Search “Amazon FBA” on YouTube and you’ll find thousands of videos showing screenshots of six-figure seller dashboards, people unboxing product samples from China, and claims about “passive income from Amazon.” Then search “Amazon FBA scam” and you’ll find thousands more from people who lost their savings.
So which is it?
The straightforward answer: Amazon FBA is not a scam. It’s a legitimate fulfilment service offered by one of the world’s largest companies. You send products to Amazon’s warehouses. They store, pack, and ship them to customers. Amazon handles returns and customer service. You pay fees for these services.
What is often misleading: the courses, gurus, and influencers who portray FBA as easy money requiring minimal effort and investment. The reality involves substantial startup capital, inventory risk, intense competition, and profit margins that are thinner than most beginners expect.
I’ve spent 15+ years evaluating income methods. Here’s the balanced assessment.
Before We Start…
Hey, my name is Mark.
After 15+ years testing income methods, I’ve watched Amazon FBA go from a genuine opportunity with reasonable barriers to a hyper-competitive marketplace where the costs of entry have risen dramatically.
The best method I’ve found for building recurring income is local lead generation. I build simple 2-page websites that show up in Google and generate leads for local businesses. Each site pays $500–$1,200 monthly, recurring, with 92–97% margins.
Go here to see the exact system I use to do this.
But first — the full Amazon FBA assessment.
What Amazon FBA Actually Is
FBA stands for “Fulfilment by Amazon.” You source or manufacture products, ship them to Amazon’s fulfilment centres, and list them on Amazon’s marketplace. When a customer orders your product, Amazon picks, packs, and ships it. They also handle customer service and returns for FBA orders.
You’re responsible for: finding products, sourcing or manufacturing them, creating listings, marketing (PPC advertising, optimisation), and managing your business finances.
Amazon is responsible for: storing inventory, shipping orders, handling returns, and providing customer service.
For the full platform overview, Amazon FBA covers the operational details. For broader Amazon monetisation, how to make money on Amazon provides additional context.
Why People Call It a Scam
Reason 1: Misleading Course Marketing
The biggest source of “Amazon FBA is a scam” sentiment comes from FBA courses — not FBA itself. Many courses cost $997–$4,997 and market FBA as a simple, passive income opportunity. Students who invest in these courses plus $5,000–$15,000 in inventory often discover that reality is far more complex and expensive than presented.
The course is the product, not the knowledge. Many FBA course creators earn more from selling courses than from selling on Amazon. Their income screenshots may be genuine, but their results aren’t typical or easily replicable.
Reason 2: Hidden and Underestimated Costs
FBA involves numerous fees that beginners don’t anticipate: referral fees (8–15% depending on category), FBA fulfilment fees ($3–$8+ per unit), monthly storage fees, long-term storage fees, PPC advertising costs, and returns processing fees.
A product that appears to have a 50% margin on paper often has a 15–25% margin after all Amazon fees, advertising costs, and returns.
Reason 3: Inventory Risk
You invest $3,000–$10,000+ in inventory before selling a single unit. If the product doesn’t sell, you lose that capital. If Amazon changes its policies, suspends your listing, or a competitor undercuts your price — your inventory sits in a warehouse costing you storage fees.
Reason 4: Account Suspension Risk
Amazon suspends seller accounts for policy violations — sometimes legitimately, sometimes due to false complaints from competitors. A suspended account with $20,000 of inventory in Amazon’s warehouses creates a nightmare scenario that new sellers rarely anticipate.
The Real Startup Cost Breakdown
| Cost Category | Range | Notes |
|---|---|---|
| Amazon Professional seller account | $39.99/month | Required for serious selling |
| Product samples | $100–$500 | Testing before bulk order |
| Initial inventory order | $1,500–$8,000+ | Minimum order from manufacturer |
| Shipping to Amazon warehouse | $300–$2,000 | Depends on product size/weight |
| Product photography | $200–$500 | Professional listing images |
| Amazon PPC advertising (first 3 months) | $500–$3,000 | Essential for new product visibility |
| UPC/barcode | $30–$250 | Required for listing products |
| Brand registry/trademark | $275–$400 | Recommended for brand protection |
| Product liability insurance | $500–$1,500/year | Required above $10K in sales |
| Total minimum startup | $3,000–$8,000 | |
| Realistic startup with marketing | $5,000–$15,000 |
Most FBA courses mention $1,000–$3,000 startup costs. The realistic range is $5,000–$15,000 before you sell your first unit. This is a real business with real capital requirements.
What’s Legitimate About Amazon FBA
The platform is real. Amazon processes billions in third-party seller transactions annually. Hundreds of thousands of sellers operate profitable FBA businesses.
The fulfilment service is genuinely valuable. Storing, packing, and shipping products yourself is expensive and time-consuming. FBA’s logistics infrastructure is world-class.
The marketplace reach is unmatched. Amazon has 200+ million Prime members in the U.S. alone. No independent website can match this built-in buyer audience.
Successful sellers exist. Many FBA sellers earn $5,000–$50,000+/month in profit. These are real businesses with real revenue.
What’s Misleading About Amazon FBA Marketing
“Passive income” claims. FBA requires active management: inventory forecasting, PPC campaign optimisation, listing updates, competitor monitoring, customer communication, and supplier relationship management. It is not passive.
“Start with $500” claims. Technically possible with retail arbitrage, but private label FBA (what most courses teach) realistically requires $5,000–$15,000 minimum.
“No experience needed” claims. FBA requires understanding of product research, supply chain logistics, Amazon’s advertising platform, listing optimisation, and financial management. The learning curve is significant.
“30-day launch” timelines. From product research to first sale typically takes 3–6 months, including manufacturer sourcing, sample testing, shipping, and listing optimisation.
For understanding why most people fail at making money online, unrealistic expectations set by course marketers — not the business model itself — are the primary failure driver.
Pros and Cons
What works: Amazon’s massive customer base. Professional fulfilment infrastructure. Scalable (add products, increase inventory). Real businesses with real profit potential. Brand-building opportunity.
What doesn’t: High startup capital required. Intense competition in most categories. Amazon controls the platform (policy changes, fee increases, suspensions). Thin margins after all fees. Inventory risk (unsold stock = lost capital). Dependent on PPC advertising for visibility.
Verdict: Is Amazon FBA a Scam?
No. Amazon FBA is a legitimate e-commerce fulfilment service and marketplace.
But: The ecosystem surrounding FBA — expensive courses, hype-driven marketing, unrealistic income claims — is frequently misleading. The platform is real. Many representations of what it takes to succeed on the platform are not.
FBA is a real business with real capital requirements, real competition, and real risk. It can generate meaningful income ($5,000–$50,000+/month) for sellers who approach it as a serious business. It regularly loses money for people who approach it as a passive income hack based on a $2,000 course.
For realistic online income expectations, FBA sits in the “moderate to high income potential with moderate to high risk” category. The best business model for long-term income compares FBA against models with lower capital requirements and less platform dependency.
Who Amazon FBA Is NOT For
If you can’t invest $5,000–$15,000 upfront with the risk of losing some or all of it, FBA’s capital requirements are prohibitive.
If you want passive income, FBA requires active, ongoing management.
If you’re uncomfortable with complex logistics and financial management, the operational learning curve is steep.
If you need income within 30 days, FBA’s timeline from research to first sale is 3–6 months.
Frequently Asked Questions
Is Amazon FBA legitimate? Yes — it’s a fulfilment service from Amazon, used by hundreds of thousands of sellers worldwide.
Why do people say it’s a scam? Primarily because of misleading course marketing that understates costs, complexity, and timeline.
How much can you make with Amazon FBA? Range: $0 (many sellers lose money) to $50,000+/month (established sellers with multiple products). Median: $1,000–$5,000/month for active sellers.
How much does it cost to start? Realistically: $5,000–$15,000 including inventory, advertising, and fees.
Is Amazon FBA worth it in 2026? For people with capital, patience, and willingness to learn complex logistics — potentially. For people seeking quick, easy income — no.
Amazon FBA requires $5K–$15K upfront with significant risk. Local lead generation builds assets paying $500–$1,200/site monthly with under $300 startup cost, 92–97% margins, and zero inventory risk.
Click here to see how it works.
The Bottom Line
Amazon FBA is a real business, not a scam. But it’s frequently marketed as something it isn’t — easy, passive, and cheap to start. Approach it as a capital-intensive, skill-intensive business with a 6–12 month timeline to profitability, and evaluate honestly whether that matches your situation. The platform is legitimate. The hype around it often is not.
FBA Failure Rates and Why Sellers Quit
Amazon doesn’t publish official seller failure rates, but industry surveys and marketplace data paint a consistent picture.
Jungle Scout’s annual seller survey consistently shows that approximately 50% of new FBA sellers become profitable within 12 months. The other 50% either break even or lose money. Of those who become profitable, the majority earn less than $5,000/month in profit.
Common failure patterns:
Product selection mistakes are the top killer. Beginners often choose products based on perceived demand without verifying competition depth, margin viability after all fees, or seasonal fluctuation. A product that looks profitable on a spreadsheet often isn’t after Amazon’s referral fee (8–15%), FBA fulfilment fee ($3–$8+), monthly storage fees, PPC advertising costs (often $0.50–$3.00 per click), and returns processing.
Undercapitalisation is the second killer. Sellers who start with $3,000 expecting to build a profitable business discover that one product launch often consumes $5,000–$10,000 before generating meaningful sales. Running out of inventory during a growth phase — or running out of cash to fund PPC advertising — stalls businesses that would otherwise succeed.
Amazon policy changes affect everyone. Fee increases, category restrictions, review policy changes, and algorithm updates can shift the economics of a product overnight. Sellers who built their entire business around one product in one category are especially vulnerable.
The 90-day danger zone: Most FBA sellers who quit do so within the first 90 days — typically after their first product launch underperforms expectations set by course marketing. The gap between “what the course said would happen” and “what actually happened” destroys motivation.
How to Evaluate FBA Courses
If you’re considering an FBA course, apply these filters:
Does the instructor show full account performance, not just revenue screenshots? Revenue of $50,000/month means nothing without knowing costs. A seller doing $50K revenue with $45K in costs profits $5K — impressive-looking but modest.
Is the instructor’s primary income from selling on Amazon or from selling the course? If course revenue exceeds Amazon revenue, the instructor is better at marketing courses than selling products.
What’s the refund policy? Courses confident in their value offer 30–60 day refunds. No-refund policies are a red flag.
Are student results independently verifiable? Testimonials on the course sales page are curated. Look for independent reviews on Reddit, Trustpilot, or YouTube from students who aren’t affiliates.
Is the price proportional to the information? Most FBA knowledge is available free through YouTube, Amazon Seller University, and online communities. A $2,000 course should provide mentorship, community, and live support — not just video lessons.
The FBA Alternatives
If you’re attracted to selling products online but concerned about FBA’s risks, consider these alternatives:
| Model | Startup Cost | Inventory Risk | Platform Dependency |
|---|---|---|---|
| Amazon FBA | $5,000–$15,000 | High | High (Amazon controls) |
| Shopify + own products | $1,000–$5,000 | Moderate | Low (you own the store) |
| Print-on-demand | $100–$500 | None | Moderate |
| Dropshipping | $500–$2,000 | Low | Moderate |
| Digital products | $50–$200 | None | Low |
| Local lead generation | $100–$300 | None | Low |
For the dropshipping profit margins comparison, that guide examines how product-based business margins compare across models.
Mark is the founder of MarksInsights and has spent 15+ years testing online business programs and tools. He focuses on honest, experience-based reviews that help people avoid scams and find real, sustainable ways to make money online.