Amazon Seller Glossary
Key terms, metrics, and concepts every Amazon seller needs to understand. From ACoS to VAT, explained clearly.
A
ACoS (Advertising Cost of Sales)
The percentage of ad spend relative to the revenue generated by those ads. Calculated as (Ad Spend ÷ Ad Revenue) × 100.
ASIN (Amazon Standard Identification Number)
A unique 10-character alphanumeric identifier assigned by Amazon to every product in its catalog. Starts with "B0" for most products.
Aged Inventory Surcharge (Long-Term Storage Fee)
An additional fee Amazon charges for inventory stored in FBA warehouses for more than 180 days. Previously called Long-Term Storage Fee (LTSF). Increases significantly at 270+ and 365+ days.
B
BSR (Best Sellers Rank)
Amazon's ranking system that indicates how well a product sells relative to others in the same category. Lower BSR means higher sales volume.
Brand Registry
Amazon's program for trademark-registered brands that provides listing protection, enhanced content tools (A+ Content), Sponsored Brands access, and Brand Analytics data.
Buy Box (Featured Offer)
The "Add to Cart" section on a product detail page. When multiple sellers offer the same product, Amazon rotates the Buy Box among eligible sellers based on price, fulfillment, and performance metrics.
C
COGS (Cost of Goods Sold)
The direct costs of producing or purchasing the products you sell, including manufacturing, shipping to Amazon, and packaging. Essential for calculating true profit.
CTR (Click-Through Rate)
The percentage of ad impressions that result in clicks. Calculated as (Clicks ÷ Impressions) × 100. A key indicator of ad relevance and creative quality.
Cash Conversion Cycle (CCC)
The number of days between paying your supplier for inventory and receiving payment from Amazon. A critical metric for managing cash flow in Amazon businesses.
Conversion Rate (Unit Session Percentage)
The percentage of sessions that result in a purchase. Amazon calls this "Unit Session Percentage." Calculated as (Units Sold ÷ Sessions) × 100.
F
FBA (Fulfillment by Amazon)
Amazon's fulfillment service where sellers ship products to Amazon warehouses, and Amazon handles storage, packing, shipping, customer service, and returns.
FBA Fees (Fulfillment by Amazon Fees)
The fees Amazon charges for storing, picking, packing, and shipping your products through the FBA program. Includes fulfillment fees (per unit) and monthly storage fees.
FBA Reimbursement
Compensation Amazon owes you when they lose, damage, or incorrectly handle your FBA inventory. Sellers must often identify and claim these manually.
FBM (Fulfilled by Merchant)
A fulfillment method where the seller handles storage, packing, shipping, and customer service directly, rather than using Amazon's FBA warehouses.
FNSKU (Fulfillment Network Stock Keeping Unit)
Amazon's internal barcode for FBA inventory that links a product to a specific seller's account. Prevents commingling of inventory between sellers.
I
IPI Score (Inventory Performance Index)
Amazon's metric (0-1000) that measures how efficiently you manage FBA inventory. Scores below the threshold can result in storage limits and higher fees.
Inventory Age
The number of days units have been stored in Amazon's FBA fulfillment centers. Aged inventory (180+ days) incurs escalating surcharges.
P
PPC (Pay-Per-Click)
Amazon PPC is advertising where you pay when a shopper clicks your ad. In search campaigns you bid on keywords or products, and an auction decides where your ad appears and what each click costs.
Page Views
The total number of times your product detail pages are viewed. Unlike sessions, page views count every visit including repeat views by the same shopper.
Profit Margin
The percentage of revenue that remains as profit after deducting all costs (COGS, Amazon fees, PPC, shipping, operating expenses). Net profit margin = (Net Profit ÷ Revenue) × 100.
R
ROAS (Return on Ad Spend)
The revenue generated for every dollar spent on advertising. Calculated as Ad Revenue ÷ Ad Spend. The inverse of ACoS.
Referral Fee
The commission Amazon charges on every sale, typically 8% to 15% of the selling price depending on the product category. This is Amazon's primary revenue from marketplace sellers.
Reorder Point
The inventory level at which you should place a new purchase order to avoid running out of stock, calculated based on sales velocity, lead time, and safety stock.
S
SFP (Seller Fulfilled Prime)
A program allowing FBM sellers to display the Prime badge by meeting Amazon's delivery speed and performance requirements from their own warehouses.
SKU (Stock Keeping Unit)
A unique identifier you assign to each product variant in your inventory. Used internally for tracking, unlike ASIN which is Amazon's identifier.
Sell-Through Rate
The number of units sold and shipped over the past 90 days divided by the average number of units in FBA inventory during that period. Higher is better.
Sessions
The number of visits to your product listing pages within a 24-hour period. One session can include multiple page views but counts as a single visit.
Settlement Period
The 14-day cycle during which Amazon accumulates your sales revenue, deducts fees, and disburses the remaining balance to your bank account.
Sponsored Brands
Amazon PPC ads featuring your brand logo, a custom headline, and up to three products. They appear at the top of search results and help drive brand awareness.
Sponsored Products
Amazon's most common PPC ad type. Individual product listings appear in search results and on product detail pages, marked with a "Sponsored" label.
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