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How much does it cost to sell on Walmart Marketplace?


how much does it cost to sell on Walmart Marketplace

“Save Money. Live Better.”


Walmart’s slogan is as familiar to many of us as Nike’s “Just Do It.” And these days, the company isn’t just known for being the biggest retailer in the world—but an emerging online marketplace that’s ranked among the top dogs of eCommerce.


Already, the marketplace has opened its arms to 151,000 third-party sellers, up from just 23,000 in May 2019, according to Statista. Even more impressive: 73% of Walmart Marketplace sellers report profit margins above 20%, according to a JungleScout analysis.


So, if you’re wondering whether Walmart.com is the next great addition to your multichannel selling strategy, ask first “what does it really cost?”


In this blog, we’ll dissect all the fees associated with Walmart Marketplace. Learn how to properly estimate your costs and profits, and gauge whether Walmart offers enough bang for the buck.



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Mandatory Walmart Marketplace fees


One of the greatest appeals of Walmart.com is that it’s free to join. There is no setup or monthly fee, and you can create a Walmart Seller Center account in just a few minutes. Once your business is verified and approved to sell, you can list products to any category (excluding a few that require pre-approval). The only fee you’ll be required to pay is a referral (aka “commission”) fee.



Referral fees: 8% - 15% on average


As a marketplace seller, you’ll only be charged for what you sell. The referral fee is taken as a percentage of your item’s total sales price (TSP), though the exact rate depends on your product category.


In many categories—such as apparel, sporting goods, and video games—the referral fee percentage remains the same whether your product sells for $1.99 or $1,099. But in select categories—such as baby, beauty, and jewelry—the referral fee percentage will vary based on your item’s TSP.


For example:


  • Apparel and accessories - 15%

  • Automotive and powersports - 12%

  • Baby - 8% for items with a TSP of $10 or less; 15% for items with a TSP of more than $10

  • Beauty - 8% for items with a TSP of $10 or less; 15% for items with a TSP of more than $10

  • Books - 15%


Walmart Marketplace currently features more than 35 categories. Referral fees average between 8% and 15%, similar to Amazon seller fees. Yet, there are a few categories like jewelry that carry a referral fee percentage as high as 20%, while others (like personal computers) carry ones as low as 6%. View a full list of Walmart Marketplace referral fees.



Optional Walmart Marketplace fees


While the referral fee is the only Walmart Marketplace fee you have to pay, it’s a good bet that if you use the site, you’ll want to pay for a few additional services, including product storage, shipping, and promotion. Let’s break them down.



An intro to Walmart Fulfillment Services (WFS)


Walmart Marketplace supports two fulfillment methods: You can choose to store, pack, and ship products on your own. Or, you can use Walmart Fulfillment Services (WFS) and outsource logistics to Walmart.


Today, a whopping 80% to 90% of all Walmart products are either sold or fulfilled by Walmart, reports Marketplace Pulse. And, 28 out of 33 third-party sellers use WFS.


This is not unlike Amazon FBA, which is now a prerequisite for Amazon sellers who want to benefit from high rankings and Buy Box positions. Much like FBA, WFS gives online sellers access to two-day shipping and boosts sales by 50% on average, according to Walmart, as a result of greater visibility.


Needless to say, you’ll likely want to give WFS some serious thought. When you use WFS, you’ll pay two fees: One to ship your packages, and another to store your packages.



WFS fulfillment fees: cost varies


WFS fulfillment fees are based on the weight and/or the dimensions of your product.


  • For units that weigh less than 1 lb, use unit weight to determine the fee

  • For units that weigh more than 1 lb, use either the unit weight or the dimensional weight* —whichever one is higher


*Dimensional weight = unit volume in inches (length x width x height) / 139


Note: WFS adds 0.25 lbs of packing weight to a package’s actual unit weight, plus rounds all unit weights up to the nearest pound to get the final shipping weight. You’ll also pay additional fees for apparel, items that cost less than $10, oversize items, and hazardous materials.


The fulfillment fee itself is then calculated as such:


  • 1 lb or less: $3.45

  • 2 lb: $4.95

  • 3 lb: $5.45

  • 4 to 20 lbs: $5.75 + $0.40 for each lb greater than 4 lbs

  • 21 to 30 lbs: $15.55 + $0.40 for each lb greater than 21 lbs

  • 31 to 50 lbs: $14.55 + $0.40 for each lb greater than 31 lbs

  • 51 to 150 lbs: $17.55 + $0.40 for each lb greater than 51 lbs


So, if you’re sending sneakers to a customer and the sneakers weigh 0.75 lbs, the cost would be $3.45 based on a total unit weight of 1 lb (0.75 actual unit weight + 0.25 lb packing).


But, if you’re selling gift boxes that weigh 6 lbs and measure 12 x 10 x 10 inches, you’ll pay a fee based on the dimensional weight (8.63 lb) of your product because it’s larger than the unit weight (6.25 lbs). Your fulfillment fee would come out to be $7.75.


Walmart Marketplace makes it easy for you to add up your exact WFS fees with this WFS calculator.



WFS storage fees: starting at $0.75/cubic foot


The amount you’ll pay WFS to store your inventory depends on the number of cubic feet* you need, the time of year (you’ll pay more during “peak season”), and how long your goods stay in a Walmart fulfillment center.


*Cubic feet = unit volume in inches (length x width x height) / 1,728



January through September

  • 0.75 per cubic foot


October through December

  • For items stored for fewer than or up to 30 days: $0.75 per cubic foot per month

  • For items stored for more than 30 days: $0.75 per cubic foot + $1.50 per cubic foot per month



In addition to these, if your inventory goes unsold and stays in a WFS facility for more than 12 months, you’ll pay a long-term storage fee of $7.50 per cubic foot per month.


Money-saving tip: Don’t give WFS more inventory than you think you’ll sell.



Walmart PPC ads


When compared to Amazon, Walmart offers a far less competitive arena. On Walmart, you’re going up against 151,000 third-party sellers on Walmart, whereas on Amazon, you’re going up against 13 times as many sellers (nearly 2 million).


Even so, you’ll want to make it as easy as possible for Walmart.com shoppers to find your brand and products. That’s where Walmart pay-per-click (PPC) ads come into play.


Walmart PPC advertising breaks down into three categories:


  1. Sponsored products - Ads that place your products near the top of Walmart search result pages, and in designated areas within product pages

  2. Sponsored brands - Ads placed at the top of Walmart.com search results that include a custom headline and up to four products from your brand (you must be registered in the Walmart Brand Portal)

  3. Display ads - Ads that are strategically placed across Walmart.com, the Walmart app, and other locations (including social channels and other properties owned by Walmart)


Walmart Marketplace runs its ad placement like a PPC auction. You place a bid, and the highest bidder wins the slot. To qualify for any Walmart Marketplace advertising, however, you must commit to a monthly spend of at least $1,000 with a daily cap of $100.


Like other marketplaces, Walmart will give you suggested per-item bids based on your specific products. Some online sellers choose to hire a third party to handle their PPC bidding; others do it in-house. To help marketplace sellers learn more about Walmart PPC, the brand recently rebranded its media offerings as Walmart Connect.



An example of a Walmart Marketplace bill


With only a few mandatory fees, adding up total costs to sell on Walmart Marketplace is arguably easier than figuring out the cost to sell on eBay or the cost to sell on Etsy.


For this example, let’s pretend that you’re selling women’s flip flops for $35. You buy them wholesale for $5. You use WFS to store and ship your shoes. Your shoes weigh 10 oz (or 0.63 lb), so, after adding the extra 0.25 lb in WFS packing fee, your unit weight comes out to 0.88 lb. Your package dimensions come out to be 13 x 7.5 x 4 inches.


Here’s what your bill will look like once the transaction is complete.



Description

Amount

Item price

$35

Product cost

-$5

WFS shipping fee

-$3.45

Referral fee (15%)

-$5.25

WFS storage cost (Jan - Sept)

-$0.17

Net profit from sale

$21.13 (60%)



Selling on Walmart Marketplace: Can it really be this simple?


Walmart has done a good job of making its Walmart Marketplace fees as streamlined and easy to understand as possible. Yet, there are some things eCommerce business owners must know before they commit to Walmart Marketplace:


1. You must maintain very high standards. If you want to participate in WFS, win Walmart PPC ad bids, or get your products listed higher in organic searches on Walmart.com, you’ll need to meet Walmart Marketplace’s performance expectations. To do so, you must:


  • Price your items competitively (remember, many Walmart shoppers expect discounts and low prices)

  • Always keep products in-stock

  • Offer free shipping (or keep the shipping price low)

  • Deliver products on-time or early

  • Maintain positive product and brand reviews


Should you fail to meet these standards, Walmart can suppress your listings and/or revoke your rights to selling on its platform.


2. Walmart Marketplace is best for experienced merchants. While Walmart has loosened up its requirements and simplified the signup process, the most successful sellers tend to come with existing eCommerce experience. (Until recently, Walmart’s application process required sellers to show proof of previous marketplace or eCommerce success.)


Seasoned sellers benefit from having carefully curated and tested products, a clear understanding of their target market, a firm grasp of their numbers, and—at times—brand recognition. Not to mention, those with experience selling on other marketplaces like Amazon can more easily adapt to Walmart’s rules of engagement, which otherwise come with a steep learning curve.


3. Walmart holds the reins. As with any third-party marketplace, you lose control over many aspects of the customer experience in exchange for exposure. At the end of the day, Walmart has total control over your selling privileges. You’ll have to abide by Walmart’s regulations for product listing, fulfillment, customer interactions, and more. Go off-script, and you risk getting kicked out. This can be unnerving for sellers who rely heavily on Walmart (or other third-party channels) for a bulk of their sales.



The bottom line: Is it worth it to sell on Walmart Marketplace?


Right now, Walmart Marketplace is growing more than five times faster than Amazon, which means it’s worth looking into as a potential channel for your products. But, as the saying goes, “don’t put your eggs in one basket.”


Diversify your sales channels and create an online store that’s all your own. Get started easily with Wix for eCommerce. Create a free eCommerce website today (only upgrade when you’re ready to start selling) and take advantage of Wix’s built-in tools for catalog management, inventory management, price management, SEO, and more.



Allison Lee headshot

Allison Lee

Editor, Wix for eCommerce


Allison is the editor for the Wix eCommerce blog, with several years of experience reporting on eCommerce news, strategies, and founder stories.


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