The Amazon marketplace is one of the largest and most lucrative ecommerce platforms in the world. It comes with tools and features that make it easy for sellers to increase sales and grow their business. However, selling products on Amazon doesn't come cheap. There are several fees associated with selling on the platform.
In addition, failing to pay these fees may have some unpleasant consequences.
In this guide, we will look at what Amazon Seller Repay is, different types of Amazon fees, and how you can avoid incurring Amazon Seller Repay charges.
Amazon Seller Repay or Amazon Seller Repayment charges are fees that Amazon takes out of your registered credit card for unpaid charges.
Amazon has fixed charges that it automatically collects each month. This includes your Amazon Seller Account fees among other fees for programs you enrolled for.
Amazon automatically takes out fees from your account for each billing cycle. However, if your account doesn't have enough funds, Amazon tries to charge your credit card. These charges emerge as “Amazon seller repay”.
Amazon seller repayment charges can come as an unwanted surprise and may even affect your business.
Typically, Amazon Seller Repay charges are common with sellers who use the Professional Amazon Seller account.
If you have a Professional Selling account and sales have been down and you consequently can't cover the monthly subscription for your seller account, Amazon will still charge you for it through your registered credit card.
Also, Amazon will charge you for programs like Amazon FBA, Advertising, and so on.
At the end of every billing cycle, Amazon will attempt to collect charges from your account. If there are insufficient funds, Amazon will then charge your registered credit card leaving you with a seller repayment fee.
To avoid Amazon Seller Repay charges and sell successfully on the Amazon marketplace, it is important to take note of the different types of Amazon seller fees.
Here are some of the most important Amazon fees to take note of:
Amazon features two types of selling accounts:
With the Individual seller account, you pay a fee of $0.99 per Amazon sale. This is also referred to as Per-item fees. These fees are only charged after you make a sale. The Individual seller account is ideal for Amazon sellers who sell less than 40 Amazon products per month.
The Professional seller account comes at a monthly fee of $39.99 per month. With this seller account, you get access to a plethora of features and programs including advertising, Amazon seller reports, and so on. You also get access to sell in all accessible product categories.
This type of seller account is ideal for Amazon sellers that can sell more than 40 products per month.
With every Amazon product sold, Amazon charges a Referral fee. This fee is a percentage of the total price of the product and varies depending on the product category. Typically, this falls between 6% to 20%. Also, some products in certain categories incur what is called Minimum Referral Fees.
Amazon offers two fulfillment options to sellers: Fulfillment by Amazon (FBA) and Fulfillment by Merchant (FBM)
With FBM, sellers handle the entire fulfillment process. On the other hand, with FBA, Amazon handles the entire process of storing, packing, shipping, and customer service. With this service, you can focus on important areas of your business that directly impact sales and revenue, while Amazon does the rest. However, this comes at a cost.
FBA fees vary depending on a number of factors including the size and weight of your product, inventory levels, selling volume, and so on. You can check out the various Amazon FBA fees here.
For every media item sold, sellers pay a closing fee of $1.80. These media categories include Books, Amazon software, DVDs, Video Games, Music, etc.
If you have a huge number of products within Amazon's listings that you haven't sold in the past 12 months, you will need to pay for what is called “Cataloging Costs”. Amazon charges $0.005 per eligible listing. However, Amazon waves this fee for the first 100,000 listings.
If you meet the following criteria, you will be charged high-volume listing fees:
Refund Administration fees are charged when you refund a customer for an order that you already received payment for. When this happens, Amazon refunds the amount of the product’s referral fee and takes out the Refund Administration fee. This is calculated as 20% of the referral fee for the Amazon product.
While they are not part of Amazon's fees, you may also incur unexpected shipping costs if you don't charge enough based on your sales volume.
Amazon Seller Repay charges can be unexpected and may even get overwhelming. Here are some tips that can help you get around it:
To avoid unexpected charges, it is important to understand Amazon's fee structure and know which applies to your seller account.
Monitor your Payment Reports on your Amazon seller central account and assess your regular charges. Record all fees that apply to your product. This will ensure you stay up to date with all your fees.
Understanding your Amazon fee and monitoring your cash flow will help you deliver your payments on time. If you don't have enough funds to cover your fees, you can use your credit card in advance to avoid Amazon Seller Repay charges.
For many sellers, canceling your seller account may just be the easiest way to avoid incurring costs especially when you are not selling products or making profits.
While this is an easy way to avoid unexpected costs, there's a big catch.
If you decide to close your account, you will never be able to sell on the platform because Amazon doesn't reinstate closed accounts.
To sell on Amazon again, you will need to restart the entire process of setting up a seller account.
However, if you want to close your seller account, here's how:
Selling on Amazon comes with various fees which could pile up and incur unexpected charges when sales are low or you're not actively selling products on Amazon.
To avoid this, it is important to thoroughly understand the Amazon fee structure and ensure you make payments on time.