What is FBA Revenue Calculator? Basics of "Visualization of Profit Structure" and ROI Optimization that Newcomer EC Person in Charge Should Master

In sales on Amazon, first step to maximize profit is "accurate cost graps". FBA Revenue Calculator is tool officially provided by Amazon, which can instantly calculate effective profit amount and profit margin by entering sales price of product, delivery agency fee, inventory storage fee, etc. In this article, we explain visualization method of profit structure that new EC person in charge must hold and basic strategy to optimize ROI (Return on Investment).

1. Definition and Role of FBA Revenue Calculator

FBA Revenue Calculator is browser-based tool to simulate profitability when using Amazon Seller Service (FBA). By entering ASIN (Amazon Standard Identification Number) or entering dimensions and weight of product directly, it automatically calculates Amazon commission, delivery fee, and storage fee.

Mistake that new person in charge tends to fall into is judging by "simple gross profit" just subtracting purchase price from sales price. Actually, sales commission by category and monthly storage fee oppress profit. By visualizing these in advance, risk of "the more you sell, the more you lose money" can be avoided.

2. Decompose Profit Structure into MECE

To understand profit structure, it is necessary to organize cost into MECE (Mutually Exclusive and Collectively Exhaustive). Main items calculated by simulator are as follows.

• Referral Fee: Percentage of sales set for each product category.
• FBA Fulfillment Fee: Fixed cost based on size and weight of product.
• Inventory Storage Fee: Variable cost according to occupied volume and period in warehouse.
• Cost/Promotion Fee: Costs such as purchase price, Amazon Ads (Sponsored Ads), etc.