Amazon selling fees can quietly consume a large share of your revenue if you do not understand them before you launch. Many founders focus on their product cost and sale price, then get surprised when the money that lands in their account is far less than expected. For Korean entrepreneurs selling into the US market on Amazon, knowing exactly how these fees work is the difference between a profitable business and one that loses money on every order. This guide explains the main types of Amazon selling fees and shows you how to calculate what you actually keep.
The Two Selling Plans
Amazon offers two account plans, and your choice affects your baseline costs.
- Individual plan. There is no monthly subscription fee, but Amazon charges a per-item fee on each sale. This works for sellers moving only a handful of units per month.
- Professional plan. You pay a flat monthly subscription instead of the per-item fee, plus access to advanced tools, advertising, and bulk listing features. This is the standard choice for serious sellers.
As a rule of thumb, if you sell more than a small number of units each month, the Professional plan usually costs less overall because you avoid the per-item charge. Exact amounts vary, so check Amazon’s current fee schedule.
Referral Fees
The referral fee is the core cost of selling on Amazon. It is a percentage of the total sale price, including the item price and often shipping, that Amazon takes as commission for every sale. The percentage depends on the product category.
Referral fees commonly fall in the range of roughly eight to fifteen percent, though some categories are higher or lower. Because this fee is charged on nearly every sale regardless of how you fulfill orders, it is the single most important cost to factor into your pricing. Many categories also have a minimum referral fee, meaning very low-priced items may pay a small fixed amount instead of the percentage.
Fulfillment Fees: FBA vs. FBM
How you deliver products to customers has a major impact on your total costs. There are two main approaches.
Fulfillment by Amazon (FBA). You send inventory to Amazon’s warehouses, and Amazon handles storage, packing, shipping, and customer service. In exchange, you pay:
- Fulfillment fees per unit, based on the item’s size and weight. Larger and heavier items cost more.
- Storage fees charged monthly based on the volume of space your inventory occupies, with higher rates during peak season.
- Long-term storage fees if inventory sits in the warehouse too long, which encourages efficient inventory management.
Fulfillment by Merchant (FBM). You store and ship products yourself or through a third party. You avoid Amazon’s fulfillment and storage fees, but you take on shipping costs, packaging, and customer service. For foreign sellers without US logistics, FBA is often more practical, though it comes with its own fees.
FBA is popular because it makes products eligible for Prime and removes the burden of logistics. However, the fulfillment and storage fees can add up quickly, so you must include them in every profit calculation.
Other Fees to Watch
Beyond the major categories, several additional costs can affect your margins:
- Advertising costs. Amazon advertising is optional but often necessary to gain visibility. This can become one of your largest expenses.
- Refund administration fees. When you refund a customer, Amazon may retain a portion of the original referral fee.
- Removal and disposal fees. Getting inventory back or disposing of it from FBA warehouses carries charges.
- High-volume listing fees. Very large catalogs may incur additional charges.
These smaller fees are easy to overlook, but together they can meaningfully reduce your profit.
Calculating What You Actually Keep
To understand your real profit, work through the numbers before you list a product. Consider a simplified example for a single sale:
- Start with the sale price the customer pays.
- Subtract the referral fee, a percentage of the sale price based on category.
- Subtract the fulfillment fee if you use FBA, based on size and weight.
- Subtract a share of storage and other periodic fees allocated to the unit.
- Subtract your product cost, including manufacturing and shipping to Amazon.
- Subtract advertising and any other per-unit costs.
What remains is your actual profit per unit. Many new sellers are surprised to find that fees and product costs can consume the majority of the sale price. Amazon provides a fee calculator that estimates referral and fulfillment fees for a given product, and using it before launch helps you set prices that leave real margin. Always price with all fees in mind, not just your product cost.
Tips to Protect Your Margins
Once you understand the fee structure, you can manage it strategically:
- Choose products with healthy margins that can absorb fees and still profit.
- Optimize packaging size and weight to reduce fulfillment fees.
- Manage inventory carefully to avoid long-term storage fees.
- Track advertising spend against sales to keep it profitable.
- Reprice thoughtfully as your costs and competition change.
Sellers who treat fees as a core part of their business model, rather than an afterthought, build sustainable profits. Those who ignore them often discover too late that their best-selling product is losing money.
This article provides general information and is not financial or tax advice. Amazon fees change over time and vary by category and product, so review Amazon’s current fee schedule and consult a qualified professional for your specific situation.
Frequently Asked Questions
What is the biggest Amazon selling fee?
For most sellers, the referral fee and, if using FBA, the fulfillment fees are the largest costs. Referral fees are commonly in the range of roughly eight to fifteen percent of the sale price depending on category, and FBA fees depend on item size and weight.
Do I need FBA to sell on Amazon as a foreign seller?
No, FBA is optional, but many foreign sellers use it because they lack US-based logistics. FBA handles storage, shipping, and customer service and makes products Prime eligible, though it adds fulfillment and storage fees you must factor into pricing.
How can I estimate my fees before listing a product?
Amazon offers a fee calculator that estimates referral and fulfillment fees for a specific product. Enter your product details and price to see the fees, then subtract your product cost and advertising to estimate your actual profit per unit.
Understanding Amazon fees before you launch protects your margins and your peace of mind. If you would like help planning your US Amazon strategy, from company formation to selling setup, we invite you to a free consultation with USdongsan, where we help Korean founders enter the US market profitably.
