Amazon has announced its new fee structure which has been in action since January 18, 2022.
Amazon has helped sellers as well as consumers during the pandemic by postponing and keeping fee changes low, reducing or eliminating select fees like those for customer returns, and absorbing billions of dollars in increased costs. Now that the economy is back on track; Amazon has decided to hike fees for the betterment of all.
The company emphasizes that despite fee hikes, the overall cost for the Amazon seller would be 30 percent less compared to fulfilling their orders independently.
Amazon Seller Fee Structure
Amazon sellers need to enroll in the Amazon Business Seller program to know monthly subscription fees and other Amazon seller account fees that apply to them.
Unlike other marketplaces, Amazon offers several fulfillment options with corresponding Amazon seller account fees:
1. Basic Amazon Plans: Amazon provides two basic plans: Individual Plan and Professional Plan. The seller can opt for anyone based on expected monthly sales volume.
- Individual Plan: This plan is suitable for small sellers who sell less than 40 items a month. Monthly fees do not apply to individual sellers; instead, they have to pay $0.99 for every item sold.
- Professional Plan: This plan is suitable for vendors who sell more than 40 items a month. Amazon charges a monthly fee of $39.99 to professional sellers.
2. Fulfillment by Amazon (FBA): In the FBA plan, Amazon handles operations from storing and packing to shipping and after-sales services for sellers’ products. Amazon FBA fees vary depending upon the size and start from $2.70 per unit for the non-apparel categories and $3.00 per unit for apparel inventory storage.
3. Referral Fees: Amazon deducts applicable referral fees from every product sold on Amazon. Referral fee charges depend on the product price, delivery charges, gift wrapping charges (if applicable), and product category. Approximately referral fees are about 8-15 percent of the total sales.
4. Advertising Fees: Amazon advertising is largely based on Pay Per Click (PPC) but it offers three different kinds of advertising options: Sponsored Product Ads, Sponsored Brand Ads, and Sponsored Display Ads. These advertising options provide different formats and placements of the ads depending on the marketing strategies.
Estimate Costing For Amazon Seller For 2022
- Amazon FBA fees increase by 5.2 percent approximately.
- Shipping weight for all large standard-sized products will be determined on the basis of higher unit weight or dimensional weight.
- Increase in removal and disposal fees.
- Increase in the monthly off-peak storage fee (January-September) for standard-size and oversize products.
- A surcharge will be applied on top of monthly storage fees for long-term storage fees.
- FBA Prep service fees will increase to compensate for bagging, labeling, and taping operations costs.
- The maximum weight eligible for the FBA Small and Light program will increase from 12 oz to 3 lb.
Gear Up Your Amazon Sales in 2022
Let us look at the actionable ways to increase your Amazon sales by standing out from the competitors and think out of the box marketing strategies for competing, surviving, and growing on the Amazon marketplace:
1. Optimize Product Listings: Amazon SEO services will optimize your product listings to rank better and gain visibility.
- Select relevant keywords
- Attractive product titles
- Creative and informative product descriptions
- Effective bullet points
- Leverage customer reviews and ratings
- High-quality product images
2. Creative A+ Content: A+ content, also known as Enhanced Brand Content, is a feature that is only available to Amazon Brand Registered Professional Sellers.
- High-quality descriptive and informative images of your products
- Clear and scannable product features, specifications, and benefits
- Comparison charts to make proper buying decisions
3. Optimize Amazon Brand Store: Amazon Brand Store is a small, customizable version of the Amazon website solely for your brand.
- Craft a compelling brand story
- High-quality images and videos
- Optimize your store for mobile
- Keep your design simple
4. Use Amazon Posts: Amazon Post is a feature similar to social media posts that allows a product image and a relevant caption.
- Visually attractive background
- Avoid collaged images
- Avoid over text and informative images
- Create unique product captions
5. Amazon PPC Advertising: One of the key sales drivers on Amazon is PPC advertising:
- Identifying target audience
- Determining suitable Sponsored ad type
- Use advanced long-tail and top-performing keywords
- Setting competitive bids
6. Promote on Social Media and Google Ads: Amazon Brand Registered Professional Sellers can earn back referral fees on off-channel ads that drive sales on Amazon. This is enabled by the Amazon Attribution and Brand Referral Bonus Program.
- Sellers can generate codes using Amazon Attribution for Google Shopping ads, Social Media ads, emails, and more.
- Viewers click on the ad which results in a sale, and 10 percent of the sale will be credited back to the seller.
- Sales from the brand, which is received within 14 days after the ad is clicked, will get 10 percent credit from Amazon.
Establish Brand on Amazon and Boost your Sales
One should have knowledge, expertise, and experience in managing Amazon accounts and products or else it will result in a lot of spending on Amazon fees without getting the ROI. Let Sipransh Ecommgrowth manage your Amazon account and you enjoy the revenue.
