How Much Money Does Amazon Take from Sellers?

Amazon charges sellers a variety of fees that can significantly impact their earnings. The primary fees include referral fees, variable closing fees, and subscription fees, each of which plays a crucial role in determining the total cost of selling on Amazon. Understanding these fees is essential for sellers to manage their finances effectively and to price their products competitively.

Referral Fees:
Amazon's referral fee is a percentage of each sale made by the seller. This fee varies depending on the category of the product. For example, the referral fee for electronics might be around 8% to 15%, whereas for books, it might be closer to 15% to 20%. This percentage is calculated based on the total selling price, including the item price and any shipping charges.

Variable Closing Fees:
In addition to the referral fee, Amazon charges a variable closing fee for media items like books, music, and DVDs. This fee is a fixed amount added to the referral fee. As of the most recent update, this fee is typically around $1.80 per item.

Subscription Fees:
Sellers on Amazon can choose between two types of accounts: Individual and Professional. The Individual account does not have a monthly subscription fee but charges $0.99 per item sold. The Professional account, on the other hand, costs $39.99 per month and does not have an additional per-item fee. Professional accounts are generally recommended for those who plan to sell in higher volumes.

Other Fees:
There are additional fees that might apply depending on the services used by the seller:

• Fulfillment Fees: If sellers use Amazon’s Fulfillment by Amazon (FBA) service, they incur fulfillment fees for storage and handling. These fees are based on the size and weight of the items stored and shipped.
• High-Volume Listing Fees: Sellers with a large number of listings might face additional fees for managing high volumes of product listings.
• Refund Administration Fees: If a customer returns an item, Amazon charges a refund administration fee. This is typically a percentage of the item's referral fee.

Fee Summary Table:

Fee Type	Individual Account	Professional Account
Referral Fee	8% - 15% of selling price	8% - 15% of selling price
Variable Closing Fee	$1.80 per media item	$1.80 per media item
Subscription Fee	$0.99 per item sold	$39.99 per month
Fulfillment Fee	Varies by size/weight	Varies by size/weight
High-Volume Listing Fee	Varies	Varies
Refund Administration Fee	Percentage of referral fee	Percentage of referral fee

Implications for Sellers:

Sellers need to account for these fees when pricing their products. The referral fee and variable closing fee are straightforward, but the fulfillment fees and high-volume listing fees can add complexity to cost calculations. Additionally, sellers using the Fulfillment by Amazon (FBA) service should consider these fees as they directly affect their profit margins.

To maximize profits, sellers should:

1. Monitor Fees Regularly: Regularly review Amazon’s fee structure as it may change.
2. Optimize Pricing: Adjust product prices to cover Amazon’s fees while remaining competitive.
3. Manage Inventory Efficiently: Keep track of inventory levels to avoid unnecessary fulfillment and storage fees.
4. Leverage Reports: Use Amazon’s reporting tools to analyze sales and fees to make informed decisions.

Conclusion:

Understanding how much money Amazon takes from sellers is crucial for running a successful business on the platform. With various fees including referral, variable closing, and subscription fees, sellers must plan carefully and monitor their expenses to ensure profitability. By staying informed and strategic, sellers can navigate Amazon’s fee structure effectively and thrive in the competitive marketplace.