Is FBA really this expensive? I mean are all sellers paying 60% to amazon?
I am doing self-fulfilment at the moment and I saw the FBA New Selection programme offer. So I thought i investigate it and apply. My items are unique but as soon as I made some calculation I realised that basically selling on amazon FBA for my products means I would actually make a massive loss.
The net margin depending on the price of products is 35%. How can merchants sell on Amazon with these costs?
See screenshot of calculation example
I am selling pasta and flour and I dont have 500% margin on my items to justify these massive fees.
Is this really what the deal is with FBA or am I missing something?
58 replies
Seller_vMsxjZPrdu6uI
I hope I haven’t misread this, apologies if I have.
But in your seller fulfillment you have added shipping so the total cost to the buyer is more than £4.50
If you increase the cost to FBA (to cover what you charge for FBM shipping), that will make your FBA profits more healthy?
Seller_BS5lg2keRs2QO
As has been mentioned, not really a fair comparison if you’re using different prices. That said, it is important to realise with FBA that some of the costs are fixed based on the size and weight of the product which means they can look unfavourable at a lower price point.
Seller_vMsxjZPrdu6uI
And just to add, if you recalculate your FBA prices , don’t forget to add VAT onto the fees (unless you have already done so)
Also, just my opinion, but its worth considering raising the FBA selling prices a little higher too, fast delivery etc could justify it. Although I suppose that would depend on whether you would get the custom on a slightly higher price, depends on the popularity of your product
Seller_vMsxjZPrdu6uI
You will have to excuse me, as I am a little lost. I only sell FBA which is probably why.
Just to clarify, if I purchased your product, what would i pay including postage
Seller_DTufFoxJuMU0M
Besides surely you don’t expect it to be the same price.
Amazon are picking your product, packaging it, printing out the labels and delivering it the next day fully tracked right down a map to track your driver when he’s close, I believe they also handle all the returns, customer complaints etc. You can’t expect them to do all that for the same price that Hermes just delivers something in a few days.
Also people will pay more for prime delivery. I do quite often pay over the odds because I need something and I know it will get to me tomorrow.
Seller_EOmLRMFX8Oo9x
I am very sorry I really do not understand the issue here.
If you are currently selling your product at £6.95 including shipping and fulfilling yourself why would you only charge £4.50 on FBA, surely the minimum price on FBA should match your FBM price of £6.95, you would make slightly less profit per sale (pennies only) but Amazon do everything for you (pick, pack and ship). As mentioned before you can raise your prices slightly on FBA without effecting your sales.
If you sell both at £6.95 you will be surprised how many more sales you will get with FBA
Edit - I am a prime member and have never paid anything for delivery when ordering from someone doing FBA
Seller_ws4PZEK3YTmos
This is the reason that Jeff Bezos is a BILLIONAIRE . Amazon use the marketplace to generate a second revenue stream from small independent sellers who cant afford a website of their own . We all sell on THEIR forum , and so they take their cut , for the money we pay , we get exposure to a potentially huge market that we couldn’t access elsewhere else ( Ebay being the alternative )
Many years ago when we started selling on here , it was profitable for us to do so ,Amazons fees were reasonable and if there was a problem Amazon customer services were quite helpful . Things have changed , Amazons fees have continued to creep up and every few month your tied up in more red tape and are presented with more and more pointless hoops to jump through . Its also nigh on impossible to get in touch with anyone at customer services and if you manage it , you usually get an answer that has been cut and pasted .
Our time on Amazon is coming to an end as it simply isnt profitable anymore .
Seller_TOekIMUa9rgxA
You’ll probably be surprised how much more people will pay just because its Prime. That can either be becuase they want it fast or simply because its the offer in the buy box and most buyers don’t even know there are other offers. It’s kinda messed up for buyers because they’re already paying a subscription for prime, then still paying sometimes double for the same product just to get that service.
For your own products is a bit different because I’d guess you don’t really want to be damaging your brand by charging inflated prices.
Regarding the prices Amazon charge, don’t use their estimates as your real figures. I don’t know about others but every single item I’ve listed has had higher fees when the item sells, even if the weight and size etc are correct. I usually go into my statement transactions to see the actual cost of selling a particular item, then adjust.
Finally! From my experience (only a few years) I’ve found that the volume you’ll sell on Amazon far outweighs any other platform and the fees are not that far off something like ebay for example if you work everything out, particularly at the moment while PayPal is still a thing. If I were you I’d try it out, tweek things as you go and if it really doesn’t benefit you, you’ll have lost very little. I do think you’ll get a massive increase in sales from Prime buyers no matter what the product is.
Seller_7VbclcPFFRTnc
Can I just point out @paperback_heroes1 that I redid the fba fee calculator that the op based his figures on as he had done them wrong (he’d not included his postage) and he is actually better off sending fba
Is FBA really this expensive? I mean are all sellers paying 60% to amazon?
I am doing self-fulfilment at the moment and I saw the FBA New Selection programme offer. So I thought i investigate it and apply. My items are unique but as soon as I made some calculation I realised that basically selling on amazon FBA for my products means I would actually make a massive loss.
The net margin depending on the price of products is 35%. How can merchants sell on Amazon with these costs?
See screenshot of calculation example
I am selling pasta and flour and I dont have 500% margin on my items to justify these massive fees.
Is this really what the deal is with FBA or am I missing something?
Is FBA really this expensive? I mean are all sellers paying 60% to amazon?
I am doing self-fulfilment at the moment and I saw the FBA New Selection programme offer. So I thought i investigate it and apply. My items are unique but as soon as I made some calculation I realised that basically selling on amazon FBA for my products means I would actually make a massive loss.
The net margin depending on the price of products is 35%. How can merchants sell on Amazon with these costs?
See screenshot of calculation example
I am selling pasta and flour and I dont have 500% margin on my items to justify these massive fees.
Is this really what the deal is with FBA or am I missing something?
58 replies
58 replies
Seller_vMsxjZPrdu6uI
I hope I haven’t misread this, apologies if I have.
But in your seller fulfillment you have added shipping so the total cost to the buyer is more than £4.50
If you increase the cost to FBA (to cover what you charge for FBM shipping), that will make your FBA profits more healthy?
Seller_BS5lg2keRs2QO
As has been mentioned, not really a fair comparison if you’re using different prices. That said, it is important to realise with FBA that some of the costs are fixed based on the size and weight of the product which means they can look unfavourable at a lower price point.
Seller_vMsxjZPrdu6uI
And just to add, if you recalculate your FBA prices , don’t forget to add VAT onto the fees (unless you have already done so)
Also, just my opinion, but its worth considering raising the FBA selling prices a little higher too, fast delivery etc could justify it. Although I suppose that would depend on whether you would get the custom on a slightly higher price, depends on the popularity of your product
Seller_vMsxjZPrdu6uI
You will have to excuse me, as I am a little lost. I only sell FBA which is probably why.
Just to clarify, if I purchased your product, what would i pay including postage
Seller_DTufFoxJuMU0M
Besides surely you don’t expect it to be the same price.
Amazon are picking your product, packaging it, printing out the labels and delivering it the next day fully tracked right down a map to track your driver when he’s close, I believe they also handle all the returns, customer complaints etc. You can’t expect them to do all that for the same price that Hermes just delivers something in a few days.
Also people will pay more for prime delivery. I do quite often pay over the odds because I need something and I know it will get to me tomorrow.
Seller_EOmLRMFX8Oo9x
I am very sorry I really do not understand the issue here.
If you are currently selling your product at £6.95 including shipping and fulfilling yourself why would you only charge £4.50 on FBA, surely the minimum price on FBA should match your FBM price of £6.95, you would make slightly less profit per sale (pennies only) but Amazon do everything for you (pick, pack and ship). As mentioned before you can raise your prices slightly on FBA without effecting your sales.
If you sell both at £6.95 you will be surprised how many more sales you will get with FBA
Edit - I am a prime member and have never paid anything for delivery when ordering from someone doing FBA
Seller_ws4PZEK3YTmos
This is the reason that Jeff Bezos is a BILLIONAIRE . Amazon use the marketplace to generate a second revenue stream from small independent sellers who cant afford a website of their own . We all sell on THEIR forum , and so they take their cut , for the money we pay , we get exposure to a potentially huge market that we couldn’t access elsewhere else ( Ebay being the alternative )
Many years ago when we started selling on here , it was profitable for us to do so ,Amazons fees were reasonable and if there was a problem Amazon customer services were quite helpful . Things have changed , Amazons fees have continued to creep up and every few month your tied up in more red tape and are presented with more and more pointless hoops to jump through . Its also nigh on impossible to get in touch with anyone at customer services and if you manage it , you usually get an answer that has been cut and pasted .
Our time on Amazon is coming to an end as it simply isnt profitable anymore .
Seller_TOekIMUa9rgxA
You’ll probably be surprised how much more people will pay just because its Prime. That can either be becuase they want it fast or simply because its the offer in the buy box and most buyers don’t even know there are other offers. It’s kinda messed up for buyers because they’re already paying a subscription for prime, then still paying sometimes double for the same product just to get that service.
For your own products is a bit different because I’d guess you don’t really want to be damaging your brand by charging inflated prices.
Regarding the prices Amazon charge, don’t use their estimates as your real figures. I don’t know about others but every single item I’ve listed has had higher fees when the item sells, even if the weight and size etc are correct. I usually go into my statement transactions to see the actual cost of selling a particular item, then adjust.
Finally! From my experience (only a few years) I’ve found that the volume you’ll sell on Amazon far outweighs any other platform and the fees are not that far off something like ebay for example if you work everything out, particularly at the moment while PayPal is still a thing. If I were you I’d try it out, tweek things as you go and if it really doesn’t benefit you, you’ll have lost very little. I do think you’ll get a massive increase in sales from Prime buyers no matter what the product is.
Seller_7VbclcPFFRTnc
Can I just point out @paperback_heroes1 that I redid the fba fee calculator that the op based his figures on as he had done them wrong (he’d not included his postage) and he is actually better off sending fba
Seller_vMsxjZPrdu6uI
I hope I haven’t misread this, apologies if I have.
But in your seller fulfillment you have added shipping so the total cost to the buyer is more than £4.50
If you increase the cost to FBA (to cover what you charge for FBM shipping), that will make your FBA profits more healthy?
Seller_vMsxjZPrdu6uI
I hope I haven’t misread this, apologies if I have.
But in your seller fulfillment you have added shipping so the total cost to the buyer is more than £4.50
If you increase the cost to FBA (to cover what you charge for FBM shipping), that will make your FBA profits more healthy?
Seller_BS5lg2keRs2QO
As has been mentioned, not really a fair comparison if you’re using different prices. That said, it is important to realise with FBA that some of the costs are fixed based on the size and weight of the product which means they can look unfavourable at a lower price point.
Seller_BS5lg2keRs2QO
As has been mentioned, not really a fair comparison if you’re using different prices. That said, it is important to realise with FBA that some of the costs are fixed based on the size and weight of the product which means they can look unfavourable at a lower price point.
Seller_vMsxjZPrdu6uI
And just to add, if you recalculate your FBA prices , don’t forget to add VAT onto the fees (unless you have already done so)
Also, just my opinion, but its worth considering raising the FBA selling prices a little higher too, fast delivery etc could justify it. Although I suppose that would depend on whether you would get the custom on a slightly higher price, depends on the popularity of your product
Seller_vMsxjZPrdu6uI
And just to add, if you recalculate your FBA prices , don’t forget to add VAT onto the fees (unless you have already done so)
Also, just my opinion, but its worth considering raising the FBA selling prices a little higher too, fast delivery etc could justify it. Although I suppose that would depend on whether you would get the custom on a slightly higher price, depends on the popularity of your product
Seller_vMsxjZPrdu6uI
You will have to excuse me, as I am a little lost. I only sell FBA which is probably why.
Just to clarify, if I purchased your product, what would i pay including postage
Seller_vMsxjZPrdu6uI
You will have to excuse me, as I am a little lost. I only sell FBA which is probably why.
Just to clarify, if I purchased your product, what would i pay including postage
Seller_DTufFoxJuMU0M
Besides surely you don’t expect it to be the same price.
Amazon are picking your product, packaging it, printing out the labels and delivering it the next day fully tracked right down a map to track your driver when he’s close, I believe they also handle all the returns, customer complaints etc. You can’t expect them to do all that for the same price that Hermes just delivers something in a few days.
Also people will pay more for prime delivery. I do quite often pay over the odds because I need something and I know it will get to me tomorrow.
Seller_DTufFoxJuMU0M
Besides surely you don’t expect it to be the same price.
Amazon are picking your product, packaging it, printing out the labels and delivering it the next day fully tracked right down a map to track your driver when he’s close, I believe they also handle all the returns, customer complaints etc. You can’t expect them to do all that for the same price that Hermes just delivers something in a few days.
Also people will pay more for prime delivery. I do quite often pay over the odds because I need something and I know it will get to me tomorrow.
Seller_EOmLRMFX8Oo9x
I am very sorry I really do not understand the issue here.
If you are currently selling your product at £6.95 including shipping and fulfilling yourself why would you only charge £4.50 on FBA, surely the minimum price on FBA should match your FBM price of £6.95, you would make slightly less profit per sale (pennies only) but Amazon do everything for you (pick, pack and ship). As mentioned before you can raise your prices slightly on FBA without effecting your sales.
If you sell both at £6.95 you will be surprised how many more sales you will get with FBA
Edit - I am a prime member and have never paid anything for delivery when ordering from someone doing FBA
Seller_EOmLRMFX8Oo9x
I am very sorry I really do not understand the issue here.
If you are currently selling your product at £6.95 including shipping and fulfilling yourself why would you only charge £4.50 on FBA, surely the minimum price on FBA should match your FBM price of £6.95, you would make slightly less profit per sale (pennies only) but Amazon do everything for you (pick, pack and ship). As mentioned before you can raise your prices slightly on FBA without effecting your sales.
If you sell both at £6.95 you will be surprised how many more sales you will get with FBA
Edit - I am a prime member and have never paid anything for delivery when ordering from someone doing FBA
Seller_ws4PZEK3YTmos
This is the reason that Jeff Bezos is a BILLIONAIRE . Amazon use the marketplace to generate a second revenue stream from small independent sellers who cant afford a website of their own . We all sell on THEIR forum , and so they take their cut , for the money we pay , we get exposure to a potentially huge market that we couldn’t access elsewhere else ( Ebay being the alternative )
Many years ago when we started selling on here , it was profitable for us to do so ,Amazons fees were reasonable and if there was a problem Amazon customer services were quite helpful . Things have changed , Amazons fees have continued to creep up and every few month your tied up in more red tape and are presented with more and more pointless hoops to jump through . Its also nigh on impossible to get in touch with anyone at customer services and if you manage it , you usually get an answer that has been cut and pasted .
Our time on Amazon is coming to an end as it simply isnt profitable anymore .
Seller_ws4PZEK3YTmos
This is the reason that Jeff Bezos is a BILLIONAIRE . Amazon use the marketplace to generate a second revenue stream from small independent sellers who cant afford a website of their own . We all sell on THEIR forum , and so they take their cut , for the money we pay , we get exposure to a potentially huge market that we couldn’t access elsewhere else ( Ebay being the alternative )
Many years ago when we started selling on here , it was profitable for us to do so ,Amazons fees were reasonable and if there was a problem Amazon customer services were quite helpful . Things have changed , Amazons fees have continued to creep up and every few month your tied up in more red tape and are presented with more and more pointless hoops to jump through . Its also nigh on impossible to get in touch with anyone at customer services and if you manage it , you usually get an answer that has been cut and pasted .
Our time on Amazon is coming to an end as it simply isnt profitable anymore .
Seller_TOekIMUa9rgxA
You’ll probably be surprised how much more people will pay just because its Prime. That can either be becuase they want it fast or simply because its the offer in the buy box and most buyers don’t even know there are other offers. It’s kinda messed up for buyers because they’re already paying a subscription for prime, then still paying sometimes double for the same product just to get that service.
For your own products is a bit different because I’d guess you don’t really want to be damaging your brand by charging inflated prices.
Regarding the prices Amazon charge, don’t use their estimates as your real figures. I don’t know about others but every single item I’ve listed has had higher fees when the item sells, even if the weight and size etc are correct. I usually go into my statement transactions to see the actual cost of selling a particular item, then adjust.
Finally! From my experience (only a few years) I’ve found that the volume you’ll sell on Amazon far outweighs any other platform and the fees are not that far off something like ebay for example if you work everything out, particularly at the moment while PayPal is still a thing. If I were you I’d try it out, tweek things as you go and if it really doesn’t benefit you, you’ll have lost very little. I do think you’ll get a massive increase in sales from Prime buyers no matter what the product is.
Seller_TOekIMUa9rgxA
You’ll probably be surprised how much more people will pay just because its Prime. That can either be becuase they want it fast or simply because its the offer in the buy box and most buyers don’t even know there are other offers. It’s kinda messed up for buyers because they’re already paying a subscription for prime, then still paying sometimes double for the same product just to get that service.
For your own products is a bit different because I’d guess you don’t really want to be damaging your brand by charging inflated prices.
Regarding the prices Amazon charge, don’t use their estimates as your real figures. I don’t know about others but every single item I’ve listed has had higher fees when the item sells, even if the weight and size etc are correct. I usually go into my statement transactions to see the actual cost of selling a particular item, then adjust.
Finally! From my experience (only a few years) I’ve found that the volume you’ll sell on Amazon far outweighs any other platform and the fees are not that far off something like ebay for example if you work everything out, particularly at the moment while PayPal is still a thing. If I were you I’d try it out, tweek things as you go and if it really doesn’t benefit you, you’ll have lost very little. I do think you’ll get a massive increase in sales from Prime buyers no matter what the product is.
Seller_7VbclcPFFRTnc
Can I just point out @paperback_heroes1 that I redid the fba fee calculator that the op based his figures on as he had done them wrong (he’d not included his postage) and he is actually better off sending fba
Seller_7VbclcPFFRTnc
Can I just point out @paperback_heroes1 that I redid the fba fee calculator that the op based his figures on as he had done them wrong (he’d not included his postage) and he is actually better off sending fba
