Average overhead percentage?

[ByronM]

What is your average overhead percentage in cost for ecommerce per product? For example if you add up.

1. Hosting
2. Merchent Fees
3. Credit Card Processer fees

I realize this can be confidential data for many, but i'm interested in knowing what the average cost is in percentage compared to the final value since most shopping systems supported by the "big boys" such as yahoo, amazon and other major cart systems have fixed percentages all over the place and just wondering if its paid off for those "DIY" ecommerce sites or if they wish they accepted the higher upfront costs for better store performance, reliability and processing.

[Essex_boy]

My hosting is around $20 per year and card costs are 5.5% per transaction.

I think ive giot them to a point where cost/quality time/effort is about right.

[AffiliateDreamer]

Say your product is retailing for $100, and it cost you $70. So that means you have marked your product up around 40% from cost.

Now if the CC take 2.5%, that is 2.5% of the GROSS sale, which in the above case is $2.5.

Now your profit from the sale is: $100 - 70 = $30 or 30% before taking into consideration other expenses.

Now in reality the credit card copmany is taking 2.5/30 = 8.33% from your actual profit.

That hurts doesn't it? hehe

[ByronM]

I asked this mainly because i'm interested in using webstores and fba (fulfilment by amazon).

I'm negotiating stickerless inventory with amazon on the fba and if that goes through i figure i'll have all my suppliers send directly to the warehouse and let amazon do all of my fulfillment i don't already have a group purchase or fulfillment center on.

Amazon charges 7% of total bill of sale and 59/month for the service. Seems expensive but in the long run if you have a large catalog, decent amount of traffic and selling items you can't afford to have bad charges on the amazon credit scrubbing/merchant billing included is worth it alone.

[AffiliateDreamer]

7% off the gross sale is what they take?

Will you be running your own custom cart?

[ByronM]

amazon webstores provides the entire kit n kaboodle. Shopping cart, a to z guarantee, invenory management, order processing, site hosting & all. (highly available as well)

[AffiliateDreamer]

so your site will be hosted within the amazon.com domain?

So basically you really lose out on your branding.

[ByronM]

Not really. You use your own domain name and the site is branded according to the templates you use and how you modify them.

The shopping cart system itself is powered by amazon.com functionality so its really full featured for comparison, hot items, recommended items, checkout process and using the great amazon fraud prevention systems and a2z guarantee