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AMAZON FBA Fees

An easy explanation to AMAZON FBA Fees to ensure best ROI on your investment

Amazon, an e-commerce market place has helped several hundred businesses to grow, exponentially, utilizing its solution and services. The Amazon business solution and services are not limited to a single business area, however, they offer a holistic business environment to an entrepreneur to optimize his business operation and processes to an optimum level.

Among the range of services offered by Amazon, the Amazon FBA services are the most noticeable that have made the life of businessmen quite simpler and easier by easing their logistics and supply chain woes. FBA, popularly, also known as Fulfillment By Amazon is a logistic solution offered by Amazon. Under it, against an order placed by a seller’s customer, Amazon offers him storage, shipping, and support services.

Amazon FBA is a paid service offered on the leading market place Amazon. The fee charged by the company for its inventory and fulfillment services is known as the Amazon FBA fee. The determination of Amazon FBA fee depends upon many factors most importantly the weight and size of the package delivered in the process of shipping. For a new merchant or seller on Amazon FBA, it is very necessary for him to fully understand the Amazon FBA fee to comprehend the difference among various fee charges. Below, a step-wise self-explanatory study is provided focusing on every aspect of Amazon FBA fees.

Overview of FBA Services and Fees

To thoroughly get into the details of FBA Fees first understand the background of Fulfillment by Amazon (FBA) making a comparison between two sellers that had begun their business on Amazon. The seller A that began business on Amazon without FBA, the sailing was very easy, when, the number of orders was very small. Initially, it was easy for A to conduct the business process, though, he was handling storing, packing, shipping and delivery by himself. He started feeling the pinch of handling operations as soon as the number of orders in his inventory increased. He lost his concentration on managing the business and messed up badly in handling the supply and delivery of the products.

Contrary, the story for seller B had been comfortable and profitable. The seller from the very beginning of his tie-up with Amazon signed Amazon FBA services. Here, he got an edge over seller A. He just only had to ship his products to Amazon and rest was cared for by Amazon. Amazon not only stored his products at its highly secure fulfillment centers but at the same time packed, shipped and offered customer support services for the B’s products. By hiring Amazon FBA solutions, he allowed a professional team of executives to handle picking, storing, packing and shipping of his products. Additionally, with value-added services of FBA, seller B was able to expand his business and increase his customer base at a rapid and much faster pace.

For the integration of FBA, Amazon offers easily customization solution on the Amazon Seller Central dashboard. With an array of user-friendly tools provided, the integration is quite simple and easy giving easy access to product inventory. Amazon FBA fees are thus charged on the return of the service offered by the e-commerce marketplace.

Advantages of Amazon FBA Program

Similar to seller B, a seller avails many benefits if he signs for an Amazon FBA program. The advantages acclaimed by a merchant or signing an FBA program include.

  • An Upper Hand Against a Competitor in Market: The biggest benefit for signing up an Amazon FBA program is a preferred inclusion into Amazon Prime Free Two-Day Shipping, where a merchant’s products are shipped free of cost without paying any fee. Shipped through the Amazon Prime Services, a merchant receives the benefit of the brand value of Amazon Prime thus reaching out to a wider and extensive client base.

  • A Better Opportunity to Focus Upon One’s Business: While after hiring Amazon FBA services that take care of entire logistics and supply chain management services on a merchant’s part, it becomes easier for him to entirely focus upon his business. He can now focus upon expanding his business to newer heights. Already availing FBA service new orders can easily be completed by storing their inventory in Amazon’s fulfillment centers.

  • Customer and Return Oriented Services: The FBA services are provided with an additional cover of support and return. The consumers, when, making a purchase online prefer the products with an additional easy return policy. Moreover, the products backed with customer support have a better chance to be sold out in comparison to one that has none.

  • Better Propensity to Emerge in Amazon SERP: The products listed under the Amazon FBA program have better chances to emerge in Amazon search results. FBA products are more closely inclined towards Amazon search algo in comparison to non-FBA products. The better Amzaon search ranking further results in better sales and revenue for an FBA merchant. It is self-evident from the fact that top listing on Amazon search is from Amazon prime products.

Explaining Amazon FBA Pricing and Fees

As every service and product incur a certain cost, does Amazon FBA service also works under a fee structure termed as Amazon FBA Fee. Primarily, prices on Amazon FBA depend on three factors.

  • Product Weight: Volumetric weight of the product to be sold on Amazon
  • Product Size: Dimensions of the product.
  • Market Place: Products are whether sold on Amazon or an external site.

A merchant who has signed up Fulfillment by Amazon (FBA) is obligated to pay two types of fees.

  • Amazon Fulfillment Fees: A merchant has to pay this fee to Amazon in order to fulfill his orders through the FBA program. Under this fee, the cost of all the processes is covered including picking, packing, shipping, and customer service. Return fee, too, if is applicable in his contract. The fees are determined and accounted on per unit basis.

  • Monthly Inventory Storage Fees: These costs are incurred in return of storage space provided by Amazon at its warehouses also known as to be fulfillment centers. This fee is calculated on the basis of space occupied and calculated per cubic foot wise.

Other important aspects determining Amazon’s FBA fees are product size and weight of a particular product. Amazon has set the product sizes into categories for an easy cost classification and estimation.

  • Standard Size: Under this category product package must be less than 20 pounds after being fully packed and not be more than 18” x 14”x 8” in dimension.

  • Oversize: The product beyond the prescribed weight and size under the standard category is known to be as oversized. Product more than 20 pounds and 18 inches on the longest side comes under an oversize category.

However, there are sub-division of sizes for which prices are fixed and charged accordingly.

Product size

Weight (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″

Revisions in AMAZON FBA Fee in 2019. Price Breakdown Explained Below

The below mentioned youtube video provides an easy explanation of the changes that occurred in Amazon FBA fees in 2019. After going through this video you will able to learn about making an estimation about Amazon FBA program fees and can immediately join the FBA program.

Amazon FBA Price Chart

As has been already explained in the above-mentioned paragraphs, the working of the Amazon FBA fee. It is time to check out these prices across various size categories in upcoming sections. The price varies for the FBA program for the products sold on the Amazon website in comparison to sold on external websites.

Amazon FBA Fees For Products Sold on Amazon

As already explained any product sold on Amazon under Fulfillment by Amazon (FBA) program offers services like picking, packing, and shipping of goods to a merchant. Moreover, FBA services offer customer support for product queries regarding shipping, payment, returns, etc. Fees for these products depend on the size and weight of the products sold on Amazon platform.

Below Mentioned Charts Explains Amazon Fulfillment Fees Per Unit

Standard Size

Product size

Price

Small (10 oz or less)


$2.41

Small (10 oz to 16 oz)

$2.48

Large (10 oz or less)


$3.19

Larges (10 oz to 16 oz)


$3.28

Large (1lb to 2lb)


$.4.76

Large (2 to 3lb)


$5.26

Large (3 to 21lb)


$5.26 + $0.38/lb after the first 3 pounds

Oversized

Product size

Weight (Pounds)

Small oversize (71lb or less)

$8.26 + $0.38/lb above the first two pounds

Medium oversize (151lb or less)

$9.79 + $0.39/lb above the first two pounds

Large oversize (151lb or less)

$75.78 + $0.79/lb above the first 90 pounds

Special oversize

$137.32 + $0.91/lb above the first 90 pounds

Amazon FBA Fees For Selling Products on Non-Amazon Sites– Multi-Channel Fulfillment

Multi-Channel Fulfillment Services are for those merchants that sell services on other e-commerce platforms other than Amazon market place. A merchant with his own dedicated website for a product even can avail Amazon FBA services under the Multi-Channel Fulfillment program. In this case, Amazon MCF fulfills a merchant’s order. The fee charged for Multi-Channel Fulfillment is comparatively higher than Amazon’s FBA.

As an external shopping space than Amazon, FBA fees for MCF depends upon the variety of shipping options offered by a merchant, most common being Standard (3-5 days), Expedited (2-day), and Priority (Next day shipping).

Shipping Fees for Standard Size Products

SIZE

1 UNIT ORDER

2 UNIT ORDER

3 UNIT ORDER

4 UNIT ORDER

5+ UNIT ORDER

Small(1lb or less)

$5.85


$3.75

$3.35

$3.25

$2.20

Large Products (1lb or less)

$5.90

$3.90


$3.40

$3.30

$2.80

Large(1lb to 2 lb)

$5.95

$3.95


$3.45

$3.35

$2.95

Large(More than 2 lb)

$5.95 + $0.39/lb

$3.95 + $0.39/lb

$3.45 + $0.39/lb

$3.35 + $0.39/lb

$2.95 + $0.39/lb

Shipping Fees for Oversized Products

1 unit order

2 unit order

3 unit order

4 unit order

5+ unit order

Small:
more than
first 2 lb

$12.30 + $0.39/lb

$6.80 + $0.39/lb

$5.80 + $0.39/lb

$4.80 + $0.39/lb

$3.80 + $0.39/lb

Medium:
more than
first 2 lb

$15.30 + $0.39/lb

Large:
more than first 90 lb

$78.30 + $0.80/lb

Special:
more than first 90 lb

$143.30 + $0.92/lb

It is evident from the above-mentioned list as much products a seller will sell as cheaper will be his Fulfillment By Amazon fees. And, if a merchant’s website is selling you more products than his channel on Amazon then the bargain is more rewarding.

Amazon FBA Monthly Storage Price

Last and the most important are the Amazon FBA monthly storage price for booking space at Amazon Fulfillment Centers. It is very important in case a merchant has a very popular product category that runs out very fast from the fulfillment centers. The fees for monthly storage as follow:-

Storage Month

Standard-Size

Oversize

January – September

$0.69 per cubic foot

$0.48 per cubic foot

October – December

$2.40 per cubic foot

$1.20 per cubic foot

Monthly Storage Cost

INVENTORY ASSESSMENT DATE

ITEMS IN FULFILLMENT CENTERS 181 TO 365 DAYS

ITEMS IN FULFILLMENT CENTERS 365 DAYS OR MORE

Semi-annual (February 15 and August 15)

$11.25 per cubic foot

$22.50 per cubic foot

Long-Term Storage Fees

Inventory Assessment Date

Items In Fulfillment Centers 181 To 365 Days

Items In Fulfillment Centers 365 Days or More

Monthly (15th of every month)

$3.45 per cubic foot

$6.90 per cubic foot

Minimum Long-Term Storage Fees

Inventory Assessment Date

Items in Fulfillment Centers 365 Days Or More

Monthly (15th of every month)


$0.50 per unit

Other FBA Fees a Merchant Should Know Before Beginning

You as a merchant have decided to get enrolled in the Amazon FBA program and already had a good look at the fees and charges as discussed above. However, there are many other fees as well that you are required to look at when signing up for the Amazon FBA program.

  • Seller Fee: A referral fee charged on every item sold on Amazon.

  • Monthly Selling Fees: The monthly rental paid to Amazon for using its platform.

  • Returns Processing Fees: Fee charged from a merchant for processing his returns.

  • Stock Removal Fees: This fee is incurred from a merchant for disposing of his stock from the Fulfillment center at amazon.
  • Inventory Placement Service: By signing up for FBA Inventory Placement Service all eligible inventory goes to a single fulfillment center instead of separated across multiple shipments in return of a fee.
  • Amazon FBA Export Fees: This fee is charged for exporting products to different countries from a fulfillment center.

SUM Up

Fulfillment by Amazon is a highly rewarding logistic program that a merchant should always opt for in order to book profitability. Opting for a third-party logistics partner can reduce annual turn over of a merchant selling from Amazon or any other website without FBA. Amazon FBA is a better-poised fulfillment solution whether you are selling on Amazon or off Amazon.

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