May 31, 2023
5 min

Make Your Amazon Payout Schedule Work for You

Learn how the Amazon payout schedule works for sellers, optimize it for your business, and learn about solutions to delays in funding.
Make Your Amazon Payout Schedule Work for You
Table of contents

Amazon payouts are critical to life as an Amazon seller - your business’ success hinges on your ability to get paid consistently and correctly. Understanding how Amazon’s payout system works and different fees to be aware of is vital for your success as an e-commerce business. Here, we’ll take a look at how payouts from Amazon work and several factors to consider when optimizing your payouts.

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How Amazon Payouts Work for Sellers

Amazon payouts are payments sent by Amazon to you, the seller, for products sold on the platform. Once payment for the order has been processed, Amazon holds that money in “escrow” until the order has been shipped. At the time of shipment funds are released to your Amazon account, at which point you can choose how to withdraw the funds into your bank account.

Here’s a step by step how that process works:

  1. A buyer places an order for your product on Amazon.
  2. Payment for the order is processed and those funds are held in escrow.
  3. The product is shipped to the buyer, either by you or via Amazon FBA.
  4. After the product is shipped Amazon holds onto the funds for a period of time.
  5. The funds are then released to your Amazon Seller account.
  6. You can choose how to withdraw funds from your Amazon account to your bank account.

When do Amazon Sellers Get Paid

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You can choose the schedule of your Amazon payouts, with daily, weekly, or bi-weekly options. Amazon, however, defaults to a bi-weekly payout schedule. Let’s break down the pros and cons of each of these options:

Daily Payouts

With daily payouts, you can receive funds from your sales on the same day that they’re collected by Amazon. This will allow you to access your funds as quickly as possible, which can be useful if you need daily cash advances.

However, daily payouts can also be a bit more complicated to manage and tend to be associated with higher fees. Keep in mind that these are not real-time or next-day payments for sales. Although you are getting paid every day, the daily payments will be for sales made 14 days ago to comply with Amazon’s holding period. This is why most sellers use third-party products to get daily payouts, rather than Amazon. Third-party products tend to have much more favorable fee rates, as well as giving you the ability to get yesterday’s sales today.

Weekly Payouts

Getting paid weekly allows sellers to choose a specific day of the week on which they are paid. Weekly payouts tend to provide more stable income for budgeting and cash flow, but do result in delays of up to seven days for cash flow.

Bi-Weekly Payouts

Payouts on a bi-weekly schedule are the default schedule offered by Amazon. Receiving funds only every two weeks can be challenging for some sellers to maintain cash flow, but it can also provide a reasonable balance between convenience and stability. This is also the payment schedule that typically has the lowest fees.

Why Sellers have to Wait for Payouts

Since Amazon handles almost all of the customer experience, they hang onto your money for 14 days to ensure that it is, in fact, revenue. On the off chance that a customer disputes a purchase, the money that Amazon is holding onto will be used to cover it. This portion of revenue kept to cover incidents is called your Account Level Reserve.

Although Account Level Reserves can be annoying to face when you’re trying to keep cash flowing throughout your business, they’re designed to protect both business owners and customers. By maintaining your Account Level Reserve you’re guaranteeing that once the money hits your Seller Account it won’t be needed for refunds.

Typically you will be required to wait at least two weeks from the time of your sale till the money hits your Seller Account. If you’re waiting longer to receive payouts this is likely due to other issues, such as bank details or tax information.

Cash Advance for Sellers

man holding a credit card

Many Amazon sellers use Cash Advance products, like Viably, to help receive faster payment on their sales - whether that’s the next day or the next week. With the help of cash advance products, you can take out an advance to keep your cash constantly flowing through your business.

Be aware though, that while cash advance products might appear to be the best option when you’re strapped for cash, there are still fees and interests associated with them. It’s important to ensure that you’re aware of all these fees to maintain a positive cash flow and make the best decisions for your business.

Fees to Look for in Amazon Payouts

There are several different factors to take into consideration when looking at your Amazon payouts fees. There are transaction fees, payout fees, and potentially more if you are using a cash advance product.

Transaction fees are charged by Amazon for each sale made on their platform. These fees depend on the product category that your sale was in, and have a large range in price. This is essentially Amazon’s “cut” of your product sale.

Additionally, there are Amazon payout fees based on the payment schedule that you choose. These are charged by Amazon for the process of transferring funds from your seller account to your bank account. Typically Amazon payout fees range from $0.25 to $1.50 per transfer.

If your business is struggling with a tight budget due to Amazon’s payout schedule, it might be time to look into cash advance products or alternative funding, like Viably. Viably can help fill the gaps between payouts to help your business maintain a better cash flow and ultimately keep growing. Learn more about what Viably can do for your Amazon business today!

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