YouTube gurus love to show you revenue screenshots. $50K months. $100K months. What they rarely show you is the cost side of the equation.

Here's every cost you need to account for before you call a product "profitable."

The costs everyone knows about:

• Product cost: what you pay your supplier (typically 20-30% of sale price)
• Shipping to Amazon: freight from manufacturer to FBA warehouse (varies wildly)
• FBA fulfillment fee: $3.22-$6.00+ per unit depending on size and weight
• Referral fee: 15% of sale price in most categories

The costs most beginners forget:

• PPC advertising: plan for 15-25% of revenue in the first 3 months to build ranking
• Storage fees: $0.87-$2.40/cubic foot per month (spikes Oct-Dec)
• Returns: budget 3-5% of units sold coming back
• Product photography: $150-$500 for a professional set
• Product samples: $50-$200 before you commit to a bulk order
• Amazon account fee: $39.99/month for Professional

When you add it all up, a product selling for $25 might cost you $18-$20 all-in. Your real margin is $5-$7 per unit, not the $15 you imagined when you saw the sale price minus product cost.

That's still a viable business. You just need to know the real numbers before you commit.

Run your specific product through our FBA Profit Calculator. It accounts for every fee and gives you your true per-unit margin.

Calculate Your Real FBA Profit

Tomorrow: PPC advertising, and how to not burn through your budget in the first week.

Let's build,
The BagEngine Team

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