The decision to start selling on Amazon is heavily influenced by how much it will cost the seller. The total cost depends on several factors and options chosen. Today we will answer the question: How much does it cost to sell on Amazon.
How much does it cost to sell on Amazon – table of contents:
- Sales plan
- Sales commission
- Costs associated with implementation
- How much does it cost to sell on Amazon – Other costs
Amazon offers two sales plans: individual and professional. They differ not only in the benefits available but also in the price.
- The Individual Plan is designed for people selling less than 40 items per month. It’s $0.99 for each product sold (excluding VAT),
- The Professional Plan costs $39.99 (excluding VAT) and offers the vendor more benefits.
Sales commissions are calculated taking into account the percentage rate and the total selling price of the product, i.e. the price including: the amount paid by the buyer, the value of the goods and delivery and packaging charges. The table below shows the percentage rates by product category.
Costs associated with implementation
The fulfillment fees depend on whether the seller uses the FBA program or delivers the packages themselves. In the second case, Amazon charges shipping fees, depending on the product category and which shipping service the customer has chosen. The platform then transfers an amount equivalent to the shipping fee. Sellers who have a professional plan can set their own shipping costs.
Vendors who opt into the FBA program incur costs that include: storage fees, fulfillment fees, and fees for additional services. A detailed breakdown of the costs was presented in the FBA article.
How much does it cost to sell on Amazon – Other costs
Other costs include such fees as:
- Return administration fee – that is, if the seller returns the customer’s previously received funds, Amazon will refund the seller the commission they paid, subtracting administration fee, which is equal to the least of: 20% of the commission or £20.
- High-volume fee – applies to merchants who list more than 2 million SKUs in a month. Each SKU above this threshold is charged at $ 0.0004.
The Amazon platform is a great platform for sellers as the site is visited by potential customers whose main goal is to purchase the product. You can use it and start selling there, but you have to take into account the costs associated with its use. We hope that we have answered the question: How much does it cost to sell on Amazon.
Read our previous Amazon article: Start selling on Amazon – 4 things you need to know