How Much Does It Cost to Sell on Amazon in 2025? A Realistic Breakdown

Amazon continues to be the go-to marketplace for businesses in 2025, but the first question every seller asks remains the same: what does it actually cost to get started and keep running? The numbers matter because they decide whether your product will bring profit or leave you stuck with thin margins.

In this breakdown, we’ll walk through the real costs of selling on Amazon in 2025.

True Amazon Startup Costs

Before you can pencil out a budget, you have to understand that not all Amazon businesses are built the same way. The initial investment swings wildly depending on how you plan to sell your products. This decision dictates your upfront costs for things like inventory, branding, and advertising.

Trying to figure out how to fund a startup can feel difficult, but having a clear picture of these initial expenses is the first step to building a solid financial foundation.

The Five Main Amazon Selling Models

Thinking about your budget starts with picking a business model. Each one comes with a totally different price tag and risk level.

• Private Label: This is where you create your own brand. You find a product, have a manufacturer produce it exclusively for you with your logo, and build an entire brand identity around it. This requires the biggest upfront investment, but it also gives you the most control and the highest potential profit margins.
• Wholesale: You buy existing, well-known branded products in bulk directly from a manufacturer or distributor and then resell them on Amazon. This model demands a good chunk of capital for inventory but saves you the hassle of building a brand from scratch.
• Retail & Online Arbitrage: You find discounted products at retail stores or on other websites and flip them on Amazon for a profit. This has the lowest barrier to entry.
• Dropshipping: You list products for sale on Amazon without ever touching the inventory. When an order comes in, you buy the item from a third-party supplier who ships it directly to the customer. It’s low-risk, but the profit margins are notoriously thin, and you have no control over shipping times.
• Amazon KDP (Kindle Direct Publishing): For authors and creators. You can publish and sell your own e-books or print-on-demand physical books with zero upfront inventory costs.

Figuring out which of these paths you’ll take is the first real step in building a budget that makes sense. If you’re still weighing your options, our guide on how to start an ecommerce business on Amazon is a great place to get your bearings.

Next up, we’ll get into the specific fees and costs tied to each of these approaches.

Choosing Your Seller Plan & Understanding Amazon’s Fee

Your first real cost decision on Amazon is picking a seller plan. The best way to think about it is like a cell phone plan: do you want a pay-as-you-go option or a flat monthly rate? Amazon gives you two main paths, and your choice really depends on how much you plan on selling.

Individual vs. Professional Seller Plans

If you’re just dipping your toes in or plan to sell only a few items, the Individual Plan is your best bet. It has no monthly subscription fee, but you will pay a flat $0.99 fee for every single item you sell.

The Professional Plan is a flat $39.99 per month. The biggest benefit? It completely removes that $0.99 per-item fee. It also unlocks tools you absolutely need to grow, like access to Amazon’s advertising platform, advanced sales reports and more.

If you sell more than 40 items a month, the Professional plan starts saving you money right away. At 41 items, the Individual plan would cost you $40.59 in per-item fees alone ($0.99 x 41), which is already more than the monthly cost of the Professional plan.

Amazon Referral Fees

After your plan fee, the next cost you can’t avoid is the referral fee. This is Amazon’s commission for every sale you make. Think of it as the rent you pay for setting up shop in their massive digital mall and getting your product in front of millions of customers.

This fee isn’t a simple, one-size-fits-all charge; it changes drastically depending on your product category.

These fees can range from 8% to 45%, but most product categories are around the 15% of product selling price. Both Amazon FBA and FBM sellers pay this fee.

Fulfillment by Amazon (FBA) Costs

When you use FBA, you’re paying for convenience and access to Amazon’s massive logistics network. They store your inventory, pick and pack your orders, ship everything out, and handle customer service and returns. But that service comes with specific fees you have to budget for.

Apart from referral fee, the two main FBA fees are:

• FBA Fulfillment Fees: This is a per-unit fee that covers the cost of picking, packing, and shipping your product. Amazon calculates it based on your item’s size and weight.
• Monthly Inventory Storage Fees: You’re renting shelf space in Amazon’s warehouses, and they charge you for it based on the volume your products occupy, measured in cubic feet.

These fees aren’t static. For standard-size products, the monthly storage fee is $0.78 per cubic foot from January through September. But that number jumps to $2.40 per cubic foot during the busy holiday season from October to December. Your winter storage costs can be more than triple what you pay in the summer.

Fulfillment fees are also item-specific. As of early 2025, a small standard item (up to 12 oz) has a fulfillment fee of around $3.22 per unit. Heavier items, like a bulky product weighing up to 50 lbs, might see a placement fee reduction of about $0.58 per unit. It pays to know your numbers here.

Expert Tip: Don’t forget about long-term storage fees. If your inventory sits in a warehouse for more than a year, Amazon hits you with a steep penalty. Always monitor your inventory age to avoid these profit-killing charges.

Fulfillment by Merchant (FBM) Costs

Choosing FBM puts you in control. You handle your own inventory, packing, and shipping. This can be a great way to save money, especially for certain products, but you have to account for all the costs, both in dollars and in your time.

With FBM, your expenses will include:

• Amazon Referral Fees: You will pay standard Amazon referral fees based on category and product selling price
• Shipping Materials: You’ll need to source your own boxes, mailers, bubble wrap, tape, and shipping labels.
• Postage: You’re on the hook for buying shipping from carriers like USPS, UPS, or FedEx.
• Labor: Your time (or your staff’s time) spent picking, packing, and making post office runs has a real, tangible cost.
• Storage: You need a place to keep your inventory, whether that’s your garage, a spare room, or a rented warehouse space.

FBM often makes more sense for large, heavy, or slow-moving items where FBA storage fees would be enormous. It also gives you total control over your packaging and branding. To get a better feel for which method is right for you, our in-depth comparison of Amazon FBA vs. FBM can help you weigh the pros and cons.

Ultimately, figuring out which method is cheaper requires you to run the numbers. Use Amazon’s own FBA Revenue Calculator to get a precise estimate for your product, then compare that against a realistic tally of your FBM costs.

You can find more detail on the various Amazon fees for sellers in our detailed guide to make sure you’re not caught by surprise.

Cost Breakdown for Different Amazon Business Models

Asking what it costs to sell on Amazon is like asking what it costs to buy a car; it really depends on the model you choose. Launching a private label brand is a completely different financial universe than flipping clearance items from your local Target.

So, let’s break down the real startup costs for the five most common ways to sell on Amazon. This will give you a much clearer picture of where your budget might fit in.

Private Label: The Brand Builder

This is where you’re not just selling a product; you’re creating a brand from scratch. You find a product opportunity, partner with a manufacturer to put your logo on it, and build an entire identity. While it has the highest potential for massive profits and creating a sellable asset, it also demands the most cash upfront.

Here’s where the money goes:

• Manufacturing & Inventory: This is your biggest expense. A typical first order of 500 units at $5 each immediately puts you at $2,500.
• Branding & Packaging: Don’t skip this. Budget $200 to $500 for a solid logo, packaging design, and a professional brand guide.
• Product Photography & Videography: On Amazon, your images are your product. High-quality visuals are non-negotiable. Plan for $500 to $1,000 for professional photos and maybe a short video.
• Product Launch & PPC: Your product won’t sell itself. You need an initial ad budget to get eyeballs on your listing. A safe starting point is $1,000 to $2,000 for your first month of pay-per-click (PPC) ads.

Realistic Startup Budget: A serious private label launch in 2025 typically requires $5,000 to $10,000. Yes, you can try it for less, but a smaller budget often means painfully slow growth and a lot more risk.

Wholesale: The Reseller

With the wholesale model, you’re buying products in bulk directly from established brands (or their distributors) and then reselling them on Amazon. You don’t have to build the brand, you just get to sell it.

Your main expenses are pretty straightforward:

• Bulk Inventory Purchase: This is your primary cost. Brands often have Minimum Order Quantities (MOQs), which can range from $500 to $5,000 or even more for that first purchase order.
• Business Licensing: To buy from legitimate distributors, you’ll need a reseller’s license or permit. This usually costs between $50 and $150.
• Software Tools: You won’t find profitable wholesale accounts by guessing. Tools like Helium 10 are essential for identifying opportunities. Budget $50 to $200 per month.

Realistic Startup Budget: You can often get started with wholesale for $2,000 to $5,000. The trick is finding a good brand with a manageable MOQ to test the waters before going all-in.

Retail and Online Arbitrage: The Flipper

Arbitrage is the Amazon equivalent of house flipping, just with products. You hunt for discounted goods at retail stores (retail arbitrage) or on other websites (online arbitrage) and then sell them for a profit on Amazon. It’s a fantastic, low-cost way to learn the ropes of selling.

Here’s a look at the costs:

• Sourcing Products: This is your main expense. You can literally start with just $300 to $500 spent in the clearance aisle at Walmart.
• Shipping Supplies: You’ll need boxes, tape, shipping labels, and packing materials. A good starter kit will set you back about $50.
• Scanner App: An app that lets you scan barcodes in-store to check profitability on the spot is a must-have. These usually run from $15 to $50 per month.

Realistic Startup Budget: You can genuinely get an arbitrage business off the ground with $500 to $1,500. The entire model is built on reinvesting your profits to buy more inventory, so it can scale surprisingly well from a tiny start.

Regardless of your business model, you’ll have to account for Amazon’s fees, especially those related to fulfillment. They’re a central piece of the cost puzzle.

As you can see, FBA fees are a major part of your total expenses, affecting your profit margins on every single sale.

Dropshipping: The Middleman

Dropshipping is the classic “no inventory” model. You list a product for sale on Amazon, and when a customer orders, you buy it from a third-party supplier who then ships it directly to the customer. It sounds great in theory because of the low startup cost.

• Amazon Seller Plan – $39.99 per month (Professional plan, required for serious sellers).
• Product & Supplier Costs – $200 to $1,000+ depending on initial testing orders and supplier pricing.
• Software & Tools – $50 to $300 per month for product research, automation, and order management.
• Miscellaneous (branding, returns, refunds) – $100 to $500 depending on volume.

On average, most new dropshippers need $400–$1,800 in startup funds to launch properly.

For details, read our guide comparing dropshipping vs. Amazon FBA discusses much deeper into various costs and the logistical nightmares you can run into.

Amazon KDP: The Creator

If you’re an author or creator, Kindle Direct Publishing (KDP) is your path. It lets you publish and sell ebooks and print-on-demand paperbacks with zero upfront inventory costs. Amazon just prints and ships the books as they’re ordered.

Your costs here are all about creation and marketing:

• Book Cover Design: A professional cover is your single most important marketing tool. Don’t cheap out. Expect to pay $150 to $500.
• Editing: Nothing screams “amateur” like typos. Professional editing is crucial for your credibility and can range from $500 to $2,000, depending on the book’s length.
• Marketing & Ads: To get those first crucial sales and reviews, you’ll want a launch budget for Amazon Ads. Plan for at least $200 to $500 for the first month.

Realistic Startup Budget: A professional KDP launch can cost anywhere from $850 to $3,000. The good news is that every dollar is going toward quality and marketing, not sitting in a warehouse.

Estimated Startup Costs by Amazon Business Model

To give you a quick side-by-side view, here’s a table summarizing the typical startup investments for each model. This should help you see where you might fit in based on your available capital.

Ultimately, the “right” amount to start with depends entirely on the path you choose. Each model has its own financial landscape, risks, and rewards.

The Hidden Costs Most New Sellers Overlook

The fees on your monthly Amazon statement are just the tip of the iceberg. It’s pretty easy to budget for your subscription plan and referral fees, but a handful of other expenses can silently eat away at your profits if you aren’t ready for them.

These are the costs that separate sellers who build a profitable business from those left wondering where all their money went. Let’s pull back the curtain on the expenses that most newcomers forget to factor into their budget.

Product Presentation and Legitimacy Costs

Before you even make your first sale, you’ll need to invest in making your product look professional and legitimate. These aren’t optional; they are fundamental to competing on Amazon today.

• Professional Product Photography: Your main image is your digital storefront. Lousy photos you snapped on your phone will get your listing ignored. Plan on spending $300 to $800 for a professional photoshoot that covers all the bases: high-quality white background images, lifestyle shots, and infographics. This is one of the highest-impact investments you can make.
• GS1 UPC Barcodes: To list a new branded product on Amazon, you need an official barcode. You might see cheap codes for sale elsewhere, but don’t do it. Amazon is cracking down and validating barcodes against the official GS1 database. A single, legitimate GS1 barcode costs $30, though bulk packages offer better value. Don’t risk your entire listing’s future by using cheap, recycled codes.

Getting Your Product Seen

Listing your product is one thing; getting customers to actually see it is another challenge entirely. Without an initial marketing push, even the best product will get buried on page 20 of the search results.

Key Insight: Expecting organic sales from day one is totally unrealistic. In 2025, a dedicated launch budget is a non-negotiable part of your startup costs.

Amazon PPC (Pay-Per-Click) Advertising is your primary tool for gaining initial sales. For a new product launch, a realistic starting budget is $1,000 to $3,000 for the first 30 to 60 days. This investment helps you gather keyword data, generate your first sales, and start climbing the organic rankings.

Essential Tools of the Trade

Trying to sell on Amazon without the right software is like trying to build a house without a hammer. These tools give you the data you need to make smart decisions on everything from product research to keyword tracking.

Plan to spend $50 to $200 per month on seller software. The popular, all-in-one suites like Helium 10 or Jungle Scout are industry standards for a reason. They help you find profitable products, spy on competitors, and optimize your listings.

Post-Sale and Long-Term Expenses

Your job isn’t done after the sale. A few lingering costs can pop up that you need to be aware of.

• Customer Returns: Returns are just a part of doing business. You can expect a return rate of 5-15% on average, and it can be much higher in categories like clothing or electronics. When a product comes back, you not only lose the sale but might also have to pay for return shipping and eat the cost of an unsellable item.
• Long-Term Storage Fees: If your inventory sits in an FBA warehouse for too long (over 365 days), Amazon will hit you with some pretty hefty penalty fees. This is why accurately forecasting your sales is so critical. These fees can quickly turn a profitable product into a money pit.

Understanding these costs upfront is everything. It lets you build a real-world budget and figure out if your product actually has enough margin to succeed. Many sellers ask, is Amazon FBA worth it after all these expenses? The answer is yes, but only if you plan for every single cost, not just the obvious ones.

Matching a Selling Model to Your Budget and Goals

Now that we’ve broken down all the fees, it’s time to figure out how this all applies to you. The best Amazon business for one person could be a total financial disaster for another. It all comes down to your budget, your appetite for risk, and what you’re really trying to build.

Let’s walk through a few common scenarios to see where you might fit in.

For the Low-Budget Side Hustler

Are you looking for a side project you can start with minimal cash? Maybe you have $500 to $1,500 tucked away and just want to learn the ecommerce ropes without betting the farm.

If that’s you, these are your best bets:

• Retail & Online Arbitrage: This is the ultimate “earn while you learn” model. Your only real startup cost is your first haul of clearance products. It’s heavy on hustle and light on financial risk.
• Amazon KDP: Got a creative streak? KDP is a fantastic, low-risk way to build a passive income stream. Your main costs are for things like editing and a professional cover design, not a warehouse full of inventory.

For the Aspiring Brand Builder

Do you have a bigger vision? Are you dreaming of building a real, sellable brand and have more capital to bring to the table? If you have $5,000 to $10,000+ to invest and you’re playing the long game, there’s really only one choice.

Private Label is your path. This model is all about creating an asset. Your money goes into manufacturing a unique product, creating professional branding, and funding an aggressive launch strategy. The upfront costs are steep, but the potential reward is massive. You’re building a business you could one day sell for a serious payday.

Of course, whichever path you choose, you have to know your numbers inside and out. Getting a handle on calculating profit margins is non-negotiable for making sure your business is actually sustainable.

For the B2B Relationship Builder

Maybe you’d rather work with established brands instead of building one from scratch. If you’ve got strong negotiation skills and $2,000 to $5,000 for inventory, this model could be a perfect match.

Wholesale lets you bypass the brand-building grind completely. Your main job is to open accounts with distributors and purchase proven, in-demand products in bulk. Success here is less about slick marketing and more about finding profitable sourcing deals and managing your inventory like a hawk. It’s a great middle-ground between the low-risk hustle of arbitrage and the high-stakes world of private label.

Final Takeaway: Don’t just pick the model that sounds the most profitable. Pick the one that aligns with your current financial reality and risk tolerance. Starting small with arbitrage to build capital for a future private label launch is a much smarter strategy than going into debt to start a brand you can’t afford to support.

Frequently Asked Questions About Amazon Selling Costs

Let’s cut through the noise and get straight to the questions I hear most often from sellers trying to wrap their heads around the cost of selling on Amazon.

What Is the Absolute Minimum I Need to Start?

You can technically get your foot in the door with less than $500. This is the world of retail arbitrage where you’d be hunting for clearance deals at local stores, listing them on Amazon with the free Individual seller plan, and shipping them out yourself. Your only real costs are buying the products and paying for postage. It’s a great way to learn the ropes.

But if you’re serious about building a real brand with a private label product, you need to be realistic. A more sustainable starting budget is closer to $3,500 to $5,000. That gives you enough runway to cover your first big inventory order, pay the necessary fees, and run some initial ads to get those first crucial sales.

How Do I Calculate My Profit Margin With All These Fees?

Figuring out your actual profit can feel like death by a thousand paper cuts, but the math is pretty straightforward once you know the formula. Just take your product’s sale price and start subtracting.

For every single unit you sell, you need to deduct:

• Cost of Goods: What you paid your supplier for one unit.
• Amazon Referral Fee: This is Amazon’s commission for the sale, which is a percentage of the total sale price.
• Fulfillment Costs: If you use FBA, this is your FBA fee. If you ship yourself (FBM), this includes your boxes, tape, and shipping labels.
• Advertising Spend: Take your total ad spend for a period and divide it by the number of units you sold in that same period.

What’s left over is your net profit on that one item. To get your profit margin, just divide that profit number by your selling price and multiply it by 100.

Pro Tip: Before you place an inventory order, play around with Amazon’s FBA Revenue Calculator. It’s a free tool that gives you a surprisingly accurate estimate of your fees and profitability. It’s saved me from investing in more than a few duds with razor-thin margins.

Is It Always Cheaper to Ship Products Myself With FBM?

Nope, and this surprises a lot of sellers. For products that are small, lightweight, and sell quickly, FBA is often the cheaper route. Amazon has negotiated rock-bottom shipping rates with carriers, and they pass a lot of those savings on to you through their FBA fulfillment fees.

By the time you factor in your own time, the cost of boxes and bubble mailers, and what you’d pay for postage, FBM can easily end up costing more.

That said, FBM is almost always the more cost-effective option for items that are big, heavy, or slow to sell. Using FBM lets you sidestep Amazon’s hefty monthly and long-term storage fees, which can crush your profits on bulky inventory that just sits there. The right choice really comes down to the unique profile of your product.