In order to keep your bottom line healthy, it’s important to have a strong grip on how much you spend. One of the major queries that ambitious business owners usually have when they first learn about selling on Amazon is, “How Much Commission Does Amazon Take?” After all, you want to ensure that you will make profits if you sell on the biggest e-commerce platform in the world. It is essential to comprehend Amazon Seller Fees & Charges if you want to sell on Amazon India and dominate the competition. Read on to learn about Amazon commission rates and seller fees – how much does Amazon take from its sellers as Amazon seller fees, and what are the associated costs?
What is Amazon Seller Fees?
Amazon charges third-party sellers commission fees, commonly referred to as Amazon seller commission fees, in exchange for the right to sell their goods on the Amazon marketplace. A seller who offers their goods on Amazon and makes a sale must provide Amazon seller fees equal to a portion of the sale price.
Different Types of Amazon Seller Commission Fees in India
Here we discuss the various types of Amazon seller commision fees and Amazon commission rates in India.
1. Referral Fees
The “commission” paid to Amazon for every product sold on their website is a referral fee. An important part of Amazon Seller commission charges is referral payments, determined by the goods category you are selling in and the item’s selling price. Starting at 2% for books under ₹250, the referral fee percentage can reach a maximum of 22.5% for designer jewels. The warranty services have the highest referral fee of 38%. You are not required to pay these costs upfront, though. Instead, amazon seller commissions are deducted from your Amazon account following a transaction.
2. Fixed Closing Fees
Depending on an item’s price range, Amazon also levies a fee in addition to the referral fee. A predetermined amount is charged for closing costs for each sold unit. They cover the expenses of Amazon’s numerous services, such as return processing, customer assistance, and payment processing. The closure charge amount varies depending on whether prepaid or Cash on Delivery (COD) shipping was selected for the purchase. The closing fees are taken out of the sale’s revenues, the same as the referral fee, so you don’t have to pay them upfront.
3. Amazon Easy Ship Weight Handling Fee
a. Easy Ship: Easy Ship provides regional, local, and national shipping rates for merchants, making it simple for them to manage shipments. The product’s weight determines the cost of Amazon’s easy shipping. It is determined using the greater of the actual weight or the volumetric weight. A product’s volumetric weight is determined by multiplying the package’s dimensions (in cm) by 5000 and dividing the result. The volumetric weight that results will be in grams.
b. Self-Ship: Since Amazon doesn’t charge for shipment, merchants are entirely responsible for the delivery and courier fees with Self-Ship.
c. FBA by Amazon: Goods storage, packaging, and shipment are handled by Fulfillment by Amazon (FBA), which assesses weight handling costs in accordance with the size and location of the goods.
d. Flexible Amazon Seller: A tailored fulfillment system called Seller Flex combines the advantages of FBA with the adaptability of self-shipping.
4. Miscellaneous Fees
a. Pick and Pack Charges (FBA Only): Products sold through Amazon FBA are subject to the per-unit Pick & Pack Fee. The price is ₹13 for Standard products and ₹26 for Oversize, Heavy, and Bulky items.
b. Fee for Storage (FBA Only): Products kept at Amazon Fulfillment Centers are subject to a monthly storage fee that is calculated at ₹45 per cubic foot.
c. Fees for FBA Removal (FBA Only): Removal of FBA Whether taken from Amazon Fulfillment Centers for returns, disposal or return to the seller, goods incur fees. Standard products cost ₹50 for Standard Shipping and ₹500 for Expedited Shipping, whereas Heavy & Bulky items cost ₹100 for both shipping choices. Amazon commission fees are calculated per unit.
Conclusion
Amazon is a highly intriguing platform to employ due to its immense popularity and well-earned reputation for putting customers first.
Why Consider Alternatives to Amazon?
While Amazon offers a vast customer base and convenience, its fees can significantly eat into your profits. The referral fees, closing costs, and additional charges make it essential to evaluate if your business model remains viable.
For a product priced at ₹1,000, Amazon’s total fees (₹310) include referral fees, closing fees, shipping charges, and other costs like FBA or return handling. These charges collectively consume 31% of your selling price, significantly reducing your profit margin.
For those looking for a cost-effective solution, Pygmy Commerce offers an incredible alternative. As a SaaS e-commerce platform, it provides:
- 0% Commission Fees
- No Platform Fees
- No Transaction Fees
With Pygmy Commerce, you can keep your entire revenue without worrying about hidden costs. Sign up for free today with no credit card required and start building your e-commerce business seamlessly: PYGMY Commerce.
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