All You Need To Know About Reduce Amazon Fees:

Yes, it is possible to reduce your Amazon fees, and No, Amazon won’t give you any discount for that, but it depends on your own management and strategic skills. It depends on how you use the service to avoid any unnecessary charges.

What’s the purpose of selling if selling costs more than you even earn? To increase your profit by selling, you should know what it costs to sell on Amazon and how to lower the cost.

You can save a little on your every order and shipping through little amendments in your strategies. Multiplying that small amount by thousands of orders will make up a lot of savings.

This guide will let you know all the selling expenses on Amazon and how to reduce it.

The following are the 4 main costs Amazon sellers have to pay to sell on Amazon:

• Account fee: The primary cost for selling on Amazon is the account fee; it’sit’s a monthly fee. Amazon offers two different accounts with different fees. There’sThere’s an Amazon individual amount and a professional seller account. The individual account is free, but it’s restricted to only 40 listings and 20 categories monthly. Amazon professional account has a monthly fee of $39.99, but there’s no restriction on listings or categories.

• Sales fee: The next is the sales fee. Amazon charges sellers for the items sold. There’sThere’s a per-item fee, but it’s only for the individual account, not the professional one. The other three charges are for both the accounts, such as a Referral fee of 6-45% of the selling price (depending on the item category)—a Closing fee of $1.80 per item for media items only and a High-volume listing fee            $0.005 on items over 100,000.

• Fulfilment costs:  Fulfilment costs are often overlooked by sellers, but it’s one of the most important ones. There are a few ways of this, like you can also consider doing it on your own or using Amazon FBA. Using Amazon’s service is more recommended as it is definitely worth the cost, and you just have to drop your order at their warehouse, and the rest is their job.

• Other expenses: As we all know, Amazon is a very competitive platform, so it’s essential to keep in view other expenses needed to get your products on top. These additional charges include the following:
• PPC advertising through Amazon Sponsored Products and Brands.
• External marketing spends.
• Competing the Amazon buy box by low costs and free shipping.

How To Reduce Amazon Fees

Amazon can be a little too costly marketplace to become a seller. Still, if you work on your strategy and reduce Amazon fees as much as possible, your business profit will automatically increase. Here’s how you can do that in a few simple steps:

Select a Professional Seller Account

Zero monthly fees might sound very tempting, but if we take an overall look, it’s not the most suitable and cheapest option as it has its limitations. The individual account makes sense for beginners who want to sell under 40 items monthly. But most sellers sell above 40 items each month, so ensure to sign up for a Professional account to avoid a fee of $0.99 per item.

Also, switching to a Professional seller account gives you access to unlimited product listing and nil per-item fees. This will save your profit and give you more benefits like:

• The authority to run promotions.
• Conversion-increasing benefits.
• Sell on other Amazon sites.
• Access the buy box.

Reducing Referral Fees

There’s no way you can avoid the Amazon referral fees, but you can be strategic about the items you decide to sell on Amazon.

You should do proper research on which items or categories have a lower referral fee.

You can also use Amazon’s Referral Fee Calculator to evaluate the categories.

So by merely selecting the correct product to sell, you can save quite a few dollars in fees.

Increasing ROI

Increasing your ROI indirectly prohibits Amazon from making dents in your profits. It doesn’t directly lessen your Amazon fee but saves you a good profit.

You can increase your ROI by:

• By being on Amazon Prime and serving shoppers who prefer speedy delivery.
• By improving your conversion rates through excellent service.
• By offering your customers a smooth purchase and competing on your service rather than prices.
• By selling on different marketplaces to get more exposure.

Increasing visibility

If you improve your visibility on Amazon, there are huge chances you can also increase your profit and reduce your Amazon fee.

Here’s how you can increase your visibility:

• By optimising and working on your Amazon listings, product pages, titles and descriptions.
• By offering quick shipping options to emerge in filtered search results.
• By getting five-star ratings and good reviews because of your good service, immediate responses, on-time delivery and quick responses to all the queries.

Get unfulfillable Inventory Out Of FBA.

When any of your customers return your product, Amazon reviews the product and decides if that product is in the condition to be resold. Products not in reselling condition are termed as “unfulfillable”. Such products will remain in the fulfilment centre and collect storage fees until you take them out of there.

To know if you are paying for any unfulfillable inventory, you can check the Inventory Health report from Seller Central, check the column of unsellable items, and get them destroyed or returned to you.

Selling items in Bundles

Selling your items in bundles is also an excellent technique to earn more profit and reduce your selling fee. By creating bundles, you can also sell items that were not sellable separately. And if you sell 10 items in a bundle, you will only have to pay fulfilment fees for one item, not 10, because Amazon considers bundles as one item.

Be particular about Sending items to Amazon Fulfilment Centre.

If you send heavy items to the Amazon Fulfilment centre, you will have to pay extra because of their weight because the storage fee of Amazon Fulfilment centre depends on the product’s weight and not their price.

Try to limitate the quantity of heavy products you store because it will cut your profit when you pay extra for the product’s weight. Because Amazon charges storage fees calculated by the cubic foot, oversized items that require more space costs more to be stored in a fulfilment centre.

Conclusion

Selling on Amazon, a vast marketplace, comes with a cost, obviously. But if you work on your techniques and tactics and follow our guide, you can earn a good profit. You can reduce selling costs by acting upon our guide and increasing your visibility, conversion rates and fulfilments.