Selling Price (SP) = Cost Price (CP) + ({Amazon referral fee + Fixed Closing Fee + Easy Ship Fee} +18% GST) + GST to be paid to government
Let say we want to sell a product in category “Accessories – Electronic, PC and Wireless” which have a commission rate of 16.5%.
Let cost price of item = INR 250 (Includes input GST + Transportation charges to buy it + Storage charge to kept it)
Let say the selling price of item = INR 550
Referral fee charged on referral fee = 550 * 16.5/ 100 = INR 90.75
Fixed closing fee charged = INR 20 ( in case of (Easy Ship) excl. easy ship prime)
Easy Ship Fee
Let the weight of the item = 400 gms
Dimension = 20 cm * 20 cm * 10 cm
Volumetric weight = 20*20*10/5 = 4000/5 = 800 gms
Volumetric weight is greater than actual weight. So, Volumetric weight will be used to calculate the charges.
Let say the shipment is a regional shipment then,
Easy Ship Fee Charged = INR 46 (For first 500 gms) + INR 21 (For next 300 gms) = INR 67
Amazon Fee Charged = 90.75 + 20 + 67 = INR 177.75
GST on Amazon Fee Charged = 177.75*18/100 = INR 31.95 { Can be claimed while filing GST return}
Total Amazon Fee Charged = 177.75 + 31.95 = INR 209.74
Let say GST to be paid = 12%
GST = 550*12/100 = INR 66
Profit = Selling Price – Cost Price – Amazon Fees Charged – GST = 550 – 250 – 209.74 – 66= INR 30.26
Note – GST charged on amazon fee as well as on the cost price can be claimed while filing GST monthly return.
So Net Profit = 30.26 (Profit) + 31.95 (GST on Amazon Fee charged) + 26.78 (GST on Cost Price) = INR 88.99
Please note that I have not included the product packaging cost and the return product cost as of now. Please include these costs as well while calculating the selling price of your products on amazon.
*Return cost will be generally taken as 2% of the selling price.
*Packaging cost will be generally taken in range (INR 20 – INR 50) depending upon the type of item and material you have used.