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What Are Amazon FBA Fees – Everything You Need To Know

E-commerce retailers can leverage business solutions offered by Amazon to expand revenues. One such business solution is Amazon FBA. Fulfillment by Amazon (another name for Amazon FBA) enables e-commerce sellers to store and ship their products from Amazon warehouses – regardless of whether they sell their products on Amazon or not. 

What’s the best part about using Amazon FBA? Well, sellers get access to one of the world’s most streamlined storage and shipping services. Amazon FBA services handle storing, packaging, as well as shipping of the products. 

Though you might be tempted to try out Amazon FBA services, it’s important to have first-hand knowledge of the costs involved before getting started. Deciphering Amazon FBA shipping fees can be like solving a jigsaw puzzle. However, that’s about to change since we’re about to explain the A-to-Z of Amazon FBA fees.

Keep reading to find out more.

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Image Credit: Salmaans.com

Benefits of Opting for the Amazon FBA Program

Amazon FBA can be beneficial for sellers in different ways. It presents several business benefits, the most significant of which have are below:

Category Gates

Here is a list of Amazon gated categories as of September 2021:

  • Get an Edge Over Competitors: When you choose Amazon FBA’s solution to sell your products, they automatically become eligible for free shipping, Amazon Prime’s free two-day shipping, and other benefits. Also, your products will feature the Amazon Prime logo (as shown below), that will allow them to stand out.
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Image Credit: http://amazon.com

  • Easy Business Scalability: Since Amazon FBA takes care of the fulfillment of your orders, you don't have to worry about logistics. You can focus on other aspects of expanding your business. You can now quickly scale your business since you have Amazon FBA coordinating logistics seamlessly.
  • Improved Ranking in Search Results: Regarding Amazon's search results, FBA products get preference over non-FBA products. Ultimately, it means that your products can have a better ranking on Amazon's search results. You can check this for yourself. Most of the products on the first page are more likely to be Prime listings.
  • Returns Provided and Customer Service: Consumers are more comfortable buying easily returnable products from e-commerce stores. Additionally, if excellent customer service backs the products, customers are more likely to pick these products. Amazon FBA ensures seamless provisions for both. 

Amazon FBA Pricing – Explained

The Amazon FBA service is indeed the best out there. However, such premium services come at a cost known as the Amazon FBA fee. The pricing of Amazon FBA depends on three significant factors:

  • Selling Channel: An Amazon Selling Channel is defined as the way you create your product listings, define prices, control and manage your inventory as well as start and stop any promotions. Based on which product you use when it comes to your sales channel, the fee for Amazon FBA will vary. Check out this guide on multi-channel fulfillment to really dive deep into selling channels.
  • Size of the Product: The dimensions of your product also determine the Amazon FBA fees. For some items, Amazon FBA considers the volumetric weight (cubic foot) for calculating the charges.
  • Weight of the Product: Similar to package dimensions, the shipping weight is also a significant factor that decides the prices.

If you decide to sell your products on Amazon through Amazon FBA services, then you’ll have to consider two other fees:

  • Monthly Inventory Storage Fees: A seller will incur a monthly inventory storage fee if they store their product in Amazon's warehouses. Amazon FBA will calculate the cost of the monthly inventory storage fee based on the space occupied by your products. 
  • Amazon Fulfillment Fees: The fulfillment fees are the charges you pay for having Amazon fulfill your order. The fulfillment fees cover a range of things required to complete an order – packaging, picking, offering customer service, shipping, and even returns. Also, you have to pay the fulfillment fees for every product. 

Another factor that sellers should analyze is the weight and size of their products. As we mentioned before, Amazon FBA takes the weight and size under consideration for pricing. To make things simpler for the seller, Amazon FBA has split the product size into two types:

  • Standard Size Products: Any product that weighs less than 20 pounds after packaging will fall into the standard size product category. Moreover, the dimension of the product should measure within 18 inches x 14 inches x 8 inches.
  • Oversize Products: Your product will be considered oversized if it exceeds the dimensions of a standard-size product. For instance, if an item weighs 28 pounds and is 22 inches on its longest side, it is an ‘oversize product.’

Apart from the above product size categories, there are further subdivisions. We have discussed the drill-down of sub-categories in the below table:

Product

Size

Category

Weight

(In Pounds)

Longest

Side

(Inches)

Median

Side

(Inches)

Shortest

Side

(Inches)

Length +

Girth

(Inches)

Small

standard-size

Equal to or less than 12 lb.

15″

12″

0.75″

N/A

Large

standard-size

Equal to or less than 20 lb.

18″

14″

8″

N/A

Small

oversize

Equal to or less than 70 lb.

60″

30″

N/A

130″

Medium

oversize

Equal to or less than 150 lb.

108″

N/A

N/A

130″

Large

oversize

Equal to or less than 150 lb.

108″

N/A

N/A

165″

Special

oversize

Over 150 lb.

Over

108″

N/A

N/A

Over

165″

FBA Fees for Products Sold on Amazon

If you are a seller on Amazon already, the chances are that you are already well aware of Amazon’s fulfillment services. These cover pretty much all tasks related to logistics. Amazon FBA will cover packaging, packing, shipping, and even helping your customers through their customer support.  

As we had mentioned earlier, the fees for Amazon FBA depend on several factors. The weight and size of the products you’re selling on Amazon determine the costs. All costs mentioned in the article apply to the US.

Standard Size Products

Product Size

Price

Small (6 oz or less)

$2.70

Small (6 oz to 12 oz)

$2.84

Large (6 oz or less)

$3.47

Large (6+ to 12 oz)

$3.64

Large (12+ to 16 oz)

$4.25

Large (1+ to 1.75 lb)

$4.95

Large (1.75+ to 2 lb)

$4.95

Large (2+ to 2.75 lb)

$5.68

Large (2.75+ to 3 lb)

$5.68

Large (3+ to 4 lb)

$5.98

Large (4+ to 5 lb)

$6.28

Large (5+ to 6 lb)

$6.58

Large (6+ to 7 lb)

$6.88

The fees for large standard-size products weighing 3+ lb to 20 lb are $6.08 + $0.30/lb above the first three lbs.

Oversize Products

Product Size

Price

Small oversize (70 lb or less)

$8.66 + $0.38/lb above first lb

Medium oversize (150 lb or less)

$11.37 + $0.39/lb above first lb

Large oversize (150 lb or less)

$76.57 + $0.79/lb above first 90 lbs

Special oversize (Over 150 lb)

$138.11 + $0.79/lb above first 90 lbs

Apart from the charges mentioned in the above chart, Amazon FBA levies different rates for clothing items. If you sell clothes, the below table would better suit you.

FBA Fulfillment Fees for Clothing

Size Tier

Shipping weight (packaging weight no longer applies)

Fulfillment cost per unit

Small Standard

·         6 oz or less

·         6+ to 12 ox

·        12+ to 16 oz

·         $3.00

·         $3.14

·       $3.62

Large Standard

·         6 oz or less

·         6+ to 12 ox

·         12+ to 16 oz

·         1+ to 2 lb

·         2+ to 3 lb

·         3+ to 20 lb

·         $3.87

·         $4.04

·         $4.65

·         $5.35

·         $6.08

·         $6.08 + $0.30/lb          above first 3 lbs

The oversize apparel tiers with Amazon FBA (small oversize, special oversize, and large oversize) will be charged the core of Amazon FBA fees.

Amazon FBA Shipping Fees for Multi-Channel Fulfillment

We love Amazon FBA because it also helps sellers sell products on channels other than Amazon. For example, if a seller has a dedicated website for their products, they can still use Amazon FBA to fulfill the orders.

Multi-channel(MCF) fulfillment is one of the best perks offered by Amazon. However, you should know that Amazon FBA fees are significantly higher for multi-channel fulfillment.

Amazon FBA understands that sellers have a variety of shipping options for the items listed on their site. Keeping that in mind, Amazon FBA has curated its MCF fees for different shipping options:

  • Standard (3 to 5 days shipping)
  • Expedited (2-day shipping)
  • Priority (Next day / 24-hour shipping)

We've researched and mentioned the price for each shipping option. The below table also includes two product categories – oversized and standard.

Standard Shipping (3-5 Business Days)

Size Tier

1 Unit Order

2 Unit Order

3 Unit Order

4 Unit Order

5+ Unit Order

Small standard: 4 oz or less

$3.95

$2.75

$2.39

$1.89

$1.79

Small standard: 4 oz to 10 oz

$4.95

$3.45

$2.95

$2.29

$1.99

Small standard: 10 oz to 16 oz

$5.79

$4.05

$3.45

$2.89

$2.59

Large standard: 10 oz or less

$5.49

$3.85

$3.29

$2.69

$2.39

Large standard: 10 to 16 oz

$5.79

$3.90

$3.40

$2.89

$2.59

Large standard: 1 to 2 lb

$5.95

$3.95

$3.45

$3.35

$2.95

Large standard: 2 to 21 lb

$5.95+ $0.38/lb above first 2 lb

$3.95 + $0.38/lb above first 2 lb

$3.45 + $0.38/lb above first 2 lb

$3.35 + $0.38/lb above first 2 lb

$2.95 + $0.38/lb above first 2 lb

Small oversize

$10.99 + $0.38/lb above first 2 lb

$6.80 + $0.38/lb above first 2 lb

$5.80 + $0.38/lb above first 2 lb

$4.80 + $0.38/lb above first 2 lb

$3.80 + $0.38/lb above first 2 lb

Size Tier

Unit Orders

Medium Oversize

$15.30 + $0.39/lb above first 2 lb

Large Oversize

$78.30 + $0.80/lb above first 90 lb

Special Oversize

$143.30 + $0.92/lb above first 90 lb

Expedited shipping (2-day)

Size Tier

1 Unit Order

2 Unit Order

3 Unit Order

4 Unit Order

5+ Unit Order

Small standard: 10 oz or less

$5.69

$3.99

$3.29

$2.89

$2.49

Small standard: 10 to 16 oz

$5.89

$4.19

$3.49

$3.09

$2.69

Large standard: 10 oz or less

$5.79

$4.09

$3.39

$2.99

$2.59

Large standard: 10 to 16 oz

$6.29

$4.59

$3.89

$3.49

$3.09

Large standard: 1 to 2 lb

$6.99

$4.99

$4.19

$3.69

$3.29

Large standard: 2 to 21 lb

$6.99 + $0.38/lb above first 2 lb

$4.99 + $0.38/lb above first 2 lb

$4.19 + $0.38/lb above first 2 lb

$3.69 + $0.38/lb above first 2 lb

$3.29 + $0.38/lb above first 2 lb

Small Oversize

$11.99 + $0.38/lb above first 2 lb

$7.80 + $0.38/lb above first 2 lb

$7.30 + $0.38/lb above first 2 lb

$7.15 + $0.38/lb above first 2 lb

$6.85 + $0.38/lb above first 2 lb

Size Tier

Unit Orders

Medium Oversize

$16.80 + $0.39/lb above first 2 lb

Large Oversize

$78.30 + $0.80/lb above first 90 lb

Special Oversize

$143.30 + $0.92/lb above first 90 lb

Priority Shipping (24-hour / next day)

Size Tier

1 Unit Order

2 Unit Order

3 Unit Order

4 Unit Order

5+ Unit Order

Small Standard: 16 oz or less

$12.80

$7.30

$6.30

$5.80

$4.30

Large Standard: 16 oz or less

$13.80

$7.80

$6.80

$5.90

$4.80

Large Standard: 1 to 2 lb

$13.85

$7.85

$6.85

$5.95

$4.85

Large Standard: 2 to 21 lb

$13.85 + $0.39/lb

above first 2 lb

$7.85 + $0.39/lb

above first 2 lb

$6.85 + $0.39/lb

above first 2 lb

$5.95 +  $0.39/lb

above first 2 lb

$4.85 + $0.39/lb

above first 2 lb

Small Oversize

$20.80 + $0.39/lb

above first 2 lb

$11.30 + $0.39/lb

above first 2 lb

$8.20 + $0.39/lb

above first 2 lb

$7.70 + $0.39/lb

above first 2 lb

$7.30 + $0.39/lb

above first 2 lb

Size Tier

Unit Orders

Medium Oversize

$31.30 + $0.39/lb above first 2 lb

Large Oversize

$78.30 + $0.80/lb above first 90 lb

Special Oversize

$143.30 + $0.92/lb above first 90 lb

Products such as those with Lithium batteries or any other dangerous product will incur an additional cost of $0.11 per unit fee. From the prices mentioned in the above tables, it is eminent that the more products you sell on your site, the more affordable it will be for you to use Amazon FBA

Monthly Storage Fee for Amazon FBA

It is worth mentioning that Amazon charges monthly inventory storage fees between the 7th and 15th of every month following the month for which charges are applicable. For example, if you want to see your inventory storage fee for February, check out the March payment transaction report (the transactions made between March 7 and 15).

You should also know that the monthly storage fees at Amazon FBA will vary significantly based on time of year and product size tiers. Though regular-sized products are smaller than oversized products, they sometimes need complicated and costly storage and shelving. In some cases, small products might be fragile and require extra care, making their storage difficult. Amazon FBA considers the volumetric weight (cubic foot) for charging a monthly storage fee.

Based on volume, the storage fee for standard-size products is less than that of large-sized products. Here’s a table explaining the Amazon FBA storage fees:

Storage Month

Standard-Size Products

Oversize Products

January to September

$0.69 per cubic foot

$0.48 per cubic foot

October to December

$2.40 per cubic foot

$1.20 per cubic foot

Monthly Storage Fee for Dangerous Goods

Storage Month

Standard-Size Products

Oversize Products

January to September

$0.99 per cubic foot

$0.78 per cubic foot

October to December

$3.63 per cubic foot

$2.43 per cubic foot

Long-Term Storage Fees

When your inventory has been lying in the fulfillment center for about a year, Amazon levies a monthly long-term storage fee. The LTSF or long-term storage fee is $0.15 per unit or $6.90 per cubic foot of the product, whichever is greater. Also, Amazon FBA calculates the long-term storage fee (LTSF) on the 15th day of every month.

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Image Credit: wxyz.com

Things To Consider Before You Start

We've not completed explaining the Amazon FBA fees yet. There's a whole range of prices that Amazon levies on its sellers.

Sellers need to consider these additional charges before selling. Otherwise, it might take a bite out of their profits!

  • Return Processing Fee: Most of the time, the returns processing fee is free for products. You need to keep an eye on the categories of products that do not fall under this. Amazon FBA might charge a returns processing fee to process returns for your products. If applicable, they might even charge a repackaging fee if your products need to be packed again for resale.
  • Monthly Selling Fee: The monthly selling fee is the amount you owe to Amazon every month for using its platform. You can consider the monthly selling fees as the rent you are paying Amazon to enlist and sell your products.
  • Variable Closing Fee & Referral Fees: The variable closing and referral fees is the commission you pay Amazon on each unit of product you sell through their site.
  • Inventory Placement Service Fee: Sellers can sign up for FBA Inventory Placement Service to send all eligible stock to a single fulfillment center. This way, you don’t have to divide your inventory into multiple shipments and send them to different shipment centers. But to avail of this service, you have to pay an inventory placement service fee.
  • Stock Removal Fee: If sellers want to dispose of unsold stock from Amazon FBA's inventory, they charge stock removal fees. Amazon also has an inventory removal fee if they have to send the products back to you. 
  • FBA Export Fee: The best part about Amazon FBA fulfillment is that you can export your products to multiple countries. If you ship your products to a different country, Amazon FBA will levy an FBA export fee. You can get more information about the export service on the Amazon Seller Central dashboard.

How Can I Reduce FBA Fees?

Here are a few ways by which you can reduce your Amazon FBA fees and increase your profits:

  • Use Seller Fulfilled Prime: The seller fulfilled Prime logo can help you expand your business quickly. It is worth mentioning that seller fulfilled Prime products sell better than other products. Therefore, the Prime logo can help you generate higher revenue to cover costs. 
  • Cutoff Points Between Tiers: Carefully analyze where the rise in the Amazon FBA fees occurs. This trick can save you hundreds of dollars every month. The difference between a regular and an oversized product can be a game-changer.
  • Estimate Your Fees Beforehand: A complicated process like logistics calls for errors. There might be times where the fulfillment process would’ve generated unreasonable errors in fees. So, we suggest you calculate your fee beforehand to prevent paying high fees.
  • Use FBA fee Preview Tool: The FBA fee preview tool states the current fee amount of your stock in the Amazon fulfillment center. This tool is a great way to stay informed of liabilities. Also, it helps you avoid unexpected and unwanted fees.
  • Remove Excess Inventory:  If you have excess or old inventory, you can request Amazon to remove the dead stock for you. Amazon fulfillment centers will ship you the excess inventory when you opt for removal. Though the removal of stock would be chargeable, it is less than inventory storage fees. You can reduce the ongoing costs significantly by doing this.

Amazon FBA vs Traditional Selling on Amazon

Before concluding this article, let’s go over Amazon FBA and compare it to the traditional way of selling on Amazon. This will give you a better context as to which model works best for you.

Let’s consider two sellers, named A and B, who recently started their business on Amazon. When a consumer orders one of A's products, A is tasked with packing and shipping it carefully.  

Additionally, seller A has to take care of other aspects such as storing the stock and offering customer support. Though this selling cycle might not look challenging for purchasing one product, it becomes a Herculean task for seller A if he tries to expand his business.

Moreover, since seller A is trying to do business all by himself, there is scope for error. A’s warehousing, packing, and shipping model is apt for a small business. On the other hand, seller B made the right decision by delegating these responsibilities to Amazon FBA. All B has to worry about is shipping his products to Amazon, and Amazon FBA will take care of the rest. Amazon FBA stores its inventory in highly secure and safe fulfillment centers and then packages, ships, and offers customer assistance. Choosing Amazon FBA will let B's business grow and expand. Moreover, Amazon FBA's highly trained professionals will also ensure an error-free selling process for B.

With plenty of tools, sellers can easily track and monitor their inventory. Sellers can set up and configure Amazon FBA on the Amazon Seller Central dashboard. You'd also find the dashboard to be highly user-friendly and easy to understand.

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Image credit: Crazylister

For anyone looking to take up self-employment or venture into lifestyle businesses, running a venture using Amazon FBA should be on the list.

 FAQs

How much do Amazon FBA fees cost?

Three components(fulfillment, closing, referral fees) make up the overall Amazon FBA fees. Moreover, Amazon FBA also applies tax which differs from one country to another. You can take the help of the Amazon FBA FAQ page or pricing policy to understand tax rates for your country.

Here’s how to calculate the total FBA fee:

Total FBA fee = fulfillment fee + closing fee + referral fee + tax

Is doing business on Amazon FBA beneficial?

Sellers indeed have to pay different fees while doing business with Amazon FBA. There are fees such as picking and packaging, commission, weight handling, order handling, disposal, and storage. However, selling with Amazon FBA has several perks.

The streamlined Amazon FBA service can help you expand your business and customer base. It can have a considerable impact on the success of your business.

How much can I make with FBA as a seller?

The profits you generate with Amazon FBA will depend on several factors. For example, the earnings for sellers will vary depending upon the demand in the market and the type of product you are selling. However, most Amazon sellers claim that they make a wholesome amount with Amazon. Amazon also happens to be an excellent platform for start-ups and small businesses.

What are disposal fees for Amazon FBA?

Apart from the regular fulfillment fees, Amazon FBA also has a disposal fee. Amazon FBA charges a disposal fee when you remove an item from the inventory permanently. The seller has to pay disposal for each item they wish to dispose of. In simpler words, Amazon FBA charges the disposal fee on a per-item basis.

How much is the Amazon FBA tax rate?

Before you plunge into Amazon FBA services, it is also essential to consider the tax rate. Any seller should be aware that Amazon charges 2.9% of each transaction as sales tax. However, the tax rate will vary from one country to another depending on their tax rules and regulations.

The Bottom Line

Fulfillment by Amazon is one of the best programs that can give a tremendous boost to your business. It is worth mentioning that the fulfillment rates are pretty competitive. Often, you’d find them to be more affordable than a third-party logistics partner.

Running your calculations before selecting a fulfillment service would help you make the best decisions for your business. Additionally, you can also contact Amazon's representatives to understand the Amazon FBA fees better. 

Don’t forget to consider the other fees involving Amazon FBA before making your decision. Please pay close attention to these fees as they are crucial for your e-commerce business.

Now that you are aware of Amazon FBA fees, you can decide which solution is best for your business.

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Mike Vestil

Mike Vestil is an author, investor, and speaker known for building a business from zero to $1.5 million in 12 months while traveling the world.

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