Amazon India Seller Fees: A Per-Unit Profit Checklist
A calculator profit of Rs. 380 can shrink to Rs. 229 once GST on fees, ads, returns and handling are counted. Here is a checklist to find your real per-unit profit.
Most new Amazon sellers price a product by subtracting the cost and the Amazon fee from the selling price, and calling the remainder profit. That number is usually too high. Several costs sit outside the headline fee, and they decide whether a product earns money or quietly loses it. This checklist walks through each cost, shows a worked example, and gives a way to find your break-even price.
This is general information for sellers, not tax or financial advice. Fee schedules change, so always take the actual numbers from your own Seller Central fee pages and ask your accountant about GST treatment.
What the quick calculator covers
The Amazon FBA calculator on this site is a first screen. You enter the selling price, your product cost and the FBA fee. It applies a flat 15% referral fee to the price and returns price − cost − referral − FBA fee.
That 15% is a simplification. Amazon's actual referral rate depends on the product category and sometimes on the price band, and Amazon revises its fee structure from time to time. The FBA fee depends on the size and weight tier, so you must type in the figure from Amazon's current fee schedule for your product. The tool does not look anything up.
It also leaves out several costs, which the next sections cover one by one.
The per-unit cost checklist
- Product cost, landed. Include what you pay the supplier plus freight, import duty if any, and the cost of getting stock to the point where it is sent to Amazon. Using only the ex-factory price is the most common mistake.
- Referral fee. A percentage of the selling price, set by category. Look up your category rather than assuming a number.
- Closing fee and fulfilment or shipping fee. Amazon charges per-unit fees on top of the referral fee. If you use FBA, the fulfilment fee depends on size and weight. If you ship yourself, your own courier charge replaces it.
- GST on Amazon's fees. Amazon charges GST on its fees; the rate applied in recent fee notices has been 18%. If you are GST-registered, this is generally claimable as input tax credit, but if you are not registered or not eligible, it is a real cost. Check with your accountant.
- Storage and inbound costs. FBA storage is charged by space and time, and sending stock to a fulfilment centre has its own cost. Spread these over the units you expect to sell.
- Returns and damages. Some returned units come back unsellable, and fees on returned orders are not always fully refunded. Use your own return rate for the category.
- Advertising. If most of your sales come through sponsored ads, treat ad spend as a cost of sale, not an optional extra.
- Packaging and handling for anything you prepare yourself.
Worked example: Rs. 380 becomes Rs. 229
Take the calculator's default numbers: selling price Rs. 1,000, product cost Rs. 400, FBA fee Rs. 70. The tool gives a referral fee of Rs. 150 and a profit of Rs. 380, or 38% of the price.
Now add the costs the tool leaves out. The figures below are assumptions chosen for illustration; replace them with your own.
| Item | Per unit (Rs.) |
|---|---|
| Calculator profit | 380.00 |
| 18% GST on referral and FBA fee (18% of Rs. 220) | −39.60 |
| Inbound shipping and storage (assumed) | −15.00 |
| Packaging and handling (assumed) | −10.00 |
| Advertising at 8% of price (assumed) | −80.00 |
| Returns: 10% of units, Rs. 60 lost on each (assumed) | −6.00 |
| Real profit per unit | 229.40 |
The real margin is about 22.9% of the price, not 38%. Put your own revenue and profit into the profit margin calculator to see the percentage. Note that the example treats the Rs. 1,000 as the amount you earn before Amazon's fees. If your listed price includes GST on the product itself, take the GST out first; the GST calculator helps you see how much tax a price carries. It adds tax to a base amount, so to remove GST from an inclusive price, divide by 1 plus the rate (for example, by 1.18 at 18%).
If you are not eligible to claim credit on the GST charged on fees, the Rs. 39.60 stays in as a cost. If you can claim it, your profit is higher by that amount, but only after the credit is actually set off against your GST liability.
Find your break-even price
A better question than "what is my profit at Rs. 1,000?" is "what is the lowest price at which I stop losing money?". Because the referral fee, GST on it and ad spend all scale with price, you can solve for it.
Using the same assumptions, the fixed per-unit costs are: product Rs. 400, FBA fee plus its GST Rs. 82.60, inbound Rs. 15, packaging Rs. 10 and returns Rs. 6, a total of Rs. 513.60. The costs that grow with price are the 15% referral fee plus 18% GST on it (17.7% of price) and ads at 8%, so 25.7% of price. What is left to cover the fixed costs is 74.3% of the price.
- With no advertising: break-even price is 513.60 ÷ (1 − 0.177) ≈ Rs. 624.
- With ads at 8% of price: break-even price is 513.60 ÷ (1 − 0.177 − 0.08) ≈ Rs. 691.
Here is how profit moves with price under the same assumptions:
| Selling price (Rs.) | Profit per unit (Rs.) | Margin |
|---|---|---|
| 700 | 6.50 | 0.9% |
| 800 | 80.80 | 10.1% |
| 1,000 | 229.40 | 22.9% |
| 1,200 | 378.00 | 31.5% |
A Rs. 300 price cut, from Rs. 1,000 to Rs. 700, takes the profit from Rs. 229 to about Rs. 6. Discount-led selling is dangerous when the fees and ads are percentages of a shrinking price while your product cost stays fixed.
Check your ads against the margin
Advertising is where many sellers go wrong. At a Rs. 1,000 price, the example above leaves about Rs. 309 per unit before ads (229.40 + 80). Spending Rs. 309 or more of ad money per sale would erase the profit. In ROAS terms, that is sales divided by ad spend of about 3.2 (1,000 ÷ 309). Any campaign with a lower ROAS loses money on each sale at these assumptions. The ROAS calculator gives you the ratio from your own ad spend and sales figures.
A routine before you list a product
- Pull the referral rate for your exact category and the fulfilment fee for your product's size and weight from Seller Central.
- Put them into the FBA calculator for a first-pass number, remembering it uses a flat 15% referral rate.
- Subtract GST on fees (if you cannot claim it), inbound and storage, packaging, a realistic return allowance and your expected ad share.
- Compute the break-even price and compare it with what competitors actually charge.
- List only if the margin at a realistic price still looks acceptable after all of it.
Limits: what this does not cover
- The calculator uses a flat 15% referral fee and has no category table. If your category differs, the output is off by the difference.
- It does not include the closing fee, GST on fees, storage, returns, ads or inbound shipping. The table above shows these by hand.
- It returns a rupee profit, not a margin percentage, and it does not compute a break-even price.
- The assumed figures in this post (inbound, packaging, ad share, return rate and loss per return) are examples, not Amazon rates or industry averages.
- Income tax, GST filing, TCS and other compliance are outside this post. Ask a chartered accountant how they apply to your business.