However, if you’re not aware of the different types of fees your store might incur, or you don’t know where to look, they can take you by an unpleasant surprise. Sure, you probably know and understand fulfillment fees and referral fees, but what about other fees?
There are 10 main types of Amazon fees you should know about.
Today I will show you what these fees are for and how to calculate how much they will be, so you can build a cash-rich Amazon business.
Myself and the Just One Dime team have put in the work to dig through every type of report, as well as every Amazon support topic, to uncover the fees that you might encounter along your FBA journey in 2022.
Keep reading, and I will give you a powerful tool that breaks down the Amazon fees for your specific type of product.
1. Account fees
These are the fees you pay Amazon for the privilege of selling on their platform.
There are two types of account fees, and which one you are charged depends on what type of account you have.
You will pay monthly subscription fees of $39.99 if you have a professional seller account. Sellers with professional seller accounts do not pay per item fees.
You will pay per item fees, however, if you have an individual seller account. These per item fees run you $0.99 per item sold. But, in this case, you do not pay the $39.99 monthly subscription fee.
If you (plan to) sell more than 40 items per month, opting for a professional seller account will save you money. If you sell more than 40 items per month with an individual seller account, you will end up paying Amazon more in per item fees than you would pay for a monthly subscription to the professional seller account. Plus, professional seller accounts come with lots of perks and tools.
Keep in mind that regardless of the type of account you open, you will still pay Amazon per sale through your referral fees.
2. Referral fees
Referral fees are Amazon’s cut of every sale.
Amazon refers customers to you: the customer comes to shop on Amazon where they happen to find your product.
Shoppers didn’t find you through your own website (which you may or may not have). They find you through Amazon, so Amazon collects a part of your revenue.
Oftentimes in other business models, such as in real estate, you pay a sales service for customer referrals. In other words, you pay a service to refer customers to you. Amazon’s referral fees simply cover this same type of expense.
Referral fees vary by product category. Most often, they are 15% of your revenue from each sale. Learn more about the different product categories and their respective referral fees here.
Referral fees are also charged on shipping and wrapping if you are fulfilling your own orders and doing gift wrapping yourself. In other words, Amazon will also charge you referral fees on the cost of shipping as well as any gift wrapping if you sell FBM. FBM stands for fulfilled by merchant—you can also think of it as fulfilled by me—where you package, label, and ship products yourself.
For example, let’s say you sell desk lamps FBM for $30. Your product falls under the category of office supplies which carries a 15% referral fee. If it costs $5 to ship this product to your customer, you will pay Amazon:
- 15% of the $30 product: $4.50
- 15% of the $5 shipping: $0.75
That’s a total referral fee of $5.25.
Referral fees also scale down if you offer discounts, which is great!
For example, if you decide to run a promotion on your $30 lamp for 50% off, your referral fees on that product will be cut in half as well. Instead of paying $4.50 in referral fees, you would pay $2.25. So they run proportional to your sell price.
If your product is priced low enough Amazon will round up the referral fee to a “minimum referral fee” of 30¢ for most categories. In other words, 30¢ is the lowest referral fee possible.
For example, if you sell fidget spinners for $1.50 each—which we do not recommend because you would have minimal profit margin, if any—a 15% referral fee would amount to 22.5¢. However, Amazon would take a flat referral fee of 30¢, regardless of its product category.
Keep in mind that whatever product category you sell in, you will pay referral fees regardless of if you sell FBM or FBA.
3. FBA fulfillment fees
Fulfillment fees are charged per unit sold FBA.
FBA stands for fulfilled by Amazon. FBA means your inventory is stored in an Amazon fulfillment center and, when a shopper buys your product, Amazon packs up, labels, and ships it to the customer for you. They even handle customer service.
FBA fulfillment fees are the fees you pay to have Amazon fulfill your orders.
When you shop on Amazon.com and you see the “prime” logo next to certain products, most of the time those products are stored in and shipped from an Amazon fulfillment center.
Shoppers tend to prefer prime because they can get their products faster, and it comes with increased trust. So when you sell FBA, you can leverage the trust shoppers already have in Amazon.
Now, the majority of products (FBA or not) are actually created and sold by third party sellers—like you and me—not Amazon. So you’re not alone in paying FBA fulfillment fees.
In fact, I love paying these fees. I remember what it’s like to print shipping labels, tape boxes, and ship products on my own. To me, FBA and all its fees are worth every dime.
If you instead choose to sell FBM, I highly recommend you hire a third party logistics company (3PL) to help you.
You might be thinking “Ok, great. But what will FBA fees cost?”
FBA fees scale with size and weight. Essentially, the larger and heavier your product, the more it will cost you in FBA fulfillment fees.
Your product price has zero effect on FBA fulfillment fees.
Yes, FBA fees increase with product size and weight. However it is possible to succeed with larger items provided that you have enough profit margins to account for these increased fees. This is why we recommend you only sell products with at least a 40% profit margin after the costs of manufacturing and shipping your product plus fees.
Amazon determines the combined weight of your product and its retail packaging two ways:
- The actual weight of your product in its retail packaging on a scale
- Dimensional weight
Dimensional weight is the volume (length x width x height) of your product’s retail packaging in inches divided by 139. And dimensional weight is Amazon’s way of accounting for the cost of bulky items that don’t weigh too much.
For example, if you sell bulk cotton balls, your products will weigh next to nothing. However, if they come in a large box, it costs more to ship regardless of the weight. Amazon needs to factor that size and bulk into your FBA fulfillment fees or they’d be operating at a loss.
For your FBA fulfillment fees, Amazon will charge you based on your product’s actual weight or dimensional weight, whichever is greater.
For example: let’s say you do sell bulk cotton balls. Your product in its retail packaging measures:
- 1 lb in weight
- 12 inches long
- 12 inches wide
- 12 inches high
Its dimensional weight is (12 x 12 x 12) / 139 = 12.4, which is greater than the 1lb it actually weighs. So your cotton balls stash would be charged as if it weighs 12.4 lbs due to the package’s dimensional weight.
Weight is not the only part of your FBA fulfillment fees, though. They also factor in size.
- Small standard
- Large standard
- Small oversize
- Medium oversize
- Large oversize
- Special oversize
Each tier is based on both product weight and dimension.
As of April 28, 2022, Amazon has added a 5% surcharge to all FBA fulfillment fees to account for the growing global inflation and rising transportation costs. The surcharge is not an additional fee, Amazon has merely increased standard FBA fulfillment fee rates.
Let me give you something that can help you make sense of FBA fulfillment fees and sizing tiers, along with most other types of fees. Download our Breakdown of Amazon Seller fees spreadsheet at JOD.com/fees. We offer an even better version to our members at JOD.com/freedom.
FBA fulfillment fees are different for clothing and dangerous goods. The tier sizing is the same as any other type of product. But what you pay for each tier is different for these categories than others. You can check the different pricing here.
Everything we’ve just covered includes the cost to have Amazon fulfill your products. But what about the cost to even keep your products where Amazon can fulfill them?
4. FBA storage fees
FBA storage fees are what sellers pay to have products stored in Amazon fulfillment centers. So if you sell FBM, you’re off the hook on this one.
FBA storage fees are based on a product’s cubic feet. In other words, your storage fees depend on the unit’s volume—the storage space required to house your unit.
Something unique about storage fees is that they actually increase over the holidays. For the fourth quarter—October 1 to December 31—storage fees are at their highest.
There are only two sizing categories for storage fees: standard and oversize.
Standard size fees are as follows:
- $0.83 per cubic foot January through September
- $2.40 per cubic foot October through December
Oversized fees are as follows:
- $0.53 per cubic foot January through September
- $1.20 per cubic foot October through December
To calculate your product’s volume in cubic feet, measure each side of your product in feet and multiply all sides together (length x width x height).
For example, if your product in its retail packaging measures 1 foot wide by 1 foot tall by 1 foot deep, your product is 1 cubic foot. If the retail packaging measures 2 feet wide by 2 feet tall by 2 feet deep, your product is 8 cubic feet.
In both of these examples, the products would fall into the oversized tier. To calculate how much you pay per month, multiply the cubic footage by the per cubic foot fee. With our two product examples, it would look like this (January through September):
- 1 cubic foot x $0.53 = $0.53 per month
- 8 cubic feet x $0.53 = $4.24 per month
FBA storage fees are the smallest fees we’ve covered. And these fees are for short term storage, where short term means less than one year (if that’s short to you). Next, let’s look at long-term storage fees.
5. Long-term storage fees
Long-term storage fees are charged when unsold FBA products sit in an Amazon fulfillment center for 12 or more months.
Long-term storage fees are charged on an individual unit basis. Amazon keeps track of how long specific units have been stored in their fulfillment centers.
For example, let’s say you sell insulated water bottles. You send your first batch of inventory of 200 bottles to an Amazon FBA fulfillment center.
You run through that first batch of inventory in four months and reorder another batch. If that second batch takes another ten months to sell out, you will not pay long-term storage fees even though you’ve had this type of product in the fulfillment center for 14 months.
Each unique, individual unit has 12 months to sit before it starts to incur long-term storage fees.
However, if you were to sell all but two units of your first batch within 12 months, but the last two units take 13 months to sell, you will pay for one month of long-term storage fees on those two units.
Long-term storage fees occur on top of regular storage fees.
With long-term storage fees you will be charged either $6.90 per cubic foot per unit or $0.15 per unit, whichever is greater.
Let’s say you have two units of bulk cotton balls, 1 cubic foot in volume each, that have been sitting in a fulfillment center for 13 months. Per unit, you would pay $6.90 in long-term storage fees on top of regular storage fees.
That amounts to $14.86 (($0.53 + $6.90) x 2 units) for that 13th month.
Now let’s say you have 2, smaller water bottle units that are in their 13th month in a fulfillment center. In this case, you would be charged long-term storage fees on a per-unit basis because $0.15 for 2 units would be greater than charging the per cubic foot fee of $6.90 (they’re water bottles, not tanks, afterall). Per unit, you would pay $0.15 in long-term storage fees on top of regular storage fees
That amounts to $1.36 (($0.53 + $0.15) x 2 units) for that 13th month.
You can avoid paying long-term storage fees on products that are not selling if you place a removal order before your inventory reaches the 12 month mark. Even if the removal order has not yet shipped the inventory out of the fulfillment center by that date, you will not be charged long-term storage fees if the order was placed before the long-term storage fees would have gone into effect.
Learn both how to avoid long-term storage fees and going out of stock here.
6. Removal and disposal fees
Removal and disposal fees are what sellers pay Amazon to remove their items from FBA inventory.
You might want to consider a removal order to avoid long-term storage fees. Anytime your products aren’t selling, they’re not hanging out for free.
If you have damaged products in your inventory or your products aren’t selling, you should plan to remove them from fulfillment centers to avoid extra costs.
Removal and disposal fees are based on product tiers (standard and oversized). And within each of those tiers, fees vary by product weight. You can find the most up-to-date costs of removal and disposal fees here.
7. Variable closing fees
Variable closing fees are $1.80 charged to sellers per media item sold (both FBA and FBM).
Media items include:
- Software & Computer/Video Games
- Video Game Consoles
- Video Game Accessories
One thing to keep in mind: when you sell media items, you don’t ever see the variable closing fee refunded with the return. In other words, when you have to issue a refund to your customer for whatever reason on a media item, Amazon keeps the $1.80 closing fee.
In the case of non-media items, Amazon will keep certain, other fees for those returns, as well.
8. Refund and return fees
Amazon charges sellers a per item fee when the customer is given a refund.
Refund administration fee
When you refund a customer, Amazon will refund you the referral fee and tax, but not your fulfillment fee. And that makes sense: Amazon has to work to get that unit back on the shelf in a fulfillment center.
Except Amazon won’t refund you the entire referral fee. Amazon will additionally withhold 20%—up to $5 per unit—of that product’s referral fee (both for FBA and FBM products). And that is their admin fee for processing the refund for you.
For example, let’s say you sell bows.
They’re nicer bows so you charge $100 per unit. Whenever you sell a unit, Amazon takes a 15% referral fee on that product, which is $15.
Now let’s say that one of your customers, perhaps Bobby McGee, decides he’s not into archery as much as he thought and returns the bow. You will lose your fulfillment fee automatically, yes. But Amazon will also take 20% of that $15 referral fee, which amounts to $3.
However, the refund administration fee caps out at $5.
If you sold an exceptionally great bow, so much so that you were charging $200 per unit, your referral fee would be $30. When Bobby returns this $200 bow, 20% of the $30 referral fee would equal $6. But Amazon would only take $5.
Returns processing fee
Returns processing fees are unique to the clothing, shoes, & jewelry category.
When customers return a shoe or apparel FBA item, Amazon charges sellers a returns processing fee.
This fee is Amazon’s way of getting past the fact that shoppers—faced with the conundrum of not being able to try on clothes and shoes when they shop online—often take advantage of Amazon’s prime shipping and free returns.
Since Amazon’s not charging the customer for those returns, they charge you, the seller.
The returns processing fee is based on the item’s size and weight. If your product fits in the standard size tiers, you will pay anywhere from $2.12 to $6.81, depending on the exact weight.
9. Unplanned service fees and manual processing fees
Unplanned service fees occur when a barcode is missing or there are safety issues with your product, boxes or pallets.
These fees are charged differently based on the specific size and problem with your units. These fees only apply to FBA items.
You can avoid these fees by having your supplier prepare your units in advance. And be sure to give them careful packing and labeling instructions.
You might also ask your supplier to label each individual unit with an FNSKU (fulfillment network stock keeping unit) label. Amazon uses these identifiers to track your products in their fulfillment centers.
Manual processing fees occur if you have Amazon manually apply your FNSKU labels at their fulfillment centers. You can avoid these fees by applying FNSKU labels yourself or—as we suggest—having your supplier apply them for you. These fees can only occur if you ship products to Amazon fulfillment centers.
Manual processing fees increase every November and December before decreasing in January.
From January 1 through October 31, manual processing fees are $0.15 per unit. From November 1 through December 31, that fee is $0.30.
For this fee, you will be charged on a per unit basis. However, the fee is a neat $0.15 or $0.30 per unit, regardless of size.
You can avoid paying this fee by creating a thorough shipping plan, which we teach you how to do in our Amazon FBA membership. That membership also happens to cover advertising (and associated fees).
10. Sponsored advertising fees
Sponsored ads are not a required part of selling on Amazon (FBA or FBM). That said, they are still essential.
Imagine you have a brand new, pristine listing. That alone is not enough to get your product in front of shoppers and/or convince them to buy your product in spades.
When you first list on Amazon, you will have no reviews and no ranking. Rank refers to where in search results your product appears when shoppers search relevant keywords. If you have no ranking, shoppers can’t find you. So how do you get sales if no one can find your product?
With PPC—pay per click—advertising.
PPC advertising is the most-used type of sponsored advertising among Amazon sellers. And you use it to promote your listing to shoppers via sponsored ads.
When you build out a PPC campaign, you will pay for your product to rank high in search results where shoppers can find it. When you do this, your listing will appear as a sponsored ad, complete with a label that reads “Sponsored”. From this, you get visibility, which is needed for sales.
And while PPC is not required, it’s basically a must. But have no fear: we teach absolutely everything there is to know about PPC.
PPC is not the only way to get your product in front of shoppers (although it’s arguably the best). Nor is it the only way you might pay sponsored advertising fees.
Sponsored brand videos are keyword-targeted, pay per click video ads that appear in shopper search results.
Editorial recommendations are keyword-targeted articles that promote certain product listings in shopper search results.
When you run editorial recommendations, you pay an upfront cost for the service. After that, you pay 10% of each purchase (not click) driven by that article. Essentially, it creates a surprisingly low cost of advertising, which is a win for you.
Now, editorial recommendations are not run through Amazon. You won’t find any help from them on that front. But we can help you apply for editorial recommendations with the help of our partner.
Alright. That’s a lot of fees!
You may be wondering, “How do I find and keep track of them all? Do I have to track them individually and manually?!?”
You can easily find and track all of your fees in Seller Central with the Detailed Fee Explainer.
And here’s where you get it:
- In Seller Central, click the three horizontal lines in the top left corner.
- Under Payments, select Payments.
- Select Transaction View.
- Click on any of the amounts listed in the Total column. This will give you breakdowns for each individual shopper transaction.
- Click on any of the clickable amounts under Amazon fees to see what specific fee that charge refers to.
When we click on the $1.79 charge, for instance, we get the following breakdown:
We can easily see where each charge went and any related details.
While we’ve covered a lot of fees today, the list I’ve given you does not include fees for special programs such as Amazon Renewed, the Early Reviewer Program, or Multi-channel fulfillment fees. We only cover those topics for our Amazon FBA Mastery Members. So why not apply to become one today?
Don’t forget to grab your Breakdown of Amazon Seller fees below. But before you do, which of these Amazon fees surprised you the most? Let me know in the comments.