Amazon selling fees: How much does it cost to sell on Amazon?

It can be tempting to start selling on Amazon when you see prices of some products listed on this marketplace. At first sight you may get a feeling it would be very profitable business. But is it really so simple?

In this page I’ll try to simply explain what are the main Amazon selling fees.

Amazon selling plans

There are 2 Amazon selling plans which you have to choose from: the basic plan and the professional plan.

The basic plan is suitable only for sellers who sell only very few items per month. There is no monthly subscription fee but you pay £0.75 for each sold item (or similar equivalent based on the marketplace i.e. DE, FR, US). You can also sell not more than 35 pcs / month.

The professional plan is necessary for all sellers who are serious about selling on Amazon. The subscription fee is £25 (excl. VAT) or equivalent depending on marketplace location. There is no fee per item.

FBA vs. FBM fees

Fulfilled by Amazon (FBA) and Fulfilled my Merchant (FBM) are 2 possible ways how to sell on Amazon.

If you choose FBM you have to ship the products yourself like if you have a regular ecommerce business. In this case you pay only Referral fee which is a percentage from the selling price. For most cathegories it is around 15% (depends on the marketplace).

FBA method is more expensive but more automated. The products are shipped in bulk to FBA warehouses and Amazon expedites the units based on customer orders. Besides the 15% referral fee you will be charged an additional FBA fee which depends on the item weight and dimensions. For example: a regular item with dimensions ≤ 45 X 34 X 26 cm and weight 1 kg the FBA fee is £2.49.

Sales tax or VAT

Although sales tax or VAT is not Amazon fee, it is important to calculate with it. Depending on where you sell you will have to pay Sales tax or VAT (in some cases). Let’s say you sell in the UK and you are VAT registered. The sale price on Amazon is always final (VAT included). If you sell an item for £24 the VAT which you have to pay is £4 (20% in the UK). After you provide Amazon with the VAT number they will show you what amount is the tax from each order.

Example

It’s always better to see an example so here is a real Amazon order breakdown.

 

• The Lego was sold for £35.97.
• “Commission” is the 15% referral fee
• FBA fee is based on the cathegory ≤ 45 X 34 X 26 cm and ≤ 0.5kg
• “Product tax” is the 20% UK VAT in this case

 

 

 

 

 

 

 

 

 

 

How to evaluate net profit from an Amazon order?

Evaluation of net profit from Amazon is the most important step. All sellers should exactly know how much they make from Amazon sales. Otherwise it can easily happen they lose money on some products.

Let’t look at the FBA order from the example above.

I’ll assume the seller is VAT registered in the UK and the sale is made in the UK.