Have you been dreaming of reaching indescribable success? It’s a perfect moment to start your business right now because there’s a fantastic opportunity to sell products to customers around the world. Amazon is your lucky ticket to cloudless days and bags full of money. No matter what type of product you’ll pick – everything can be sold here.
Amazon treats entrepreneurs with cutting-edge business solutions. The marketplace gives sellers a chance to overstep the borders and realize their potential. Fulfillment by Amazon is an alternative that allows thousands of brand owners to delegate their duties and focus on other important aspects of the e-commerce world. It comes with a range of charges, so you must take into account additional outgoings. In our guide, we’ll explain what stands behind major Amazon FBA fees, why you should start offering goods on this website, and other essential details.
What are Amazon FBA Fees? Overview
Once a brilliant idea to launch a business has crossed your mind, you’ll never stop thinking about it. Of course, brand ownership is often connected with risks and disappointments, but with Amazon, this path turns into an exciting journey. Let’s explore the situation with FBA fees and find out if this model is the most effective solution for businesses.
Very often, brand owners who want to offer their products online don’t know where to store hundreds of boxes. Moreover, there’s even a bigger problem – lack of time to pack items and find a trustworthy delivery company. And if you can’t get through the same challenge, you might find it attractive to allow Amazon to do the dirty job for you. When selecting FBA, you leave behind several troubles at a time. A fulfillment center is the best place where goods could be kept – you no longer have to search for a warehouse or garage in your city. After a shopper buys something from your online store on the platform, Amazon’s employees execute all the shipment tasks. They carefully put items into labeled boxes and organize the delivery process.
Does it sound interesting to you? Then the following information will intrigue you even more! You won’t have a headache caused by product return matters and communication with customers – Amazon FBA fees include these services too. Specially trained managers will take care of the tiniest detail – you can relax and focus on finances and promotion strategy while they’re working on the improvement of the buyers’ experience.
For whom is Fulfillment by Amazon?
Many sellers prefer paying Fulfillment by Amazon fees rather than trying to manage all the logistics processes by themselves. However, it’s better to check if your budget handles all the expenses coming with the program. Otherwise, a surprise may strike you down, and you won't even enjoy the idea of promoting goods online. But in case your financial situation is brilliant and you belong to one of the following categories, you have all the chances to benefit from selecting this model:
- Entrepreneurs. As a seller who promotes goods on Amazon successfully, you may find it hard to watch all the company’s requirements and rules. The truth is that everything is changing quickly here, so you’ll have to keep up with all the transformations. With FBA, an entrepreneur can relax and focus on creating his success story.
- Online businesses. The desire to earn thousands of dollars per month makes Fulfillment by Amazon the right decision. Worldwide shipment won’t make you worry because all the tasks connected with packing and delivery are completed by specialists at the fulfillment center.
- Physical stores. Very often, offline shops offer unique products worth of attention. FBA will help sellers with the logistics process and online promotion. All the items participating in the program obtain a Prime logo – it’s a signal for customers who expect to receive the ordered products earlier. The purchased goods will be shipped within two days for free.
With an effective strategy, you can get all the perks of paying FBA fulfillment fees. You’ll shorten the distance between you and success, manage to profit and increase your budget by implementing effective research and analytical tactics. But it may be a complicated mission in case you don’t use a helpful tool.
IO Scout is the instrument that eases the entrepreneur's path in many senses. More than 150 million products become available for you – keep track of prices, trends, sales, revenue, and other pieces of data. With this software, you’ll quickly occupy one of the leading places in the niche and get the love of customers. We recommend you try IO Scout features to conduct FBA product research and find an optimal solution for your business.
Amazon FBA Fees Explained
You’ve just started promoting goods on the site, and profitable deals are on the way. It seems like Amazon FBA fees are easy to cover, but you still need to investigate this aspect to avoid surprises. All in all, the price depends on different terms, including the item size, weight, storage terms , and many more. The following information will help you understand which Amazon FBA costs are covered by members of this program:
1. Amazon referral fees
All sellers pay the commission for each item they sell on Amazon. Products are valued according to different characteristics, and that’s why you should conduct an investigation before you select Fulfillment by Amazon. Usually, this fee doesn’t exceed 15 % of the total price. But it’s better to check how much you’ll have to pay for the performed goods.
2. Amazon fulfillment fees
If you strive to run a business more conveniently, then FBA might work excellently for you. You’ll be obliged to cover program fees connected with the shipment, storage, packing, returns, and customer support. No doubt that this option helps entrepreneurs get rid of many pains connected with their goods, but it’s necessary to select the right items for online promotion. Amazon fulfillment pricing depends on the weight and size of the products you want to offer on the website. Consider picking something small that doesn’t occupy more space than a shoebox. This trick will help you save money and get all the perks of FBA.
3. Amazon FBA storage fees
Are you planning to store your inventory in the warehouse for a long or short period? This aspect matters because the storage fee is based on the season and size of your goods. Of course, successful entrepreneurs who sell a lot of their products will essentially benefit from paying storage fees. Their items must always be in stock, and it’s the reason explaining why you should send a large number of goods to a fulfillment center.
However, you can prevent unnecessary charges. Ship a lower number of products to a warehouse. Arrange the delivery of another batch later to save your budget.
4. Monthly Amazon FBA fee
New sellers have an opportunity to stick to one of Amazon’s plans . Your choice may depend on your goals and business size. If you don’t aim to sell more than 40 products a month, then the Individual plan is a brilliant solution. Amazon takes a fee of $1 for every item a customer buys at your online store. And in case you take it seriously, consider starting promoting goods on the website with the Professional plan. Once you decided to use this package, be prepared for paying $40 every month.
5. Amazon FBA Fees – example
If you’re only looking for goods to offer through Amazon, we recommend starting with something lightweight and of small size. Look at the example below to see the difference. A T-shirt doesn’t accumulate such scary fees as a monitor or baby bed. It makes sense to enter the market with products that allow you to save your budget – you can grow your business and begin selling something bigger in the future. In case you don’t know how much the selected item costs, count on Amazon FBA Calculator – this tool helps entrepreneurs prepare for expenses.
7 Reasons to Start Selling on Amazon FBA
Amazon is one of the best places for businesses and entrepreneurs. But how to figure out that FBA is an effective solution for your store? Here’s a list of reasons explaining why this model is your chance to reach for the stars:
1. Only a few clicks separate you from money
If the idea to cover the Amazon FBA fee is okay for your brand management strategy, then you should fill the registration form. All merchants must create Sellers’ accounts – only this small detail lets you apply for FBA membership. It’s the most convenient way to promote your online store because everybody knows that it takes time to create a website.
2. Two-day Prime shipping feature
All products participating in the FBA program are labeled with a Prime logo. It attracts buyers from all over the world. Of course, it’s a specific category of shoppers. Only Prime customers and those purchasing something that costs more than $25 can benefit from buying FBA items. In case a person orders your product, he or she receives it within two days for free.
3. Higher rankings
Once you’ve sold one or more items, you appear on the BSR list. Now, you get all the chances to improve your financial situation, as high rankings bring good money. FBA goods are displayed above products that don’t participate in this program. The chances to sell a large number of items are excellent, and that’s why many merchants prefer selecting the features offered by the model. The days when you had to create schemes to attract your target audience are far gone. Catch the moment to offer the product that is in high demand
4. Professional customer support
You don’t have to communicate with customers anymore. Now, you can rely on well-trained Amazon’s specialists who will pleasantly provide important information and answer all the buyers’ questions. All complaints, returns, and other issues are handled by the company’s representatives, and it means the service is taken to the highest quality level .
5. Shipping, packing and storing
When covering Amazon fulfillment cost, you get access to a variety of helpful services. This program allows you to relax and stop searching for a place to store your goods. Your products will be kept in one of the fulfillment centers, so you won’t have to fill your house with hundreds of boxes. Amazon’s specialists do the hard job for you – they pack each item and ship it to a customer. And be sure that a receiver will obtain an undamaged product because Amazon collaborates with reliable logistics partners.
6. Multi-channel fulfillment
Amazon allows sellers to promote their products through other online platforms and leave goods in its fulfillment centers. In this case, you aren’t obliged to cover the referral fee as your items are sold in another place. It’s a convenient option because you can relax and offer products through a variety of channels, including your online store. Of course, you must remember that Amazon FBA fees still exist, and you have to prepare your budget.
7. Gain popularity all over the world
Did you know that over 55 % of buyers choose to visit the marketplace first when they need to find something particular? You have an excellent opportunity to introduce your goods to a larger audience. Just imagine, millions of shoppers based in the USA, Europe, and other regions will see your items in Amazon search results! It’s time to boost sales, refill the budget, and grow your business.
Disadvantages of Using Fulfillment by Amazon
It doesn’t matter what you’re going to offer through Amazon – there’s a chance that FBA pricing will make money vaporize from your wallet. Although this program has many helpful features for entrepreneurs, it’s necessary to take into account each aspect of membership. Consider the following disadvantages of Amazon FBA fees:
- Amazon takes away your customers. If you decide to deactivate your Seller’s account, the marketplace saves a list of buyers who purchased from your store on the website. You don’t get access to the contact data of these people, and, as a result, can’t offer your products to them afterward.
- The amount of Amazon FBA fees may be overwhelming. A member must cover a variety of expenses connected with the program’s charges. Of course, you can calculate Amazon FBA fees and find out the sum you’ll pay for the selected products. But in fact, the company controls all the charges, and soon the pricing scheme may change. No one will ask you if you’re ready to pay more than a month ago, for example.
- Product requirements. Once you’ve become a FBA member, be ready to select the allowed products from the list represented by Amazon. You’re risking to lose money by sending a batch of unchecked goods – the company returns items that don’t meet the requirements.
- Customers will return the purchased products more often. Prime logo informs shoppers that they’re eligible for a free two-day shipment, and they can easily send items back. That’s why many buyers order goods to check and test them.
5 Steps to Start Selling on Amazon FBA
Are you ready to upgrade your business and grab each chance to gain success? If the mentioned disadvantages don’t scare you, it’s time to learn how to become a member of this program and reach for your target audience. Read Amazon FBA Guide and follow these simple steps:
1. Register on the website
Welcome to the e-commerce world! Joining FBA is easy, but first, you have to sign up on the platform. Follow the directions provided by Amazon and share the required information. In case you haven’t decided which plan to select – Individual or Professional - don’t worry. You can freely start your way with the basic package and switch to the advanced model in the future.
2. Come up with the listing of promoted goods
When you’re done with the registration, make another step towards amazing business opportunities. By the time of signing up, you’ve probably decided on items to offer on Amazon. Now, you only have to transfer the list of products to your seller’s account. Many entrepreneurs don’t trust online tools and prefer doing it solely. But in case you strive to complete this task quickly, you can use the software that upgrades the seller’s experience on Amazon.
3. Ship your products to Amazon’s fulfillment center
After you’ve checked the product requirements and used the Amazon FBA fees calculator, prepare goods for shipment. There’s no need to rent a store and leave all the boxes there – benefit from the program features and send everything to the company’s warehouse. Amazon’s specialists will put your items on appropriate shelves, prepare them for shipping, and organize delivery. In fact, you can relax and start working on your business strategy while others are handling the hardest processes. Entrepreneurs who don’t want to pay Amazon FBA fees to save money lose their time very often – too many aspects must be covered.
4. Sell goods through Amazon
Basically, you don’t even have to do anything. Once you’ve uploaded the product listing, Amazon does everything for you. First of all, the Prime logo will attract hundreds or thousands of customers. Secondly, if your product is in high demand, shoppers won’t miss a chance to buy it. Wait for notifications that will inform you that someone has just purchased an item from your online store. It seems like FBA is the most comfortable solution for sellers, as they can easily show their goods to customers from different countries. You don’t have to limit your business opportunities with borders – it’s time to increase your income .
5. Wait for money transfer
According to Amazon’s payment schedule, sellers get paid once every two weeks. There’s no need to be worried about the fees you must cover. Amazon takes the money from your income before you get cash. It’s also a convenient option for entrepreneurs who have to take care of other stuff and forget about regular payments.
Amazon is like a pot of gold for sellers from all over the world. It’s probably one of the most popular marketplaces due to the features it offers to entrepreneurs. Access to millions of customers is the reason that explains why people decide to pick this platform. It doesn’t matter if you have an offline store or want to boost your online business – everybody has the chance to succeed here.
FBA allows sellers to get rid of many difficulties connected with storing, packing, delivery, and customer support . If you don’t have employees, partners, or simply want to delegate your responsibilities – this program is a perfect solution. Of course, you must cover Amazon FBA cost, but you get so much in return. Besides, you can use the calculator to count the sum you’ll have to pay, and then you won’t face unexpected financial problems.
Can I lower my Amazon FBA fees?
You can reduce the amount of Amazon FBA fees by selecting products that don’t accumulate sky-high charges. It should be something small – the preferable size of goods is the one that allows you to put an item into a shoebox. The fee also depends on weight, so it’s better to pick a lightweight product.
Are there any items that I can not sell on Amazon?
Amazon has a list of prohibited items. For example, it’s not allowed to sell specific types of alcohol. It’s not permitted to sell pets, products made of the fur of federally protected animals, explosives, guns, and other goods. Before selecting what to offer on Amazon, check the list of items you can’t sell here.
Is it worth it to use Fulfillment by Amazon?
FBA eases the entrepreneurs’ lives in many senses, but you must be ready to pay fulfillment, storage, referral, and other fees. In case you decide to turn into a member of this program, you get many benefits, including shipment services, Prime logo, professional customer support, and many more.