What is an acceptable profit margin for an online business starting out on Amazon/eBay?

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Q&A Pro › Category: eCommerce › What is an acceptable profit margin for an online business starting out on Amazon/eBay?
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Julie Schneider asked 5 years ago
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Dani Avitz Staff answered 5 years ago
Profit is the lifeblood of any business. But how much profit is enough profit? Sellers often ask what kind of profit margins they should seek when selling on Amazon and eBay. You’ll often see people throw around figures between 5-15%, but there is no exact number that fits every business. Why? Because every product is different. Some products have high-profit margins, while others are lower and focus on an overall high volume of sales. As a seller, you need to determine what profit margin you need to reliably sell your products. The exact profit margin your products will earn depend on several factors like:
  • Product durability
  • Shipping fees
  • Amazon FBA fees
  • The size of your product
  • How much your product costs to source
Sellers also need to understand the differences between gross profit and net profit. What are they? Gross profit includes the total profit made after deducting a product’s cost of goods sold, while net profit is the total profit earned after deducting every expense. With the Algopix online market research tool, you can analyze products to see what kind of profit you can make by selling them. This takes a lot of guesswork out of the equation and provides you with actionable data for 16 international eBay, Amazon and Walmart marketplaces.