Amazon is a popular online platform where millions of sellers sell their products. If you are one of them, it is important that you know how to calculate your earnings and maximize your profitability. In this article, I'll explain how to do it and provide you with some useful resources, such as the Amazon calculator.
Calculating your Amazon earnings is a relatively simple process that involves deducting the costs of products sold and Amazon fees from your income. Here are the steps you should follow to calculate your Amazon earnings:
- Calculate the costs of the product sold. The first step is to calculate the costs of the products you sold. This includes the cost of the product itself, shipping and any other fees associated with the product, such as import costs or the pickup and handling (P&H) fee. These costs vary by product, supplier and location, but it is important that you calculate them accurately so that you can determine your profit margin.
- Determine Amazon's fees. Amazon charges a fee for selling on its platform. The fees vary depending on the type of product you sell and the selling plan you choose. Amazon offers two selling plans: the individual seller plan and the professional seller plan. The selling fee for the individual seller plan is $0.99 per item sold, while the selling fee for the professional seller plan is $39.99 per month. In addition to the selling fee, Amazon also charges a referral fee which is a percentage of the final selling price. This fee varies by product category, but is typically 15% for most products.
- Calculate your net revenue. Once you calculate the costs of products sold and Amazon fees, you can calculate your net revenue. To do this, subtract the costs of products sold and Amazon fees from your gross revenue. For example, if you sold a product for $100 and your costs were $40 (including shipping costs), and Amazon's fees were $20, your net income would be $40.
Now that you know how to calculate your Amazon earnings, it's important to know how to maximize your profitability. Here are some useful tips on how to do it:
- Set competitive prices. Price is an important aspect of selling products on Amazon. Make sure you set competitive prices so you can attract more buyers. To do this, research the competition and set prices that are comparable or better than theirs.
- Optimize your product listings. Optimizing your product listings is an effective way to increase your sales. Make sure your listings are accurate, detailed and attractive so you can attract more buyers. Include high quality images, detailed descriptions and accurate product specifications.
- Uses the Fulfillment by Amazon. (FBA) program Fulfillment by Amazon is a program in which Amazon takes care of warehousing
Below are some useful links from Amazon that can help you calculate your profits and maximize your profitability:
Amazon Profit Calculator: This tool allows you to calculate your Amazon profit, including product cost, Amazon fees, and any other costs associated with the sale. https://sellercentral.amazon.com/hz/fba/profitabilitycalculator/
Amazon Selling Rates: This page shows you Amazon's selling rates for each product category and selling plan.
https://sellercentral.amazon.com/gp/help/external/200336920
Fulfillment by Amazon (FBA) Program: This program allows you to ship your products to Amazon's warehouses and they take care of storage, shipping and customer service.
https://sell.amazon.com/fulfillment-by-amazon
