If you wish to sell online, the first question should be whether your business will be profitable or not. You should earn profits, or you do not have a business. And, of course, you need to keep in mind manufacturing costs per item, taxes, shipping costs, taxes, and more… However, you also need to consider AMZ commissions like seller accounts or fulfillment fees.
So, if you wish to find out more about AMZ seller costs, you have come to the right place. We have compiled a comprehensive and transparent guide on the Amazon seller calculator to help you calculate the actual cost of working in the marketplace. Many variables may influence it, so it is vital to know how commissions are calculated to plan appropriately and reduce your costs as much as possible.
Now, let’s get started!
What Are Costs for Selling on Amazon FBA?
When determining whether to sell and fulfill goods through the AMZ marketplace, a seller should take into account that they would pay the following commissions:
Selling plan: The marketplace charges the most general recurring commission for its plans for merchants. The Individual subscription costs $0.99 per unit, while the Professional one costs $39.99 per month. Moreover, some additional selling fees may also apply.
Fulfillment fees: Such commissions occur if you handle orders via FBA, including additional costs for weight handling, inbound and outbound shipping, etc.
Referral fees: Such costs are connected to the marketplace’s referral fee on each item sold. Although most referral fees are between 8% and 15%, the exact amount may vary based on the product category.
Other charges: Preparation service, picking&packing, order handling, picking, and 30-day or long-term keeping of products in Amazon’s warehouses might come with additional costs for sellers.
However, it can be that fulfilling the items themselves is more expensive. Therefore, even though a seller might not need to cover some aspects (for example, weight handling) when delivering items themselves, it can be that other fees are high enough to make merchants switch to AMZ FBA economically efficient.
How to Leverage Amazon Calculator for Your Best Results?
The FBA estimator can be extremely helpful when you are looking for new merchandise to sell. It will offer you an estimate of the FBA commissions per unit and a rough estimation of your net profit and margin if you start to move the item via Amazon FBA.
It may also help you to realize the impact on profit margins if you intend to raise or reduce the price of a product or its cost. The tool can help you decide on your item cost budget and minimum client price to guarantee your company is profitable. If you are going to change from FBM to SFP, you can also check Amazon FBA Calculator.
If you’re just beginning to sell on the platfrom, Amazon’s FBA estimator can allow you to compare the bottom-line profit margins between different fulfillment methods. Once you start selling on Amazon via FBA, you will need more advanced software to track and manage your sales.
Why Do You Need to Estimate Your FBA Profitability Upfront?
Calculating your profitability is a vital business administration task if you move physical goods via Amazon FBA. It might seem challenging to keep tabs on all the fees. However, whether you are a novice seller or an FBA expert, it is essential to do proper research and estimate each product. It includes considering seller fees, order revenue, manufacturing and fulfillment costs, and platform commissions.
Amazon merchants who do not manage all the fees can find their profits dropping or barely covering their costs. So if you have items in the wild, monitoring your fees and expenses is essential to ensure your brand runs smoothly.