Is selling on Amazon profitable anymore?
Hi Everyone,
I was looking through our recent transactions and I was shocked to see unexpected variable closing fee being charged on quite a few of our orders.
We've also found ourself in a loop that we can not get out of with advertising . No advertising means less sales. Advertising only generates 3.4 ROAS.
So for most of our sales we're being charged by Amazon alone the following fees. Let's not even get started on the oporation cost of the business and tax liabilities.
1. 18% Comission
2. FBA Fullfillment Fee per unit ( £3-6)
3. DTF
4. Variable Closing Fee for some orders
5. Advertising cost
6. VAT
I am not sure , if it's worthwile selling on Amazon anymore. Has anyone else found themselves in this situation?
It feels like we're doing all the work and Amazon takes everything in return.
1 reply
Seller_mS10UjVYuuGor
Only you can answer your own question. Every seller has different circumstances, costs, competition etc etc.
Run your numbers, see if you can put your prices up or cut any of your costs and run the numbers again. See if registering for VAT even if you're under the threshold would be beneficial (aasuming you're UK based and not already registered). If it stacks up great, if not its time to either move on or perhaps accept the level of sales you get without ads on Amazon and try moving your advertising budget elsewhere.
Amazon provide a platform with lots of potential customers but that doesn't guarantee it will work for every business.