As the Hong Kong business environment evolves, sellers move online to sell their products. Hong Kong sellers use a variety of online platforms to sell their products, but one of the most widely used platforms is Hong Kong Amazon. They capitalize on Amazon’s global reach to tap into a larger consumer base. Amazon enables sellers to reach their target audience, thereby enhancing the customer experience.
We provide a concise guide to essential Amazon seller fees in Hong Kong. Understanding these fees is crucial for achieving profitability and growth in the competitive Hong Kong market. This article can help you learn about the costs associated with selling on Amazon in Hong Kong for individual sellers. You can also understand listing fees and refund administration fees for Amazon Hong Kong. Moreover, this article also covers the process of deleting a seller account and promotes the benefits of using professional accounting services for e-commerce businesses.
Amazon Seller Account Types and Associated Fees
A seller is required to select an account category before selling on Amazon. The fees for individual seller accounts and Amazon Professional seller accounts in Hong Kong are explained in detail below.
| Account Type | Best Suited For | Monthly Subscription Fee | Per-Item Fee | Other Fees (Variable) | Recommended Monthly Sales Volume |
|---|---|---|---|---|---|
| Individual Seller | Low-volume sellers | USD 0.00 | USD 0.99 | Referral Fees, Closing Fees | Fewer than 40 items |
| Professional Seller | High-volume businesses | USD 39.99 | USD 0.00 | Referral Fees, Closing Fees | More than 40 items |
Individual Seller Account
An individual seller account is suited for low-volume sellers. It doesn’t have a monthly subscription fee; instead, it charges a per-item fee. Every item you sell on Amazon will incur a USD 0.99 charge, along with any variable referral fee or closing fee. The individual seller account is generally recommended for business owners who sell fewer than 40 items per month. This saves them from the monthly subscription fee, allows them to save a significant amount of money, and provides them with a cost-effective solution.
Professional Seller Account
A professional seller account is best suited for businesses that deal with large volumes of items. Rather than charging a fixed amount per item sold, Amazon charges a monthly subscription fee. The monthly subscription fee for professional seller accounts is $39.99, in addition to variable closing and referral fees. A professional seller account is ideal for businesses selling more than 40 items per month. If you sell more than 40 items a month, the total fee will surpass the USD 39.99 mark, which may reduce your overall profits.
How to choose the Right Amazon Account Type?
Although several factors need to be considered when choosing an Amazon seller account type, the most important factor is sales volume. Compare your monthly unit sales to the monthly subscription fee. If you sell more than 40 units, then a professional seller account can be the most profitable for you. However, if your monthly sales are less than 40 units, then the individual seller account can be the best plan for you.
Key Amazon Selling Fees Explained
Different kinds of selling fees are associated with selling a product on Amazon. Here is an in-depth description of the key Amazon fees.
| Fee Type | Description | Applies To | Example/Calculation |
|---|---|---|---|
| Referral Fees | A commission charged by Amazon for each item sold, calculated as a percentage of the item’s selling price. Rates vary significantly by product category (e.g., typically 8-15%, but can range from 6% to 45%). | All Sellers | Percentage of selling price (including item price, shipping, gift-wrap). Exact rates found in Seller Central. |
| Refund Administration Fees | Charged when a seller issues a refund to a buyer. Amazon refunds the original referral fee, but deducts an administration fee. | All Sellers | USD 5.00 or 20% of the original referral fee, whichever is lower. (Meaning the refunded referral fee is 80% of original, or less USD 5.00) |
| Closing Fees | A fixed fee levied on every media product sold (DVDs, videos, video games/consoles/accessories, computers, software, music). | All Sellers (selling media items) | USD 1.80 per media item sold. |
| Seller Repay Charges | Incurred when insufficient funds are available in the seller’s account to cover fees (e.g., Professional Selling Plan, advertising). | All Sellers | Appears on statements when Amazon attempts deductions for fees but funds are insufficient. (Avoid by monitoring balance, updating payment info, understanding deduction timings). |
| Listing Fees for Unsold Items | Charge for simply listing an item on Amazon. | N/A (No such fee) | None. Amazon does not charge a fee for listing unsold items. |
Amazon Referral Fees
Understanding Amazon referral fees for Hong Kong sellers is critical. Every time a seller sells an item on Amazon, they are required to pay a referral fee to the platform. A referral fee is a percentage of the item’s selling price. The referral fee rates may vary depending on the product category. To find the referral fee rates, sellers can visit Seller Central, which contains the rates organized by the category of the items.
Amazon Refund Administration Fees
The refund administration fee is another charge that Amazon imposes on its sellers. For instance, a seller has already received payment for a sale but must provide a refund to the buyer for the order. In such an event, Amazon will refund the referral fees that were charged at the time of the sale. However, Amazon will charge a refund administration fee of USD 5.00 or 20%, whichever is lower. This means that the refunded referral fee will be 80% of the original referral fee you initially paid, or USD 5.00 will be deducted from the original referral fee.
Amazon Closing Fees
Amazon also levies a closing fee on every media product sold by sellers using the platform. It affects both individual sellers and professional sellers. The media items that fall under this category include DVDs, videos, video games, video game consoles, video game accessories, computers, software, and music. The fixed closing fee that is charged per media item sold is USD 1.80.
Understanding and Avoiding “Amazon Seller Repay Charges”
If you are wondering how to avoid Amazon Seller Repay Charges in Hong Kong, this section is for you.
What are Amazon Seller Repay Charges?
Amazon Seller Repay Charges refer to the charges incurred by sellers when they lack sufficient funds to cover various fees or in the event of payment issues. These charges typically occur when Amazon attempts to deduct fees for services such as the Professional Selling Plan, advertising, and other programs, but is unable to do so due to an insufficient balance in the seller’s account. These fees may appear as Seller Repay Charges on the statements.
Few actionable tips to avoid Amazon Seller Repay Charges
- The first tip is to regularly monitor your account balance. This allows you to ensure that the account always has sufficient funds.
- The next step is to ensure that the linked bank or payment methods have sufficient funds at all times.
- One of the most crucial steps is to keep your payment information up to date.
- Lastly, you are required to understand the fee deduction timings of Amazon to ensure you have sufficient funds before the deduction time.
Other Important Considerations
This section will help you understand the process of deleting your Amazon account and the benefits of professional services for e-commerce.
Listing Fees for Unsold Items
While Amazon charges a wide spectrum of fees to sellers for using the platform, there is no listing fee for unsold items. Amazon doesn’t charge any fee simply for listing unsold items on the platform, neither to individual sellers nor to professional ones.
Deleting Your Amazon Seller Account
When you decide you no longer want to see profits, when you have not made any sales in a long period, or you simply want to quit selling on Amazon due to any other reason, you can do this permanently by deleting your account with Amazon Seller. Nevertheless, before dismissing the deletion process, several crucial steps have to be taken.
Before Deleting Your Account
- Resolve all outstanding transactions.
- Remove all your product listings.
These actions ensure your account is in good standing and ready for closure.
How to Delete Your Amazon Seller Account:
- Log in to Seller Central.
- Go to Account Settings.
- Select Close Your Account.
Once submitted, your request will be processed, and your account will be permanently deleted.
Benefits of Professional Accounting Services for E-commerce
Hiring professional accounting services can be extremely beneficial for your e-commerce business. They have years of experience that can be leveraged for the company’s growth. They can assist you in tracking fees and managing the company’s income and expenses. Furthermore, they can assist you with tax compliance in Hong Kong, helping to save you from potential fines and penalties.
Key Takeaways: Navigating Amazon Seller Fees in Hong Kong
Sellers and business owners are advised to understand Amazon seller fees in Hong Kong before setting up an Amazon seller account. Being aware of the necessary fees enables you to plan your budget effectively and stay compliant with the platform’s regulations. Amazon sellers should select the appropriate account type to manage their finances effectively. If they are selling fewer than 40 items per month, then an individual seller account may be best for them. However, if the sale exceeds 40 items per month, it is best to choose the professional seller account. Calculating total Amazon selling costs for your Hong Kong business can help you make informed decisions and create better opportunities for business growth.
FAQ
Here’s a breakdown of common questions about selling on Amazon. Understanding these details is crucial for any seller looking to maximize profitability and avoid surprises. Let’s dive into the specifics of Amazon’s referral fees, which are essentially Amazon’s commission for facilitating your sales.
What is the referral fee on Amazon?
Amazon applies a referral fee to every sold product, which averages between 8-15% of the entire value of a restockable product sale, depending on the category. There can also be a lower referral fee in some categories.
How much does Amazon pay for referrals?
Under the Amazon Associates program, as a referrer, not a seller, you can earn up to 10 % in advertising returns depending on the product category. This does not compare with seller referral fees.
What are the fees for an Amazon seller account?
Amazon has two selling options:
- Individual Plan: $0.99 per item sold (referral and other fees).
- Professional Plan: $ 39.99/month (including referral and other charges), an ideal plan for sellers with a larger volume.
Why is Amazon charging me a referral fee?
A referral fee, which Amazon levies for granting access to its vast customer base and marketplace infrastructure, is referred to as such. It is an amount charged on each of your sales at the time of sale, depending on the category of the item.
How much should I charge for a referral?
When you refer customers to a non-Amazon product or service, you may be eligible for referral fees that vary according to industry standards. For physical product referrals, a fee of 5% to 20% is typical. But this is subjective, and it must be value-oriented and industry-based.
