How to Calculate Amazon Fees
Amazon fees feel opaque because they arrive from five different directions at once. The formula is simple once each line has a name.
The formula
Net profit = (item price + buyer shipping) − referral fee − closing fee* − fulfillment − storage − returns allowance − plan fee − product cost − inbound shipping
*media items only (books, music, DVD, software, video games: $1.80/item on Amazon.com)
Each line, in order
- Referral fee — a category percentage of the total sales price (item + shipping + gift wrap), with a per-item minimum ($0.30 US / £0.25 UK). Most categories are 15%; computers 8%; a few climb to 45%. Tiered categories switch percentage bands at a price threshold.
- Closing fee — a flat per-item amount added on media categories.
- Fulfillment — FBA charges by size tier (envelope to extra-large parcel); FBM uses your own shipping cost.
- Storage — monthly per-unit cost × expected months in stock. UK rates are public (£0.76/cu ft Jan–Sep, £1.51 Oct–Dec); estimate the rest from your rate card.
- Returns allowance — worst-case expected loss: return rate × unit cost. Conservative, transparent, editable.
- Plan fee — $0.99 per item on Individual, or the Professional monthly subscription amortized over your monthly units.
Worked example: a $24.99 kitchen item on FBA
| Sale price | $24.99 |
|---|---|
| Referral fee — most categories 15% (min $0.30) | − $3.75 |
| FBA fulfillment — small parcel (estimate) | − $4.30 |
| Storage — 2 months × $0.50 | − $1.00 |
| Returns allowance — 3% × $8.00 cost | − $0.24 |
| Per-item fee — Individual plan | − $0.99 |
| Cost of goods + inbound | − $9.20 |
| Net profit per unit | $5.51 |
Roughly 41% of the sale never reaches you on this profile — which is exactly the number most sellers under-estimate. Reproduce it live in the calculator (it opens pre-filled with this example).
Break-even price, solved
Because referral is proportional to price and most other costs are fixed per unit, the break-even price is “everything except referral, divided by (1 − referral %)”. The calculator solves it numerically (handling minimums and tiered bands) and prints it next to your net profit — the fastest reality check before you commit to a product.