Amazon FBA Revenue Calculator
Analysis Result
Total Amazon Fees:
Total Product Costs:
Net Profit:
Profit Margin:
Comprehensive Guide to Amazon FBA Revenue Calculation
Success on Amazon hinges on more than just high sales volume; it requires a deep understanding of your net profit after all Amazon fees are deducted. Fulfillment by Amazon (FBA) offers incredible logistics reach, but the fee structure can be complex. This FBA Revenue Calculator helps you strip away the guesswork and see exactly what stays in your pocket.
Key Components of FBA Profitability
To use this calculator effectively, you need to understand the primary costs associated with the FBA model:
- Cost of Goods Sold (COGS): This is the manufacturing or acquisition cost of your product. If you buy a unit for $5.00 from a wholesaler, that is your COGS.
- Amazon Referral Fee: This is essentially Amazon's commission for selling on their platform. For most categories, this is 15% of the total selling price, though it can range from 8% to 45% depending on the niche.
- Fulfillment Fees: These are flat fees charged per unit to cover picking, packing, and shipping your orders to customers. These are determined by the weight and dimensions of your product.
- Storage Fees: Amazon charges monthly fees based on the volume (cubic feet) your inventory occupies in their warehouses. Note that these fees increase significantly during the Q4 holiday season.
How to Calculate Your Net Profit
The math behind FBA revenue is straightforward once you have the variables. The formula is:
Net Profit = Sales Price – COGS – Shipping to Amazon – Referral Fee – Fulfillment Fee – Monthly Storage
Example Calculation
Let's say you are selling a yoga mat for $40.00.
- COGS: $10.00
- Shipping to Amazon: $1.00 per unit
- Referral Fee (15%): $6.00
- FBA Fulfillment Fee: $5.50
- Monthly Storage: $0.50
In this scenario, your total expenses are $23.00. Your Net Profit is $17.00, resulting in a 42.5% Profit Margin. A healthy FBA margin is typically considered anything above 25% after all expenses.
Strategies to Increase FBA Margins
If your calculator results show thin margins, consider the following optimizations:
- Optimize Packaging: Because FBA fees are based on size and weight, reducing your product packaging by even half an inch can sometimes move you into a lower "size tier," saving you dollars per unit.
- Bulk Shipments: Reduce your "Shipping to Amazon" cost by sending larger quantities via LTL (Less Than Truckload) rather than individual parcel deliveries.
- Review Referral Categories: Ensure your product is listed in the correct category. Some categories have lower referral percentages than others.
- Inventory Turn: High storage fees occur when inventory sits for too long. Aim for a 30-to-60-day inventory cycle to minimize monthly storage costs and avoid "Aged Inventory Surcharges."