What is Referral fee?

How the Amazon referral fee is calculated

Amazon applies the referral fee as a percentage of the total sales price, which generally includes the item price plus any shipping or gift-wrap charges you collect. The percentage depends on the product category — broadly, rates tend to sit in the high single digits to mid-teens range, but you should verify your specific category against Amazon's current schedule because rates differ by category and get updated periodically.

On top of the percentage, many categories carry a per-item minimum referral fee. For inexpensive products, that minimum can be the binding number — meaning a low-priced item may owe the flat floor rather than the percentage. This is why margins on cheap items are so easy to misjudge: the effective referral fee rate on a low-ticket product can be far higher than the headline category percentage suggests.

• •Referral fee = the greater of (category percentage x total sales price) or the per-item minimum
• •Total sales price typically includes item price plus shipping and gift-wrap you charge
• •Rates vary by category — verify yours against Amazon's current fee schedule
• •Applies to both FBA and FBM orders, unlike fulfillment fees
• •Charged on the gross sale, before your own costs are considered

Referral fees vs fulfillment fees: don't confuse them

Sellers frequently lump all Amazon deductions together as 'fees,' but the referral fee and the fulfillment fee are different animals. The referral fee is the marketplace commission — you owe it on every sale no matter who ships the order. The fulfillment fee is what FBA sellers pay Amazon to pick, pack, and ship; an FBM seller who ships themselves pays no fulfillment fee but still owes the referral fee.

Keeping them separate in your accounting matters. They behave differently, they map to different lines on your settlement report, and conflating them makes it impossible to compare FBA versus FBM economics honestly. A clean chart of accounts that splits referral fees from fulfillment fees, storage fees, and advertising is the foundation of knowing your real per-unit profit.

Where referral fees show up in your accounting

Amazon nets referral fees out of your payout — you never see the full sale price hit your bank. The gross sale and the referral fee deduction both appear on your settlement report, and clean books require recording the full revenue and the fee as a separate selling expense rather than only booking the net deposit. If you book only the net, your revenue is understated and your true selling costs are invisible.

Categorizing referral fees correctly is also what lets you calculate gross margin and contribution margin per SKU. Once referral fees, fulfillment fees, and your landed cost of goods are all mapped to dedicated accounts, you can see which products actually make money after Amazon takes its cut — and which ones only look profitable until the commission lands.

How referral fees shape product and pricing decisions

Because the referral fee scales with price, a higher selling price means a larger absolute commission — but the percentage stays the same, so the fee doesn't erode margin the way a fixed cost would. The bigger trap is category. Two products at the same price can carry different referral fee percentages, which changes the math on whether a category is worth entering at all.

Walmart, eBay, TikTok Shop, and other marketplaces charge their own referral or commission fees that work on a similar principle but at different rates. If you sell across channels, modeling each marketplace's referral fee against the same product is the only way to know where a SKU actually nets the most — a calculation that depends entirely on accurate, channel-by-channel fee accounting.

Frequently asked questions

What is the referral fee on Amazon?

It is the commission Amazon charges on each sale — a percentage of the total transaction price that varies by product category, often with a per-item minimum. It is Amazon's fee for letting you sell on its marketplace and applies to every order whether you use FBA or fulfill it yourself. Check Amazon's current fee schedule for your specific category, since rates change over time.

Is the referral fee the same as the FBA fee?

No. The referral fee is the marketplace commission you owe on every sale regardless of fulfillment method. The FBA fulfillment fee is a separate charge that only applies when Amazon picks, packs, and ships your order. An FBM seller pays the referral fee but no fulfillment fee, which is why keeping the two separate in your books is important.

Does the referral fee apply to shipping charges?

Generally yes — Amazon typically calculates the referral fee on the total sales price, which usually includes the shipping and gift-wrap amounts you charge the buyer, not just the item price. This catches sellers who set low item prices and high shipping to game fees. Confirm the current treatment in Amazon's fee schedule, as the rules can vary by program and category.

Why is the referral fee higher than expected on cheap items?

Because many categories carry a per-item minimum referral fee. On a low-priced product, that flat minimum can exceed the straight category percentage, so the minimum becomes the fee you actually pay. The effective rate on inexpensive items can therefore be much higher than the headline category percentage, which is easy to miss when pricing low-ticket products.

How do I record referral fees in my bookkeeping?

Record the full sale as revenue and the referral fee as a separate selling expense, rather than only booking the net deposit Amazon sends to your bank. The gross sale and the fee both appear on your settlement report. Mapping referral fees to their own account in your chart of accounts is what lets you calculate true gross margin per product.

Related terms

Go deeper

• The Amazon Settlement Report, Explained (and How to Book It)
• Amazon FBA Fees Explained (2026): Every Fee, and What You Can Get Back