How to Calculate the Profitability of each product that you sell on Amazon

A business owner calculating profitability of her sales - created using Stable Diffusion

Amazon Marketplace provides an attractive platform for third-party sellers due to its vast customer reach and robust logistical capabilities. But to achieve lasting success, sellers must be able to set the selling price of their products at an optimum level – a level that is attractive to customers, competitive on the marketplace AND, most importantly provides the seller with a decent profit.

Amazon Marketplace is a competitive platform. Sellers must find ways to stand out from the crowd while still maintaining profitability. Understanding how Amazon’s fees and cost structures affect your bottom line is essential to setting your price at the right level to pay all of the costs associated with your product sales, to have enough money to pay for marketing and to make a profit from your endeavours.

However, the fact is that profitability isn’t merely the difference between your product’s selling price and its direct cost. To calculate true profitability, one must consider other factors like Amazon fees, shipping and fulfilment costs, advertising, and returns.

By taking all of these factors into consideration you can make sure that you set your selling price at a rate that makes money on every sale.

To learn how to do that in detail, fill out the form below to download the full article.

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