How much does it cost to sell on Amazon

The modern high street market of the twenty-first century is no longer found on high street. It's on the web, available to anyone and everyone with an internet connection and a desire to supply a demand or demand a supply. Today's global commerce now runs on servers and modems, not steam and coal.
For those of us interested in using the power of the internet to sell products around the world, the appeal is obvious and immediate: reach customers all across the globe, expand into new markets, sell more product, and do it all from the comfort of our keyboards. What's not to like?

And of course, this biggest internet selling Goliath of them all is Amazon, the mighty magic company that delivers those brown packages of joy to your doorstep from every corner of the globe. Amazon is the eighth-largest retailer in the world, and has built an inventory, storage, and shipping infrastructure the equal of any operation on earth. The difference, however, is that you can use Amazon to sell your very own products.

That's right! You, too, can harness the awesome power of Amazon to sell stuff! So, how much does it cost to sell on Amazon?

We're glad you asked! We take a look at prices, advantages, and things to keep in mind when it comes to selling on Amazon. Let's take a look.

How much does it cost to sell on Amazon?

Amazon has several different selling programs available to would-be sellers like yourself, each with different pricing models, fees, and considerations. Picking the right one is just as important to your sales success as choosing the right product or the right brand name. So which is the best for you? That depends on how much inventory you have to sell, how frequently you expect to receive orders, and – of course – where you're located!

Fulfillment by Amazon

According to Amazon, fullfillment by Amazon (FBA) gives you the ability to “store your products in Amazon's fulfillment centers, and we will pick, pack, ship, and provide customer service for them.”

Here's how it works, in six easy steps:

  1. Register with Amazon. Provide your basic personal information, as well as a credit or debit card, a bank account for receiving payments, and a valid tax ID.
  2. Choose what products you wish to sell. More on how to choose the right products, below.
  3. Ship your products to Amazon. Amazon's low, standard shipping rate is all it takes to get your products to an Amazon fulfillment center.
  4. Amazon stores your products. Amazon catalogs, inventories, and stores your products at a fulfillment center so they are ready to ship immediately when ordered.
  5. Customers buy your products. Customers shop, purchase, and order your products on Amazon.com (or other e-commerce channels like your own storefront) just like they would any item.
  6. Amazon picks, packs, and ships your products. Amazon selects your products from inventory, packages them, and ships them out to your customers. Amazon also provides customer support for any items ordered from Amazon.com.
Fulfillment by Amazon is supernaturally powerful for sellers because it lets you list your products on the all-powerful Amazon.com storefront, and because it dramatically slashes your operating costs around inventory and storage. (Not to mention that fact that you may not have your own warehouse to store things, anyway.)
cost

So, what does it cost?

Amazon breaks its seller pricing structures down into two main categories: Individual Sellers and Professional Sellers.

Amazon charges several types of fees, depending on your status as an Individual or a Professional. They are: monthly subscription fees, selling fees, referral fees, variable closing fees, and shipping and storage fees (what Amazon calls “fulfillment” fees).

Amazon charges sellers who opt for the “Professional” structure a monthly fee of $39.99. Sellers who opt for the “Individual” structure do not pay a monthly subscription fee.
Amazon charges sellers who opt for the “Individual” structure $0.99 per time, plus all applicable referral and variable closing fees. Sellers who opt for the “Professional” structure do not pay selling fees. The mathematical result of this structural dichotomy, when all is said and done, is that “Professional” selling generally favors those sellers who plan on selling greater than 40 items per month; “Individual” favors those who expect to sell fewer, meaning their selling fees will total fewer than $40.

Amazon charges both “Professional” and “Individual” sellers a referral fee for each item sold, which operates on a sliding scale depending upon the category of the item sold. Amazon charges either the referral fee percentage, or an Applicable Minimum Referral Fee, whichever is larger. As a simple hint, though, all Applicable Minimum Referral Fees are $1.00, except for the Jewelry and Watches categories, which charge $2.00.

Amazon's referral fees for sellers are below:

Amazon Device Accessories – 45%
Baby Products – 15%
Books – 15%
Camera and Photo – 8%
Cell Phone Devices – 8%
Consumer Electronics – 8%
DVD – 15%
Electronics Accessories – 15% up to $100; 8% after that
Furniture and Decor – 15%
Home and Garden – 15%
Kitchen – 15%
Major Appliances – 15% up to $300; 8% after that
Music – 15%
Musical Instruments – 15%
Office Products – 15%
Outdoors – 15%
Personal Computers – 6%
Software and Computer/Video Games – 15%
Sports – 15%
Tools and Home Improvement – 15%; 12% for base equipment power tools
Toys and Games – 15%
Unlocked Cell Phones – 8%
Video and DVD – 15%
Video Game Consoles – 8%
Everything Else – 15%

Amazon charges both “Professional” and “Individual” sellers a variable closing fee, depending on the category of the product sold.

Sellers pay a closing fee of $1.80 for each “media” item sold. “Media” categories include Books, DVD, Music, Software and Computer/Video Games, Video, and Video Game Consoles.

Amazon's pricing structure for fulfillment – that is, picking, packing, shipping, handling, customer service, and product returns – is a bit more complex than its other structures, and is dependent upon a number of variables, including product dimensions, product weight, and time of year. Seriously, time of year! Amazon does a high volume of business during the holiday seasons, and they pass their volume-based shipping savings onto their customers. However, storage space in their warehouses is at a premium during the holidays, and fees for storage increase as a result.

Amazon's fulfillment fees for sellers for the months of January to September are below:

  • “Small” items (<1 lb., <15” x 0.75” x 12”) – $2.41 
  • “Small Oversized” items (<70 lbs., <60” x 30” x 130”) – $6.85 + $0.39/lb after 2 lbs.
  • “Medium” items (<20 lbs., <18” x 8” x 14”) – $2.99
  • “Medium Oversized” items (<150 lbs., <108” x 130”) – $9.20 + $0.39/lb after 2 lbs.
  • “Large” items (<20 lbs., <18” x 8” x 14”) – $3.96
  • “Large Oversized” items (<150 lbs., <108” x 165”) – $75.06 + $0.80/lb after 90 lbs.

Amazon's fulfillment fees for sellers for the months of October to December are below:

  • “Small” items – $2.39
  • “Small Oversized” items – $6.69 + $0.35/lb after 2 lbs.
  • “Medium” items – $2.88
  • “Medium Oversized” items – $8.73 + $0.35/lb after 2 lbs.
  • “Large” items – $3.96
  • “Large Oversized” items – $69.50 + $0.80/lb after 90 lbs.

Amazon's monthly inventory storage fees for the months of January to September are below:

  • Standard Size items – $0.64 per cubic foot
  • Oversized items – $0.43 per cubic foot over standard dimensions

Amazon's monthly inventory storage fees for the months of October to December are below:

  • Standard Size items – $2.35 per cubic foot
  • Oversized items – $1.15 per cubic foot over standard dimensions

Thankfully, Amazon offers a helpful “Fulfillment by Amazon Revenue Calculator” that helps you quickly and easily calculate the total profit and costs of selling any theoretical item on Amazon. So, go ahead! Play around with it, and determine for sure whether selling that baby rattle is actually profitable on Amazon. You might also want to check Algopix to help determine competitive pricing.

Where is fulfillment by Amazon available

Fulfillment by Amazon is available in several countries worldwide, allowing sellers to expand into highly valuable markets around the globe.

Amazon says that in order to sell products in a given market (for example, Japan), you must ship to and store your inventory in Amazon's fulfillment centers in that country. The only exception is Europe, where European Union economic agreements allow you to use Amazon's Pan-European FBA program.

Amazon Fulfillment Centers are available in the following countries below:

  • United States – 104 fulfillment centers
  • Canada – 6 fulfillment centers
  • Mexico – 1 fulfillment center
  • United Kingdom – 13 fulfillment centers
  • Germany – 9 fulfillment centers
  • France – 4 fulfillment centers
  • Italy – 1 fulfillment center
  • Spain – 3 fulfillment centers
  • Czech Republic – 2 fulfillment centers
  • Poland – 3 fulfillment centers
  • China – 17 fulfillment centers
  • Japan – 10 fulfillment centers
  • India – 27 fulfillment centers
  • Brazil – 1 fulfillment center

According to the Guardian and Business Insider Australia, Fulfillment By Amazon will soon be coming to the great nation of Australia, too!

By September 2017, Amazon hopes to offer Fulfillment by Amazon down under, thanks to the planned construction of a 93,000-square-meter fulfillment center to be built in either Brisbane, Sydney, or Melbourne.

So get ready, Australia! Soon you, too, will be able to use Fulfillment By Amazon to fill domestic orders, and international sellers else will be able to offer FBA products in Australia, as well!

price products, amazon

Can I export products on Amazon?

Yes, you sure can! In fact, Fulfillment By Amazon makes it fairly simple to designate which products to make available for export, and streamlines the process for you, the seller.

To make your products available for export, simply:

  1. Log in to Amazon Seller Central
  2. Click “Setting,” and then click “Fulfillment By Amazon”
  3. Scroll down to “Export Settings,” and then click “Edit”
  4. Click “FBA Export,” and then upload a signature
  5. Click the “Submit” button

To verify which products in your inventory are eligible for export, simply:

  1. Log in to Amazon Seller Central
  2. Click “Reports,” and then click “Fulfillment”
  3. In the left window, under “Inventory,” click “Show More”
  4. Click “Exportable Inventory”

Please keep in mind that inventory updates may take up to two weeks to appear in the report.


Foreign Currency Exchange for Sellers

Foreign currency exchange for sellers

Of course, if you're a true savvy seller, you've probably figured out by now that there's bound to be a smarter way to collect payment on your Fulfillment By Amazon products.

As usual, you're right! And that smarter way is OFX.

OFX provides online sellers with a virtual local bank account number in the foreign market of your choosing, so you can provide that account number to Amazon when signing up for Fulfillment By Amazon. With an Online Seller account from OFX, you can collect payment directly in USD, EUR, GBP, CAD, AUD, JPY, and HKD and convert it at a great exchange rate. Otherwise, Amazon usually charges as much as 4% for cross-border payments.

To create an online seller account with OFX, simply:

  1. Register with OFX. Click “Register” and fill in your details. There are no setup fees.
  2. Get a call from OFX. OFX will ask some basic questions, including which currencies you want your receiving account to accept.
  3. Verify your account. Send the final required documents to OFX via our secure site.

OFX accounts are (normally) approved within four business days. Once your account is approved, your receiving account details should be delivered within two business days.

Then, you're off to the Amazon races like a true power seller!

Fulfillment By Amazon is a wonderful tool for online sellers. Knowing how much it costs to sell on Amazon is the key that unlocks that tool, and opens a world of commerce possibilities to anyone eager to seize it.