Overview

Amazon's Merch Collab program allows sellers to offer products featuring licensed brand designs, but participation comes with a distinct fee structure beyond standard selling fees. Understanding these costs is essential for sellers considering Merch Collab, as the additional royalty payments directly affect profit margins on every sale.

Key Points / What Sellers Need to Know

• Two-layer fee structure — Merch Collab products are subject to both a referral fee and a separate brand royalty fee, charged on top of any standard Amazon selling fees.
• Uniform rates across categories — Every Merch Collab product category carries the same fee percentages: a 5% referral fee and a 15% brand royalty, making cost calculations straightforward.
• Minimum brand royalty applies — A minimum brand royalty fee of $1.50 per unit is enforced, which means lower-priced items may see a proportionally higher fee impact.
• Fees based on total sales price — Both the referral fee and brand royalty are calculated on the total amount the buyer pays, including the product price, shipping charges, and gift-wrapping fees, but excluding taxes collected through Amazon's tax calculation services.
• Broad category coverage — The fee schedule applies uniformly across all eligible Merch Collab product categories, from apparel and accessories to home goods and beyond.

How the Fee Calculation Works

When a Merch Collab product sells, Amazon deducts fees from the seller's proceeds in a specific order. The total sales price is first determined by adding together the item price, any delivery charges, and gift-wrapping fees paid by the customer. Taxes calculated through Amazon's tax calculation services are excluded from this total. Amazon then applies the 5% referral fee and the 15% brand royalty to this figure. If the calculated brand royalty falls below $1.50, the minimum brand royalty of $1.50 is charged instead. These deductions happen automatically before the remaining balance is deposited into the seller's account.

For example, if a Merch Collab t-shirt sells for $25 with $5 shipping, the total sales price would be $30. The 5% referral fee would be $1.50, and the 15% brand royalty would be $4.50. In total, $6.00 in Merch Collab-specific fees would be deducted from that sale, in addition to any other standard Amazon fees that apply.