn.

This blog captures some of my lessons, experiences, and insights for successfully selling using the Fulfillment-By-Amazon program or as it’s commonly referred to Amazon FBA. Checkout the first module Base Camp: Get Ready to Climb Amazon’s FBA Program if you are interested in taking the first step towards your financial freedom.

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