Why Are Amazon FBA Fees So High? 6 Ways To Reduce Costs

The main types of Amazon FBA fees can be grouped into a few key areas: fulfillment, storage, referral, and additional service-related costs. Fulfillment fees are what you pay Amazon to pick, pack, and ship your products. These are charged per unit and depend on the size and weight of your product. Smaller, lighter items cost less to fulfill, while larger or heavier products cost more. These fees also cover things like customer service and returns, so Amazon manages the post-sale process for you.

You will also pay monthly storage fees for the space your inventory occupies in Amazon’s warehouses. These fees are calculated based on the cubic footage of your products and increase during the busy holiday season from October through December when warehouse demand is high. If your products sit for too long, you may be charged aged inventory surcharges that increase the longer your stock remains unsold. This motivates sellers to maintain steady inventory turnover rather than letting products sit on the shelves.

Referral fees are another major cost and act as Amazon’s commission for using their marketplace. They are calculated as a percentage of the total sales price, which varies by category, with most categories averaging around fifteen percent. On top of these, there are smaller but important fees such as return processing, labeling or prep service fees, and removal or disposal costs if you decide to take back or discard unsold products. Together, these fees cover the full range of services that Amazon provides, making it easier for sellers to focus on growing their business while Amazon takes care of the logistics.

Estimating your Amazon FBA costs takes a bit of planning, but once you understand what drives the fees, it becomes much easier to predict your profit margins. The first and most accurate way to estimate costs is by using Amazon’s FBA Revenue Calculator. This tool lets you input details like your product’s dimensions, weight, and selling price, and it automatically breaks down your fulfillment, storage, and referral fees. You can also compare FBA with FBM (Fulfilled by Merchant) to see which one is more cost-effective for your business. It’s a simple way to get a real-time estimate before committing to a product or pricing strategy.

Another smart approach is to analyze your product’s size tier and weight class since those are the biggest factors in determining fulfillment costs. Even a small change in packaging dimensions can move your product into a lower fee bracket, saving you money over time. You should also factor in monthly storage fees and seasonal surcharges that hit during the holiday season when warehouse space is in high demand. Looking at Amazon’s published rate charts or using third-party tools like Helium 10’s Profits dashboard or Jungle Scout’s FBA calculator can help you predict these expenses accurately.

Lastly, don’t forget about hidden or occasional fees like removal, disposal, or returns processing charges. If your product tends to have high return rates or moves slowly, those costs can add up quickly. By testing a few different pricing scenarios and keeping an eye on your sell-through rates, you can estimate not just your upfront FBA costs, but also the long-term impact of storage and returns. In short, the key to estimating Amazon FBA fees accurately is to combine official calculators with a realistic understanding of how your product performs in the marketplace.

Yes, there is a monthly fee for using Amazon FBA, but how it applies depends on your seller plan. If you’re on the Professional plan, you’ll pay a flat monthly subscription of $39.99, which gives you access to FBA and other selling tools like bulk listing uploads, ads, and advanced reports. It’s basically the cost of having a full seller account. If you’re on the Individual plan, you won’t pay that monthly fee, but you’ll be charged $0.99 for every item sold, which quickly adds up if you’re selling at scale.

Beyond that, Amazon also charges monthly storage fees for the inventory you keep in their warehouses. These fees depend on how much space your products take up and can increase during the busy holiday season. So while the flat monthly seller fee is straightforward, your total monthly cost for FBA can vary based on how much inventory you’re storing and how quickly it moves. In my opinion, the Professional plan is worth it for most sellers who are serious about growing on Amazon, because the monthly fee pays for itself once you sell more than forty items a month and gives you access to the full power of the FBA system.

If your products don’t sell through Amazon FBA, it can quickly become expensive and stressful because you’re still responsible for the storage costs. Amazon charges monthly fees based on the space your inventory occupies, and those fees add up the longer your items sit unsold. After 181 days, Amazon begins applying aged inventory surcharges, which can rise significantly over time. So even if your products aren’t moving, they’re still costing you money every single month just to stay in the warehouse. This is why keeping track of sell-through rates and maintaining healthy inventory levels is so important for profitability.

If your inventory continues to stagnate, Amazon gives you a few options. You can choose to remove or liquidate your products, which means Amazon will either send them back to you or attempt to sell them through liquidation channels. Both options come with per-unit fees, but they can still be cheaper than letting inventory sit and rack up long-term storage charges. Some sellers also run short-term discounts, coupons, or PPC campaigns to try to move slow stock before these fees hit. It’s a balancing act between clearing out old products and maintaining your cash flow.

In my opinion, the key to avoiding this situation is proactive inventory management. Using tools like Helium 10’s Inventory Management or Amazon’s own restock reports can help you spot slow movers early before they become a problem. If an item isn’t selling, it’s usually a signal that something needs adjusting, maybe your price is too high, your listing isn’t optimized, or the demand simply isn’t there. FBA works best when your products sell consistently because the entire system is designed for fast turnover. When inventory lingers, it stops being an asset and quickly turns into a liability.

Many sellers are surprised when their FBA fees end up higher than expected, but it usually comes down to how Amazon calculates costs behind the scenes. The biggest factor is often product size and weight. Even a slight increase in packaging dimensions or materials can bump your item into a more expensive size tier. Amazon uses the greater of the actual or dimensional weight to determine shipping costs, which means that bulky but lightweight products can still be charged as heavy items. If your packaging is inefficient or your measurements are off, those few extra inches can significantly raise your fees.

Another common reason for unexpectedly high fees is storage. Amazon charges monthly storage fees based on the amount of warehouse space your inventory occupies, and those rates go up during the fourth quarter holiday season. If your products are moving slowly, you might also be hit with aged inventory surcharges, which can rise steeply after 181 days or more. On top of that, if your sell-through rate is poor or your inventory is consistently low relative to demand, you might face extra charges like storage utilization or low-inventory-level fees. These are Amazon’s way of encouraging efficient use of warehouse space.

Finally, it is easy to overlook smaller service fees that add up over time. Things like return processing, labeling, inbound placement, and disposal or removal fees can quietly increase your total costs. Each may seem small individually, but together they can make a noticeable dent in your margins. The best way to stay ahead of these surprises is to regularly audit your FBA reports, verify your product dimensions in Amazon’s system, and use the FBA calculator to run new estimates whenever you change your packaging or pricing. Understanding how each fee connects to your product’s performance and physical profile will help you control costs and protect your profits.