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You should track five main cost categories for your Amazon business:
Tracking all these categories gives you a complete picture of your true cost structure and helps you identify areas for optimization.
Total Cost of Goods (COGS) = Product Cost + Shipping to Amazon + Packaging + Prep Fees + Customs & Duties. For example, if a product costs $3.50 to manufacture, $0.80 to ship to an Amazon warehouse, $0.30 for packaging, and $0.20 for prep work, your total COGS per unit is $4.80.
Use the ylishi.tools Cost Tracker to automatically aggregate all your per-unit costs and get an accurate COGS figure. Always include landed costs (duties, freight, insurance) to avoid underestimating your true product cost.
Fixed costs remain the same regardless of how many units you sell — these include warehouse rent, software subscriptions, salaries, and insurance.
Variable costs change proportionally with your sales volume — these include product cost per unit, Amazon FBA fulfillment fees, referral fees, shipping costs, and PPC ad spend.
Understanding this distinction is critical: when sales drop, fixed costs still must be paid, while variable costs decrease naturally. A healthy business tracks both separately so you can calculate your break-even point and make informed pricing decisions.
Track advertising costs by collecting data from three sources:
Key metrics to monitor include Advertising Cost of Sales (ACoS), Total Advertising Cost of Sales (TACoS), and Return on Ad Spend (ROAS). The ylishi.tools Cost Tracker lets you log monthly ad spend across all channels and calculate your blended advertising cost per unit sold.
Cost tracking is essential because many Amazon sellers focus only on revenue while overlooking hidden expenses that erode profit margins. Without proper cost tracking, you may unknowingly sell products at a loss after accounting for returns, storage overages, advertising spend, and currency exchange fees.
Regular cost tracking helps you:
Sellers who track costs weekly typically find 10-20% more savings opportunities compared to those who only review quarterly.
| Cost Category | Examples | Typical Range |
|---|---|---|
| Product Cost | Manufacturing, raw materials, packaging | 20-35% of revenue |
| Amazon Fees | Referral (8-15%), FBA fulfillment ($2.68-$7.22) | 25-35% of revenue |
| Shipping & Logistics | Inbound freight, customs, prep fees | 3-8% of revenue |
| Advertising (PPC) | Sponsored Products, external ads | 10-25% of revenue |
| Storage | Monthly FBA storage, long-term fees | 1-5% of revenue |
| Operational Overhead | Software, salaries, accounting | 5-15% of revenue |
| Returns & Refunds | Return shipping, lost inventory, restocking | 2-8% of revenue |