How to Sell on eBay: A Beginner’s Guide
How to start selling on eBay: setting up your account, researching sold prices, writing listings that sell, auction vs Buy It Now, fees, shipping and ratings.
Amazon FBA: The Real Costs
The real costs of Amazon FBA: referral and fulfilment fees, storage and inbound costs, advertising, returns, prep costs and how to calculate margins.
Key takeaways
- FBA fees include referral fees, fulfilment fees and storage, and they vary by size, weight and category.
- Advertising, returns and slow-moving stock can wipe out margins.
- Model the full landed cost per unit before ordering inventory.
On this page
Fulfilment by Amazon (FBA) lets you store products in Amazon’s warehouses while Amazon handles packing, shipping and customer service. It can unlock enormous reach, but the costs are more complicated than they look.
The main FBA costs
| Cost | What it is |
|---|---|
| Referral fee | A percentage of each sale, varying by category |
| Fulfilment fee | Per-unit fee for picking, packing and shipping, based on size and weight |
| Storage fees | Monthly fees per unit of space, higher in peak season |
| Long-term or excess storage | Extra charges for slow-moving stock |
| Inbound costs | Shipping and placement fees to get stock into warehouses |
| Advertising | Sponsored product ads, often essential for visibility |
| Returns | Return processing and unsellable returns |
Costs outside Amazon
- Product cost from your supplier
- Freight, duties and customs
- Prep, labelling and packaging
- Photography and listing creation
- Samples and quality checks
- Software and tools
How to calculate your margin
- Start with the selling price.
- Subtract referral and fulfilment fees.
- Subtract storage, inbound and advertising per unit.
- Subtract your landed product cost.
- Allow for returns and a contingency.
If what’s left is thin, one bad month of advertising or returns can put you in the red.
Tips
- Choose small, light, durable products with steady demand.
- Avoid overstocking: storage fees punish slow sellers.
- Test with a small order first.
- Track advertising cost of sales closely.
FBA vs selling yourself
Selling via your own shipping or other marketplaces can suit bulky, slow-moving or unique items; see Etsy vs eBay vs Facebook Marketplace and shipping options for small sellers.
Frequently asked questions
Is Amazon FBA worth it?
It can be for the right products, but margins depend heavily on fees, advertising and inventory management.
How much do I need to start FBA?
It depends on product cost and order quantity. Many sellers start with a small test order.
What products work best for FBA?
Small, lightweight, durable items with consistent demand and room for healthy margins.
Sources
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