Amazon FBA (Fulfillment by Amazon) is a popular service that allows sellers to store their products in Amazon’s fulfillment centers, and Amazon takes care of the pick, pack, and shipping of orders. However, using FBA comes with a range of fees that can add up and eat into a seller’s profits.
In this article, we will break down all the Amazon FBA fees that sellers need to be aware of, as well as some new hidden fees that have recently been introduced.
1. Fulfillment fees: This is the fee charged by Amazon for picking, packing, and shipping your items to customers. The cost is based on the size and weight of the item, with larger and heavier items incurring higher fees.
2. Storage fees: If your products sit in Amazon’s fulfillment centers for an extended period of time, you will be charged storage fees. These fees vary depending on the time of year and the size of the item.
3. Long-term storage fees: If your products have been in Amazon’s fulfillment centers for over 365 days, you will be charged long-term storage fees. These fees can add up quickly, so it’s essential to monitor your inventory levels closely.
4. Referral fees: Amazon charges a referral fee for each item sold on their platform. This fee is a percentage of the total selling price and varies depending on the category of the item.
5. FBA fees: In addition to fulfillment and storage fees, there are additional Amazon FBA fees for specific services, such as labeling and prep services, returns processing, and removal orders.
6. New hidden fees: Recently, Amazon has introduced some new hidden fees that sellers need to be aware of. One of these fees is the “Long-Term Storage Cleanup Fee,” which is charged to sellers with an excessive amount of slow-moving inventory that has been in Amazon’s fulfillment centers for an extended period. Another new fee is the “Low Inventory Storage Fee,” which is charged to sellers with an insufficient amount of inventory in stock.
Overall, it’s essential for sellers using Amazon FBA to understand and budget for all the fees associated with the service. By carefully monitoring your inventory levels, sales performance, and Amazon fees, you can ensure that you are maximizing your profits and minimizing unnecessary costs.
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