• Fees & Commissions when Selling on Lazada: The Definitive Guide

    Posted on 11 Comments

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    Get help selling online in China & Southeast Asia here

    Opening a store on Lazada can be a great choice for companies that look to expand to Asian markets. China is not your only choice.

    One of the benefits of selling cross-border on Lazada is that you instantly reach six countries in ASEAN, with a total population in the hundreds of millions. The second benefit is the low upfront and running costs that comes with it.

    In this article, you’ll learn about the following when selling cross-border on Lazada:

    • Upfront fees
    • Payment service fees
    • Commissions
    • Shipping fees

    1. Upfront fees and initial deposits

    Lazada doesn’t charge sellers with any upfront fees or deposits for that matter. You can simply register an account, list your products, and get started.

    This is not the case if you plan to sell on websites like Kaola, Tmall Global, or JD Worldwide in China, where deposits stretch between USD 10,000 – 25,000.

    A yearly service fee of USD 1,000 – 5,000 apply when selling on these Chinese websites as well.

    2. Lazada commissions

    The same as it goes with various E-Commerce platforms in China, Lazada charges a commission on each sale you make. The commission is only deducted when an order has been delivered and the client has paid.

    Below I’ve made a *chart showing the different commission rates that apply for products sold in Thailand, Indonesia, Malaysia, Singapore, and the Philippines.

    Keep in mind that the rates are valid for cross-border sellers, which means that you sell from a country outside of ASEAN and use Lazada’s LGS shipping service from Hong Kong.

    Local sellers in Malaysia, except for Official Stores, Certified Stores and Brands, have been exempted from paying commissions since 2018.

    Possibly, this is a measure to compete with Shopee, one of Lazada’s biggest competitors, that doesn’t charge any commissions at all.

    *Commission rates in Vietnam are not included below and can reach up to 8%.

    CategorySub categoryCommission
    CamerasDrones, DSLR, Instant Cameras, Point & Shoot, Video & Action Camcorder, Gadgets & Other Cameras, Camera Accessories, Lenses, Optics1-4%
    Computers & LaptopsLaptops, Printers & Accessories, Scanners, Desktop Computer, Computer Accessories, Computer Components, Network Components, PC Gaming, Software, Storage1-4%
    Mobiles & TabletsMobile, Tablets, Landline Phones, Accessories1-4%
    TV, Audio & Video, Gaming & WearablesAudio, Gadgets, Televisions, Video, Wearable Technology, Gaming, TV Accessories, App-enabled accessories1-4%
    Home AppliancesCooling & Heating, Garment Care, Home Appliances Accessories, Housekeeping, Small Kitchen Appliances, Large Appliances4%
    Health & BeautyAll Products4%
    Digital GoodsAll Products4%
    Bedding & BathAll Products4%
    GroceriesAll Products4%
    Home & LivingAll Products4%
    Baby & ToddlerAll Products4%
    Media, Music & BooksAll Products4%
    MotorsAll Products4%
    Pet SuppliesAll Products4%
    Sports & OutdoorsAll Products4%
    Toys & GamesAll Products4%
    Travel & LuggageAll Products4%
    Watches, Jewelry, SunglassesAll Products4%
    FashionAll Products4%

    Calculating commissions

    Some countries charge a GST/VAT on the commissions made, thus, you need to include these when calculating the total commission fees.

    Currently, deliveries to Singapore and the Philippines are exempt from VAT and GST, these only apply for deliveries to Thailand, Malaysia, and Indonesia.

    So, let’s say that you sell pet supplies with the price of “100”, without using any currency, just to give you an example.

    In Malaysia, a GST of 6% will be added which results in a total commission of 4 + (6% x 4) = 4.24.

    In Thailand, a VAT of 7% is added, resulting in a total commission of 4 +(7% x 4) = 4.28.

    The VAT in Indonesia is 10%, which would result in a total commission of 4 + (10% x 4) = 4.40. However, the VAT is already included so you only need to pay a total commission of 4, the same as in Singapore and the Philippines.

    3. Payment service fees

    You have two payment providers to choose among if you sell on Lazada: Payoneer and World First. After you register an account, you need to sign up and integrate your store with any of these companies.

    The equivalents in China are Tenpay for JD Worldwide and WeChat, and Alipay for Tmall Global.

    By using Lazada’s platform you need to pay a payment service fee of 1-2%. At the moment, the fee is 2% of deliveries to Singapore, Thailand, Malaysia, Indonesia, and the Philippines.

    I highly recommend you to contact Payoneer and World First to get up-to-date information as the service fees can change.

    Calculating payment service fees

    The same as it goes with commissions, you need to add a GST or VAT when selling to Thailand and Malaysia (the VAT is included in the price for sales to Indonesia).

    Let’s use the same example as we did when calculating the commissions.

    If you sell a product that costs a 100 to Malaysia, a GST of 6% is added to the payment service fee of 2%.

    Hence, the total payment service fee is: 2 + (2 x 6%) = 2.12.

    The payment service fee in Thailand, on the other hand, will be as follows with a VAT of 7%:

    2 + (2 x 7%) = 2.14.

    Don’t forget to include the commissions and payment service fees when calculating the final prices, before listing your products on Lazada.

    When is the payment service fee charged?

    The payment service fee is charged for delivered products, failed deliveries, customer returns, and cancelled orders.

    Can I see the calculations in the seller centre on Lazada?

    Yes, you can see the calculations in seller centre which is helpful.

    4. Shipping fees

    lazada-shipping-fees

    Shipping fees always make up a big part of the final price used to customers.

    Selling through a bonded warehouse in China to Chinese customers, for example, can save you much money compared to using a fulfillment center in Hong Kong.

    Still, there are benefits of using Hong Kong as a hub. Cross-border sellers always need to weigh the benefits and make decisions, and where shipping rates play a big role.

    When it comes to cross-border sales through Lazada’s fulfillment center in Hong Kong, rates are higher compared to local ASEAN sellers, of course.

    There’s always a minimum fee, ranging from around HKD 12 – 37 (weight > 10g), depending on which country you ship to. Worth mentioning is that Philippines tend to have significantly higher rates compared to the other countries.

    The rates then increase on on a per-gram level. Below I’ve included an overview for each country how the *rates differ when shipping 100g to 1 kg, 1.5kg, 2kg, 5kg, 10kg, and 20kg.

    *The rates below are just for reference. Shipping rates change frequently and you should request an up-to-date list from Lazada before you start selling.

    Singapore shipping fees (in SGD)

    The prices below are shown in Singapore Dollar (SGD) where: 1 SGD = 5.91 HKD = USD 0.75 (rounded figures).

    100 g = 3.22
    200 g = 4.48
    300 g = 5.25
    400 g = 6.96
    500 g = 7.72
    600 g = 8.33
    700 g = 9.10
    800 g = 10.33
    900 g = 11.10
    1 kg = 11.81
    1.5 kg = 19.36
    2 kg = 22.10
    5 kg = 43.99
    10 kg = 79.56

    Thailand shipping fees (in THB)

    The prices below are shown in Thai Baht (THB) where: 1 THB = 0.25 HKD = USD 0.03 (rounded figures).

    100 g = 121.89
    200 g = 142.18
    300 g = 162.46
    400 g = 192.62
    500 g = 212.94
    600 g = 230.79
    700 g = 251.07
    800 g = 280.79
    900 g = 301.07
    1 kg = 321.35
    1.5 kg = 426.08
    2 kg = 538.38
    5 kg = 1,264.68
    10 kg = 2,389.98

    Indonesia shipping fees (in IDR)

    The prices below are shown in Indonesian Rupiah (IDR) where: USD 0.13 = 1 HKD = 1728 IDR (rounded figures).

    100 g = 34,035
    200 g = 48,927
    300 g = 63,837
    400 g = 78,730
    500 g = 93,640
    600 g = 107,495
    700 g = 122,405
    800 g = 137,298
    900 g = 152,208
    1 kg = 167,100
    1.5 kg = 323,265
    2 kg = 433,767
    5 kg = 1,100,253
    10 kg = 2,174,711

    Philippines shipping fees (in PHP)

    The prices below are shown in Philippine Pesos (PHP) where: PHP 1 = HKD 0.15 = USD 0.019 (rounded figures).

    100 g = 250.40
    200 g = 349.84
    300 g = 449.28
    400 g = 548.72
    500 g = 648.17
    600 g = 731.68
    700 g = 831.40
    800 g = 930.84
    900 g = 1,030.29
    1 kg = 1,129.73
    1.5 kg = 1,606.32
    2 kg = 2,103.53
    5 kg = 5,066.42
    10 kg = 10,053.42

    Malaysia shipping fees (in RM)

    The prices below are shown in Malaysia Ringgit (RM) where: RM 1 = HKD 1.98 = USD 0.25 (rounded figures).

    100 g = 9.01
    200 g = 10.29
    300 g = 11.58
    400 g = 12.86
    500 g = 14.14
    600 g = 16.55
    700 g = 17.67
    800 g =18.69
    900 g = 19.80
    1 kg = 23.79
    1.5 kg = 29.17
    2 kg = 37.42
    5 kg = 78.31
    10 kg = 146.46

    Do I need to add a GST/VAT to my shipping fees?

    Malaysia, Thailand, and Indonesia are the only countries that charge a GST or VAT to commissions and payment service fees.

    Malaysia has removed GST from shipping fees as of June 1st, 2018, hence no GST is added.

    In the case of Indonesia, I didn’t manage to find any information, but assume that VAT is included. Still, you should confirm this with Lazada, before you start selling your products.

    For deliveries to Thailand, you need to add a VAT of 7% to the shipping costs.

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  • 11 Responses to “Fees & Commissions when Selling on Lazada: The Definitive Guide

    1. john at 6:59 pm

      Dear Marcus,
      I have two questions for you:
      1. For cross-border sellers with a company in Hong Kong, which option is better when receiving payments from Lazada? Payoneer or company bank account in Hong Kong?
      2. As far as I know, Hong Kong’s laws will exempt income from outside Hong Kong territory (in this case, Southeast Asia), you think that in the long term, you should use your account company to receive payment ?

      1. Marcus Sohlberg at 3:44 am

        Hi John,

        1. If you use Lazada’s cross-border solution, you need to choose Payoneer or World First as your payment processors as they’re integrated with Lazada’s platform and seller center.

        2. You can’t pay 0% income tax (if this is what you refer to?) and should pay income tax in your country of residence. Not in Hong Kong, unless you live there. This is related to CFC regulations.

    2. Thomas Price at 9:34 am

      Hi Marcus,

      This has been really handy, thank you!
      I was on Lazada’s Vietnamese site this morning however, and lots of large banner ads and the like said that Lazada VN doesn’t charge any commission fees at all. Is this a recent development since you mentioned fees that could go up to 8% for Vietnam?

      1. Marcus at 6:42 am

        Hi Thomas,

        Yeah, I’ve seen it but as far as I know it’s only for local sellers.

    3. Rachel Lim at 9:45 am

      Hi Marcus,

      Thanks for the handy info. I have three questions:

      1) Besides the fee structure above, does Lazada charge any warehouse fee?
      2) How long will Lazada hold the stock for the seller in their warehouse?
      3) May I know where can I get the latest shipping rates. I am not a seller yet. I wish to explore a little more before committing to become one. I saw a revised shipping rates (Feb 2019) within Malaysia.
      4) I am based in Singapore and my products are from Malaysia. My customers are in South East Asia. Should I register as a seller in Singapore or would it make sense to register as a seller in the Malaysia platform?

      1. Marcus Sohlberg at 3:47 am

        Hi Rachel,

        1) Yes, they do. In Lazada’s centralized warehouse in Hong Kong, it’s around 9 HKD per square meter and day. But you better contact Lazada directly for a personal quote.

        2) Honestly, I’m not sure about the exact time. But a storage fee will apply.

        3) You can only get the latest shipping rates from the Seller Center (i.e. becoming a seller first). I know, it’s a bit annoying that you need to become a seller, before you even know if you want to become a seller! You can find some of the old rates in this guide, the rates should be fairly similar:

        https://www.export2asia.com/blog/lazada-lgs-shipping/

        Keep in mind that the rates are for international cross-border sellers who ship from Hong Kong into SEA.

        4) If you want to register in the Singapore platform, you need to have a Singaporean company. As such, you better become a local cross-border seller in the Malaysian platform.

    4. Rachel Lim at 7:56 am

      Hi Marcus,

      Thanks so much for your reply.

    5. David at 11:49 am

      Hi Marcus,

      I am a ecommerce seller based in Mumbai,India. How can i sell on lazada/redmart?

      1. Marcus Sohlberg at 8:28 am

        Hi David,

        You can become a cross-border seller by signing up on Lazada.

        1. IMAD ALHASAN at 11:46 am

          Hi Marcus,

          I tried to become a cross-border seller but I failed since LAZADA asking for register company (SSM) in Malaysia and Bank Account under a company name … so how come to overcome this problem? … thanks for your advance support

          1. Marcus Sohlberg at 11:35 am

            Strange. Are you based in Malaysia and entered http://www.lazada.com.my? Or http://www.lazada.com? Did you contact Lazada support and ask for clarification?

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