Selling on Amazon through the Fulfillment by Amazon (FBA) program offers convenience and access to Amazon's vast customer base. However, to ensure your business is sustainable and profitable, it's crucial to understand all the costs involved and accurately calculate your profit margins. This calculator helps you do just that by factoring in key expenses.
Key Metrics and Calculations:
Selling Price: The price at which you list your product on Amazon.
Product Cost: The cost to source or manufacture one unit of your product.
Amazon FBA Fulfillment Fee: A fee charged by Amazon for picking, packing, shipping, and customer service for FBA orders. This fee varies based on product size and weight.
Amazon Referral Fee: A percentage of the total sale price (including shipping and any other charges) that Amazon charges for each sale. This is typically between 8% and 17% depending on the product category.
Shipping Cost to Amazon: The cost to ship your inventory from your supplier or warehouse to Amazon's fulfillment centers. This is often averaged per unit for easier calculation.
Other Monthly Costs: These are your business's overheads that aren't directly tied to a single unit sale, such as software subscriptions (e.g., inventory management tools, accounting software), marketing and advertising expenses, or virtual assistant fees.
Units Sold: The estimated number of units you expect to sell within a month.
How the Calculator Works:
The calculator estimates your total monthly profit using the following logic:
Revenue: `Selling Price per Unit * Units Sold`
Total Cost of Goods Sold (COGS): `(Product Cost per Unit + FBA Fulfillment Fee per Unit + Referral Fee per Unit + Shipping Cost to Amazon per Unit) * Units Sold`
Total Amazon Fees: `(Referral Fee per Unit + FBA Fulfillment Fee per Unit) * Units Sold`
Total Shipping Costs: `Shipping Cost to Amazon per Unit * Units Sold`
Total Variable Costs: `Total COGS + Total Amazon Fees + Total Shipping Costs`
Total Fixed Costs (Monthly): `Other Monthly Costs`
Total Expenses: `Total Variable Costs + Total Fixed Costs`
Estimated Monthly Profit: `Total Revenue – Total Expenses`
The profit per unit is calculated as: `Selling Price – Product Cost – FBA Fulfillment Fee – (Selling Price * Referral Fee Percentage) – Shipping Cost to Amazon`.
Why Use This Calculator?
Identify Profitable Products: Determine if a product has a healthy enough profit margin before investing.
Price Optimization: Understand how changes in selling price or fees affect your bottom line.
Budgeting: Estimate your potential earnings and plan your business expenses more effectively.
Compare Scenarios: Test different cost assumptions (e.g., bulk purchasing discounts, changes in FBA fees) to see their impact.
Accurate profit calculation is the cornerstone of a successful Amazon FBA business. Use this tool regularly to keep your business on track.
function calculateProfit() {
var sellingPrice = parseFloat(document.getElementById("sellingPrice").value);
var productCost = parseFloat(document.getElementById("productCost").value);
var fbaFees = parseFloat(document.getElementById("fbaFees").value);
var referralFeePercent = parseFloat(document.getElementById("referralFee").value);
var shippingCost = parseFloat(document.getElementById("shippingCost").value);
var otherCosts = parseFloat(document.getElementById("otherCosts").value);
var unitsSold = parseInt(document.getElementById("unitsSold").value);
var resultDiv = document.getElementById("result");
// Input validation
if (isNaN(sellingPrice) || isNaN(productCost) || isNaN(fbaFees) || isNaN(referralFeePercent) || isNaN(shippingCost) || isNaN(otherCosts) || isNaN(unitsSold)) {
resultDiv.innerHTML = "Please enter valid numbers for all fields.";
return;
}
if (sellingPrice <= 0 || productCost < 0 || fbaFees < 0 || referralFeePercent < 0 || shippingCost < 0 || otherCosts < 0 || unitsSold <= 0) {
resultDiv.innerHTML = "Please enter positive values for costs and units sold, and a positive selling price.";
return;
}
// Calculations
var referralFeeAmountPerUnit = sellingPrice * (referralFeePercent / 100);
var profitPerUnit = sellingPrice – productCost – fbaFees – referralFeeAmountPerUnit – shippingCost;
var totalRevenue = sellingPrice * unitsSold;
var totalVariableCosts = (productCost + fbaFees + referralFeeAmountPerUnit + shippingCost) * unitsSold;
var totalOtherCosts = otherCosts; // These are fixed monthly costs
var totalExpenses = totalVariableCosts + totalOtherCosts;
var estimatedMonthlyProfit = totalRevenue – totalExpenses;
if (estimatedMonthlyProfit < 0) {
resultDiv.innerHTML = "Estimated Monthly Profit: $" + estimatedMonthlyProfit.toFixed(2) + " (Loss)";
} else {
resultDiv.innerHTML = "Estimated Monthly Profit: $" + estimatedMonthlyProfit.toFixed(2) + "";
}
}