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Know Different types of FBA Handling Fees you pay to Amazon

Know Different types of FBA Handling Fees you pay to Amazon

Running any business involves a lot of calculations of money. Whether you are an online seller or offline seller, you might be spending your most of the time in calculating taxes, fees, revenues, profits, and investments. And if you are not busy in doing such calculations, we are sure your accountant would have been doing it all for you. But have you ever thought that you can lessen these calculations complications and calculations. For the Amazon sellers with FBA services, Amazon has an FBA Profit calculator which calculates different types of fees associated with every product.

For the Amazon sellers, to be perfect in their maths and calculations, they need to know the basic terms of fees which they either pay to Amazon or incur from customers. This fees calculation will help you in setting the product price and calculate the profit margin so that you may save yourself from running into the loss.

We are making you familiar with the basic terms those Amazon is incurring to its sellers-

1.Amazon Referral Fee
The amount which you have to pay to Amazon for listing products on Amazon. Amazon takes it as referral fees because it says it refers your listings to the customers and therefore it charges to you. Generally, for every item, you have to pay 15% of the retail price and it differs category by category. 
2.Order Handling Fee
When you use FBA services, then, Amazon behalf of you handles the orders and becomes responsible for order fulfillment. In FBA, Amazon takes the items from your warehouse to its warehouse for fulfilling FBA orders. Therefore, it incurs charges to you as an order handling fee. For the standard size item, Amazon charges $1 but it may be different for different sizes of products. 

3.Pick & Pack Fee
The fees for packing the items is termed as Pick and Pack Fee. Amazon, for the FBA products, it charges from the amazon seller for picking it from the warehouse and for packing the item for and shipping and delivery. Here the packing material is of Amazon only and therefore it charges for every item, depending on the item’s category, weight, and size. The pick and pack fee includes the labor costs too. Knowing this, you can compare FBA and MFN packing fees and then select the one which lies in your budget.

4.Weight Handling Charge
For every item, the sellers have to pay a weight handling fee to Amazon. Depending upon the the weight of every item, Amazon reckons the shipping costs. The shipping costs are calculated on the basis of weight to be transferred from its warehouse to the buyer’s destination. So, from the next time when you are about to offer the free shipping to your customers, do calculate this fees and adjust in the selling price so that you won’t run in the loss. 

5.Storage fee per Month
Every item occupies space in the Amazon’s warehouse and therefore it incurs fees to you. Depending on the space (per cubic foot) occupied by the item, you need to pay fees to Amazon. This year Amazon has made some changed in the storage fees which would come in effect from February 2019. 
Keep yourself updated:

Read: Amazon has changed its FBA Inventory Storage Fees and Policy in 2018.
Also Read: Amazon new policy in 2019 for storage fees.  

7.Prep Service Fee
In Amazon FBA calculator, there is another term called as Prep Service fee which Amazon incurs to you for preparing order ready for shipment. It includes the charges for wrapping/shrinking the products, applying UPC labels and packing for final delivery.  

Amazon FBA calculator calculates all the above-mentioned fees so that you can estimate your budget and profit. This calculator does not calculate your profit margin. With this calculator, you can get a clearer idea of FBA and FBM/MFN fee so that you can calculate your spendings before making any sale. This will help you to be in budget so that you can be left with the expected profit margin. Using FBA calculator and other tools of Amazon will help you in tracking your budget and sales. 
For efficiently analyzing and monitoring your seller central account, hiring an Amazon service provider like evantage will be really helpful to you.

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