A selling price is not a margin. Before committing inventory, build a product-level view that separates revenue, product cost, Amazon charges, fulfilment, preparation, advertising and return or damage reserves. Final fees must always be checked in Seller Central and Amazon’s current fee schedule.
01
Build the unit economics in layers
Start with the total amount paid by the customer. Subtract product cost, referral fee, fulfilment or shipping, preparation, storage where applicable, VAT on Amazon fees, advertising allowance and a realistic reserve for returns or operational loss. The remaining amount is a planning contribution, not guaranteed profit.
02
Compare fulfilment methods using the same product
FBA, Easy Ship and self-shipping move different costs and responsibilities between Amazon and the seller. Compare them using the same price, product dimensions, order volume and service expectations rather than selecting a method from one fee alone.
03
Use estimates as a decision screen
An estimator is useful for rejecting weak products early and identifying assumptions that need verification. It cannot replace current Seller Central fees, tax advice, product compliance review or a real test launch.
Decision control
Decision checklist
- Is contribution positive after advertising and return reserves?
- Have category, size and fulfilment assumptions been verified?
- Can the seller fund stock and operating delays without relying on immediate payout?
Avoidable risk
Common mistakes
- Treating selling price as profit.
- Using one headline fee while ignoring preparation, storage, ads and returns.
- Committing large inventory before a limited launch test.
Practical sequence
Recommended next steps
- 01
Build a product-level unit economics sheet.
- 02
Compare fulfilment methods with the same product assumptions.
- 03
Launch with a controlled quantity and explicit review point.