What Are Amazon Seller Fees?

 Amazon is one of the biggest online retail stores in the world and one of the most popular shopping destinations on the web. Millions of customers visit Amazon every day to buy either books, videos, music, clothing or even appliances. That traffic creates huge opportunities for you as an online retailer. Amazon's low prices mean that your profit margin is almost guaranteed. However, you do have to sell something if you want to become an Amazon seller. So, how do you figure out what kind of sell?

This article (the " Fee Preview" article) explains the three most common fees associated with Amazon's marketplace. You can, if you so choose, use this article (and its accompanying table) to quickly see the various Amazon seller fees. Be warned, though. Amazon reserves the right to change these fees in any given month so keep an eye on the fees in the Fee Preview article. If you re prepared to begin selling on Amazon, think about launching your own brand with Web FX.

These are the basic Amazon seller fees, broken down into two types: taxes and upsells. The taxes fee applies to each sale and is based on each item's selling price. If you're just setting up an individual account, Amazon will typically offer you a free EIN number, which you can use to purchase items and then write the appropriate checks for your sales to Amazon. For more established sellers, there are additional fees.

Amazon's second fee, known as the "referral fees" is a percentage of the sales that you make on an individual account. The larger the percentage you charge, the bigger your profits. As an individual seller, you will only pay Amazon with your referral fees when your referrals actually make a purchase from Amazon. When you refer a customer to Amazon, they will pay you a commission on that order. As a seller who has a large number of customers to pass on, this makes it easier to earn the big profits that some of your customers might be expecting.

Amazon also charges two other fees for sellers on its platform. The first is the long-term storage fee. Amazon offers sellers long-term storage fees, which are equivalent to 50% of the gross price of each item you sell on their platform. This fee is charged as a subscription fee. If you want to sell more items, Amazon provides you with an unlimited storage fee for all items you list. This fee is charged per item.

The second of the two Amazon fees, called the upsells is based on the percentage of the gross sales that come from direct referrals. Amazon calls this a "referral fee," even though the actual fee per item is actually zero dollars. Amazon's website states: "In addition to upsells, sellers may also receive other fees. These fees are based on the total cost of a product per unit and vary according to the type of product. Some examples of these include: per-unit shipping, seller credits, and commission on individual items sold."

The third of the selling fees, known as the minimum referral fee, is a fixed amount per item that you sell for an entire year. Sellers can determine whether or not to charge a minimum referral fee. Most sellers do, however, charge the minimum referral fee. It is a part of their profit structure and is one of the most commonly waived fees by sellers on the Amazon marketplace.

The fourth and final of the fees involved with selling products on Amazon is the inventory fee. This fee is a percentage of the gross volume of the items you sell for every sale. This inventory fee is calculated according to the quantity of the products being sold and is a flat rate for as long as you are in business with Amazon. Amazon will calculate this fee into your final price for your item even though you have set the lowest price available for your product listings. If your final inventory fee ever comes down below zero, Amazon will make it right back up for you.