Unlocking Savings: The Impact of 0% Referral Fees on Amazon's Most Popular Categories

If you’re an Indian seller or brand exploring Amazon’s marketplace, you’ll love this: starting 7 April 2025, Amazon India rolled out zero referral fees on products priced below ₹300 across 135+ categories, from apparel, beauty, and home décor to groceries and pet products.

This change isn’t a gimmick. For you as a seller, it can reshape your cost structure and how you price and package items. Let me break down what this means in practice and how you can turn this into a competitive edge.

What Changed and Why It Matters?

Let’s see how this update impacts your business. 

The “0% referral fee” condition

Previously, every sale on Amazon attracted a referral fee (a commission percentage based on category), even for low-priced goods. But now, for 135+ subcategories, if your product price is ≤ ₹300, no referral fee is charged.

To illustrate: a ₹299 skincare item in “Beauty” now avoids that commission entirely. In contrast, selling it previously would have attracted some percent fee, cutting into your margin.

Amazon also reduced weight handling fees for items under 1 kg (savings up to ₹17 per unit) and revised shipping rates (Easy Ship / Seller Flex) to a flat rate (₹65) from ₹77. The result? For small, high-volume SKUs, your cost base drops significantly.

Categories included

The 0% referral applies across apparel, shoes, fashion jewelry, home décor, kitchen, beauty, grocery, baby & pet, toys, and many more. If you sell basics, e.g., fashion accessories, small home goods, and personal care, you are very likely to benefit the most from it.

Strategic Implications for Sellers

Here’s how sellers can use the 0% referral fee update to gain a competitive edge and boost profitability. 

Rethink pricing and bundling

You can now price items more aggressively (below ₹300) without losing margin to Amazon’s commission. Or bundle small add-ons to make the value seem higher while staying under the ₹300 mark. 

Lean into micro-SKU growth

Low-cost, fast-moving SKUs suddenly become more lucrative. You may want to diversify into “small ticket” items you previously ignored because referral fees rendered them unattractive.

Monitor category alignment

Ensure your ASIN is mapped to the correct subcategory (that’s part of those 135). A mismatch could disqualify you from the zero-referral benefit.

Don’t forget other fees

Referral fees are only one part of the cost. You’ll still pay closing fees, pick & pack, storage, and FBA or fulfillment costs. But on sub-₹300 items, the savings on referral fees are a strong margin uplift.

Use the window to test new products

This may be the best time to experiment with new small-value SKUs, because your downside risk is lower. You get a higher net margin on micro-items and better insights into what scales.

How to Get Started and Stay Ahead

• Recompute your profitability using the new scheme and run simulations for your SKUs across price tiers.

• Restructure listings to ensure your eligible SKUs are correctly categorized.

• Try price thresholds around ₹250–₹300 to see where the demand judgement is optimal.

• Monitor Amazon’s fee updates.

• Link your customers to your Amazon storefront or encourage them to buy via Amazon.  

Turning Amazon’s Fee Change into Profit

The 0% referral fee move is a bold shift by Amazon India; it gives sellers fresh breathing room on margins, especially for low-value, high-velocity items. If you structure your SKUs and catalog wisely, this can be the turning point you needed to scale profitably.