seller
- What changed
- Whether Amazon is a profitable channel for a new or existing brand
- When
- Updated October 2026, using Amazon's 2025 seller data
- Who it affects
- Brand owners, retailers and first time sellers
- What to do
- Run the margin test below before committing inventory
Key takeaways
- Amazon says US independent sellers averaged over $375,000 in 2025 sales, but sales are not profit.
- It is worth it when margin covers fees and ads, the product is different, and supply is reliable.
- Run the margin and differentiation test before buying inventory.
| Worth it | Not yet | |
|---|---|---|
| Margin above 30% after fees | ||
| Product clearly different | ||
| Budget for launch ads | ||
| Reliable reorders | ||
| Competes on price alone | ||
| Needs profit in month one |
Pass most rows on the left before buying inventory
The short answer: who Amazon is worth it for
Amazon is worth it when your product can earn a profit after Amazon's fees and advertising, and when you can supply it reliably. It suits brands that can differentiate their product, invest in good listings, and treat Amazon as a long term channel. It is a poor fit for products that sell on price alone, very low priced items where fees take most of the margin, and sellers who need fast profits.
What Amazon's data says about seller results
Amazon's 2025 Small Business Empowerment Report gives the most recent official figures. US independent sellers averaged more than $375,000 in annual sales in Amazon's store in 2025, nearly a 30% increase from 2024. More than 75,000 independent sellers passed $1 million in sales, up 36% from 2024, and over 11,000 US based sellers grew sales more than tenfold. New sellers generated more than $18 billion in sales in 2025.
Amazon also says selling partners account for more than 60% of sales in its store. These are Amazon's own numbers and they describe sales, not profit, and averages are pulled up by the largest sellers. They show the size of the opportunity, not what a typical new seller will earn.
Amazon's 2025 seller numbers
What selling on Amazon really costs
Amazon's fees are predictable but add up. A Professional plan costs $39.99 a month. Referral fees are a percentage of each sale, mostly 8% to 15% depending on category, with a $0.30 minimum in most categories. Fulfillment by Amazon adds per unit fulfillment and storage fees, and most brands need advertising to be seen. Our guides to Amazon FBA fees and Amazon fee changes in 2026 break down the details.
- Selling plan: $39.99 a month
- Referral fee: mostly 8% to 15% of the price
- FBA fulfillment and monthly storage fees
- Advertising, often the largest variable cost
- Returns, refunds and unsellable units
- Photography, A+ Content and listing design
The real benefits of selling on Amazon
The main benefit is demand. Shoppers come to Amazon ready to buy, and a good listing can reach them without building an audience first. FBA handles storage, shipping, customer service and returns, and Prime delivery raises conversion. For brands, Brand Registry adds free tools, and Amazon says new brands can earn 10% back on their first $50,000 in branded sales, then 5% back through the first year until $1,000,000.
- Large built in audience with purchase intent
- FBA logistics and Prime eligibility
- Free brand tools: A+ Content, Stores, Brand Analytics
- New seller and new brand incentives
- Fast feedback on demand through sales and search data
The risks and downsides
Amazon controls the marketplace. Fees and policies change, such as the 75 character title limit enforced from July 27, 2026, and listings can be suppressed or accounts suspended for compliance issues. Competition is intense, copycats appear quickly in successful niches, and you do not own the customer relationship the way you do on your own site. Cash is also tied up in inventory and payouts.
None of these is a reason to avoid Amazon, but each needs a plan: diversify channels, protect your brand, keep account health clean and keep a cash buffer.
A simple test: is Amazon worth it for your product?
Answer these questions honestly before you commit. If you cannot pass most of them, fix the product or pricing first.
- After referral, FBA and shipping costs, is your margin above 30% of the price?
- Can you afford advertising at a cost of 10% to 20% of sales during launch?
- Is your product meaningfully different from the top ten results?
- Can you reorder inventory reliably within your lead time?
- Do you have, or can you file, a trademark for Brand Registry?
- Can you wait several months for the channel to become profitable?
Amazon vs selling on your own website
Your own store gives you customer data, branding control and higher margins per order, but you must create all the traffic yourself. Amazon gives you traffic but takes a larger cut and more control. Most successful brands use both: Amazon for demand and scale, their own site for loyalty and margin. Our comparison of Shopify vs Amazon FBA goes deeper.
If you decide to go ahead, read how to start an Amazon business and how does selling on Amazon work for the practical setup.
How PPC Spider helps brands decide and grow
PPC Spider's Amazon account management service starts with the numbers: margin after fees, the ad cost a product can carry, and the competition it faces. SpiderOS then sets target ACoS from margin and watches bids, budgets and stock daily. A free Amazon audit is the quickest way to see if your products can be profitable on Amazon.
Sources
- About Amazon: A record number of independent sellers surpassed $1 million in sales in 2025 (aboutamazon.com/news/small-business/amazon-2025-small-business-empowerment-report)
- Amazon: Selling plans and fees (sell.amazon.com/pricing)
- Amazon: Brand Registry benefits (sell.amazon.com/brand-registry)
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