Selling on Amazon can feel like a game of numbers — sales figures, ACOS, TACoS, units sold. And when the revenue starts to rise, it’s easy to feel like things are going well.
But here’s the hard truth: high sales don’t automatically mean high profits.
Most sellers only realise this when it’s too late. When the numbers don’t add up. When the tax bill arrives. Or when they’ve spent thousands on ads and still have nothing in the bank.
If you’re not accounting for all the Amazon fees, hidden costs, and business expenses — or using proper Amazon analytics tools for sellers — you’re flying blind.
Where Sellers Get Caught Out
Amazon is designed to make selling look easy. And to be fair, the platform does a lot for you — from hosting your products to handling customer service (if you’re using FBA).
But all that convenience comes at a cost. A lot of them, actually.
Let’s break it down.
The Real Impact of Amazon Seller Fees
Amazon charges a variety of fees depending on your fulfilment model, category, and product size. These often include:
Referral fees (usually 8% to 15% of each sale)
FBA fulfilment fees (packing, shipping, handling)
Monthly storage fees
Long-term storage penalties
Returns processing fees
Advertising charges through Amazon PPC
High-volume listing fees
Closing fees for certain product categories
These Amazon seller fees add up fast. A product you thought had a £7 profit margin might only be netting £1.20 after everything’s accounted for — or worse, running at a loss.
And most sellers don’t spot this because they aren’t tracking their fees in one place.
For a full list of Amazon Fulfilment fees, check out this blog – Understanding Amazon Fees in 2025.
The Hidden Costs That Cut Into Profits
Even if you’ve wrapped your head around Amazon’s own charges, there’s more going on behind the scenes. Running an eCommerce business means managing hundreds of moving parts, many of which quietly chip away at your margins.
1. Returns and Refunds
Returns are part of selling online, but that doesn’t make them harmless. Every return comes with costs: restocking fees, damaged packaging, or unsellable items. Worse, you may not even notice the impact unless you’re looking at your data from a profit perspective, not just units sold.
2. Wasted Ad Spend
You’re bidding on keywords, driving clicks, and hoping the sales follow. But if you’re not converting, you’re bleeding cash. This is a common trap with Amazon PPC: sellers focus on impressions and clicks, not the actual return.
And even if sales are coming in, you need to ask — are they profitable sales?
Without clear Amazon analytics tools, there’s no way to separate good spend from bad spend.
3. Storage, Packaging, and Prep
If you hold too much inventory, Amazon hits you with monthly storage charges. If your items are oversized or slow to sell, that gets even more expensive.
On top of that, you’ve got packaging costs, prep centre fees, labelling, and possibly even courier expenses outside of FBA. All of it bites into your bottom line.
4. VAT and Tax Liabilities
If you’re VAT registered, failing to properly allocate VAT can seriously distort your profit view. Many sellers look at post-sale revenue without removing VAT, assuming the difference is profit.
Spoiler: it’s not.
Why Most Sellers Struggle to Stay Profitable
Most sellers aren’t lazy or careless — they just don’t have the right tools. Spreadsheets are fine when you’re doing five orders a day. But once you’re dealing with multiple SKUs, product variations, and ad campaigns, you need something more powerful.
That’s where proper Amazon analytics tools for sellers come in. You need a system that does more than track sales — you need one that tracks margins.
What a Good Analytics Tool Should Show You
A strong analytics platform should give you clarity across your entire operation:
Profit per SKU after Amazon seller fees and operational costs
Live cost breakdowns, including packaging, ad spend, shipping, and returns
Margin trends over time so you can spot declining performance early
Inventory health, showing what’s moving, what’s sitting, and what’s costing you money
Custom alerts when TACoS rises or SKU profitability drops
Full visibility of all Amazon fees, not just what’s in your Seller Central dashboard
You’d be surprised how many “profitable” SKUs are actually losing money — the margin killers just aren’t visible without proper breakdowns.
Seller Margins - Built For Sellers Who Want To Know The Truth
We created Seller Margins because we were tired of the guesswork. Tired of seeing sellers pour thousands into ads and stock, only to walk away with pennies.
Our platform is built to give you a complete view of your business — not just how much you’re selling, but how much you’re keeping.
With Seller Margins, you’ll be able to:
Instantly see true profit after Amazon seller fees
Track which SKUs are driving revenue and which are draining your cash
Monitor spend on Amazon PPC and link it to actual conversions
Get notified when margins fall, so you can fix it before it’s too late
Finally understand your Amazon fees in context
Knowledge = Profit
Running an Amazon business is hard enough. The last thing you need is to be kept in the dark by poor visibility and clunky spreadsheets.
Revenue is vanity. Profit is everything.
If you’re serious about growing a profitable Amazon business in 2025 and beyond, it starts with getting the full picture. No more guesswork. No more gut feelings.
Know your numbers. Understand your costs. And give your margins a fighting chance.
Want to see what your actual profit looks like?
Try SellerMargins.io with a 14-day free trial
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