Amazon FBA Profit Calculator
Net Profit
$0.00
Profit Margin
0%
ROI
0%
Amazon Referral Fee: $0.00
Total Cost per Unit: $0.00
Understanding Amazon FBA Profitability
Calculating your potential earnings on Amazon is the most critical step for any e-commerce seller. The Fulfillment by Amazon (FBA) model offers convenience, but it comes with a complex fee structure that can quickly erode your margins if not calculated accurately.
Key Components of FBA Fees
- Product Cost (COGS): This is the manufacturing or wholesale price you pay for the item.
- Referral Fee: Amazon charges a percentage of the total sales price (usually 15%) as a commission for selling on their platform.
- Fulfillment Fee: A flat fee per unit based on the weight and dimensions of your product. This covers picking, packing, and shipping.
- Shipping to Amazon: The cost of transporting your inventory from your warehouse or supplier to an Amazon Fulfillment Center.
- Marketing & Storage: Don't forget to account for PPC (Pay-Per-Click) advertising costs and monthly inventory storage fees.
FBA Profit Calculation Example
Let's look at a realistic scenario for a private label seller:
Example: Silicon Spatula Set
– Selling Price: $25.00
– Unit Cost: $5.50
– Referral Fee (15%): $3.75
– FBA Fulfillment Fee: $5.40
– Inbound Shipping: $0.80
– Total Profit per unit: $9.55
– Profit Margin: 38.2%
– Selling Price: $25.00
– Unit Cost: $5.50
– Referral Fee (15%): $3.75
– FBA Fulfillment Fee: $5.40
– Inbound Shipping: $0.80
– Total Profit per unit: $9.55
– Profit Margin: 38.2%
How to Improve Your FBA Margins
To maximize your Amazon business, consider these three strategies:
- Optimize Packaging: Reducing the size and weight of your product box can drop it into a lower FBA fee tier.
- Bundle Products: Selling two items together increases the selling price while only incurring one FBA fulfillment fee.
- Negotiate with Suppliers: As your volume grows, lower your COGS to increase your ROI.