Amazon Profit Margin: What's Left of $24.99 on Each Channel?

Part 2: Amazon, TikTok Shop, Shopify and retail, worked out one channel at a time

In part 1, we saw why a Korean price converted at the exchange rate is not a US price. You build the price up from your landed cost, then check it against what US shoppers will pay.

That post ended with an open question.

Even with the right retail price, what you keep depends on where you sell.

Brands we work with ask us this all the time:

"Our price is $24.99. Do we keep more on Amazon or on our own store?"

"Retail brings bigger orders. Isn't that better?"

The short answer: the same $24.99 can leave you more than three times as much on one channel as on another. Below, we take the product from part 1 and work out its Amazon profit margin, then what is left on each other channel.

The example product: a $24.99 beauty item with a $7 landed cost

Every calculation in this post uses the same product as part 1.

Retail price (MSRP): $24.99
Landed cost (the cost of one unit delivered to a US warehouse): about $7. That is product cost $5, international freight and import costs $1.20, and freight to the warehouse $0.80.
Size: a 4 to 8 oz beauty product

Platform fees come from each platform's official fee pages as of October 2026. Ad spend and logistics costs are example figures. Margins come from the industry sources named below. Your real numbers depend on category, size and weight, volume and contract terms. What matters is which costs come out, and in what order.

1. Amazon seller fees: a $24.99 item leaves about $5.90 on Amazon

Three costs come out of every Amazon sale: the referral fee, the FBA fee and advertising.

Referral fee: 15% in Beauty, Health and Personal Care when the price is over $10, per Amazon's fee schedule. At $24.99 that is $3.75.
FBA fulfillment fee: most beauty bottles and jars are too thick for small standard, so they fall in large standard. Under Amazon's 2026 FBA fees, a 4 to 8 oz item is $3.95, plus the 3.5% surcharge added on April 17, 2026: about $4.09.
Advertising: for example, 15% of sales, about $3.75. New listings with few reviews often spend more.
Inbound costs: freight to the FBA warehouse plus the inbound placement fee, for example about $0.50 per unit.

Price $24.99 - referral fee $3.75 - FBA fee $4.09 - ads $3.75 - inbound $0.50 - landed cost $7 = about $5.90

The $5.90 Amazon leaves is before two seasonal costs. From October 15, 2026 to January 14, 2027, the holiday peak fee takes the same item's FBA fee to about $4.36. Monthly storage goes from $0.78 per cubic foot in January to September to $2.40 in October to December.

2. TikTok Shop fees: creator commission decides the margin

A $24.99 item leaves about $4.70 on TikTok Shop. The referral fee is lower than Amazon's, but creator commission and samples cost more.

Referral fee: 6% for beauty on TikTok Shop's fee page, about $1.50.
Creator (affiliate) commission: TikTok Shop lets you set it anywhere from 1% to 80%. In MediaLabs' 2026 benchmarks, beauty commissions mostly ran 15 to 25%. For example, at 15%, about $3.75.
Pick, pack and ship from a US 3PL: for example, about $6.
Samples and promotions: free product for creators and coupons, for example about $2 per unit sold.

Price $24.99 - referral fee $1.50 - creator commission $3.75 - fulfillment $6 - samples and promotions $2 - landed cost $7 = about $4.70

Some trade press reports that the referral fee has already gone up to 8%. Ecommerce Times dates the change to July 1, 2026, and another outlet says August 4. In October 2026, TikTok's own fee page still shows 6%. At 8%, you would keep about $0.50 less per unit.

Most TikTok Shop sales come through creator videos. So the commission you offer and the samples you send decide your margin more than the referral fee does. If you ship from the US, see when a US 3PL starts to make sense.

3. Shopify fees are low, but customers are not free

A $24.99 item leaves about $3 on a Shopify store. With Shopify Payments there is no selling fee, only card processing, but you pay to bring in every customer.

Card processing: 2.9% + $0.30 on the Basic plan, per Shopify's pricing page, about $1. A third-party payment provider adds another 0.6 to 2%.
Shipping: for example, about $7. US shoppers expect free shipping, so the brand usually pays most of it.
Ads to bring in customers: for example, about $7 per order, or about 28% of sales.

Price $24.99 - card processing $1 - shipping $7 - customer acquisition $7 - landed cost $7 = about $3

Your own store looks like the best deal because the fees are low. But nobody finds a new store by accident. You pay for every visit, and that ad spend decides the margin.

Repeat customers change the math. A second order costs little or nothing to win. A store's margin improves as repeat buyers grow.

4. Retail through a distributor leaves the least per unit

Selling through a distributor into retail leaves about $1.65 on a $24.99 item. Retail works the other way around: you start from what is left after each partner takes its margin.

Retail margin: Beauty Independent reports that retailers take at least 50% of every dollar, and Femfounded puts specialty beauty retailers like Sephora at 50 to 60%. Mass retailers take about 30 to 38%. At 50%, the retailer buys at about $12.50.
Distributor margin: usually 20 to 30% in US consumer goods, according to CPGBrokers. At 25%, your price to the distributor is about $9.40.
Retail logistics: pallet shipping, labeling and the like, for example about $0.75 per unit.

Your price to the distributor $9.40 - retail logistics $0.75 - landed cost $7 = about $1.65

The $1.65 retail leaves is before promotions, testers, chargebacks and returns. And because retailers pay on terms, it arrives months later.

Amazon profit margin vs. the other channels

Here is what the same $24.99 beauty product leaves per unit on each channel, before fixed costs:

Channel	Biggest costs	Left per unit	Not yet deducted
Amazon	15% referral fee, FBA fee, ads	about $5.90	Peak fee, Q4 storage
TikTok Shop	Creator commission, samples	about $4.70	A possible fee increase
Shopify store	Customer acquisition, shipping	about $3	Improves with repeat buyers
Retail through a distributor	Retailer and distributor margins	about $1.65	Promotions, chargebacks, returns

One retail price, four very different results.

Why not set a different price on each channel?

Setting a different price on each channel rarely works. The question usually comes up like this:

"Can we charge more in retail and less on Amazon?"

US shoppers compare prices across channels in seconds. Retailers do not want to stock a product that sells for less elsewhere. Under its Fair Pricing policy, Amazon can also remove your offer from the Featured Offer (the Buy Box) when another retailer sells it for less.

So most brands keep one MSRP on every channel. Your price is not a number you set per channel. It is one number that every channel has to live with.

Test your US price on the channel that leaves the least

Your US price has to make a profit on the channel that leaves the least. This is why part 1 said to price for the channels you plan to add, not only the one you start with.

If you start on Amazon but plan to enter retail in a year or two, check the retail math now. If retail leaves $1.65 a unit, you will struggle to say yes when a buyer calls. Raising the MSRP at that point clashes with your reviews, your sales history and the price shoppers already know.

Before you lock in your price, answer these:

1. What do you keep per unit on the channel you sell on today?

2. Which channels will you add in the next one to two years?

3. Does the same MSRP still leave a profit there?

4. If not, what can you change: product cost, size, packaging or positioning?

Wrap-up

Most brands entering the US ask which channel will sell the most. Put in numbers, the better question is which channel leaves you the most per unit.

On Amazon, referral fees, FBA and ads decide your margin. On TikTok Shop, creator commission and samples decide it. On Shopify, the cost of winning customers decides it. In retail, partner margins and program costs decide it. The cost lines differ by channel, so the same price gives very different results.

LinkONE works with brands entering the US to work out sales structure and margin channel by channel, and to set a price that works for the channels they sell on now and the ones they plan to add.

In the end, your US price has to work on the channel that leaves you the least, not the one that leaves you the most.

In the next post, we look at how to protect that price through discounts and promotions.

Frequently Asked Questions

How much does Amazon take from each sale?

As of October 2026, Amazon takes a 15% referral fee in Beauty, Health and Personal Care when the price is over $10, and 8% at $10 or less, with a $0.30 minimum (Amazon fee schedule). Rates differ by category. If you use FBA, a fulfillment fee based on size and weight comes on top.

How much is the Amazon FBA fee in 2026?

For a large standard item of 4 to 8 oz priced $10 to $50, the 2026 FBA fee is $3.95, or about $4.09 with the 3.5% surcharge. From October 15, 2026 to January 14, 2027, the holiday peak fee takes it to about $4.36 (Amazon 2026 FBA fees). Check the table for your exact size and weight.

What are TikTok Shop fees?

As of October 2026, TikTok Shop's official US referral fee for beauty is 6% (TikTok Shop fee page). You also pay the creator commission you set, from 1% to 80%. Trade press reports an increase to 8%, but TikTok's fee page does not show it yet.

What are Shopify's fees?

With Shopify Payments, online card payments cost 2.9% + $0.30 on Basic, 2.7% + $0.30 on Grow and 2.5% + $0.30 on Advanced (Shopify pricing). A third-party payment provider adds 0.6 to 2%. The monthly plan fee is separate.

What margin do US retailers take?

US retailers take 50 to 60% in specialty beauty (Femfounded) and about 30 to 38% at mass retailers (Big Box Broker). A distributor in between usually takes another 20 to 30% (CPGBrokers). These are industry figures, and contracts vary.

Sources

Fees and rules in this post are as of October 2026.

-LinkONE-