How to Start an Amazon FBA Business: Fees, Steps (2026)

Quick answer: To start an Amazon FBA business, pick a sales model (private label, wholesale or arbitrage), open a Professional seller account ($39.99 a month as of October 2026), source a product with room for Amazon's referral and fulfillment fees, prepare and ship inventory to Amazon's warehouses, then drive sales with listings and ads.

Fulfillment by Amazon (FBA) lets you store products in Amazon's fulfillment centers while Amazon picks, packs, ships and handles returns. Your products become Prime-eligible, which can lift sales, but every unit carries fees that can quietly erase your margin. This guide shows how to start an Amazon FBA business in 2026: the fee structure, sourcing options, inventory planning, taxes and a worked per-unit profit example.

What is Amazon FBA?

Amazon FBA is a fulfillment service for third-party sellers. You send inventory to Amazon; when a customer orders, Amazon ships it, provides customer service and processes returns. You pay Amazon a referral fee on each sale plus FBA fees for fulfillment and storage. The alternative is Fulfillment by Merchant (FBM), where you ship orders yourself.

What are the main Amazon FBA business models?

Model	How it works	Pros	Cons
Private label	Your own brand, made by a manufacturer	Control of listing and brand, higher margins	Higher upfront cost, product development risk
Wholesale	Buy established brands from distributors and resell	Proven demand	Thinner margins, need brand approval in some categories
Retail and online arbitrage	Buy discounted retail items and resell	Low startup cost	Hard to scale, brand restrictions, authenticity risks
Handmade or bundles	Your own products or unique bundles	Less direct competition	Production capacity limits

How much are Amazon FBA fees? (as of October 2026)

Amazon's fee schedule has several layers. Amazon raised US FBA fees by an average of about $0.08 per unit effective January 15, 2026, and referral fee percentages were largely unchanged. Seller-industry reports also describe a fuel and logistics surcharge added to fulfillment fees during 2026, and holiday peak fulfillment fees apply from October 15, 2026 through January 14, 2027. Because fees change often, always confirm current rates in Seller Central's fee pages and the Revenue Calculator.

Fee	What it is	How it is charged
Selling plan	Individual: $0.99 per item sold. Professional: $39.99 per month	Per item or monthly
Referral fee	Amazon's commission on each sale	Percentage of total sale price (commonly 15% in many categories, lower or tiered in some), with a per-item minimum
FBA fulfillment fee	Pick, pack, ship and customer service	Per unit, based on size tier, shipping weight and price band
Monthly storage fee	Space in fulfillment centers	Per cubic foot, higher from October to December
Aged inventory surcharge	Inventory stored a long time	Additional storage charge on older units
Low-inventory-level fee	Charged when stock is consistently low relative to demand	Per unit shipped
Inbound placement service fee	Distributing your shipments across Amazon's network	Per unit, depends on how many locations you ship to
Returns processing fee	Applies to some categories with high return rates	Per returned unit
Removal and disposal	Getting stock back or destroyed	Per unit
Advertising	Sponsored Products and other ads	Cost per click, set by your bids

Amazon's official announcement is on its Selling Partners site, and the full schedule sits in Seller Central.

How to start an Amazon FBA business: step by step

1. Choose your model and category. Check whether the category is gated (some require approval, invoices from authorized suppliers or extra documents).
2. Research products. Look for steady demand, manageable competition, a size that keeps you in a cheaper fulfillment tier, and a price that leaves room for fees and ads.
3. Form your business. Many sellers form an LLC (see how to start an LLC), get an EIN and open a business bank account.
4. Open a Seller Central account. Choose the Professional plan if you expect to sell more than about 40 units a month, since that is where $0.99 per item exceeds $39.99. Amazon verifies identity, bank and tax details.
5. Source and sample. Contact manufacturers or distributors, order samples, negotiate price and minimum order quantities, and get a written specification.
6. Get barcodes and trademark. Buy UPCs from GS1 US and consider a trademark application for Brand Registry.
7. Create the listing. Professional photos, keyword-rich title, bullet points and backend search terms.
8. Prepare and ship inventory. Follow Amazon's packaging and labeling requirements, create a shipment in Send to Amazon, and book a carrier (Amazon's partnered carrier or your own freight).
9. Launch with ads. Sponsored Products campaigns help new listings get traffic and reviews through legitimate channels such as Amazon's programs. Never offer incentives for reviews.
10. Manage inventory. Monitor sell-through, reorder before stockouts, and avoid long-term storage charges.

Worked example: per-unit profit on a private label product

Suppose you sell a silicone kitchen utensil set for $29.99. The fee figures below are illustrative estimates for a small standard-size item; use Amazon's Revenue Calculator for your exact product.

Line	Per unit
Sale price	$29.99
Referral fee (15%)	-$4.50
FBA fulfillment fee (illustrative)	-$5.20
Storage and inbound placement (illustrative)	-$0.60
Product cost from manufacturer	-$6.00
Freight and duty to the US, per unit	-$1.40
Shipping to Amazon, per unit	-$0.70
Advertising per unit sold	-$4.00
Returns and refunds allowance	-$0.60
Net profit per unit	$6.99 (about 23%)

Amazon's fees take roughly a third of the sale price in this example before you have paid for the product. That is why sourcing cost and size tier matter so much. Use our guides to calculating profit margin and cost of goods sold to track it properly.

How to source products for FBA

• Manufacturers: found through B2B platforms such as Alibaba, trade shows or domestic manufacturers. Ask for samples, certifications and factory audits for larger orders.
• Distributors and brand owners: for wholesale, you need an account and often authorization to sell on Amazon. Keep their invoices, because Amazon may ask for them to prove authenticity.
• Retail and liquidation: works for arbitrage but brand restrictions and authenticity complaints are common.

Get a written purchase order, a proforma invoice and agreed Incoterms for every import. Our guide to Incoterms on invoices explains who pays freight and duty. Amazon may request supplier invoices with your business name, the supplier's contact information and quantities matching your sales, so store them carefully. Our Amazon invoicing guide covers invoices for Amazon Business buyers.

FBA vs FBM: which fulfillment method should you use?

Factor	Fulfillment by Amazon (FBA)	Fulfillment by Merchant (FBM)
Who stores and ships	Amazon	You or a third-party logistics provider
Prime badge	Yes, automatically	Only through Seller Fulfilled Prime, with strict standards
Customer service and returns	Handled by Amazon	Handled by you
Main fees	Referral plus FBA fulfillment and storage fees	Referral fee plus your own shipping and labor
Best for	Small, light, fast-selling items	Oversized, slow-moving, fragile or high-value items
Cash tied up	Inventory sits in Amazon's network	Inventory sits with you

Many sellers use both: FBA for core fast sellers and FBM as a backup when FBA stock runs low or for bulky products.

How to prepare inventory for Amazon

Shipments that do not meet Amazon's requirements can be refused, repackaged for a fee or delayed. Before you ship:

• Label each unit with its FNSKU barcode (or use eligible manufacturer barcodes), covering any other scannable barcodes.
• Follow prep rules for poly bags (suffocation warnings), bubble wrap for fragile items, and sets sold as one unit.
• Pack cartons within Amazon's size and weight limits and label each box with the shipment ID label.
• Create the shipment in Send to Amazon and choose your inbound placement option, since fewer destination warehouses generally means a higher placement fee.
• Ask your manufacturer or a prep center to handle labeling before goods leave the factory to save time.

Keep a copy of the supplier's commercial invoice and packing list for every import, because customs brokers and Amazon may both ask for them.

How to plan FBA inventory

Inventory is where most FBA cash gets tied up. Amazon sets capacity limits on how much you can store, charges low-inventory-level fees if you run too lean and storage surcharges if you run too heavy. A simple reorder plan:

1. Estimate daily sales (for example, 15 units a day).
2. Add up lead time: production (30 days), ocean freight and customs (35 days), receiving at Amazon (10 days) = 75 days.
3. Reorder point = daily sales x lead time + safety stock = 15 x 75 + 300 = 1,425 units.
4. When available plus inbound inventory falls to 1,425, place the next order.

Track turnover with the inventory turnover ratio and value stock correctly using inventory accounting methods.

Taxes for Amazon FBA sellers

General information, not tax advice:

• Income tax: report gross sales, then deduct Amazon fees, cost of goods sold, ads and other expenses. Sole proprietors and single-member LLCs use Schedule C and owe self-employment tax.
• Form 1099-K: Amazon reports gross payments above the federal threshold (more than $20,000 and more than 200 transactions for 2026). See the 1099-K threshold guide.
• Sales tax: Amazon collects and remits on marketplace sales as a marketplace facilitator, but inventory in fulfillment centers can create nexus, and some states still require registration. Review sales tax nexus rules.
• Inventory: unsold stock is not deductible until sold; it sits on your balance sheet.
• Estimated taxes: pay quarterly once you are profitable.

The IRS explains marketplace income reporting on its Form 1099-K page.

Keep your seller account healthy as well. Amazon tracks order defect rate, late shipment rate (for FBM orders), policy compliance and customer complaints such as "not as described" or authenticity claims. Check Account Health in Seller Central weekly and respond to any notice quickly, because a suspended account freezes both sales and payouts.

Common Amazon FBA mistakes

• Ignoring size tiers. A few extra ounces or inches can push a product into a costlier fulfillment fee.
• Underestimating ad costs. New listings rarely sell without paid traffic.
• Over-ordering. Large first orders tie up cash and rack up storage fees if the product does not sell.
• Running out of stock. Stockouts hurt rankings and may trigger low-inventory-level fees when you restock thin.
• Weak supplier documentation. Without valid invoices, you cannot answer authenticity complaints.
• Breaking review policies. Incentivized reviews can get your account suspended.
• Not reconciling payouts. Amazon settlement reports net fees, refunds and reimbursements; reconcile them to your books every period.

Selling to businesses and off-Amazon

Many FBA sellers also sell wholesale to local shops or directly to businesses. Those buyers expect a proper invoice with your business details, quantities, unit prices and terms. You can create one in our free invoice generator, and use the sales tax calculator where sales tax applies.

Is Amazon FBA worth it in 2026?

Learning how to start an Amazon FBA business is really learning Amazon's fee math: price, size tier, sourcing cost and ad spend decide whether a product works. Run every product idea through the Revenue Calculator, keep supplier invoices, plan inventory around lead times, and reconcile payouts monthly. For any off-Amazon sales, our free invoice generator needs no sign-up and builds a downloadable PDF in your browser.