selling on amazon - am confused please help!

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Sorry not ebay selling but wondered if someone can help! Am very sleep deprived so suspect my brain is mashed potato but I really don't understand the Amazon fees.

Why do people list items for 0.01 plus £2.80 postage?! Surely once they have posted and Amazon has taken its fees then they make less than nothing. Or am I missing something here?

Plus if Amazon says that the amount I receive is say £1.15 does that mean net proceeds after I have paid postage or are they saying I will need to pay postage out of that £1.15?

Told you I was sleep deprived...!

The £1.15 will be your payment after Amazon has taken it's fees.
Yes you would need to fund the postage out of that amount.
You are right - people do make less than nothing on Amazon.

I have a business seller account there - however I rarely sell anything on it.
It's useful as a business for exposure and a bit of free advertising, but I couldn't make money out of it because Amazon itself constantly undercuts it's own sellers.

Ah thank you 80sbabe - and for such a clear explanation!
hmm I will not be retiring on my Amazon proceeds....