As the saying goes: If you want to make money, you need to spend some money. Selling on Amazon, gives you huge opportunities like reaching a huge customer base and hence increase sales and earn more money.
However, it is not free. Before you start selling on Amazon, it’s important to be aware of the cost that involved while selling on Amazon.
That's why we're here to help you out by listing the costs that are involved while selling on Amazon.
COSTS THAT EVERY AMAZON SELLER NEED TO KNOW
1. SUBSCRIPTION FEES
The first step to get started on Amazon is to create an account. Amazon offers sellers two selling plans: Individual and Professional.
If you're going to sell less than 40 items, you can opt for individual plan. Individual plan doesn't have monthly fees, but you need to pay $0.99 for every sale, on top of the referral fees.
But, if you're going to sell more than 40 items, you can opt for professional selling plan where you need to pay $39.99 a month.
2. REFERRAL FEES
Amazon charges referral fees on every item sold. Most of the categories such as Books, Home & Garden, Office Products, and Sports, referral fee would be 15%.
However, for clothing and accessories referral fee is 17%, gift cards are charged 20%. This percentage is based on the total sales price, excluding taxes.
Also, items in several categories have a per-item minimum referral fee. The minimum referral fee is $0.30.
3. CLOSING FEES
It's pretty straightforward. If you're an individual or professional seller, you need to pay a $1.80 closing fee for each item sold for the following categories:
Software & Computer/Video Games
Video Game Consoles
Video Game Accessories
4. SHIPPING CREDITS
If you fulfill orders by yourself, Amazon will assign shipping credits for every sale. For self-fulfilled orders, Amazon shipping rates apply to media products sold by professionals and to all products sold by individual sellers.
However, the amount they set is much lower than what you’d actually have to pay to ship the item.
5. FULFILLMENT BY AMAZON
If you opt for Fulfillment by Amazon, you will have to pay certain fees, on top of the charges which have been discussed above.
Amazon FBA is all about picking, packing, storing, handling customer service and returns right.
Fulfillment fees are based on the size and weight of each product. And there's a monthly storage fee which is for storing inventory in Amazon’s fulfillment warehouses.
Along with that, there is a long-term storage fee, which is an additional charge for inventory stored at Amazon for over a year. When it comes to long-term storage fees, this choice is totally up to you.
Remember, if you're fulfilling orders by yourself, you have external costs in place. Also, if you're promoting your products by ads that involve bidding costs.
But, what about product sourcing costs? Maybe it costs you more, but not anymore. We'll recommend you a platform Amz Online Arbitrage.
Amz Online Arbitrage helps you to find profitable products from various online stores to sell on Amazon.
All you have to do is simply sign-up at Amz Online Arbitrage, choose profitable products, purchase for a lower price from the store and resell on Amazon.
Don't worry about sourcing or sourcing costs anymore. With Amz Online Arbitrage you can find the profitable deal of products for FREE.