How do Amazon Sellers manage storage costs?

Hi there!

How do Amazon Sellers manage storage costs? I am a new seller and have come across an issue when trying to find products using the Amazon FBA revenue calculator. For example, when I try it with this product (silicone nipple covers; a small packaged item), I get very low storage fees and the business looks profitable. However, whenever I check products like bath floor mats, it looks literally impossible to make a profit. How do Amazon sellers manage this? My question really is, how do Amazon sellers manage to store hundreds of these floor mats with such high storage costs and still make a profit?

Thanks!

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7 replies

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Tags:FBA

7 replies

Seller_CF0URQS5DxG2u

2 years ago

In reply to: Seller_A4wDLUCkwWvwW’s post

A) i would recommend not using that tool - it doesn't tell the whole story with regards to fees, AND it pours a ton of free data into Amazon's hands & they WILL use it against you if your products are successful.

B) many old time sellers on here swear by FBM and say to never use FBA. the logic is sound if you have a place to store & pack.

C) there are 3rd party fulfillment services that are cheaper than FBA.

D) FBA fees are about to get EVEN higher in 3 days, until next year. fees are always highest at the end of the year.

simply put, the only way to succeed on FBA is to ensure your costs are low enough or your prices are high enough to absorb the fees.

Seller_rGcQW1yb6ZWbC

2 years ago

In reply to: Seller_A4wDLUCkwWvwW’s post

I don't have an answer for you becasue I am an FBM merchant, not FBA.

But, how much dioes one expect to make on an $8.99 item? Nothing at that price point would be a good FBA idea. They probably need to sell a lot of them to make it up on volume (that was a joke).The other product is a bit more realizstic as an FBA product. At least that seller is getting something.

Since you are new and are still trying tro feel your way, you may want to get some product(s) and try FBM for a little bit until you get your feet wet.

Seller_nRFmxiQg4EGrw

2 years ago

In reply to: Seller_A4wDLUCkwWvwW’s post

Seller_A4wDLUCkwWvwW

My question really is, how do Amazon sellers manage to store hundreds of these floor mats with such high storage costs and still make a profit?

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One thing to keep in mind here is that you should NEVER assume that someone is making a profit on the items you see them selling. Many sellers do not do the due diligence that you are doing, and simply find a product and send it in, not knowing that they will be losing money; often, they are taking advice from YouTube or TikTok videos that are way out of date and of questionable reliability when fresh.

On top of that, even people who do some research will sometimes go wrong; they may be pricing a product to blow it out, taking a loss that is less than the cost of removals. That is especially true now, as removal costs increased dramatically a few months ago.

There are even some people who sell for years, never realizing that they are losing money, never wondering why they are not getting paid, until Amazon bills them, in one case, for $37K.

Whether or not the tool you are using is the best, I applaud you for doing the research, and realizing that some things simply don't make sense.

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