Amazon FBA ROI = (Net Profit ÷ Total Investment) × 100. Calculate net profit by subtracting all costs (COGS, Amazon fees, shipping, advertising) from revenue. A healthy FBA ROI target is 100%+ (doubling your money), with minimum viable ROI typically at 30-50%.
FBA ROI = (Net Profit ÷ Total Investment) × 100. Net Profit = Revenue - COGS - Amazon Fees - Shipping - Advertising. Total Investment = Product Cost + Shipping to Amazon + Any prep costs. Example: $10 profit on a $10 investment = 100% ROI.
A good FBA ROI is 100% or higher, meaning you double your investment. Minimum viable ROI is typically 30-50% depending on your volume. Higher-volume sellers can accept lower ROI per unit because total profit is larger.
Include: product cost (COGS), shipping to Amazon, prep and labeling fees, Amazon referral fees, FBA fulfillment fees, monthly storage fees, advertising costs (PPC), returns and damages, and any software or tool subscriptions allocated per unit.
ROI measures return relative to your investment (money put in). Profit margin measures profit relative to revenue (money received). A product could have a 20% profit margin but 100% ROI if your investment per unit is half the selling price.
Improve ROI by negotiating better supplier prices, optimizing product packaging to reduce FBA fees, lowering advertising costs through better targeting, reducing returns through improved listings, and managing inventory to avoid long-term storage fees.
Track every fee, calculate true profit per unit, and never guess your margins again.
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