- Hi guys, Neil Waterhouse.
In this video, I want to show you how
to understand the Amazon fees, including FBA and FBM,
and I also want to share with you a free tool
which I use to automatically calculate Amazon fees.
You can download a free tool now
for free using the link below.
It saves you a ton of time trying
to manually calculate the different Amazon fees.
Okay, so first of all, for the newbies watching this video,
there are two ways that Amazon sellers can ship items
to their customers, and these are called FBM and FBA.
The first is FBM, which is, it's an acronym
for fulfillment by merchant.
Fulfillment by merchant means that when an item sells,
the seller, IE you or me, boxes the item up
and ships it to the customer.
And you use either a courier or Australia Post to do that.
The other way is FBA, which is an acronym
for fulfillment by Amazon.
In other words, Amazon ships your item direct to customer.
But of course, with FBA, you do need
to ship the item first to an Amazon warehouse,
so they can warehouse the item
and then ship it to your customer when it sells.
In this video, I'll cover fees for both FBA and FBM.
Okay, so the first fee to sell on Amazon Australia
is the monthly professional selling plan fee,
and this is $49 plus GST per month.
So basically, $50 plus GST per month.
This is the fee all Amazon sellers in Australia pay
to be able to list items on Amazon Australia.
The next fee is the FBA storage fee,
and this fee is charged monthly.
For Amazon Australia, the monthly storage fee is $19.40
per cubic meter, or for round numbers, $20
per cubic meter per month.
Now this $19.40 or $20 per cubic meter per month applies
for just January to September.
For the busy period, which is October to December,
Amazon charges more.
They increase the monthly storage fee to $26.50.
Basically an extra $7 per month
for the October to December silly Christmas peak period.
Now, these storage fees are only for FBA items
where you or your suppliers send items to one
or more of the warehouses around Australia.
It's a fee that Amazon charges for storing your products.
Now, the next fee is called the Amazon fulfillment fee.
And now, some people will say
that Amazon fulfillment fee is expensive,
but they do a lot for the money, and this is what they do.
So the fulfillment fee, it's what they charge you for,
it's fulfillment services, which include picking
and packing your orders, shipping and handling,
customer service, and also looking
after any product returns.
Now all that fulfillment fee is a fixed price.
The fixed price changes based on the size
and weight of each product.
In the link below, I've created a PDF
which you can download for free
which shows you all the different prices
for all different sizes and weights.
But here's a few examples to give you an idea.
The one-off fulfillment fee
for a small envelope weighing up to 100 grams is $1.32.
For a parcel weighing zero to 1.5 kilograms,
the fulfillment fee is $3.06 to $5.19.
For a parcel weighing 12 kilograms,
the fulfillment fee is $8.92.
Now just like Australia Post and courier companies,
Amazon will charge you on whatever's greater:
The weight of the item or the size of the item.
In other words, if you've got a huge box of feathers
and it weighs next to nothing,
Amazon will charge you for the size of the box,
exactly like Australia Post and your courier companies.
Now, before anyone sends me anything,
yes, you can do a deal with Australia Post
and some courier companies and get it done just
on the size of it, so basically
on a cubic-based measurement, but Amazon does not do that.
They just charge whatever's greater.
Okay, so the next fee is called the referral fee.
Now if you're used to selling on eBay,
the Amazon referral fee is pretty much the same thing
as eBay's final value fee. (rooster crowing)
Uh oh, we've got an annoying rooster.
Apologies for that.
And I tend to think of the referral fee
as a final value fee 'cause that's what it really is.
It's really just a final value fee.
And just like eBay, Amazon sellers pay a referral fee
on each item sold, based on the total sales price.
Now like eBay, the total sales price
is a total amount paid by the buyer, including shipping,
and there's no minimum (rooster crowing)
or maximum referral rate.
The referral fee varied depending
on which category you're selling in,
and it varies from six percent for computers
or the computers category,
(rooster crowing)
or up to 15% for other categories.
Again, without spending ages going
through all the different categories
and the various percentage rates,
I've listed them all in the free download.
The next fee is a one dollar closing fee.
And this closing fee is only applicable
if you sell any kind (rooster crowing)
of media, including, that can go as books, DVDs, software,
computer, video games, video and video game consoles.
Which if you sell any of this kind of media,
(rooster crowing)
then Amazon will charge you this one dollar closing fee.
And another fee to be thinking
about is the 12-month longterm storage fee.
Now, in America, it's done every six months,
but Australia currently uses 12 months,
so we'll just see (rooster crowing)
what happens over time,
but the longterm storage fee only applies
to any inventory that's been one of the Amazon warehouses
for more than 365 days.
Now this fee is assessed on the 15th of every month,
(rooster crowing)
and it's charged a monthly rate of $160 per cubic meter
or a monthly minimum fee of 10 cents per unit,
now, whichever fee is greater.
So it's very important to keep track
of how long items have been in the warehouse.
And if it's getting closer (rooster crowing)
to the 365 days,
you might want to save yourself possibly a lot of money
and get Amazon to return the product back
to you or dispose of it.
And Amazon will easily do that,
so they call it a hassle-free return.
And they can do either.
They charge 65 cents to 75 cents
to return it back to you per item,
depending on the size, or they can dispose it
for you for 15 to 20 cents.
Anyway, so that's all for this week.
Please go on down, leave me a comment below.
Until next week, list more, sell more.
This is Neil Waterhouse.