Amazon FBA Profit Calculator
How to Use the Amazon FBA Profit Calculator
Success on Amazon hinges on understanding your "net" numbers, not just your "gross" sales. This Amazon FBA Profit Calculator helps you peel back the layers of fees to see what actually lands in your bank account. To get an accurate result, you need to account for every dollar spent from the factory to the customer's doorstep.
Understanding FBA Fees
When selling via Fulfillment by Amazon (FBA), you encounter several specific costs:
- Referral Fees: This is Amazon's commission for the sale, typically 15% for most categories.
- Fulfillment Fees: This covers picking, packing, and shipping your product. It is based on the weight and dimensions of your product.
- Storage Fees: Amazon charges for the space your inventory occupies in their warehouses. This fluctuates seasonally (higher in Q4).
Realistic Example Calculation
Let's say you sell a yoga mat for $35.00. Your manufacturing cost (COGS) is $10.00, and shipping it to Amazon's warehouse costs $2.00 per unit. Amazon takes a 15% referral fee ($5.25) and charges an FBA fulfillment fee of $6.00. If you spend $4.00 per unit on PPC advertising, your total costs are $27.25. Your net profit is $7.75 per unit, resulting in a 22.1% profit margin.
Tips for Improving Your Margins
If your margins are below 20%, consider these strategies: 1. Optimize Packaging: Reducing the size or weight of your product can drop you into a lower FBA fee tier. 2. Bulk Shipping: Lower your inbound shipping costs by sending larger shipments via sea freight rather than air. 3. PPC Efficiency: Focus your ad spend on high-converting keywords to lower your "per unit" advertising cost.