Amazon Seller Fees: The Cost Of Selling On Amazon

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Amazon Seller Fees: The Cost Of Selling On Amazon

When it comes to selling on Amazon, one of the first things you’ll want to find out is how much you’re being charged to use the platform. Working out your Amazon seller fees is fundamental to the success and growth of your business on the marketplace. 

This article puts the spotlight on Amazon seller fees so that you can work out the exact cost of selling on the marketplace. More specifically, we’ll help you to work out what percentage of your sales that you take home as profit.

What are Amazon seller fees?

amazon seller fees

When you start selling on Amazon, there are two types of seller fees you’ll come across on the marketplace. These are your account fees and commission rates for using the platform.

The amount you are charged for your Amazon account depends on the type of account you set up. Within Amazon Seller Central, you have two options to choose from:

As well as your account fees, every time you make a sale on the marketplace you may be charged up to three different types of seller fees on Amazon. These are:

There are also extra costs related to your Amazon seller fees that can add up quickly if you’re not careful. We’ll dig into detail about these later on, but for now they are:

Amazon seller fees: Your account costs

amazon account costs

When you sell on Amazon, there are two account plans to choose from. Which one you go for will depend on the size and scope of your business, but if you’re on the basic plan you have an extra fee to factor into your total Amazon seller fees.

UK Amazon basic plan – free

The basic plan for Amazon sellers based in the United Kingdom enables you to sell a total of 35 items each month. If you want to sell more products than this, you’ll need to sign up for the Amazon professional account plan.

While there’s no monthly account fee, you still need to be aware that there are additional selling fees charged by Amazon whenever you make a sale on the marketplace.

As a basic seller on Amazon, you pay a fixed rate of £0.75 per item you sell as well as your referral fees and closing costs.

Looking to sell more items on the marketplace? Give our guide on how to find profitable products with high demand to sell on Amazon a read.

UK Amazon pro plan - £25.00 per month (£28.75 per month including VAT for UK sellers)

The Amazon pro plan enables you to sell as many items as you want for a monthly sum of £28.75, VAT included. This makes it an affordable way to sell more products and grow your business on the marketplace.

As a pro seller, you’ll also receive the following benefits to help you sell more on Amazon:

  • Make use of bulk listing and reporting tools from Amazon marketplace web service
  • Customise your shipping rates*
  • Offer special promotions and gift-wrapping options for your products*
  • Eligible for top placement on product detail pages 

*Does not apply to music, videos, books, DVDs or software and games.

Amazon seller fees: Uncover your sales-related costs

amazon sales costs

1. Referral fees 

Regardless of the selling plan you choose, all Amazon sellers pay a referral fee on each item sold. The fee is a percentage of the final price your item sells for on the platform.

Why do you have to pay referral fees on Amazon?

Think of it like this. Amazon is the fifth largest retailer in the United Kingdom and has built a marketplace that brings together millions of shoppers and sellers. Instead of spending hours browsing the internet to find a specific product, your customers can go straight to Amazon.

What’s more, most people use Amazon when they’re ready to buy your products.

Your referral fees are a way to pay for this online selling advantage. You also don’t need to consider a hefty marketing budget in order to get people to see and buy your items on Amazon, which can save you a lot of time and money in the long run.

How do you work out your Amazon referral fees?

Your referral fee percentage is worked out depending on the following information:
  1. The product category your item belongs in
  2. Which Amazon marketplace you’re selling through

For Amazon UK sellers, referral fee percentages start at 7% for large appliances and reach a maximum of 45% for Amazon device accessories.

Check out the product categories listed below to work out your referral fee percentages on the Amazon UK marketplace.

The shopping platform also provides a fee calculator to work out your total Amazon seller fees.

Product categories  UK Amazon referral fee percentage*
 Additive manufacturing  12%
 Amazon device accessories  45%
 Beer, wine & spirits  10%
 Books, music, VHS & DVDs  15%
 Business, industrial & scientific supplies  15%
 Cars & motorbikes  15%
 Computers  7%
 Computer accessories  12%
 Consumer electronics  7%
 Cycling  10%
 DIY & tools  12%
 Education supplies  15%
 Electronic accessories  12%
 Flow control & filtration  12%
 Fluid transfer  12%
 Food service  15%
 Grocery  15%
 Industrial electrical supplies  12%
 Industrial tools & instruments  12%
 Jewellery  20%
 Large appliances**  7%
 Material handling  12%
 Metalworking  12%
 Musical instruments & DJ  12%
 Software  15%
 Sports & outdoors  15%
 Tyres  10%
 Video games  15%
 Video game consoles  8%
 Watches  15%
 Everything else  15%

*Last updated: May 2018.
**Not including appliance accessories, microwaves and range hoods.

If you’re selling on Amazon through international marketplaces, you can find your referral fee percentages listed on the following Amazon pages:

Find out everything you need to know about selling on international Amazon sites.

Top tip: Double check you’ve chosen the right product category when listing your items. This is a common slip up made by new sellers and means you may pay a higher fee than you need to. Unfortunately, Amazon won’t make up the difference!
 

2. Closing fees

Closing fees are extra fees you pay Amazon when you make a sale on the marketplace.
Amazon adjusts its seller fees fairly often. If you’ve heard about Amazon variable closing fees before, the marketplace has now replaced these costs with fixed closing fees.
 
This is a great move as it takes away some of the time and stress that can come from working out the total Amazon seller fees you pay. Amazon closing fees only apply to you if you sell any of the following:
  • Books
  • Video games
  • DVDs
  • Software
  • Gaming consoles
  • Any other media items

Regardless of your selling plan, every UK Amazon seller pays a fixed cost per media item that is sold. The fixed cost is £0.50 on each media item you sell.

3. Per-item fees

If you are registered as an individual seller (free account) then you will need to factor in per-item fees when you sell on Amazon. Pro sellers are not charged these fees.

Per-item fees are fixed at the rate of £0.75 for Amazon UK sellers and you only pay this fee when you sell an item on the marketplace.

This fee applies to any item within any product category sold by individual sellers.

Additional Amazon seller fees: Fulfilment by Amazon (FBA)

amazon fulfilment fees

While Fulfilment by Amazon (FBA) is an optional feature to help grow your business on the marketplace, if you use or plan to use these services then there are some extra costs to factor into your total seller fees on Amazon.

What is Fulfilment by Amazon (FBA)?

Amazon FBA is a group of services provided by the platform to help you trade and fulfil your orders quickly and easily. The basics of Amazon FBA is that you take care of selling your items and Amazon FBA takes the stress out of picking, packing and shipping your orders.

Find out more about Fulfilment by Amazon (FBA) and see if it's right for you.

What Amazon FBA selling fees will you come across?

When you use Amazon FBA you only pay for the services when you sell an item on the marketplace. There are two types of upfront FBA costs to be aware of when selling on Amazon:

  • Storage fees (variable fees per cubic foot)
  • Fulfilment fees (fixed fees per unit)

Your Amazon FBA fees are taken as a percentage from the final sales price of your products. This percentage is worked out based on the following factors:

  • The size of your stock fulfilment rate
  • How many products you sell
  • The weight of your products

To work out your Amazon FBA fees you can use the FBA fee calculator.

Amazon FBA return fees

If you do decide to make use of Amazon FBA, it's important to be aware of FBA return fees, as our eagle-eyed reader Stuart pointed out. Although not strictly seller fees, you do need to understand every factor that can contribute to a profit or a loss when selling on Amazon. 

Amazon customers can process returns through Amazon's online returns centre. This allows them to return items as and when needed and means you don't need to spend time processing a return. In exchange for this service, however, Amazon FBA users are charged a returns processing fee.

This returns processing fee applies to returned products sold on Amazon in categories for which the marketplace offers free return shipping. These categories include clothing, shoes and handbags. And, as of 5th September 2018, this fee will also apply to jewellery, watches and luggage.  

The total amount you pay for a returned item in the above categories (as an Amazon FBA user) matches the total fulfilment fee for a given product.

Additional Amazon fees: Your shipping credit and costs

amazon shipping fees

If you ship your orders yourself, Amazon helps to cover your shipping costs by paying you shipping credit on every sale you make on the marketplace.

Although your shipping credit and costs aren’t part of your Amazon seller fees, it’s a wise idea to factor them in so that you can keep track of your overall costs from selling your products on the marketplace. 

When you work out your shipping costs, something to remember is that the shipping credits Amazon pays you is low compared to the actual shipping rates you pay to send your orders.

If you sell an item on Amazon, you must ship it even if the shipping credit paid to your account doesn’t cover all your shipping costs, otherwise Amazon may suspend your account.

Read our guide to find out how to avoid account suspension on Amazon at all costs.

Your shipping amount that Amazon pays you depends on two factors:

  1. What you sell (the product categories of your items)
  2. The shipping method selected by your customer

Shipping credits remain the same regardless of whether you are a basic seller or pro seller on the platform. That said, if you are a pro seller, there are a couple of differences to know.

As an Amazon professional seller, you can select free shipping to your customers and increase or decrease your shipping credits when you need. Free shipping is not available to basic sellers.

If you do offer free shipping, Amazon won’t pay you any shipping credits, so remember to factor these costs into the final sales price of your items.

Regardless of which selling plan you sign up for, no online seller can adjust the shipping credits on media items as all media items have fixed shipping credits.

Amazon UK domestic delivery credits

Amazon charges shoppers the rates below for orders shipped within the United Kingdom. In return, you get a shipping credit worth the same amount.

Product category  Standard UK credits Expedited UK Credits
 Books (including audio books)  £2.80  £8.98
 Videos (VHS tapes)  £2.80  £8.98
 DVDs  £1.26  £8.98
 Music  £1.26  £8.98
 DIY & tools  £4.00 + £0.50/kg  N/A
 Toys  £4.03 + £0.50/kg   N/A 
 Games   £4.03 + £0.50/kg  N/A 
 Lawn & garden   £4.00 + £0.50/kg   N/A 
 Consumer electronics   £4.00 + £0.50/kg   N/A 
 Video games   £1.99  N/A 
 Software   £3.23   N/A 
 Kitchen   £4.00 + £0.50/kg   N/A 
 All other items   £3.99 + 0.49/kg   N/A 

*Last updated: May 2018.

Amazon UK international delivery credits

If you are selling internationally on Amazon, the marketplace will charge buyers the following rates for your orders shipped outside the United Kingdom.

Just as with your domestic shipping credits, Amazon pays you the same amount to cover all or part of your shipping costs. 

Product category  European Union* USA & Canada* Rest of world*
 Books & audio books  £4.02  £8.98  £7.00
 Videos (VHS tapes)  £4.02  £8.98  £5.94
 DVDs  £1.82  £8.98  £3.58 
 Music  £1.82  £8.98  £3.58 
 DIY & tools  N/A  N/A  N/A 
 Toys  £4.00 + £0.50/kg   N/A   N/A  
 Games   £4.00 + £0.50/kg  N/A   N/A  
 Lawn & garden   N/A  N/A   N/A  
 Consumer electronics  N/A  N/A   N/A  
 Video games   £3.94  N/A   N/A  
 Software   £3.94   N/A   N/A  
 Kitchen   N/A   N/A   N/A  
 All other items   £4.00 + 0.50/kg   £4.00 + 0.50/kg  £4.00 + 0.50/kg
*Last updated: May 2018.


What to do if your Amazon shipping credits don’t cover your shipping fees

Before you start selling on Amazon, it’s important to do your research and figure out your shipping costs as well as your total Amazon seller fees. If your shipping credits don’t cover your total costs for shipping your items, it’s your responsibility to find a solution.

If you are a professional seller on the marketplace and opt to use free shipping, remember that you won’t receive any shipping credits when you sell on Amazon.

In order to cover your total shipping costs, it’s good practice to factor your shipping fees in the total sales price of your items. This gives you a way to cover the remainder of your shipping fees that are not covered by your Amazon shipping credits.
 
As a pro seller, you can select free shipping on Amazon to encourage your customers to buy your products, making sure to include your shipping costs in the final sales price of your products. Most customers love free shipping as it feels like they are getting value for money, which can increase your sales.
 
Learn how to optimise your Amazon listings and rank on the first page to boost your sales and visibility on the marketplace even more.
 

Uncover your Amazon seller fees to grow your business

As challenging as it may be to work out your selling fees on Amazon, uncovering your costs is essential in order to maintain and grow your business on the marketplace.

Hopefully this guide helped you to understand your fees for selling on Amazon. If you’re still in doubt, drop us a comment below and we’ll try our best to help you work out your total Amazon seller fees.

Once you've uncovered your seller fees, you can start thinking about selling more products and growing your business on the marketplace.

Find out how to increase sales your sales on Amazon with expert tips and best practices. 

This year's Linn Academy will see international Amazon expert, Danny McMillan, share his top tips and invaluable advice on how you can build your brand on the Amazon marketplace, for increased visibility and sales. You can learn more about LA2018 and get your tickets for the one-day eCommerce event below.

Linn Academy 2018

Topics: Amazon, Selling on Amazon, eCommerce

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