Almost 25 years ago, we invited third-party sellers to join us in Amazon’s store. Since then, sellers have thrived in our marketplace, and today more than 60% of sales in Amazon’s store come from independent sellers. When sellers succeed, Amazon succeeds, and we invest heavily in helping them continue to grow their businesses.
But in recent years, there have been some myths about costs or requirements to sell in our marketplace, so we wanted to share how it all really works for independent sellers and why so many of them choose to partner with us to benefit their bottom lines.
No matter where they do business—with Amazon, in brick-and-mortar retail stores, through their own direct-to-consumer channels, or with other online stores—sellers rely on a variety of services to succeed. They need storage, product placement, order fulfillment, shipping, advertising, customer service, payment processing, fraud prevention, and more.
"Amazon's definitely the best bang for the buck."
Craig Leslie
The Bean Coffee CompanySellers have many options for all of these services, and each business has to decide which work best for them. Many companies—like Amazon—offer services that sellers can use in multiple channels, whether or not they choose to sell on any particular marketplace. The fact is, sellers frequently choose the products and services Amazon offers (whether they’re selling on Amazon or not) because they work well and provide strong value.
Here’s how it works.
Amazon’s low selling fees allow businesses to sell in a trusted, global store with features to help drive their growth.
There are only two types of required costs for selling at Amazon: selling plan fees and referral fees.
Selling plans: Amazon offers two selling plans, and sellers can switch between them or cancel at any time. An individual plan is free to use and costs $0.99 per item sold. A professional plan is $39.99 per month with no additional fee per item sold, and includes tools and services that boost sales and growth, including additional branding, marketing, pricing, and inventory management support.
Referral fees: Referral fees vary by product category, but are transparent and average about 15% or less of the item price, with a minimum of $0.30 per item. For some product categories, these referral fees are as low as 5% of the item price.
These mandatory costs give sellers access to a huge number of innovative, built-in benefits, including listing and inventory features, sales dashboards, and customer insights, and the ability to engage with new and existing customers. And they get the benefit of selling with a brand that customers consistently rank as one of the most trusted.
Compared to other sales channels, Amazon’s low fees leave more money for sellers to cover costs and make a profit. For example, Amazon referral fees leave sellers with about 85% of the sale price, while wholesalers leave sellers with just 38-75%. And for those who want to sell in traditional brick-and-mortar stores, just getting a product onto the shelves of a grocery or big-box store can run as high as $1,000 per store.
Amazon typically updates its fees annually, and we’re always looking for ways to improve them for sellers. For 2024 we had one of our lowest-ever fee increases, even during a high-inflationary environment when competitors aggressively raised their prices. And for 2025, we’ve announced that we’re not introducing any new fee types or increasing referral fees, and we’ll decrease some fees and add new benefits to further support sellers and new selection growth.
Other than these two required costs, sellers control their cost of selling in the Amazon store by selecting which, if any, optional add-on programs, tools, and services are right for their business.
“Amazon fees for me are, I think it's about a straight 10%. It's really not bad at all. And…the shipping discounts from Amazon offset those fees…The fees at Amazon are net-net less than I pay on other venues."
Matthew Beaudoin
Mystic KnotworkShipping and logistics are often less expensive with Amazon than with competitors.
One of our popular optional services is Fulfillment by Amazon (FBA), where sellers send their products to Amazon, and we store, pick, pack, and ship these products to customers, as well as handle customer service and returns. When sellers use FBA and place items within our fulfillment network, customers get fast, reliable shipping. These fast speeds drive increased conversion and sales for sellers, which can be a powerful growth accelerator.
Even more impressive is that FBA costs an average of 70% less per unit than other U.S. major carriers’ two-day shipping options. As a result, many sellers choose to use FBA for its great value, and because they know we’re always innovating to find even more ways to be efficient, save sellers money, and add more value. For example, we are constantly improving shipping speeds to get products to customers faster and in turn help drive more sales for sellers. And, we’re not increasing FBA costs for 2025.
However, sellers can always choose to ship their own products using competing services, and in fact, they frequently do. This year, more than 60% of U.S.-based sellers that had a sale in our store handled shipping and fulfillment for some or all of their orders themselves. Sellers who use these other shipping services can also obtain a Prime badge for their products through our Seller Fulfilled Prime program, so long as they can consistently get shipments to customers in time to meet our customers’ expectations for Prime delivery.
"We run the math a lot…we typically find that Amazon can do it much more efficiently than we can from a shipping and a warehousing standpoint. So just from a financial perspective, the FBA program continues to make sense for us."
Richard Palmer
eleeo BrandsThe affordability and effectiveness of Amazon advertising helps drive a greater return on sellers’ investments.
Most businesses, regardless of where they sell, advertise their products to build customer awareness of their products and increase sales. Advertising is helpful to businesses of all sizes, especially small businesses, start-ups, and newer brands that don’t yet have the customer recognition of more established brands.
Amazon advertising helps businesses easily create, manage, measure, and optimize cost-per-click campaigns using self-service and highly automated campaign tools with rich reporting and analytics. According to a 2022 benchmarking report, sellers and other advertisers using our Sponsored Products ads spent 13-79% less per click compared to alternatives, noting that “Amazon compares favorably not only with Google and Facebook, but also other major players like Instagram and LinkedIn, as well as close competitor Walmart.”
Advertising on Amazon also helps sellers reach customers that are searching and browsing in Amazon’s store and are already considering buying a product. Sellers set their own bids and budgets for their advertising campaigns, helping ensure sellers stay in control and don’t overspend on unproven advertising.
"We use every type of e-commerce advertising channel that there is…we analyze the different returns on advertising from each of those metrics, and for us, nothing's better than Amazon."
Shawn McGowen
Leather HoneyOur success at Amazon depends upon the success of the sellers in our store.
More than 60% of sales in Amazon’s store come from independent sellers—most of which are small and medium-sized businesses—and attracting and retaining sellers is incredibly competitive. And in 2023, more than 10,000 independent sellers surpassed $1 million in sales in Amazon’s store for the first time. We’re proud that so many sellers choose Amazon, and that they are doing so well by selling in our store.
When it comes to providing powerful services for sellers at competitive prices to help them succeed, the number of sellers that choose to sell on Amazon when there are so many other options available, and how well sellers are doing by selling in Amazon’s store, speak for themselves.
We invite you to learn more about the facts and figures and read more stories about the experiences of the small businesses selling in Amazon’s store. Check out the featured sellers in this article: The Bean Coffee Company, Mystic Knotwork, eeleo Brands, and Leather Honey.
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