Amazon has an “FBA revenue calculator” to help sellers make decisions about how they use Fulfillment by Amazon. On Friday, it published a post showing sellers how they could use it to “remove some of the guesswork” from calculating costs and comparing FBA options.
Amazon explained, “The profit calculator generates side-by-side comparisons for various fulfillment options, whether you store, pack, and ship orders yourself, or use a service like FBA. Play around with different numbers for factors like sales price and costs for storage, shipping, and fulfillment. The calculator will then give you estimates depending on what stores you want to sell in.”
The calculator takes into account common fees like referral fees, fulfillment costs, monthly storage costs, and variable closing fees. Sellers have to use the “Miscellaneous cost” field to add their other types of expenses, such as long-term storage costs, removal order costs, and return processing costs.
Amazon also linked to its Sales Estimator calculator to help sellers with their FBA calculations. Clearly being too optimistic (or pessimistic) about future sales can provide an inaccurate picture.
While the calculator can’t determine profitability without knowing how much sellers paid for their inventory, it does have a Cost of Goods Sold field so sellers can enter the information (or they can leave it blank and continue the calculations offline).
The calculator compares FBA to other fulfillment services where there are fields for sellers to include costs such as labor, packing materials, shipping, customer service.
An Amazon Seller University video from last year explaining the calculator used an example where the seller intended to store 30 items with a $15 price tag with expectations of selling 15/month. Using Amazon FBA, the seller would see a 20.39% profit margin versus a negative 30.56% margin (a loss) – without even factoring in the cost of the goods sold.