Have you heard of 6-figure Amazon sellers? selling on Amazon will make you successful and hence make you to earn more money by practicing some tactics and techniques.
But, to earn money you need to spend money. While selling on Amazon, fees are one of the business expenses that Amazon seller can’t miss out.
However, these fees are worth paying for most sellers, many tend to look for ways to reduce the Amazon seller fees.
That’s why we are here to provide the tips that help you to lower your Amazon seller fees so that you can invest that money in other aspects of your business.
HOW MUCH DOES IT COST TO SELL ON AMAZON?
Here are a few seller fees that Amazon sellers are required to pay:
There are two types of seller accounts that every Amazon seller needs to choose, which are Individual selling plan or professional selling plan.
If you sell less than 40 items per month you can opt for an individual selling plan on Amazon, and for that you need to pay $0.99 for each item you sell.
If you plan to sell 40 or more items per month, you need to opt for professional selling plan and you need to pay membership subscription fee of $39.99 per month.
The Professional plan gives you full access to Amazon’s seller services whereas individual selling plan gives limited access to sellers.
Amazon sellers need to pay a referral fee for each item sold. This fee varies by category, but is generally 8% of sale price for electronics and 15% for most other categories.
Simply, it’s a percentage of your total product price paid to Amazon after a sale is made, and that percentage differs based on the category of product being sold.
VARIABLE CLOSING FEES
This fees apply strictly to books, music, videos, DVDs, video games, consoles and software (BMVD products).
Both Individual and Pro sellers have to pay a variable closing fee for each item sold. A flat rate of $1.80 will be added on top of your referral fee.
If you are an Amazon seller who opt for fulfillment by Amazon service where Amazon handles picking and packing your orders, shipping and handling and customer service.
These fees depend on the item classification which is based on the weight and dimensions of an item being sold.
WAYS TO LOWER YOUR AMAZON SELLER FEES
Having these many fees seem overwhelming? Here are few ways to reduce your Amazon seller fees.
1. PRIORITY MAIL
If you are shipping lightweight items you can use the US post office Priority Mail option which provides you with a free box and more often than not comes out cheaper than the Flat Rate box option.
You don’t always have to use new boxes and packaging materials for packing. You can look for used boxes and packing material both offline and online.
If you’re an experienced Amazon seller, you will already have a great relationship with suppliers. To purchase products itself, you can negotiate a great amount to save lot more money.
If you send out large shipments consistently, you can negotiate for significant discounts with the courier you’ve been using.
3. CHOOSE YOUR PRODUCT CATEGORIES WISELY
As discussed above, the product categories you planned to sell will determine the referral fee you must pay.
For example, if you sell fashion items, the referral fee is up to 20 percent, while beauty products are as low as six percent and three percent, respectively.
If you need to choose categories that have relatively less referral fee, you need to sell restricted category products.
By selling restricted categories on Amazon, you can have huge opportunity to increase your sales. Those restricted category products are higher in demand and it has low competition.
But getting approval for those restricted categories is quite tedious. To make it easy, you need to opt for ungating service provider like The Funnel Guru who are experts in this field gets you ungated in any of the restricted categories. They know the hacks and procedures to get you ungated in no time.
4. INCREASE YOUR AVERAGE SELLING PRICE
By raising your Average Selling Price you will increase your profit margin and hence it will reduce your Amazon seller fees.
The more expensive your product price is, the higher your product margin. With that, always try to sell products that cost $35 and above and keep an eye on competitors pricing.
Amazon seller fees can add up and increase your cost to sell on Amazon fast. However, by considering the above stated tips you can reduce your Amazon seller fees.
Also you can cut your Amazon fees by increasing your sales. To do that, you need to ungate restricted categories by The Funnel Guru.
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