Amazon FBA Fees Explained

What They Are, How Much They Cost, and How to Calculate Them Correctly

If you’ve ever looked into selling on Amazon FBA, you’ve probably heard a vague warning about “fees.”

What most guides never tell you is which fees exist, how they stack together, and how quickly they can erase profit if you don’t model them correctly.

Understanding Amazon FBA fees is not optional. It’s the difference between building a profitable business and unknowingly selling at a loss.

This guide breaks down:

• what Amazon FBA fees actually are

• how Amazon FBA costs show up in real businesses

• how to calculate Amazon FBA fees accurately

• and why most sellers underestimate them

At the end of this page, you’ll find an Amazon FBA fees calculator that lets you run the math properly before you commit capital.

What Are Amazon FBA Fees

Amazon FBA fees are the costs Amazon charges you to use their fulfillment infrastructure, customer base, and platform.

When you sell through FBA, Amazon handles storage, picking, packing, shipping, returns, and customer service. Every one of those services has a cost.

The mistake most sellers make is thinking about fees individually instead of as a system. Fees compound. Margins disappear slowly, then all at once.

The Core Amazon FBA Costs You Need to Know

Here are the major categories of Amazon FBA fees that affect profitability.

1. FBA Fulfillment Fees

This is the fee Amazon charges to pick, pack, and ship each unit.

Fulfillment fees depend on:

• product size tier

• package weight

• package dimensions

Small differences in packaging can push a product into a higher size tier, dramatically increasing Amazon FBA costs per unit.

This is one of the most common margin killers.

2. Amazon Referral Fees

Amazon charges a referral fee on nearly every sale. This is essentially Amazon’s commission for letting you sell on their platform.

Referral fees are typically a percentage of the retail price and vary by category.

This fee comes straight off the top, before you account for fulfillment, ads, or cost of goods.

3. Advertising Costs

Almost every product selling on Amazon FBA requires advertising, especially at launch.

Advertising spend is not technically an Amazon FBA fee, but it is a real cost of selling on Amazon FBA and must be included when calculating profitability.

Ignoring ad spend is one of the fastest ways to believe a product is profitable when it isn’t.

4. Inventory Storage Fees

Amazon charges monthly storage fees based on how much space your inventory occupies in their warehouses.

Storage costs depend on:

• cubic footage

• time of year (peak vs non-peak)

• standard vs oversize items

These fees are small per unit, but they compound quickly if inventory turns slowly.

5. Inbound Placement and Transportation Fees

When you send inventory into Amazon’s network, you may incur:

• inbound placement fees

• transportation fees if you use Amazon-partnered carriers

These fees often get overlooked in early calculations, even though they affect landed cost per unit.

6. Removal and Return Processing Fees

If inventory needs to be removed from FBA, Amazon charges a removal fee.

Returns also carry processing fees. While returns are unavoidable, high return rates quietly destroy margins over time.

A healthy business plans for returns instead of pretending they won’t happen.

7. Aged Inventory Surcharges

If inventory sits too long, Amazon penalizes you.

Once inventory crosses certain age thresholds, storage fees increase sharply. In extreme cases, storage costs can exceed the product’s cost of goods.

This fee exists to force sellers to manage inventory responsibly.

8. Coupon Redemption Fees

Running coupons on Amazon triggers an additional per-redemption fee, on top of the discount itself.

Coupons can increase conversion, but they must be modeled carefully. Otherwise, they reduce profit more than expected.

Why Amazon FBA Fees Feel Overwhelming

When sellers first see the full list of Amazon FBA fees, the reaction is often the same:

“How does anyone make money?”

The answer is margin discipline.

Amazon FBA is unforgiving if your gross margin is weak. Fees do not scale down just because your product economics are thin.

Gross Margin Is the Real Constraint

Gross margin is the difference between your retail price and your landed cost of goods.

If your gross margin is too low, no optimization can save you. Ads, listings, and reviews cannot overcome bad math.

As a general guideline:

• 70 percent gross margin is healthy

• 60 percent can work with discipline

• 50 percent and below becomes extremely difficult

Most sellers who struggle with selling on Amazon FBA fees are not being “overcharged.” They are under-marginized.

The Two Levers That Control Profitability

There are only two levers that meaningfully improve profitability on Amazon FBA.

Increase Retail Price

Higher retail prices increase margin, but only if:

• product quality supports the price

• listing quality supports the price

• return rates stay stable

Price increases without infrastructure usually backfire.

Lower Landed Cost of Goods

Lowering cost of goods improves margin, but quality has a floor.

Cut too far and:

• reviews drop

• returns rise

• conversion falls

The goal is not cheapest. The goal is highest quality at the lowest sustainable cost.

Why You Need to Calculate Amazon FBA Fees Before Launch

Most sellers calculate fees after they order inventory.

That is backwards.

You should calculate Amazon FBA fees at the idea stage, before you commit capital. This includes:

• referral fees

• fulfillment fees by size tier

• storage assumptions

• advertising assumptions

• landed cost of goods

This is the only way to know if a product can support profit.

Use the Amazon FBA Fees Calculator Below

At the bottom of this page, you’ll find an Amazon FBA fees calculator designed to do this math properly.

It lets you:

• estimate Amazon FBA fees per unit

• see profit before and after ads

• understand how package size and weight affect costs

• scale unit economics into total revenue and profit

Whether you already know your product or are still estimating, the calculator helps you answer the most important question:

Does this product actually make money after Amazon takes its cut?

If you want to sell on Amazon FBA profitably, this is where every decision should start.