Detailed cost analysis for opening and operating an Amazon store for one year

For merchants looking to expand their business on Amazon, the world’s largest online retailer, it’s critical to understand the fees involved in setting up a store. This article will combine the content of the two articles to introduce in detail the expenses of opening an Amazon store for one year.

Registration fee

Registering as a seller on Amazon requires a registration fee. If you register by yourself, you usually don’t need to pay any fees; however, if you choose to register through an agency, you may need to pay a fee ranging from 500 to 2,000 yuan. It’s worth noting that if you consider purchasing an existing Amazon store, the cost may exceed 10,000 yuan. However, no matter how many store accounts you have, the official registration fee is a one-time US$39.99.

Platform fees

Monthly service fee

Amazon charges a fixed monthly service fee for each seller account, with the standard fee being $39.9 per month.

Commission fee

Amazon sets different commission rates for various products based on different sites and regions. Taking the US site as an example, the sales commission for products such as mobile phones is usually 17%, and for each transaction, Amazon also charges at least US$0.3 as a fixed commission.

Withdrawal fees

When sellers need to withdraw funds from their Amazon account to their bank account, they will face a certain withdrawal fee. The rates vary depending on the third-party payment service provider used. The withdrawal rate on the Amazon platform itself is 0.3%, while the rate for transferring funds back to China may be as high as 1.2%.

Product-related fees

Sales fees and FBA fees

Amazon charges sales fees in proportion to the selling price of the product, and the specific rates vary for different categories. In addition, if you choose Fulfillment by Amazon (FBA), you will also need to bear a number of costs including storage, order processing and delivery.

UPC Barcode

When selling on the Amazon platform, each product needs to have a unique UPC barcode, and the cost of purchasing these barcodes is approximately $5 each.

Marketing and promotion expenses

Advertising costs

In order to increase product exposure and sales, many sellers choose to advertise on Amazon. This includes forms such as CPC (pay-per-click) advertising and PAC (pay-per-acquisition) advertising, with specific costs determined based on the performance of the advertising campaign and the auction situation.

Other potential overhead

In addition to the basic fees mentioned above, sellers may also encounter some additional expenses, such as brand registration fees, patent application fees or inventory clearance fees, etc. In addition, you need to pay about 2,000 yuan per year to use professional product selection tools (such as Jungle Scout); and the first-leg fee incurred in shipping goods from China to Amazon’s FBA warehouse depends on the volume, weight and size of the items. Quantity and other factors.

To sum up, the expenses involved in opening and operating an Amazon store for one year are quite extensive and complex, covering many aspects from registration to marketing and promotion. Sellers should reasonably plan their budget based on their actual situation and find effective ways to reduce costs to achieve better profit goals.