Amazon is an attractive sales channel for many e-commerce entrepreneurs. A large reach, logistics handled through FBA, and access to millions of shoppers across Europe. But before you scan your first products into Seller Central, there is one question you really need to answer thoroughly: what do I actually keep from this?
Mari Striebeek, customer success manager at Staxxer, speaks weekly with e-commerce entrepreneurs who sell on Amazon or are looking to start. She regularly hears the same thing: the margin calculation could have been better in hindsight. "A solid margin calculation is truly the foundation," she says. "Anyone who works this out properly in advance can start with confidence and knows exactly what they need to be profitable on Amazon."
In this article, we walk through the cost structure of Amazon step by step. We make it concrete using three products in three price categories: a phone case at €20, a sweater at €50, and a vacuum cleaner at €100. Because the type of product you sell largely determines what you ultimately keep.
What costs does Amazon charge?
When you sell through FBA (Fulfilment by Amazon), you pay several cost items. It is important to include all of them in your calculation, as together they determine whether your business is profitable.
The referral fee is a percentage that Amazon deducts as a platform fee, calculated on your selling price including VAT. In most categories this is 15%. For clothing and accessories, a reduced rate has applied since December 2025: 5% for products up to €15 and 10% for products between €15 and €20. For clothing items above €20, the standard rate of 15% applies.
The FBA fulfilment fee is a fixed amount per shipped package, depending on the size and weight of your product. A small, light product like a phone case costs a fraction of what a large vacuum cleaner costs. Current rates range from €2.93 to €7.00 or more per shipment.
Storage costs are the monthly costs for the space your inventory occupies in the Amazon warehouse. Outside peak season, you pay €26 to €36 per cubic metre per month. In Q4, these costs rise two to three times higher.
Advertising costs through Amazon Ads are unavoidable for most sellers, especially in the start-up phase. You pay per click on your ad, and what you spend relative to what you sell is called your ROAS (Return on Ad Spend). A common estimate for beginning sellers is 15% of your selling price.
Returns and missing product costs are a line item that entrepreneurs often underestimate. Some of your products come back as returns, a small portion gets damaged or lost. Expect around 4% of your revenue for most product categories. For clothing this is higher: 6.5% is a realistic estimate.
Forgetting VAT? That is a costly mistake
A cost item that entrepreneurs regularly overlook: VAT. As a business owner, you must remit VAT on your selling price. At the same time, Amazon calculates the referral fee on the VAT-inclusive price. This affects your margin from two sides: your revenue is lower than the selling price suggests, and your platform costs are higher than you might initially expect.
Three products calculated
We calculate three products across three price categories. For each product we use the following assumptions: 21% VAT, 15% advertising costs, and a healthy margin of 25% of the selling price excluding VAT for fixed costs, profit, and further development. What remains after that is the maximum purchase price for your product.
This is how you calculate your maximum purchase price:
- Calculate your selling price excluding VAT
- Add up all Amazon costs: referral fee, FBA fee, storage, advertising costs and returns/missing
- Subtract the total costs from your selling price excluding VAT
- Deduct your desired margin (25%)
- What remains is your maximum purchase price
Below we apply this to three concrete products.
Phone case: €20
Small size, referral fee 15%, FBA fee €3.20, storage costs €0.50 per month, returns/missing 4%.
| Selling price incl. VAT | €20.00 |
| Selling price excl. VAT | €16.53 |
| Referral fee (15%) | €3.00 |
| FBA fulfilment fee | €3.20 |
| Storage costs | €0.50 |
| Advertising costs (15%) | €3.00 |
| Returns/missing (4%) | €0.80 |
| Total Amazon costs | €10.50 |
| What remains after costs | €6.03 |
| Healthy margin (25%) | €4.13 |
| Maximum purchase price | €1.90 |
At a selling price of €20, there is very little room for a phone case. Your maximum purchase price to remain profitable is €1.90. This is achievable for simple consumer products, but requires direct purchasing from a manufacturer and high volume. Importantly: if your advertising costs come in slightly higher, or your return rate is a bit above expectations, this margin evaporates immediately and you end up in the red.
Sweater: €50
Small/medium size, referral fee 15%, FBA fee €4.50, storage costs €0.75 per month, returns/missing 6.5%.
| Selling price incl. VAT | €50.00 |
| Selling price excl. VAT | €41.32 |
| Referral fee (15%) | €7.50 |
| FBA fulfilment fee | €4.50 |
| Storage costs | €0.75 |
| Advertising costs (15%) | €7.50 |
| Returns/missing (6.5%) | €3.25 |
| Total Amazon costs | €23.50 |
| What remains after costs | €17.82 |
| Healthy margin (25%) | €10.33 |
| Maximum purchase price | €7.49 |
With a maximum purchase price of €7.49, there is limited but realistic room, especially when purchasing directly in larger volumes. Do keep in mind the higher return rate: with clothing, a significant share of buyers send the product back, which can make this percentage even higher in practice. If you sell cheaper clothing items under €20, a lower referral fee rate of 5% to 10% applies, making your margin considerably more favourable.
Vacuum cleaner: €100
Large size, referral fee 15%, FBA fee €9.00, storage costs €4.00 per month, returns/missing 4%.
| Selling price incl. VAT | €100.00 |
| Selling price excl. VAT | €82.64 |
| Referral fee (15%) | €15.00 |
| FBA fulfilment fee | €9.00 |
| Storage costs | €4.00 |
| Advertising costs (15%) | €15.00 |
| Returns/missing (4%) | €4.00 |
| Total Amazon costs | €47.00 |
| What remains after costs | €35.64 |
| Healthy margin (25%) | €20.66 |
| Maximum purchase price | €14.98 |
A maximum purchase price of €15 for a vacuum cleaner is virtually unachievable in practice: a decent appliance can rarely be purchased wholesale for less than €40 to €50. This example shows that heavy, large products on Amazon only become profitable at significantly higher selling prices, or if you have an exceptionally strong purchasing position.
Comparison at a glance
| Phone case | Sweater | Vacuum cleaner | |
|---|---|---|---|
| Selling price incl. VAT | €20.00 | €50.00 | €100.00 |
| Selling price excl. VAT | €16.53 | €41.32 | €82.64 |
| Total Amazon costs | €10.50 | €23.50 | €47.00 |
| What remains after costs | €6.03 | €17.82 | €35.64 |
| Healthy margin (25%) | €4.13 | €10.33 | €20.66 |
| Maximum purchase price | €1.90 | €7.49 | €14.98 |
What do these numbers tell you?
The calculations reveal a few things that are relevant for every Amazon seller.
The type of product and selling price together determine your room to manoeuvre. A light product with a low fulfilment fee has a structural advantage over a large, heavy product. And the higher the selling price, the more room remains after the fixed cost items.
Your product category determines your referral fee. Clothing and accessories have a lower referral fee for cheaper items, which has a direct impact on your margin. It pays to always check the fee for your specific category before setting your price.
Advertising costs are not a side note. With 15% advertising costs, a significant portion of your revenue goes directly to Amazon Ads. Those who do not actively track their ROAS often only notice it in the numbers afterwards.
Mari recognises this pattern immediately: "I see clients who calculated things well using the basic costs, but had not factored in advertising costs and return costs. Those are precisely the line items that really eat into the margin."
Starting well is half the battle
Amazon can be an excellent channel, especially if you have a product with an attractive purchase price and a selling price you can compete on. The key lies in good preparation: anyone who calculates costs thoroughly before launch knows exactly what their product can cost and what they need to operate profitably.
Always use the Amazon Revenue Calculator in Seller Central to calculate product-specifically. And if you are unsure about your specific situation, feel free to contact Mari or one of our other specialists.
