If you are planning to start selling online in India, then you would surely like to understand the selling fees charged by online marketplaces like Amazon and Flipkart. Any today this is our mission. Before entering a trade, one should be introduced to or have knowledge about all the pricing involved.
It is your knowledge and experience which will help you in excelling in your trade online. Thus, for the budding “Chanakya of Marketing” here is the fees breakup for Amazon and Flipkart India, along with the earnings earned.
Amazon fees breakup for sellers
The various charges that apply while selling products on Amazon are:
- Referral fees
- Closing fees
- Service tax
The Referral fee varies according to product categories, for example, laptops and mobile phones are charged 5%, 17% for automotive types of equipment, and apparel 7% for books.
The Closing fee- Amazon charges a fixed closing fee according to the product category. The closing fees variations are:-
- ₹ 0 to 250 = ₹ 2
- ₹ 251 to 500 = ₹ 5
- ₹ 501 to 1000 = ₹ 20
- ₹ Over 1000 = ₹ 40
Now for courier Amazon gives you two options- Ship by self and Ship by Amazon Easy Ship.
In Amazon Easy Shipping, the products are categorized into Local, Regional, and National bases. The prices include:-
A Standard size product weighing up to 500gm is charged @ ₹ 27 for local, ₹45 for regional, and ₹65 for National movements. For an additional 500gm on these the price increases by ₹16, 21, and 26 respectively.
Items beyond 1kg and less than 5 kg are named as oversized items and are charged ₹124 for local, ₹168 for regional and ₹213 for national movements. Whereas products (upto 12kg) are charged @ ₹175 for local and ₹ 255 for regional movements. Each extra kg is priced at ₹3.5 and ₹ 4.5 respectively.
Now if you want to take care of your product, packing, and storage one has to pay additional charges for Fulfilled by Amazon (FBA) fees. These were introduced from 8 August 2017 onwards.
The fees include:
- For small-sized products pick and packing- ₹10 and storage fees per foot per month of ₹20.
- For standard-sized products pick and packing – ₹15 and storage fees per foot per month of ₹20.
- For over-sized products pick and packing – ₹25 and storage fees per foot per month of ₹20.
**Weight handling fees are also to be included.
An Approx. idea:
If you are planning to sell a book at ₹500, shipping through Amazon easy ship weighing 500gm at a national level movement. (up to 1000 INR)
- Referral fees = ₹ 35
- Closing fees = ₹5
- Amazon shipping fees = ₹ 38
- Referral+ Closing+ Shipping Fees = ₹78.
- GST on Referral+ Closing+ Shipping Fees = ₹14.04 (@18%)
- Total Amazon Charges = ₹92.04
**for a bronze seller
One would end up making
For a cost price of ₹ 200 your profit earned is ₹207.96.
Let’s excavate the next possible option. Walmart’s favorite, Flipkart.
Flipkart fees breakup for sellers
The various charges that apply while selling products on Flipkart are:
- Commission fees
- Shipping fees
- Collection fee
- Fixed fee
The Commission fee is applicable to the type or category of the product. The shipping fee is based on the product weight, shipping locations. Collection fees will vary based on order item value and customer payment mode (Prepaid/Cash on Delivery). Whereas, the fixed fee depends on the order item value.
In short, the settlement amount = Order Item Value−Marketplace Fee- GST
The Shipping fees include:
Weight Local-Regional/Zonal National
0-500 gm ₹ 30 ₹46 ₹66
+0.5Kg up to 1Kg ₹18 ₹23 ₹27
+0.5Kg up to 3Kg ₹8 ₹10 ₹15
+1Kg up to 12Kg ₹8 ₹10 ₹15
+1Kg, beyond 12Kg ₹4 ₹5 ₹8
**One thing to note here is that these prices are meant for the Bronze seller only and Silver and Gold sellers get a discount of 10% and 20% respectively.
Now going towards Collection fees:-
Flipkart charges you a small collection fee for all the prepaid and postpaid orders you receive. The fees depend on the mode of receiving the order. For prepaid orders they are based on the Payment gateway, for postpaid orders, it is based on cash collection charges.
With a selling price between ₹ 0-750, a prepaid order is charged 2% and postpaid 15%.
For all prices above ₹750, a prepaid order is charged 2% and a postpaid 2%.
For Fixed Fees-These are charged for every successful sale transaction.
The Fixed fee will vary based on the order item value irrespective of category and seller tier.
Order Item Value Rate
- 500 . ₹5
2. 500-1000 ₹15
3. Beyond 1000 ₹30
If you want to sell the same book that you sold on Amazon for ₹500 weighing 500gms and at the national level movement.
*If the package dimension is 10x10x10 cm*
Commission Fee = ₹25
Collection Fee = ₹10
Fixed Fee = ₹5
Shipping Fee = ₹66
The total amount you make =₹374.92
For a cost price of ₹200, you make a profit of ₹174.92
Thus, be aware of the various options available and aim for the best to earn profit and never feel lost in the race to earn money.