If you’re looking to start shipping products to Amazon FBA, the best way to get started is by using the Amazon FBA Calculator. This tool will help you understand the process of shipping products to Amazon and optimize your shipping costs. The calculator can also help you figure out which items to ship and what shipping costs will apply. In this article, we will explain how to use Amazon FBA calculator. So let’s get started.
What Is Amazon FBA?
Retailers looking to sell their products at the Seller Central platform on the biggest eCommerce marketplace in the world have to choose between two options to fulfill their orders. The Fulfillment By Merchant (FBM) option allows sellers to brand, package, and ship the products while using Amazon’s platform to gain more exposure. However, the sellers looking to outsource the fulfillment duties should look no further than the FBA method provided by Amazon.
Fulfillment By Amazon (FBA) is one of the two primary fulfillment methods for retailers who wish to sell their products on Amazon’s platform. Amazon charges several fees for utilizing its FBA service. However, that is well worth the price, considering that Amazon takes care of storing, handling, packaging, shipping, and even customer service on the sellers’ behalf.
Amazon is the biggest online marketplace in the world, with a shopping 300+ million customers by the end of the year 2022, and prospective sellers are set to gain instant access to this in-built customer base if they decide to start selling on the platform. Therefore, it is a no-brainer that ambitious retailers prefer to use Amazon FBA to let Amazon fulfill their orders. In contrast, they use their energies and money to strengthen their brand and promote their products.
Another advantage FBA possesses over FBM is that it allows the seller access to Prime Badge, an Amazon privilege exclusive to FBA sellers. Buyers at Amazon usually prefer sellers who display their Prime Badges on their Seller Central profiles, which significantly impacts their decision-making during shopping.
What Fees Does Amazon Charge For Using FBA?
Amazon charges several fees for using its FBA service. These are:
- Fulfillment Fee This
This fee is charged for handling and shipping the product on the seller’s behalf.
- Storage Fee
Amazon charges a per-month storage fee based on each item’s size. This fee can fluctuate due to various factors, especially during holidays.
- Long-Term Storage Fee
For those products which have been gathering rust at Amazon warehouses for more than a year (365 days), Amazon demands a long-term storage fee.
- Disposal Order Fee
If a particular item (or items) is not selling, you can pay a one-time disposal fee to have Amazon remove those items and save you the storage fees.
- Removal Order Fee
Sellers can also pay a removal order fee to have their unsold inventory returned to them by Amazon.
- Unplanned Service Fee
Once an item has been sent to an Amazon Warehouse, but you want to modify its labels or other details, Amazon will do that for a fee.
- Return Processing Fee
Amazon receives items returned by dissatisfied customers, and the sellers also have to pay the fees for those returns.
What is Amazon FBA Calculator?
Amazon FBA fees can be a bit confusing for newer retailers to wrap their heads around. But fear not; Amazon has conveniently created an FBA Calculator to help sellers calculate fees when using the FBA service. This Fulfillment By Amazon Revenue calculator tool allows sellers to calculate margin potential.
This tool is ideal for sellers who are trying to hunt new products to sell on Amazon (which is every seller on Amazon), as it allows them to understand how much they much Amazon fees they would be paying per unit, as well as get an inkling of the expected profits that could be made if the product listing proves successful. That information enables sellers to figure out the lowest price they need to break even, the possible advantages of a price hike, and the least-required budget cost range they need to get the project up and running.
Amazon Revenue Calculator also provides a side-by-side comparison of overall costs and possible profit margins between FBM and FBA, which is very helpful for sellers still determining which fulfillment method will be more profitable.
How To Use Amazon FBA calculator?
Accessing the FBA fee calculator tool is easy. Log on to your Amazon Seller Account, and choose the Revenue Calculator option. You can also access the FBA revenue calculator here.
After you gain access to the Amazon Seller calculator tool, here is how you can use the tool for your advantage:
- First, you need to search for the product you want to research using that product’s ASIN, ISBN, or EAN code.
- Once you’ve searched the product and opened its details, input any value in the item price box to get a sense of the expected price range and profit margins you can expect at that price.
- Next, head to the ‘Ship to Amazon’ section to figure out the average shipping cost per unit to Amazon. This cost varies wildly, depending on the size, weight, and total quantity of the product(s) being shipped. Experienced sellers know what charges they might have to pay to have their items sent to Amazon’s warehouses. Newer sellers should experiment with this field to understand how shipping to Amazon works.
- The final cost you can calculate using Amazon’s tool is the Cost of the Product. This is the per unit cost you should pay to buy the product from the supplier or manufacturer. Enter a price that you believe will cover all expenses, including labeling, packaging, shipping (which will most likely be overseas), and customs fees. There might be unspecified costs accrued along the way, so factor them into this cost.
- Final Result, now hit the calculated right at the bottom of the screen to see the magic happen. The FBA revenue calculator tool will factor in all the data you just input to generate data about revenues, costs, net margins, and net profits. These results are the total fulfillment costs based on the prices you just provided.
Most importantly, these results will also display the total fulfillment costs Amazon charges for the Fulfillment by Amazon (FBA) method, which will help you immensely decide whether you want to opt for FBM or FBA form to fulfill your orders.
How to use Amazon FBA calculator to decide on a reasonable price?
Amazon fee calculator has been designed not just to help sellers determine which type of fulfillment better serves their purpose but also to help them with nailing down the winning pricing strategy for their products. If you need help with how to do that, let us help you with the following data.
This data clearly shows how much net profit (or lack thereof) you stand to make with the given item price and the cost of the product. Feel free to lower or hike the item price while keeping in mind the overall profitability, to figure out the pricing sweet spot for your product listings.
Amazon FBA Calculator Chrome Extension
FBA calculator The Chrome extension is the best way to estimate costs and profits because it gives you the following:
- Fees for monthly storage – Fees for shipping
- Referral Fee (Amazon’s commission)
- Total FBA Fees
- Profit Per Unit
- Net Margin
- Return on Investment (ROI)
- Estimated Monthly Profit
This ultimate seller’s tool also shows how much each item weighs and how big it is. It also lets you think about how much your product costs, how much it costs to ship, and how much it costs per click so that you can estimate your specific supplier immediately.
Amazon FBA Calculator Not Working
If you’re experiencing issues with the Amazon FBA (Fulfillment by Amazon) calculator not working, there are several potential causes and solutions to try:
- Clear your browser cache and cookies: Sometimes, temporary files and cookies can interfere with the functioning of websites, including the FBA calculator. Try clearing your browser cache and cookies and refreshing the page.
- Check your internet connection: A poor internet connection can cause the calculator to load slowly or not at all. Check your internet connection to ensure it is stable and strong.
- Try using a different browser: Sometimes, certain browsers may not work well with certain websites. Try accessing the FBA calculator using a different browser to see if that resolves the issue.
- Update your browser: Make sure you have the latest version of your browser installed, as outdated versions may not be compatible with the FBA calculator.
- Contact Amazon Seller Support: If none of the above solutions work, contact Amazon Seller Support for assistance. They may be able to provide further troubleshooting or help resolve any technical issues with the calculator.
Is Amazon FBA Calculator Free?
Yes, Amazon FBA (Fulfillment by Amazon) calculator is free to use. It is a tool provided by Amazon to help sellers calculate the fees and profits associated with using the FBA service.
The FBA calculator takes into account various factors such as the item’s size, weight, category, and the fulfillment fees charged by Amazon. By inputting this information, sellers can get an estimate of their net profit margins and determine the selling price they need to set to make a profit.
Sellers can access the FBA calculator through their Amazon seller account dashboard, and there is no cost associated with using the tool. However, keep in mind that FBA fees may vary by marketplace and can change over time, so it’s important to double-check the fees and costs associated with your products regularly.
Which Fees Are Not Calculated By Amazon FBA Calculator?
- Returns processing fee
- Long-term storage fee
- Unplanned service fee
- Removal order fee
How Important Is It To Use An FBA Calculator?
While it is not necessary to use Fulfillment By Amazon revenue calculator to sell a product on Amazon, the data it provides is precious. Sellers get to determine the overall profitability of their items, determine whether FBM or FBA is well-suited for their business strategy, and figure out a perfect pricing strategy for their products.
With this many advantages, it is almost a form of criminal neglect for any aspiring Amazon seller not to use this ultra-useful tool.
What Is A Good Profit Margin On Amazon?
Profit margins vary depending on each product niche. However, a profit margin of 15-20% across all product categories on Amazon is considered very healthy.
How Do I Calculate My Amazon Profit?
To calculate your overall profit on Amazon, you need to consider the cost of manufacturing/procurement of products, marketing costs, and fulfillment costs and then compare those costs against the per unit cost of your product.
If this sounds too complicated, use Amazon Revenue Calculator to find out how profitable you are likely to be, all things considered.
Amazon is not the most extensive online marketplace on planet Earth by fluke. There are a lot of methods behind this particular madness. It is in Amazon’s interest that customers get the best possible shopping experience on the platform. The sellers also have the tools to maximize their gains and develop the perfect business strategies on Amazon.
One of those tools is the FBA revenue calculator Amazon. This tool is beneficial in enabling prospective sellers to calculate the fulfillment fees if they wish to use Amazon’s platform for either FBM or FBA. It also provides confused sellers with enough data to help them choose between the two fulfillment services offered by Amazon. If that is not enough, the Fulfilment by Amazon Revenue calculator also helps sellers decide the best possible price to charge for their products. With these many advantages, every Seller Central subscriber must be well-acquainted with this ultra-useful tool to enable them to grow their brand many-fold.
If you have any questions about Amazon selling, including the fulfillment process, business strategies, choosing the best management and analytics applications for your E-Commerce business, FBA vs FBM, or any other topics related to the world of Amazon, feel free to post your queries on Amazon Seller Forum. Our community of E-Commerce experts is available to help you find the answers you need.