What it costs to sell on Amazon in 2018

What it costs to sell on Amazon in 2018

It’s news to no one that third-party sellers are responsible for most of Amazon’s growth.

The fees the company charges marketplace merchants—including commissions, related fulfillment and shipping charges and other seller services—totaled over $10.5 billion during its most recent quarter, up from $7.46 billion a year earlier.

Whether you currently sell on Amazon or you’re considering it, it’s important to determine the profitability of your marketplace business. Here is a breakdown of the company’s current selling fees.

TL;DR

#1. Monthly subscription fee: Professional sellers (selling more than 40 items a month) pay $39.99 a month. Individual sellers (selling less than 40 items a month) don’t have to pay a monthly subscription fee.

#2. Per-item fees: Professional sellers don’t have to pay a per-item fee, while individual sellers are charged $0.99 for each item sold.

#3. Shipping fees: For self-fulfilled orders, Amazon shipping rates apply to media products (books, music, video, DVD, software and video games) sold by professionals and to all products sold by individuals. These rates are based on the product category and the shipping service selected by the buyer. For Amazon-fulfilled orders, sellers are charged for fulfillment, storage and optional services, in addition to selling fees.

#4. Referral fees: Sellers pay a referral fee on each item sold. Items in several categories have a per-item minimum referral fee, so sellers pay the referral fee or the per-item minimum fee, whichever is more.

#5. Variable closing fees: Individual and professionals pay a variable closing fee for each media item that’s sold.

Referral fees

Remember, Amazon takes a cut of every item sold. This ranges from as low as 6 percent (personal computers) to as high as 45 percent (Amazon device accessories), although referral fees for media products are 15 percent of the total sales price of a product, rather than the item price alone.

Meanwhile, the minimum referral fee across most categories (applied on a per-item basis unless otherwise stated) is $1 ($2 for watches or jewelry). There is no minimum referral fee for media products, as there are additional charges associated with those items.

CATEGORIES REFERRAL FEE PERCENTAGE MINIMUM REFERRAL FEE
Amazon device accessories 45% $1.00
Baby products (excl. apparel) 15% $1.00
Books 15% N/A
Camera and photo 8% $1.00
Cell phone devices 8% $1.00
Consumer electronics 8% $1.00
DVD 15% N/A
Electronics accessories 15% on the first $100 of the price and 8% thereafter $1.00
Furniture and decor 15% $1.00
Home and garden (incl. pet supplies) 15% $1.00
Kitchen 15% $1.00
Major appliances 15% on the first $300 of the price and 8% thereafter $1.00
Music 15% N/A
Musical instruments 15% $1.00
Office products 15% $1.00
Outdoors 15% $1.00
Personal computers 6% $1.00
Software and computer/video games 15% N/A
Sports (excl. collectibles) 15% $1.00
Tools and home improvement 15%, except 12% for base equipment power tools $1.00
Toys and games 15% $1.00
Unlocked cell phones 8% $1.00
Video and DVD 15% N/A
Video game consoles 8% N/A
Everything else 15% N/A
3-D printed products 12% N/A
Automotive and powersports 12%, except 10% for tires and wheels products $1.00
Beauty 15% $1.00
Clothing and accessories 17% $1.00
Collectible books 15% N/A
Gift cards 20% N/A
Grocery and gourmet food 15%, or 8% for items priced $15 or less N/A
Health and personal care (incl. personal care appliances 15% $1.00
Industrial and scientific 12% $1.00
Jewelry 20% on the first $250 of the price and 5% thereafter $2.00
Luggage and travel accessories 15% $1.00
Shoes, handbags and sunglasses 15%, or 18% on items priced above $75 $1.00
Watches 16% on the first $1,500 of the price and 3% thereafter $2.00

Sellers also pay a closing fee of $1.80 on all media sales.

Fee refund on returns

If you end up refunding a customer for an order for which you have already received payment, Amazon will refund you the amount of the referral fee you paid, minus the applicable refund administration fee ($5 or 20 percent of the applicable referral fee, whichever is less).

Order fulfillment charges

If you opt for Fulfillment by Amazon, you will have to pay a series of fees, on top of the charges we already discussed. New FBA U.S. fees, outlined below, will come into effect on Feb. 22.

Standard size

Small (1 lb. or less) $2.41
Large (1 lb. or less) $3.19
Large (1 lb. to 2 lb.) $4.71
Large (over 2 lb.) $4.71 + $0.38/lb. above first 2 lb.

Oversize

Small oversize $8.13 +$0.38/lb. above first 2 lb.
Medium oversize $9.44 +$0.38/lb. above first 2 lb.
Large oversize $73.18 +$0.79/lb. above first 90 lb.
Special oversize $137.32 +$0.91/lb. above first 90 lb.
Add $0.40 per unit for clothing items

Shipping credits

If you’re a professional seller fulfilling your own orders, Amazon will pay you a shipping credit on every sale to cover your costs, but it’s important to be aware of how much it actually costs to ship your product.

A business that chooses ‘standard shipping fee’ ostensibly allows Amazon to set the price. If they set it beneath cost (which can happen, especially with heavier items), this is going to come out of your profit margin.

The bottom line

Half of all items sold on Amazon come from marketplace sellers, with more than 140,000 small and mid-size businesses surpassing over $100,000 in sales last year.

But selling on Amazon does come at a cost. Not to mention, 82 percent of the site’s sales go through the Buy Box. That’s why you need to understand all the fees involved and invest in the right tools to ensure you sell more and always at a profit.

Our automated Amazon repricer can help keep you competitive 24 hours a day. It combines powerful algorithms with personalized seller rules so you always sell at the best price, not the lowest. Enter your costs, measure the net margin on all your SKUs and set price boundaries to ensure you profit on all your sales.


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Lyndsay McGregor

Lyndsay McGregor is the Content Manager at xSellco where she writes about all things e-commerce. In a past life, she was an award-winning B2B journalist, covering the retail and fashion industries, sustainability and technology.

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