How Amazon Calculates Commissions in 2025

As an experienced Amazon seller with five years of experience in Amazon Global Selling, I have deep insights into various aspects such as return management, review optimization, and promotion strategies. This article focuses on the topic of how Amazon calculates commission fees, including real-world case studies, underlying logic, and practical solutions to avoid common pitfalls. The content is structured using the "problem scenario + underlying logic + solution + avoidance guide" framework, incorporating the latest Amazon policies and providing detailed steps for operations in Seller Central.

Problem Scenario: Understanding Commission Calculation

Many new sellers on Amazon often face confusion about how their product's commission is calculated. For example, a Chinese seller selling home appliances on Amazon US noticed that the total fees were higher than expected, even though the product price was set at $29.99. After analyzing the fee breakdown, it turned out that the base commission rate for this category is 15%, but additional fees like referral fees, FBA storage, and other service charges significantly increased the overall cost. This highlights the need for a clear understanding of Amazon's commission structure.

• Seller A sells a product priced at $20.00 with a 15% commission rate, resulting in a $3.00 commission.
• Seller B sells a product priced at $49.99 with a 10% commission rate, resulting in a $4.99 commission.
• Both products may incur additional fees depending on the category and fulfillment method.

Underlying Logic: How Amazon Calculates Commission

Amazon’s commission calculation is based on several factors, including the product category, selling price, and whether the item is sold through FBA (Fulfillment by Amazon) or FBM (Fulfillment by Merchant). According to the latest Amazon policy document (updated October 2024), the base commission rate varies across categories. For instance, electronics typically have a base rate of 15%, while books have a lower rate of around 6%. Additionally, referral fees are applied based on the product's sales price, which is separate from the base commission.

The formula for calculating the total commission is:

Fee Type	Description	Calculation Example
Base Commission	Calculated based on the product category and selling price	15% of $29.99 = $4.498
Referral Fee	Varies per category and is based on the selling price	7% of $29.99 = $2.099
FBA Storage Fee	Based on inventory volume and time in warehouse	$0.50 per unit stored monthly
Total Fees	Sum of all applicable fees	$4.498 + $2.099 + $0.50 = $7.097

Solution: Optimizing Commission Costs

To optimize commission costs, sellers should focus on selecting the right product categories, setting competitive prices, and choosing the most cost-effective fulfillment method. For example, a Chinese seller who sells smart home devices on Amazon US realized that switching from FBM to FBA reduced their handling costs and improved customer satisfaction, which led to better sales performance despite the higher FBA fees. By leveraging Amazon's tools, such as the Seller Central pricing calculator, sellers can simulate different scenarios and choose the best strategy.

• Use the Amazon Pricing Tool in Seller Central to estimate commissions before listing a product.
• Compare FBA vs. FBM costs based on your order volume and storage needs.
• Choose product categories with lower commission rates if possible, but ensure they align with your business model.

Avoiding Common Pitfalls

One common mistake among new sellers is not accounting for all the associated fees when setting their product prices. For example, a seller listed a product at $39.99 without considering the 15% base commission and 7% referral fee, resulting in a net profit of only $25.