CP (Cost Price) - Amazon Glossary

On Amazon, Cost Price is especially relevant for 1P vendors who sell products directly to Amazon. In this context, CP is the wholesale price at which vendors supply goods to Amazon Retail.

For 3P sellers, Cost Price represents their purchase cost of inventory from manufacturers or distributors, which determines profitability when compared to selling price.

CP is used in various calculations:

• Contribution Margin (CM)
• Profit Margin
• COGS (Cost of Goods Sold)

Understanding CP is critical for:

• Pricing strategies
• Negotiating terms with Amazon (in 1P)
• Managing profitability

💡 Example:
If a vendor sells a product to Amazon for $10 (CP), and Amazon lists it at $19.99, then $10 is the cost price and $9.99 is the gross margin (before expenses).

In short:
Cost Price (CP) is the base amount a seller or vendor pays for a product - the foundation for calculating profitability and pricing on Amazon.