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3 Simple Tips Amazon sellers can use to cut fees

First published on Medium

Paying Fulfilment by Amazon (FBA) fees can quickly cut into your profit margin. We’ll show you three simple methods you can use straight away to lower your Amazon seller fees, but first, let’s look at how Amazon seller fees are calculated.

How are Amazon Seller Fees Calculated?

Amazon fee payments are made based on the seller’s location. This is why many factors are taken into consideration when calculating fees. Some of these factors include:

  • Order handling

  • Picking and packing of orders

  • Outbound shipping

  • Product weight handling

  • 30-day storage

  • Inbound shipping

  • Prep service

Amazon considers the above factors before finalising the fee on your product. If you’re fulfilling orders yourself, there are certain aspects you won’t be charged for, such as weight handling and storage.

How to Reduce Your Amazon Fees

1. Reduce Delivery Fees

Shipping costs can be expensive, but they can be easily reduced by;

  • Using unbranded packaging to reduce packaging costs (with the added benefit of increasing shipping speed)

  • Partnering with an #outsourced fulfilment provider like Deliverr or Easyship to reduce shipping carrier costs. These online shipping platforms help reduce shipping carrier costs for businesses selling on Amazon or Shopify.

  • Printing your labels online is also a simple yet effective way to save money if you’re shipping through Amazon. Here are some label printing options to help you out.

2. Reduce Referral Fees

While you can’t reduce the Amazon referral fees themselves, you can be strategic about which items you sell on Amazon. Use Amazon for products that have a low referral fee and use different marketplaces like eBay for things that have higher referral fees.

3. Reduce Exchange Rate Fees

Since the majority of Amazon FBA sellers drop-ship or source their products via overseas suppliers, usually, they incur excessive fees including FX and transaction fees.

Using a currency specialist will help you reduce fees every time you make an exchange or pay suppliers abroad.

If paying overseas suppliers is a big part of your business, make sure you’re comparing the rates before you make an exchange to ensure you’re not paying for more than what you should.


Click here to run a free live comparison now.