How Amazon Charges Sellers

Amazon offers various ways for sellers to list and sell their products on its platform. The fees associated with selling on Amazon vary depending on the seller's chosen plan, product category, and other factors. Here's a comprehensive breakdown of how Amazon charges sellers:

1. Seller Account Plans

Amazon provides two main types of seller accounts: Individual and Professional.

• Individual Plan: This plan is ideal for those who sell fewer than 40 items per month. Sellers on this plan pay a fee of $0.99 per item sold. There's no monthly subscription fee, but sellers are still subject to additional selling fees.

• Professional Plan: This plan is suitable for those who sell more than 40 items per month. Sellers on this plan pay a monthly subscription fee of $39.99. They do not pay the $0.99 per item fee, but they are still responsible for other selling fees.

2. Referral Fees

For every item sold, Amazon charges a referral fee. This fee is a percentage of the total transaction price, which includes the item price and any shipping or gift-wrapping charges. The referral fee percentage varies by category, typically ranging from 6% to 45%. For example:

• Books: 15% referral fee
• Consumer Electronics: 8% referral fee
• Beauty Products: 8% referral fee

Some categories have a minimum referral fee (usually $1), meaning sellers will pay the greater of the referral fee percentage or the minimum fee.

3. Fulfillment Fees

Amazon offers Fulfillment by Amazon (FBA), where Amazon stores, packs, and ships products on behalf of sellers. FBA fees consist of two main components:

• Fulfillment Fees: These are based on the weight and dimensions of the item. For instance, a standard-size item weighing 1 lb might incur a fee of $2.50.

• Storage Fees: Amazon charges for storing inventory in its warehouses. Fees are based on the volume (measured in cubic feet) of the stored products. Monthly storage fees range from $0.75 to $2.40 per cubic foot, with higher rates during the holiday season.

4. Additional Fees

In addition to the above, sellers may also encounter the following fees:

• Closing Fees: Certain categories, such as media products (books, DVDs, etc.), may incur a closing fee of $1.80 per item.

• High-Volume Listing Fees: If a seller lists more than 100,000 active products, they might face a fee of $0.005 per SKU.

• Refund Administration Fees: When a seller issues a refund, Amazon keeps 20% of the referral fee (up to $5) as a refund administration fee.

5. Other Costs to Consider

• Advertising Fees: Sellers can choose to promote their products on Amazon through various advertising options. Costs vary based on the type of ad, targeting options, and competition.

• Long-Term Storage Fees: Products stored in Amazon's warehouses for more than 365 days may incur additional long-term storage fees, which can be as high as $6.90 per cubic foot or $0.15 per unit, whichever is greater.

6. Comparison of Fees

Here's a simplified comparison table for the fees mentioned:

Fee Type	Cost
Individual Plan	$0.99 per item sold
Professional Plan	$39.99 per month
Referral Fees	6% - 45% of transaction price
FBA Fulfillment Fees	$2.50 (example for 1 lb item)
Monthly Storage Fees	$0.75 - $2.40 per cubic foot
Closing Fees	$1.80 per media item
High-Volume Listing Fees	$0.005 per SKU
Refund Administration Fees	20% of referral fee (up to $5)
Long-Term Storage Fees	$6.90 per cubic foot or $0.15 per unit

Conclusion

Amazon provides a range of selling options, each with its associated costs. Understanding these fees is crucial for sellers to effectively manage their business on the platform. By choosing the right plan and being aware of the potential additional costs, sellers can maximize their profits while taking advantage of Amazon's vast customer base.