Amazon FBA Profit Calculator
Calculate your net profit, margins, and ROI for Amazon FBA products.
How to Calculate Amazon FBA Profit Correcty
Selling on Amazon via Fulfillment by Amazon (FBA) is a lucrative business model, but understanding your bottom line is critical for survival. Many sellers focus on "Top Line Revenue" while ignoring the hidden fees that eat away at margins.
The Core Formula
To calculate your profit, you must subtract all associated costs from your final selling price:
- Selling Price: The final amount the customer pays.
- COGS (Cost of Goods Sold): What you paid the manufacturer for the item.
- Referral Fee: Amazon's "commission," typically 15% for most categories.
- FBA Fees: The cost for Amazon to pick, pack, and ship your item to the customer.
- Inbound Shipping: The cost to send your inventory from your warehouse or supplier to Amazon's fulfillment centers.
- Marketing (PPC): Your advertising spend divided by the number of units sold.
Understanding the Metrics
Once you run the numbers in the Amazon FBA Profit Calculator, pay attention to these two key performance indicators:
1. Net Margin
This tells you how much profit you keep for every dollar of revenue. A healthy FBA margin is usually between 20% and 30%. Anything below 10% is considered high-risk, as one bad return or price war could turn your business unprofitable.
2. ROI (Return on Investment)
ROI measures the efficiency of your capital. If you spend $5.00 on a product and make $5.00 in profit, your ROI is 100%. This is often more important than margin for sellers with limited capital who need to reinvest quickly.
Real-World Example
Let's say you sell a yoga mat for $40.00. Your costs are:
- Product Cost: $10.00
- Shipping to Amazon: $1.50
- Amazon Referral Fee (15%): $6.00
- FBA Fulfillment Fee: $7.50
- PPC Spend: $3.00 per unit
Total Expenses: $28.00
Net Profit: $12.00
Profit Margin: 30%
ROI: 120%
In this scenario, the product is highly viable and leaves enough room for price fluctuations or seasonal storage fee increases.