To move forward in any goal requires action. What have you done today to reach your dreams?
Amazon fees are high.
If you owned a brick and mortar store you would have to pay monthly: rent, utilities, employees, insurance, advertising & marketing, inventory, and many more little things that all add up to big expenses.
Amazon fees are peanuts compared to owning a brick & mortar store. Seriously.
In all honesty, I wish Amazon would just take a simple percentage in fees. At least it would be easier to calculate. I had to develop a little system to estimate my fees while out sourcing. I'm going to share my system with you today.
My system is based on a pro seller's account. If you have an individual seller's account, you will need to add 0.99 cents to your estimation. Beware that once you sell over 40 items a month, you're literally giving your money away to Amazon. Let's say you sell 80 items as an individual seller. You just gave $40 to Amazon. That's $40 you could have kept in your own pockets! Nuff' said.
I primarily source for small, lightweight products. This keeps my fees and shipping weight to a minimum. If you are sourcing oversized items, then check the FBA fees page in Seller Central.
Standard Media:
$1.02 + weight handling + 15% of sale price
When you consider weight, you need to consider both weight handling and inbound shipping. I round up to 0.50 cents (easier to calculate and gives me a little wiggle room).
$2.52 + 15% of sale price
Since I'm round up on weight handling / shipping, I could easily round down to $2 for simpler and quicker calculation.
$2 + 15% of sale price
Small, Lightweight Products (Standard Sized, Non Media):
$1.02 + $1.00 + weight handling + 15% of sale price
Example for product that is 1 lb. or less: $3.02 + 15% of sale price
Add $1 for each additional pound (keeping inbound shipping in mind)
Since I'm rounding up on weight handling / shipping, I could easily round down o $3 for simpler and quicker calculation.
$3 + 15% of sale price
Evernote Notes (Best. App. Ever.)
I keep the following notes on Evernote to help me make quick estimations (and remember, it's an estimate, not a perfect number):
Standard Media: $2 + 15% of sale price
Standard, Non Media: $3 + 15% of sale price (+$1 per lb. after 1 lb.)
Explanation of the Following - I've calculated the maximum cost of goods in order to take a certain amount of profit based on a specific price point. You can choose to lower the profit amount by either lowering the price point, or paying more than the listed max for the product. You can also up the price by a dollar or a few dollars. This is just a guide to quickly determine the potential profit you could make. Keep in mind that you want wiggle room to lower your price and get out of a product that is a bust. I keep this in my notes as a reference.
Standard, Non Media, 1 lb. or less (subtract $1 from profit for every lb. over 1)
Price Point: $35.00
COSG Max: $6.75 ($11.75)
Profit: $20 ($15)
Price Point $30.00
COSG Max: $7.50 ($10.00)
Profit: $15 ($12.50)
Price Point: $25.00
COSG Max: $6.25 ($9.00)
Profit: $12 ($9)
Price Point: $20
COSG Max: $4.00 ($7.00)
Profit: $10 ($7)
Price Point: $15
COSG Max: $2.75 ($4.75)
Profit: $7 ($5)
Price Point: $7.99-$10
COSG Max: $1 or less
Profit: $2-4
Amazon fees are high.
If you owned a brick and mortar store you would have to pay monthly: rent, utilities, employees, insurance, advertising & marketing, inventory, and many more little things that all add up to big expenses.
Amazon fees are peanuts compared to owning a brick & mortar store. Seriously.
In all honesty, I wish Amazon would just take a simple percentage in fees. At least it would be easier to calculate. I had to develop a little system to estimate my fees while out sourcing. I'm going to share my system with you today.
My system is based on a pro seller's account. If you have an individual seller's account, you will need to add 0.99 cents to your estimation. Beware that once you sell over 40 items a month, you're literally giving your money away to Amazon. Let's say you sell 80 items as an individual seller. You just gave $40 to Amazon. That's $40 you could have kept in your own pockets! Nuff' said.
I primarily source for small, lightweight products. This keeps my fees and shipping weight to a minimum. If you are sourcing oversized items, then check the FBA fees page in Seller Central.
Standard Media:
$1.02 + weight handling + 15% of sale price
When you consider weight, you need to consider both weight handling and inbound shipping. I round up to 0.50 cents (easier to calculate and gives me a little wiggle room).
$2.52 + 15% of sale price
Since I'm round up on weight handling / shipping, I could easily round down to $2 for simpler and quicker calculation.
$2 + 15% of sale price
Small, Lightweight Products (Standard Sized, Non Media):
$1.02 + $1.00 + weight handling + 15% of sale price
Example for product that is 1 lb. or less: $3.02 + 15% of sale price
Add $1 for each additional pound (keeping inbound shipping in mind)
Since I'm rounding up on weight handling / shipping, I could easily round down o $3 for simpler and quicker calculation.
$3 + 15% of sale price
Evernote Notes (Best. App. Ever.)
I keep the following notes on Evernote to help me make quick estimations (and remember, it's an estimate, not a perfect number):
Standard Media: $2 + 15% of sale price
Standard, Non Media: $3 + 15% of sale price (+$1 per lb. after 1 lb.)
Explanation of the Following - I've calculated the maximum cost of goods in order to take a certain amount of profit based on a specific price point. You can choose to lower the profit amount by either lowering the price point, or paying more than the listed max for the product. You can also up the price by a dollar or a few dollars. This is just a guide to quickly determine the potential profit you could make. Keep in mind that you want wiggle room to lower your price and get out of a product that is a bust. I keep this in my notes as a reference.
Standard, Non Media, 1 lb. or less (subtract $1 from profit for every lb. over 1)
Price Point: $35.00
COSG Max: $6.75 ($11.75)
Profit: $20 ($15)
Price Point $30.00
COSG Max: $7.50 ($10.00)
Profit: $15 ($12.50)
Price Point: $25.00
COSG Max: $6.25 ($9.00)
Profit: $12 ($9)
Price Point: $20
COSG Max: $4.00 ($7.00)
Profit: $10 ($7)
Price Point: $15
COSG Max: $2.75 ($4.75)
Profit: $7 ($5)
Price Point: $7.99-$10
COSG Max: $1 or less
Profit: $2-4
No comments:
Post a Comment
Hey there! I'd love to hear what you have to share about FBA, but please keep your spam out of it. Thanks for reading and commenting!