Amazon is the UK’s biggest online marketplace, and it isn’t close. More than 30 million active customers browse and buy on it regularly, most of them with a payment method already saved and a Prime subscription already running. For a new seller, that’s a meaningful headstart: you don’t need to drive traffic to a website you’ve built from scratch, convince strangers to trust an unfamiliar checkout, or compete against Google’s ad auction for every click. The shoppers are already there, and they’re already in buying mode.
That said, selling on Amazon is not passive income, and the learning curve is steeper than most beginner guides admit. There are fees to understand before you order stock, account settings to configure before you list anything, and decisions about how to fulfil orders that will affect your margins from day one. Getting those fundamentals right early is the difference between a business that grows and one that breaks even at best.
This guide walks through every step from scratch — business models, costs, account setup, listing your first product, fulfilment, and advertising — with the current 2026 figures, not outdated ones.
At a glance:
- You don’t need a limited company to start — a sole trader registration with HMRC is enough.
- The Professional selling plan (£25/month) is almost always the right choice if you’re serious about building a business.
- FBA (Fulfilment by Amazon) handles storage, packing, and shipping — but adds fees on top of the referral fee Amazon takes on every sale.
- Amazon reduced its UK fees significantly in early 2026. Work out your margins precisely before ordering stock.
- Strong listings and a clear advertising strategy matter from the very first product.
Step 1: Choose your business model
Before you choose a product or open an account, you need to decide how you’re going to source and sell. The four main models differ significantly in how much upfront capital they need, how much control you have over margins, and how scalable they become over time.
Private label means sourcing generic or manufactured products — usually from overseas suppliers, most commonly in China via platforms like Alibaba — putting your own brand name and packaging on them, and selling them as your own product. It’s the model that tends to create the most durable long-term value because you own the brand and control the listing, but it also requires the most upfront investment: typically several thousand pounds at minimum to cover stock, packaging design, photography, and initial advertising spend. Private label is the model most suited to Brand Registry and the brand-building tools Amazon provides.
Wholesale means buying existing branded products in bulk from UK distributors or brand owners and reselling them on Amazon. Margins are typically thinner than private label, but there’s no product development risk and you’re selling something customers are already searching for by name. The challenge is finding brands willing to sell to you at a price that still leaves room after Amazon’s fees.
Retail arbitrage (RA) and online arbitrage (OA) means buying discounted or clearance stock from shops or websites and reselling it on Amazon at a higher price. It’s a low barrier entry point and can be profitable quickly, but it doesn’t scale easily — you’re constantly hunting for the next deal rather than building something repeatable.
Amazon Handmade is the right fit if you make your own products. Amazon Handmade operates within the standard Amazon marketplace but with a specific audience looking for artisan goods. Monthly fees are waived if you qualify, though referral fees apply.
For most people reading a guide like this who are thinking about building a proper income from Amazon, private label or wholesale tends to be the more sustainable choice. The product research stage — picking something with real demand, manageable competition, and margins that survive Amazon’s fee structure — is where most of the actual work happens before you ever list anything.
Step 2: Understand the costs before you order anything
The single most common mistake beginners make is buying stock before they’ve fully calculated what Amazon is actually going to take from each sale. These are the costs you need to account for:
Professional selling plan: £25 per month excluding VAT. The Individual plan charges £0.75 per item instead, but it also locks you out of the Buy Box — the “Add to Basket” button — which is where the vast majority of sales actually happen. If you intend to sell more than around 35 items a month, the Professional plan is cheaper. More importantly, you can’t win the Buy Box on the Individual plan at all, so for anyone building a real business, Professional is the right choice from day one.
Referral fees: Amazon takes a percentage of every sale. For most categories the standard rate is 15%, but Amazon made significant cuts to several categories in early 2026. Clothing and accessories dropped to 5% for items up to £15, Home Products dropped to 8% for items up to £20, and Grocery, Pet Food, and Vitamins dropped to 5% for items up to £10. The full schedule is in Seller Central, and it’s worth checking your specific category before assuming 15%.
FBA fulfilment fees: If you use FBA, Amazon charges per unit to pick, pack, and ship your orders. The exact fee depends on your product’s size tier and weight. A small, light item might cost around £2.50–£3.50 per unit to fulfil; a larger or heavier product can easily hit £5 or more. Amazon reduced average UK FBA fees by around £0.26 per parcel in late 2025 and expanded the Low-Price FBA programme (which gives cheaper per-unit rates) to cover products priced up to £20, up from the previous £10 threshold. From April 2026, a 1.5% fuel and logistics surcharge also applies on top of FBA fulfilment fees.
Storage fees: Monthly fees based on cubic space your inventory occupies in Amazon’s fulfilment centres. These rise significantly in Q4 (October to December). Stock that sits unsold beyond 241 days incurs an additional aged inventory surcharge.
A practical worked example: say you sell a home organiser for £22. Amazon takes a referral fee at 8% (under the new Home Products rate for items up to £20… but your item is £22, so the standard 15% rate likely applies here — this is precisely why checking your category against the current fee schedule matters). That’s £3.30. An FBA fulfilment fee of roughly £3.20 for a small, mid-weight parcel. Storage of roughly £0.30 allocated per unit based on turnover. Your landed cost of goods from your supplier is £6. That leaves approximately £9.20 before advertising spend — which is workable if your PPC costs are controlled, and tight if they’re not. Run this calculation on every product before you order.
Step 3: Register your business and open a seller account
You need a registered business entity to sell on Amazon UK. You don’t need a limited company to start — most beginners register as a sole trader, which is free, takes about ten minutes on the HMRC website, and gives Amazon what it needs for verification. You can convert to a limited company later as the business grows.
What you’ll need before you start the registration:
- A government-issued photo ID (passport is the smoothest option; driving licence also works)
- Proof of address from the last 90 days — a bank statement or utility bill
- A bank account (a dedicated business account is strongly recommended, not your personal current account)
- A credit or debit card for Amazon fees
- Your business name, address, and company registration number if you’ve formed a limited company
- Your VAT number if you’re already VAT-registered
Head to sellercentral.amazon.co.uk and choose the Professional selling plan. You’ll work through business information, identity verification, and bank account details in one sitting — have everything above ready before you start, because Amazon’s registration flow doesn’t save progress easily mid-way.
A note on VAT: If you’re based in the UK and using FBA from day one, you’ll need to register for VAT with HMRC regardless of your turnover, because storing goods in Amazon’s UK fulfilment centres creates an immediate VAT obligation. The standard registration threshold (£90,000 rolling annual turnover) doesn’t apply when you’re physically holding stock in the UK under FBA. Registration is free and typically takes 2–4 weeks.
Making Tax Digital: From April 2026, sole traders earning above £50,000 must maintain digital records and submit quarterly updates to HMRC through MTD-compatible accounting software. Amazon Seller Central reports don’t meet this requirement — you’ll need Xero, QuickBooks, or similar software integrated with your Amazon account from the start if you’re above or approaching that threshold. The threshold drops to £30,000 in April 2027.
Step 4: Find your first product
Product selection deserves its own dedicated guide, but the principles for a beginner are:
Look for consistent year-round demand rather than seasonal spikes — you don’t want your cash tied up in stock that only moves in November. Aim for a product that sells in the £15–£50 range; below that, margins rarely survive the fee structure, and above it, the barrier to a customer trying an unknown brand is higher. Avoid anything dominated by a small number of established sellers with thousands of reviews who’ve been on the platform for years — you need a route to visibility that doesn’t require outspending them indefinitely.
The tools most sellers use for research include Helium 10, Jungle Scout, and Amazon’s own Brand Analytics (available in Seller Central once your account is active). What you’re looking for is decent search volume for your main keyword, relatively low average review counts among the top sellers (under 200–300 is workable; under 100 is easier), and a price point that, when you build out the full fee and cost model, leaves you with margins of at least 25–30% after all Amazon fees but before advertising.
Step 5: Source your stock and prepare your listing
Once you’ve identified a product, you’ll need to source it. Private label sellers typically use Alibaba to find manufacturers, request samples from several suppliers, test quality before committing to a bulk order, and negotiate a minimum order quantity. Factor in freight costs (sea freight is significantly cheaper than air freight for bulky goods, but takes 4–6 weeks from China), customs duties, and any prep costs before inventory arrives at Amazon’s fulfilment centre.
Your listing needs to be set up before or as inventory arrives. At minimum it needs:
- A title that includes your main keyword in a natural way and describes what the product actually is
- Bullet points covering key features and benefits
- A product description or A+ Content if you have Brand Registry
- A main image on a white background (Amazon’s requirement) that fills most of the frame
- Supporting images showing the product in use, from multiple angles, and with dimensions if relevant
Listing quality directly affects both your organic ranking and your advertising performance — Amazon’s algorithm uses conversion rate as a signal, so a poorly written or poorly imaged listing will underperform regardless of how well your campaigns are built. This is one of those areas where getting it right from launch, rather than fixing it six months in, makes a material difference to how quickly you build momentum. If you’d like help building your first listing correctly from the ground up, it’s what our product listing team does daily.
Step 6: Choose how to fulfil your orders
You have two main options: FBA (Fulfilment by Amazon) or FBM (Fulfilment by Merchant).
FBA means sending your inventory to Amazon’s warehouses. Amazon stores it, picks and packs it when an order comes in, ships it, and handles returns and customer service on your behalf. Your listings automatically become Prime-eligible, which has a meaningful impact on conversion rate — shoppers trust the Prime badge and the guaranteed delivery it implies. The trade-off is the per-unit fulfilment fee on every order, plus monthly storage fees for as long as your stock sits in their centres. FBA is the default choice for most new private label sellers.
FBM means you (or a third-party warehouse) store and ship orders yourself. You avoid FBA fees but take on the fulfilment workload and lose the Prime badge unless you qualify for Seller Fulfilled Prime, which has strict requirements around same-day dispatch and on-time delivery rates that most sellers find impractical to meet. FBM can make sense for bulky, slow-moving, or high-value products where FBA storage costs would accumulate faster than the product turns.
Most beginners using FBA find the convenience worth the cost, particularly while they’re still learning the platform and don’t have a separate warehouse operation to manage.
Step 7: Advertise your products from day one
A new listing with no sales history and no reviews has very little chance of appearing organically for competitive keywords. Advertising is how you build that initial sales velocity — and sales velocity is the single biggest factor in Amazon’s algorithm deciding how prominently your product appears in organic results.
Amazon PPC (pay-per-click) is the primary advertising tool. Sponsored Products — the ads that appear in search results and look almost identical to organic listings — are the starting point for almost every seller. You bid on keywords, pay only when someone clicks, and pay nothing for impressions. You can run both automatic campaigns (where Amazon’s system decides which searches to target, useful for discovering keywords you hadn’t considered) and manual campaigns (where you bid on specific keywords you’ve identified, useful for efficiency once you know what converts).
We covered how the whole system works — ad types, metrics, what ACOS means, and the mistakes that lose sellers money quietly — in our complete Amazon PPC guide. If you’re just starting out, that’s worth reading alongside this one. If you’d rather hand PPC management to someone who does it full-time, our Amazon PPC specialists manage campaigns from setup through to ongoing optimisation.
Step 8: Build reviews the right way
Amazon reviews are social proof that drives conversion, and a listing with fewer than 10 reviews will almost always convert worse than a comparable one with 100. The only legitimate way to build them is through Amazon’s own Request a Review button (available in Seller Central for every order) or the Vine programme, which gives free products to trusted reviewers in exchange for an honest review.
What you can’t do: offer discounts, free products, or payments in exchange for reviews. Amazon monitors for incentivised reviews aggressively and will remove them — along with potentially suspending the account. Stick to the official channels. The Vine programme is available through Brand Registry and is one of the most practical ways to get legitimate early reviews on a new product.
How brand registration changes what’s available to you
Amazon Brand Registry is a free programme that gives you access to A+ Content (enhanced product descriptions with images and comparison tables), Sponsored Brands advertising, the Amazon Storefront builder, and Brand Analytics — a genuinely useful tool showing which search terms customers use to find products like yours.
To enrol, you need a registered trademark for your brand name in the country where you’re selling. In the UK, that means a trademark registered with the Intellectual Property Office (IPO), which typically takes 4–6 months to come through. You can apply for Brand Registry with a pending trademark application in some cases, but full access requires the granted mark.
Getting your brand identity and trademark sorted early — before you start spending meaningful ad budget — gives you access to the full set of tools Amazon makes available to brand-owning sellers. If you haven’t sorted out your brand assets yet, our brand development team can help with everything from trademark strategy and logo design through to A+ Content and Storefront creation.
What comes next: managing a growing Amazon account
The skills needed to run an Amazon account in the early months — setting up campaigns, monitoring account health, responding to customer messages within 24 hours, adjusting inventory levels — are learnable and manageable when you have one or two products. They multiply in complexity quickly as your catalogue grows: more products means more listings to maintain, more campaigns to optimise, more keywords to track, more restock decisions to make, more competitor activity to respond to.
Most sellers reach a point where the time cost of managing the account themselves outweighs the cost of having it managed professionally. This is particularly true if your goal is to grow rather than to maintain — organic ranking momentum, PPC efficiency, and listing quality all require consistent, ongoing attention, not just initial setup. Our full account management service exists precisely for sellers at that point: we handle the day-to-day account operation so you can focus on the parts of the business only you can run.
Frequently asked questions
Do I need a limited company to sell on Amazon UK? No. A sole trader registration with HMRC is sufficient. Most beginners start as sole traders because it’s free and quick. Converting to a limited company later is straightforward once the business is generating income that justifies it.
How much does it cost to start selling on Amazon UK? It depends heavily on the business model. Retail arbitrage sellers can start with a few hundred pounds of clearance stock. Private label sellers typically need at least £2,000–£5,000 to cover an initial stock order, product photography, packaging design, and advertising. The Professional selling plan adds £25 a month from the moment you register.
How long does it take to make a first sale? That depends on whether your listing is live and whether you’re advertising. A new listing with active Sponsored Products campaigns can make its first sale on day one. Without advertising, a new listing with no reviews may take several weeks to rank organically — if it ever does for competitive keywords.
What is the difference between FBA and FBM? FBA means Amazon stores and ships your orders. FBM means you handle storage and shipping yourself. FBA adds per-unit fulfilment fees but gives you the Prime badge. FBM avoids those fees but loses Prime eligibility for most sellers.
Do I have to register for VAT straight away? If you’re using FBA, yes — storing goods in Amazon’s UK fulfilment centres creates an immediate UK VAT obligation regardless of your annual turnover. If you’re fulfilling your own orders from home, the standard £90,000 threshold applies.
Can I sell on Amazon UK and the European marketplaces from the same account? Amazon’s current registration creates a single account with linked access to multiple European stores. You can choose which marketplaces to activate and list on them individually, though selling in EU countries brings its own VAT and compliance considerations for each territory.
Ready to start, or looking for a hand getting there?
Amazon UK is a genuine opportunity for UK businesses and brands — but the gap between a well-built account and a neglected one shows up quickly in both rankings and margins. If you’re starting from scratch and want to build it correctly from the beginning, or if you’ve already started and want a second pair of eyes on what’s working and what isn’t, get in touch with us and we’ll talk through what makes sense for where you are right now.