What Is Amazon FBA? Meaning, Fees and How It Works (2026)

FBA stands for Fulfillment by Amazon. You send your products to Amazon’s warehouses, and Amazon stores them, packs and ships every order, answers delivery questions and handles returns. In exchange you pay fulfillment and storage fees on top of the usual selling fees. Your listings also become eligible for Prime, which is the main reason many sellers use it.

This guide explains how FBA works, what it costs with the current 2026 rates, what a unit really earns after fees, and when shipping orders yourself (FBM) is the better choice.

What FBA means in practice

Without FBA, you keep stock at home or in your own warehouse and ship each order yourself. This is called FBM, Fulfilled by Merchant. With FBA the work moves to Amazon:

• Storage: your inventory sits in Amazon fulfillment centers across the US.

• Picking, packing and shipping: when a customer orders, Amazon ships from the nearest warehouse, usually with fast Prime delivery.

• Customer service and returns: Amazon answers questions about delivery and processes returns for FBA orders.

• Prime badge: FBA offers are eligible for Prime, which tends to win the Buy Box and convert better.

• Other channels: the same inventory can fulfill orders from your own website or other marketplaces through Multi-Channel Fulfillment.

Your job is to source the product, prepare and label it to Amazon’s requirements, ship it to the warehouse, manage the listing and advertising, and keep stock levels healthy.

How FBA works step by step

1. Create a seller account. The Professional plan costs 39.99 USD a month; the Individual plan has no monthly fee but charges 0.99 USD per item sold.

2. List your product and choose “Fulfilled by Amazon” as the fulfillment channel.

3. Create a shipment in Seller Central. Amazon tells you which warehouses to send the units to.

4. Prepare and label the units and boxes, then ship them, usually by a partnered carrier or a freight forwarder.

5. Sell. Amazon fulfills each order and deposits your sales minus all fees into your seller account.

FBA fees in 2026

An FBA sale carries several separate charges. The first two apply to every sale on Amazon; the rest are specific to FBA.

• Selling plan: 39.99 USD a month (Professional) or 0.99 USD per item (Individual).

• Referral fee: a percentage of the sale price that depends on the category. Most categories pay 15%; computers pay 8%, and beauty pays 8% on items priced 10 USD or less and 15% above that. See every category in the referral fee calculator.

• Fulfillment fee: charged per unit shipped, based on size tier, shipping weight and price band. From January 15, 2026, a large standard item weighing 1 to 1.25 lb and priced between 10 and 50 USD costs 5.04 USD, and a 3.5% fuel and logistics surcharge is added on top. Items priced under 10 USD get Low-Price FBA rates that are on average 0.86 USD cheaper.

• Monthly storage fee: charged per cubic foot of space your inventory occupies, and higher from October to December.

• Other fees that may apply: the inbound placement service fee for how your shipment is split between warehouses, the low-inventory-level fee when stock falls below 28 days of supply, and fees for returns processing, removals and disposal.

From October 15, 2026 to January 14, 2027 holiday peak fulfillment fees apply. Our guide to 2026 peak fees has the full table.

Every fee with all current rates, storage tables and a worked example: Amazon FBA Fees 2026.

What one unit really earns: an example

Take a 25 USD product in a 15% category, weighing just over a pound, that costs you 8 USD landed:

Amazon’s two fees take almost 9 USD, more than a third of the price. Storage, advertising and returns usually take another 1 to 3 USD per unit, which is why many products that look profitable on the supplier’s price list are not. Enter your own numbers below to see the full picture, including ROI and break-even price.

Pros and cons of FBA

Advantages:

• Prime eligibility, which usually means more sales and a better chance of winning the Buy Box.

• No packing or shipping work: you can grow without hiring warehouse staff.

• Amazon handles delivery questions and returns for FBA orders.

• Amazon’s shipping rates are often lower than what a small seller can get from carriers.

Disadvantages:

• Fees on every unit, plus storage for stock that sells slowly.

• Less control over packaging and inserts.

• Preparation rules, inbound shipments and capacity limits take time to learn.

• Returns are easy for customers, so return rates can be higher.

FBA or FBM: which one to choose

FBA usually wins for small, light products that sell steadily, where Prime makes a real difference to conversion. FBM is often cheaper for heavy or oversized items, slow sellers that would sit in storage, and products with low margins where every dollar of fees matters. Many sellers use both: FBA for best-sellers and FBM for the long tail. The FBA vs FBM calculator shows the break-even fee for your product.

How to calculate FBA fees for your product

First find the size tier. Amazon uses the greater of the unit weight and the dimensional weight for large standard and bulky items; dimensional weight is length × width × height in inches divided by 139. Then look up the fulfillment fee in Amazon’s rate table for that tier and price band, or use the FBA Revenue Calculator in Seller Central, which finds the fee for a specific product. Add the referral fee for your category, and run the result through a profit calculator together with your product cost, shipping to Amazon, advertising and returns.