Do your numbers match these?
Are you Bleeding? I was dealing with an unprofitable account that I couldn't figure out how to turn around. Then a good friend showed me what an Amazon P&L should look like line-by-line (on average). All this being said, Amazon continues to take bites out of our margin (even though they promised no new fees, LOL). Anyway, my FBA Fees were way out of whack. Thankfully, now I have a plan to change this.Compare your P&L to these numbers:
Where are you bleeding? Net Revenue: 100% ___ Promotions: ~1% COGs: ~26% Referral Fee: ~15% FBA Pick & Pack: ~27% (Mine was 41%, yikes!) Amazon Storage: ~2% Inbound Placement Fees: ~0% PPC: ~10% —-- Post Amazon Fee Margin: 19%Breaking Down Each Line of Your Amazon FBA P&L
If your P&L does not look like the benchmarks below, you are either leaving money on the table or bleeding cash without realizing it. Here is what a healthy Amazon FBA P&L looks like for a private label seller:
- Revenue: 100% (your starting point)
- COGS (Cost of Goods Sold): 25-30%. If this is above 35%, you need to renegotiate with your supplier or find a new one.
- Amazon Referral Fee: 8-15% depending on category
- FBA Fulfillment Fee: 10-15%. If this is above 18%, your product might be too heavy or oversized for FBA to make sense.
- PPC/Advertising: 8-12%. Anything above 15% is a red flag unless you are in a launch phase.
- Storage + Other Amazon Fees: 2-5%
- Net Profit Margin: 15-25%. This is what should be left after everything.
The most common problem I see is sellers not tracking FBA fees closely enough. Amazon changes fee structures regularly, and a product that was profitable last year might be underwater this year. Run your P&L monthly, not quarterly. Use Sellerboard or a similar tool to automate tracking so you catch problems early.
Frequently Asked Questions
What is a good profit margin for Amazon FBA sellers?
A healthy net profit margin for Amazon FBA private label sellers is 15-25% after all fees, COGS, and advertising costs. New sellers often run at 10-15% while scaling, but if you are consistently below 10%, your product economics need work.
How often should Amazon sellers review their P&L statement?
Review your P&L monthly at minimum. Use tools like Sellerboard or Helium 10 Profits to track in real-time. Amazon fee changes, COGS fluctuations, and PPC cost increases can erode margins quickly if you only check quarterly.
What is the biggest hidden cost for Amazon FBA sellers?
Storage fees, especially long-term storage fees. Amazon charges $6.90 per cubic foot per month for items stored over 271 days, and even more after 365 days. Slow-moving inventory quietly eats your profits. Run an inventory age report monthly and liquidate or remove old stock before penalties hit.