Amazon is always making changes to Seller Central. That you can count on. Over the last few months, there have been some significant changes that Sellers should be aware of and how they affect you.
Amazon charges Sellers a 15% referral fee to sell their item on Amazon. In addition, Amazon charges an FBA (Fulfilled by Amazon) fee which enables your product to be Free 2 Day Prime Shipping.
Those fees increased as of February 19, 2019. There are now more tiers and anything over 10 oz increased by anywhere from $.07 per unit to $.17 per unit. We suggest brands and sellers look at their costs and weights closely. This is also good planning for new products to launch on Amazon.
| Before February 19, 2019 | February 19, 2019, and after | Before February 19, 2019 | February 19, 2019, and after | |
| Size tier | Shipping weight | Packaging weight | Fulfillment fee per unit | Fulfillment fee per unit |
| Small standard | 10 oz or less | 4 oz | $2.41 | $2.41 |
| 10+ to 16 oz | $2.48 | |||
| Large standard | 10 oz or less | 4 oz | $3.19 | $3.19 |
| 10+ to 16 oz | $3.28 | |||
| 1 to 2 lb | 4 oz | $4.71 | $4.76 | |
| 2 to 3 lb | 4 oz | $5.09 | $5.26 | |
| 3 lb to 20 lb | 4 oz | $5.09 + $0.38/lb above first 3 lb | $5.26 + $0.38/lb above first 3 lb | |
| Small oversize | 70 lb or less | 1 lb | $8.13 + $0.38/lb above first 2 lb | $8.26 + $0.38/lb above first 2 lb |
| Medium oversize | 150 lb or less | 1 lb | $9.44 + $0.38/lb above first 2 lb | $9.79 + $0.39/lb above first 2 lb |
| Large oversize | 150 lb or less | 1 lb | $73.18 + $0.79/lb above first 90 lb | $75.78 + $0.79/lb above first 90 lb |
| Special oversize | N/A | 1 lb | $137.32 + $0.91/lb above first 90 lb | $137.32 + $0.91/lb above first 90 lb |
In addition to FBA fees, Amazon charges a referral fee to list on Amazon.com. This fee is typically a percentage of the unit price for the item. In the past, most categories were around 15%. Here are the categories that changed as of February 19, 2019.
| Before February 19, 2019 | Referral Fee Minimum | February 19, 2019, and after | Referral Fee Minimum | |
| Baby | 15% | $1.00 | 8% for products with a price up to $10.0015% for products with a price above $10.00 | $0.30 |
| Electronics | 15% for the portion of the total sales price up to $100.008% for any portion of the total sales price greater than $100.00 | $1.00 | 15% for the portion of the total sales price up to $100.008% for any portion of the total sales price greater than $100.00 | $0.30 |
| Music | 15% | -- | 15% | -- |
| Musical Instruments | 15% | $1.00 | 15% | $0.30 |
| Office Products | 15% | $1.00 | 15% | $0.30 |
| Outdoors | 15% | $1.00 | 15% | $0.30 |
| Personal Computers | 6% | $1.00 | 6% | $0.30 |
| Sports (excluding Sports Collectibles | 15% | $1.00 | 15% | $0.30 |
| Tools & Home Improvement | 15%, except 12% for base equipment power tools | $1.00 | 15%, except 12% for base equipment power tools | $0.30 |
| Toys & Games | 15% | $1.00 | 15% | $0.30 |
| Unlocked Cell Phones | 8% | $1.00 | 8% | $0.30 |
| Everything Else³ | 15% | -- | 15% | $0.30 |
| Automotive & Powersports | 12%, except 10% for tires and wheel products | $1.00 | 12%, except for 10% for tires and wheel products | $0.30 |
| Beauty | 15% | $1.00 | 8% for products with a price up to $10.0015% for products with a price above $10.00 | $0.30 |
| Clothing & Accessories | 17% | $1.00 | 17% | $0.30 |
| Grocery & Gourmet Food | 15% | -- | 8% for products with a price up to $15.0015% for products with a price above $15.00 | -- |
| Health & Personal Care (including Personal Care Appliances) | 15% | $1.00 | 8% for products with a price up to $10.0015% for products with a price above $10.00 | $0.30 |
| Industrial & Scientific (including Food Service and Janitorial & Sanitation) | 12% | $1.00 | 12% | $0.30 |
| Jewelry | 20% | $2.00 | 20% for the portion of the total sales price up to $250.005% for any portion of the total sales price greater than $250.00 | $0.30 |
| Luggage & Travel Accessories | 15% | $1.00 | 15% | $0.30 |
| Shoes, Handbags & Sunglasses | 15% for products with a total sales price of up to $75.0018% for products with a total sales price above $75.00 | $1.00 | 15% for products with a total sales price of up to $75.0018% for products with a total sales price above $75.00 | $0.30 |
In addition to these fees, Amazon charges long term storage fees. Warehouse space is expensive! In the past, they have only charged long term storage fees twice a year, in February and August. That changed as of February 15, 2019. Long term storage fees are charged on units that have been in an Amazon Fulfillment Center for more than 365 days. We agree that there should be an incentive for brands to move inventory and not house old inventory for years.
What’s the Charge?
As of February 15, 2019, Amazon will charge a fee of $6.90 per cubic foot for inventory that has been in their fulfillment center for 365 days or more on the 15th of every month.
Amazon has definitely increased their focus on advertising on Amazon over the last 2-3 years. In 2019, there are new features not available last year.
Dynamic bids allow sellers to bid up or down based on the likelihood of a sale, very much like Google optimization campaigns.
Portfolios help sellers manage their campaigns by allowing them to group campaigns together. This is particularly useful for resellers that have many brands. We use it for our customers and brands to group and evaluate types of campaigns such as ones that are using dynamic bids vs. not using dynamic bids. It’s also helpful for Sellers with multiple brands to put them into portfolios based on margins and profitability.
Amazon is a constantly evolving platform and the only certainty is that it will continue to change as their goals and objectives change. Lowering minimums on categories like grocery shows Amazon’s commitment to the grocery space.
Doing more than $10k a month on Amazon and wondering if your Amazon business is as good as it could be? Contact us and we’ll do a free audit.
