We know that Amazon’s referral fees are here for a reason. They cover Amazon’s cost for benefits such as access to their marketplace, processing of credit cards, and use of customer support.
Amazon does reassess their referral fees annually based on industry cost, seller feedback and, of course, their bottom line.
On February 19, 2019, there will be some significant changes in the Referral Fee Percentages that will affect how you should reprice certain items.
It is important to note that sellers pay either the per-item minimum referral fee OR the referral fee (as a percent), whichever is greater.
Minimum Referral Fees
The first change is the drop of the Applicable Minimum Referral Fee from $1 to $0.30 on most categories*. This change is beneficial for those who were selling items in these select categories under $6.67.
*does not include watches and jewelry where the original minimum referral fee was $2.
Amazon Referral Fee by Category – Progressive Charges
In the following categories, the percentage charges are now progressive. This means there is a different fee on the portion of the price above a certain amount.
Furniture & Decor
Referral fee percentages were previously 15%. This will change to 15% for the portion of the sales price up to $200 and 10% for any portion of the sales price above $200 (excluding mattresses which are charged just 15% on all sale prices).
For example: Take a $202 chair. You will pay 15% on the first $200 which is $30. Plus 10% on the $2 above 200 which is $0.20. Total Referral Fee= $30.20
Referral fee percentages were previously 20%. This will change to 20% for the portion of the sales price up to $250 and 5% for any portion of the sales price above $250.
For example: Take a $255 necklace. You will pay 20% on the first $250 which is $50. Plus 5% on the $5 above 250 which is $0.25. Total Referral Fee= $50.25
Pay Close Attention
This next change is where things get a little more complicated. Because the new referral fees are using a tiered system, there are some price ranges where you will get less money due to increased fees after a certain price point.
Baby AND Beauty AND Health & Personal Care (including Personal Care Appliances) Categories
Referral fee percentages will be 8% for products with a price up to $10.00 and 15% for products with a price above $10.00
Example: a $10 item with 8% fee the seller will net $9.20, at $10.01 with a 15% fee the seller will net $8.51. Sellers should to sell between $10.01 and $10.82.
Grocery & Gourmet Food
Referral fee percentages will be 8% for products with a price up to $15.00 and 15% for products with a price above $15.00. The range where sellers should not sell is between $15.01 and $16.24.
Shoes, Handbags & Sunglasses
Referral fee percentages will be 15% for products with a price up to $75.00 and 18% for products with a price above $75.00. The range where sellers should not sell is between $75.01 and $77.75.
With the tiered fees becoming more and more common, shouldn’t you be with a repricer that will do everything possible to make sure you get the most out of your listings? Along with identifying and repricing around these “No Sell Zones”, Seller Snap’s proprietary software maximizes your profits while maintaining your Buy Box share. As well as being a premium repricer, Seller Snap provides advanced analytics and business intelligence for your store. Try out Seller Snap’s AI Game Theory Repricer now for free!