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).
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)
- Referral Fee Percentage (15% of the sale price in most cases; ranges from 6-20%).
- Variable Closing Fee (ranges from 45 cents + .05 cents per lb. to a fixed $1.35).
- Order Handling Fee (ranges from $0.00 for media products to $1.00 for non-media products)
- Pick & Pack Fee ($1.00)
- Weight Handling ($0.37 per lb. (rounded up))
- Storage ($0.45 per cubic foot per month and $0.60 per cubic foot during the Holiday Season)
Here is an example purchase:
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.
If you are looking for the complete introduction to Selling on Amazon using the Fulfillment By Amazon Program, Click Here Now- Sell on FBA.