Does Amazon require a security deposit? How much capital is needed to do business on Amazon?

As the Amazon platform continues to grow, more and more people can open stores on Amazon. If you want to open a store on Amazon, do you need a deposit? Many merchants still have questions about this issue. The following is a relevant introduction.

Does Amazon require a security deposit?

A deposit is required for all types of sales on Amazon, but the amount of the deposit varies depending on the category of the items sold. If you are a merchant engaged in books, alcohol, food, mobile communications and photography products, computers, digital audio and video, home appliances, televisions/stereos, office supplies, etc., you will need to pay a deposit of 50,000 yuan.

How much money does Amazon need?

1. Amazon selling program fees

Amazon offers two selling plans, with the following fees:

Individual Plan: $0.99 per item sold Professional Plan: $39.99 per month, unlimited number of products If you plan to expand your business, then choosing the Professional Plan is a must.

2. Amazon platform referral fee

The referral fee is a fee charged for each item sold on Amazon, calculated as a percentage of the sales price. The referral fee rate varies slightly by product category, with most categories having a 15% referral fee and a minimum fee of around $1. A few categories have no applicable minimum amount and may have a referral fee higher than $1.

3. Variable settlement costs

Variable closing costs refer to cost items in the total cost that change with changes in production. The latest Amazon fee schedule stipulates that a closing fee of $1.80 will be charged for media products, such as books, music, videos, DVDs, video games, game consoles, and software.

4. FBA delivery fees

The fees are calculated based on the size and weight of the product, with Amazon setting two standards for standard and oversized products. The fees include labor costs for order picking, packaging, shipping, and customer service.

5. Monthly storage fee

Amazon charges all FBA sellers monthly storage fees, and these fees are calculated based on the amount of storage space (in cubic feet) your products require. During the peak season from October to December, storage fees can rise significantly due to limited warehouse storage space.

6. Long-term storage fees

Amazon charges sellers a long-term storage fee of at least 6 months twice a year. Amazon warehouse charges are: 6-12 months, the warehouse fee is $11.25 per cubic foot, and more than 12 months, the warehouse fee is $22.50 per cubic foot.

7. Return processing fees

Amazon provides free return service to customers, so in the process of return, Amazon will charge a return processing fee for the returned products.

8. Removal Order Fees

When inventory in a warehouse needs to be returned or disposed of, removal order fee costs are incurred.

9. Unplanned preparation service fee

After shipping the product to Amazon, if the product is not marked and labeled as required, Amazon will charge an "unplanned preparation service fee" to help you solve this problem. The cost of warehouse labeling will be displayed as Unplanned Service Fee in the seller's payment information.

If you want to open a store on Amazon, you must pay a deposit. And this deposit can be returned when you apply to withdraw from the store, so consumers can rest assured to pay the Amazon deposit, otherwise it may bring some impact.

Recommended reading:

How can an individual open a store on Amazon? Are there any conditions?

Is an Amazon individual business license enough? What qualifications do I need to open a store on Amazon?

What are the requirements for opening a store on Amazon? Related questions answered