Noon Fees Decoded: Your Settlement Report Line by Line

You open your Noon seller dashboard on a Tuesday morning. Your settlement report sits there, rows of numbers in a spreadsheet, and you have no idea what half of them mean. You sold 47 units last week. You should feel good. But your bank account tells a different story. Somewhere between the order total and the money in your account, Noon took a slice. Then another. Then another.

You are not alone. Most Noon sellers in the UAE, KSA, and Egypt treat the settlement report like a tax form: necessary, confusing, and best ignored until something goes wrong. The result? Sellers leave money on the table every single day because they do not understand where their margin actually goes.

This post changes that. By the end, you will read a Noon settlement report the way a chef reads a recipe. You will know exactly which fees are eating your profit, where you can negotiate or optimise, and which products are actually making money versus just moving volume.

Understanding Your Noon Settlement Report: The Real Cost of Selling

Your Noon settlement report is not just a list of sales. It is a financial truth document. Every line represents a decision Noon made about your money. Commission taken. Storage charged. Refund processed. Ad spend deducted. By the time you see the final number, your original order total has been through five or six different fee gates.

Here is the hard truth: if you do not understand your settlement report, you cannot calculate your true cost of goods sold (COGS). And if you cannot calculate real COGS, you cannot price correctly. You will either leave money on the table by pricing too low, or you will price too high and lose sales to competitors who understand their numbers better.

The settlement report is also where Noon hides complexity. Not deliberately, necessarily, but the sheer number of possible fees, deductions, and adjustments means most sellers only see the headline number. "I made AED 5,000 in sales." Yes, but after Noon fees, commission, FBN storage, returns, and refunds, you actually made AED 1,200. That is a 76% margin loss. And you did not even know it.

The Anatomy of a Noon Settlement Report: What Each Line Really Means

Gross Merchandise Value (GMV) and Order Total

The settlement report starts with the headline number: total sales. This is the sum of all order totals across your active listings for the reporting period, usually one week. If you sold an AED 150 item twice and an AED 45 item four times, your GMV is AED 480.

But here is the first hidden cost: this number includes Value Added Tax (VAT). In the UAE, that is 5%. In KSA, it is also 15% on some categories. In Egypt, it is 14%. The VAT is not your money. It belongs to the government. Yet most sellers forget this when they calculate their real revenue.

So if your GMV is AED 480, your actual revenue is AED 480 divided by 1.05, which is AED 457. The AED 23 is VAT you owe to the tax authority, not profit.

Noon Commission (Category-Specific)

This is the first real fee. Noon takes a percentage of your order total as commission for providing the platform, handling logistics, and managing customer service. The rate depends on your category.

Electronics might be 5-8%. Fashion might be 12-15%. Home and kitchen might be 10-12%. The exact rate for your category is in your seller agreement, but it is also visible in your settlement report for each order.

Here is what most sellers miss: the commission is calculated on the order total before refunds are processed. If a customer buys an AED 200 item, you pay Noon commission on AED 200. If the customer returns it two weeks later, you get a refund of AED 200, but Noon does not refund the commission. You paid it upfront. That commission is gone.

Say you sell 100 units of a product with a 12% Noon commission rate. Your average order value is AED 80. That is AED 960 in commission. If your return rate is 15%, you are refunding AED 1,200 in product value, but you only get AED 1,200 back. The commission on those 15 units (AED 144) stays with Noon.

Over a year, if you sell 5,000 units with a 12% commission and a 15% return rate, you are paying commission on 750 units that never stayed with the customer. That is AED 7,200 in dead commission cost.

Fulfillment Fees (FBN or FBPI)

If you use Noon's fulfillment service (FBN or FBPI), you pay a per-unit fulfillment fee. This covers picking, packing, and shipping the order to the customer's door.

The fee varies by product weight, dimensions, and destination (same-city delivery is cheaper than cross-country). A light item under 500g might cost AED 3-5 to fulfil. A heavier item or one shipping across the country might cost AED 8-15. Oversized items (furniture, large appliances) can cost AED 20-50.

Here is the sneaky part: you pay this fee per unit, whether the customer keeps the product or returns it. If you fulfil 100 units and 15 are returned, you still paid the fulfillment fee on all 100. The 15 returned units cost you the same fulfillment fee as the 85 that stayed.

Further, if a customer returns an item, Noon deducts a return handling fee from your refund. This is typically AED 2-5 per return. So a returned AED 80 item costs you the original fulfillment fee, plus the return handling fee, plus the lost commission, plus the lost profit on the product itself. That single return might cost you AED 15-20 in total fees, on top of losing the sale.

If you use FBPI (Fulfilled by Noon Prime Inventory), the fee structure is similar, but you also pay storage fees, which we will cover below.

Storage Fees (FBPI)

If you store inventory in Noon's warehouse (FBPI), you pay storage fees. These are calculated per cubic metre per month. Check your current rate in your Noon seller dashboard, but typical rates in 2025-2026 range from AED 50-150 per cubic metre per month, depending on the region and season.

Storage fees are where many sellers get blindsided. You send 1,000 units to the warehouse. They sell slowly. Two months in, you have 600 units left. You are paying storage on 600 units for two months. That is money sitting in the warehouse, not in your bank account.

Here is the math: say you store 600 units, each taking up 0.01 cubic metres. That is 6 cubic metres. At AED 100 per cubic metre per month, that is AED 600 per month in storage fees. Over three months, if your inventory moves slowly, you are paying AED 1,800 in storage alone.

Worse, Noon charges storage fees in arrears. You do not see them until your settlement report weeks later. By then, you have already paid them, and they are non-refundable. If your inventory is not moving, storage fees can turn a profitable product into a loss-maker in 60 days.

Returns and Refunds

When a customer returns an item, Noon processes the refund to the customer and deducts it from your settlement. But the deduction is not just the product price. It includes:

1. The refund amount (the order total, minus VAT).
2. A return handling fee (Noon's cost to process the return).
3. Potentially a restocking fee if the item is damaged or not in original condition.

So if a customer returns an AED 100 item, you might see a deduction of AED 100 (refund) plus AED 3 (return handling) plus AED 10 (restocking, if applicable). That is AED 113 deducted from your settlement.

But you also lose the commission you paid upfront and the fulfillment fee. On a product with 12% commission and AED 5 fulfillment, that returned AED 100 item cost you AED 12 (commission) plus AED 5 (fulfillment) plus AED 113 (deduction) equals AED 130 in total fees and lost revenue.

If your return rate is high (15-25%, which is common for fashion and electronics), your real cost of doing business is much higher than your headline commission rate suggests.

Ad Spend and Sponsored Listings

If you run Noon ads (Sponsored Listings), your ad spend is deducted from your settlement. This is straightforward: you set a daily budget, bids, and Noon charges you per click or per placement, depending on the ad type.

The hidden cost here is attribution. You might think an ad generated a sale, but Noon attributes sales based on last-click logic. A customer clicks your ad, does not buy. They search for your product organically two days later and buy. Noon attributes that sale to organic search, not your ad. You paid for the ad but get no credit for the sale.

This means your actual return on ad spend (ROAS) is often worse than you think. If you spend AED 500 on ads and think you generated AED 2,000 in sales (4x ROAS), you might have actually generated AED 1,200 in truly ad-driven sales. Your real ROAS is 2.4x.

Over a year, if you spend AED 10,000 on ads thinking you are getting 4x ROAS, you might actually be getting 2.5x ROAS. That is a difference of AED 15,000 in real profit.

Adjustments, Chargebacks, and Other Deductions

Your settlement report often includes a line for "adjustments" or "other deductions". These can include:

1. Customer disputes or chargebacks (customer claims they did not receive the item or it was damaged).
2. Warranty claims (you offered a warranty and Noon is deducting the cost).
3. Seller fees (account maintenance, subscription to premium seller tools).
4. Penalties (late shipment, low customer rating, policy violations).

These are less predictable, but they add up. If you have one chargeback per 500 orders, and each chargeback costs you AED 30-50 in Noon's investigation and reversal fee, that is AED 300-500 per year on 5,000 orders.

Penalties are worse. If Noon suppresses a listing because of a policy violation (e.g., incorrect product description, prohibited item), you lose all sales on that listing until you fix it. If that listing was generating AED 5,000 per month, a 7-day suppression costs you AED 1,167 in lost sales, plus the lost commission and fulfillment fees.

The Real Math: A Concrete Example

Let us walk through a real scenario. You sell a SAR 180 electric kettle in KSA on FBPI.

Order total: SAR 180 (includes 15% VAT). Your actual revenue (before fees): SAR 180 divided by 1.15 equals SAR 157. Noon commission (say 10% for appliances): SAR 18. Fulfillment fee (medium weight item): SAR 8. Storage fee (your share of monthly storage, amortised per unit): SAR 2. Ad spend (you spent SAR 400 on ads and generated 50 sales of this kettle): SAR 8 per unit.

Total fees and deductions: SAR 18 + SAR 8 + SAR 2 + SAR 8 equals SAR 36. Net revenue to you: SAR 157 minus SAR 36 equals SAR 121. Your COGS (cost to manufacture or buy wholesale): SAR 70. Your gross profit: SAR 121 minus SAR 70 equals SAR 51. Your net profit margin: SAR 51 divided by SAR 180 (order total) equals 28%.

But that is before returns. If 10% of orders are returned (5 units out of 50), you lose:

Refund amount: SAR 157 (the revenue you never got to keep). Return handling fee: SAR 3. Original fulfillment fee: SAR 8 (you paid it upfront). Commission (already paid): SAR 18 (non-refundable).

Total loss per return: SAR 186. On 5 returns: SAR 930.

Your net profit on 50 units drops from SAR 2,550 to SAR 1,620. Your margin drops from 28% to 18%. That is a 36% margin loss due to returns alone.

Now multiply this by 200 products, 5,000 orders per month, and a year of trading. The compounding effect of fees, returns, storage, and ads is the difference between a sustainable business and one that looks profitable on paper but bleeds cash in reality.

Advanced Strategies: Where Most Sellers Miss Optimisation

Strategy 1: Map Your True Unit Economics Before Pricing

Most sellers price based on a target markup (e.g., "I want 40% gross margin"). They do not factor in the full fee structure. The result is they price too low.

Instead, build a pricing model. Take a product. Input your COGS, the category commission rate, the fulfillment fee, the expected return rate, the expected ad spend per unit, and the storage fee (if FBPI). Calculate the net profit per unit. Then price to hit your actual target margin, not your perceived one.

If a product has SAR 50 COGS and SAR 35 in fees and expected losses per unit, you need a minimum order value of SAR 140 to hit 20% net margin. If the market will only bear SAR 100, do not sell it. Full stop.

Tools like SKUmargin pull your Noon settlement data, orders, returns, and ad spend and calculate this automatically. You see which SKUs are actually profitable and which are masquerading as winners.

Strategy 2: Optimise Your Return Rate Before Optimising Anything Else

A 5% return rate is excellent. A 15% return rate is industry-average for fashion and electronics. A 25% return rate is a profit killer.

Before you optimise your title, your images, or your ads, look at your return rate. If it is above 12%, something is wrong. Either your product description is misleading, your images do not match reality, or the product itself has a quality issue.

Fix the return rate first. A 2% improvement in return rate on 5,000 units per month is 100 fewer returns. At SAR 186 loss per return (from our example above), that is SAR 18,600 in recovered profit per month. That is more valuable than any SEO optimisation or ad spend reduction.

Strategy 3: Batch Your FBN Stock to Avoid Dead Storage Fees

If you use FBPI, do not send 10,000 units to the warehouse and hope they sell evenly. Instead, send 2,000 units, monitor sell-through velocity, and resupply every two weeks.

Why? Because slow-moving inventory sits in the warehouse and accrues storage fees. If you send 10,000 units and only 500 sell in month one, you are paying storage on 9,500 units for 30 days. That is AED 4,750 in storage fees (at AED 100 per cubic metre, assuming 9,500 units occupy roughly 95 cubic metres).

If you send 2,000 units instead and resupply when you hit 500 units remaining, you only ever store the amount you need. Your storage fee drops by 75%.

Common Pitfalls: What Gets Sellers Into Trouble

Pitfall 1: Ignoring the Settlement Report Until Something Breaks

You check your settlement report once a month, scan the headline number, and move on. Then, three months in, you realise your margin is not what you thought it was. By then, you have already built a business model on faulty assumptions. You are underwater.

Instead, review your settlement report weekly. Print it. Highlight the lines that surprise you. Ask yourself: "Why did I lose more margin this week than last week?" Often, the answer is a spike in returns, a change in ad spend, or a storage fee increase. Catching these early lets you course-correct.

Pitfall 2: Confusing Gross Revenue With Net Profit

You sold AED 50,000 last month. You tell your friends you made AED 50,000. You do not. After Noon fees, commission, fulfillment, returns, storage, and ads, you might have made AED 12,000. That is 24% of your headline number.

This confusion leads to terrible decisions. You think you are profitable, so you invest more in inventory. You are not profitable; you are just moving volume at a loss. Six months in, you are out of cash.

Pitfall 3: Accepting High Return Rates as "Normal"

You see a 20% return rate and think, "That is just how fashion sells." Maybe. But your competitors might have a 10% return rate. That is a 10% margin advantage, compounded across thousands of units.

Investigate your returns. Read the customer feedback. Are they returning because the product is wrong, or because your description was misleading? Are they returning because the size is wrong, or because the quality is poor? Each answer points to a different fix.

Conclusion: Your Settlement Report Is Your Profit Map

Your Noon settlement report is not a tax document to file away. It is a profit map. Every line tells you where your money goes and where you can optimise.

Start here:

1. Download your last four weeks of settlement reports.
2. Calculate your net profit per unit (order total minus all fees and deductions, minus COGS).
3. Identify which products are actually profitable and which are just moving volume.
4. For low-margin products, either raise price, lower COGS, reduce return rate, or cut them.
5. For high-margin products, invest in more inventory and ads.

Do this, and your profit margin will improve faster than any other optimisation you could make.

If you want to automate this analysis, plug your Noon data into SKUmargin. It pulls your settlement reports, orders, returns, and ad spend, and shows you your true net profit per SKU after all Noon fees. You will see exactly which products are making money and which are costing you. From there, the decisions become obvious.

Your settlement report is not confusing. It just needs to be read properly. Now you know how.