How To Sell On Amazon UK [Complete Guide]
Estimated reading time: 14 minutes.
Almost 90% of UK shoppers use Amazon.
The platform has almost 300,000 sellers already.
There’s huge demand and significant supply, but Amazon both in the UK and abroad shows no signs of slowing down or decreasing in size.
You might be wondering whether selling on Amazon UK is worth it.
Well, it seems not only was Amazon dominating long before we’d ever heard of “COVID-19”, but that the pandemic may have added fuel to its momentous fire.
And so, in this guide, we’ll break down how to sell on Amazon UK, why you might want to, your options, and what it’ll cost.
In this guide to selling on Amazon UK:
Table of Contents
Welcome To Amazon UK
“Amazon.co.uk is a subsidiary of Amazon.com, a leading online retailer of products that inform, educate, and inspire.”
How big is Amazon in the UK?
- 86% of UK online shoppers bought from Amazon UK between February 2020 and February 2021.
- 56% of Amazon UK shoppers using a desktop have gone directly to Amazon to search for their desired products.
- 31% end up on Amazon after a general search on Google or the like.
UK customers are trusting Amazon to provide them with the goods they want: 88% of consumers read reviews on Amazon UK before buying a product.
But your reach from the platform is not limited to only UK customers.
Did you know that with an Amazon UK account, you can actually sell in Europe too?
When you sell on Amazon UK, you also have access to all five European-based marketplaces too. These are:
- Amazon Spain (Amazon.ES)
- Amazon Germany (Amazon.DE)
- Amazon Italy (Amazon.IT)
- Amazon France (Amazon.FR)
- Amazon Netherlands (Amazon.NL)
With the option of setting up an Amazon Europe marketplace account, you can sell directly to customers in mainland Europe, while managing your listings and inventory from one account.
“With an Amazon Europe Marketplaces account, you can conveniently switch in Seller Central Europe between Amazon.co.uk, Amazon.de, Amazon.fr, Amazon.it, Amazon.es and Amazon.com.tr seller tools to list products and manage orders in multiple marketplaces.”
Seeing as this guide is about Amazon UK, we’re going to stay there.
But if you want to find more information about selling in Europe from Amazon UK, read Amazon’s guide to selling across Europe.
What Do Customers On Amazon UK Want?
Best-selling products on Amazon UK range from books, software, handmade items, and automotive products.
Entertainment items have proven to be the most popular product category in the UK in 2021.
Why do UK customers shop on Amazon?
- 51% of Amazon UK users assume that it has the cheapest prices.
- 28% of millennials in the UK shop on Amazon for its lower prices.
- 86% of UK shoppers prefer free shipping over fast shipping.
- Free shipping is the main reason 19% of UK millennials have an Amazon Prime membership.
This is what the demand tells us. Let’s take a look at the supply.
What’s Being Sold On Amazon UK?
It’s not always best to go for the most popular product, because competition will naturally be higher too.
But it is helpful to get a feel for these categories as a whole, from which you might be able to find your own niche.
Source: Ecommerce News.
Best-selling categories also change constantly, so it’s best to get to know your customers, their lives, and changing wants and needs to stay ahead of the game.
With some idea now about the buyers and sellers using Amazon UK, let’s dive into how you might fulfill your orders for UK/EU customers.
Fulfillment Options For Amazon UK
We’ll focus on the two key fulfillment approaches for Amazon sellers: FBA and FBM.
Amazon UK FBA
45% of Amazon UK sellers are using the Amazon FBA service.
“Selling Partners, on average, have seen a sales uplift of 35% when moving their products to FBA in the UK, as a result of faster delivery that customers love.”
The benefits of using FBA in the UK are:
- Your products are eligible for Amazon Prime, which means your customers can get unlimited, fast, one-day delivery on millions of items.
- Amazon takes care of customer service and returns, saving you time and money, since 30% of products ordered online are returned.
- It can be cost-effective.
FBA also makes it easier to sell to customers in Europe, because Amazon has a range of distribution centres across the continent.
Number of Amazon distribution centres in Europe in 2020, by country:
For Amazon UK sellers that are making use of the access to Amazon European Marketplaces, there are three options for fulfilling Amazon Europe orders from an Amazon UK account.
- Pan-European FBA. This involves sending your stock to a central EU fulfillment centre, and Amazon decides how to split this up between centres across Europe based on where it thinks customers will be.
- Multi-Country Inventory. This method is similar to the Pan-European concept, but it gives you some control over the location of your inventory. For example, if your main marketplace is Amazon UK, but you’re also doing well in Germany, you can choose which percentage of your stock you’d like to be in each country.
- European Fulfillment Network. This applies to sellers using Amazon European Marketplace that are registered with FBA. It allows these sellers to store their inventory in their local fulfillment centre and fulfill all their orders from one pool (even orders from other European marketplaces).
Having Amazon handle this for you is great, but you might want more control over customer service and the packaging used in orders.
For sellers with these concerns, the DIY option might be the preference.
Amazon UK FBM
FBM stands for Fulfillment by Merchant and is the way that Amazon describes sellers not using FBA.
You might handle the entire storage, packing, and shipping process yourself, or use a third-party logistics company (3PL), or perhaps qualify for Seller Fulfilled Prime.
“A 3PL (third-party logistics) provider offers outsourced logistics services, which encompass anything that involves management of one or more facets of procurement and fulfillment activities.
A 3PL service may be a single provider, such as transportation or warehouse storage, or it can be a systemwide bundle of services capable of handling supply chain management.”
You may have a little more control over your fulfillment by using a 3PL, and be able to negotiate costs - unlike with Amazon FBA. This will, of course, depend on the provider.
Here’s a list of notable 3PL companies in the UK.
Seller Fulfilled Prime
“Seller Fulfilled Prime is the Prime program that allows you to deliver directly to domestic Prime customers from your own warehouse.
By displaying the Prime badge, you are committing to fulfil orders with approved Prime delivery carriers at no additional charge for Prime customers. Amazon gives you access to the right transportation solutions to help you meet the high bar for the Prime customer experience.”
SFP gives you the clout of the Prime brand and membership base, without giving up your fulfillment to Amazon completely.
You need to meet strict requirements to be eligible, maintain those standards, and use specific carriers partnered with Amazon.
Is Amazon Prime UK Worth It?
Speaking of Amazon Prime, is it worth the extra hassle to earn the badge on your UK listings?
“As a seller, the benefits of having the Prime badge displayed prominently on your listing might not be so obvious, but make no mistake — having the Prime badge is a must for almost everyone selling on Amazon.”
What are the benefits of having Amazon Prime listings in the UK?
According to Amazon, the benefits to consumers of Amazon Prime are in shipping, delivery upgrades, same-day grocery, wardrobe, gaming, and video.
While deciding whether it’s worth it for you, consider two things:
- Prime members globally buy an average around $1,400 USD worth of stuff a year on Amazon, compared to regular customers spending $600.
- 84% of UK Amazon Prime members agree with the statement: “I’m more likely to buy from Amazon Prime than I am to buy directly from a retailer’s online site.”
There are two options for selling on Amazon Prime:
- If you’re fulfilling your own orders (FBM), and are considered a top seller, you can apply for Seller Fulfilled Prime and undergo a trial period.
- If you’re using Amazon to fulfill your orders (FBA), you automatically qualify for Prime. You just have to get and maintain good seller performance metrics.
How Much Does It Cost To Sell On Amazon UK?
From subscription fees, to seller fees, and fulfillment fees, unfortunately you can’t sell on Amazon for free.
And accounting for these numerous fees is a common challenge sellers face, losing hours to manual calculations and reconciliations. This is where the idea for A2X came from, automating the process for you, but we’ll explain more about this later.
So let’s take a look at some of the key Amazon fees.
Amazon UK subscription fee
The first thing you’ll need to do to become an Amazon seller is choose your subscription type. The two options are:
- Individual Plan: £0.75 per item sold (to be accounted for in each sale).
- Professional Plan: £25 per month (to be accounted for once a month).
“Typically, individual Amazon seller plans are for sellers who will likely sell 40 units (or less) of their product each month, while professional Amazon seller plans are for sellers who plan on selling more than 40 units per month.”
Having one amount to pay each month via the Professional plan might be easier to manage in your accounts, but not worth it for smaller sellers.
Once you’ve set up your plan and account, you’re ready to sell.
You may come across per-item fees and referral fees on Amazon.
Professional sellers don’t pay per-item fees, while individual sellers pay £0.75 for each item sold.
Referral fees vary depending on the category of product/s you’re selling. They are essentially a commission for Amazon bringing you customers.
“For all products, Amazon deducts the applicable referral fee percentage calculated on the total sales price, excluding any taxes calculated through Amazon tax calculation services. The total sales price is the total amount paid by the buyer, including the item price and any delivery or gift wrapping charges.”
Then we have high volume listing fees, and refund administration fees.
Amazon UK charges a high volume listing fee if you’re listing more than 1.5 million SKUs.
And, as for refunds:
“If you refund a customer for an order for which you have already received payment, Amazon will refund you the amount of the referral fee you paid for the item(s), minus the applicable refund administration fee, which is the lesser of $5.00 or 20% of the applicable referral fee.”
There are a few other fees that apply in specific situations. To explore Amazon UK fees in their entirety, read about its pricing plans in detail here.
Fulfillment fees will only apply if you opt to use Amazon’s integrated fulfillment network: Fulfillment by Amazon.
If you fulfill your orders yourself (Fulfillment by Merchant), then you’ll have costs to deal with but they won’t be fees charged by the platform).
Amazon FBA is available in the UK and Europe, as well as in the US where it originated.
You can send your items to Amazon’s warehouses where they will store, pick, pack, and ship your products out to customers.
This all comes at a cost, of course. The key ones you’ll find are:
Amazon fees are notoriously complex, so you won’t see just these two fees on your statements.
We have a dedicated guide to the fee and transaction types you might find, as well as a more general FBA fees guide here.
It’s also helpful to forecast your fees ahead of time. Check out our Amazon fee calculators guide here to find out how.
If you’re fulfilling orders yourself, Amazon charges shipping rates that are calculated based on the product category and shipping service that the customer chooses.
Amazon UK passes this amount on to the seller in the form of a shipping credit.
“Selling partners with the Professional plan set their own shipping rates… When a customer buys your product, you receive a credit from Amazon that matches the shipping rate…
Selling partners with the Individual plan use Amazon’s set shipping rates for all products. Individual selling partners have to ship orders at the set rates even if the shipping credit is less than total shipping costs, so it’s important to price items in a way that makes sure you’ll earn a profit.”
For more information, read Amazon’s Fulfillment Fees for Europe.
Now that you’re armed and ready with all the information you need, let’s get down to the good stuff - setting up your account.
How To Set Up An Amazon UK Account
First of all, make sure you have these things in front of you:
- Your bank account number and information.
- Your tax identification information.
- A credit card (that can be charged internationally if need be).
Then go to Amazon UK Seller Central, and follow the instructions to set up your Amazon seller business account.
You’ll have to choose between selling on Amazon UK as an individual, and setting up an Amazon Professional seller account.
Here’s a visual overview of the two options:
Amazon will take you through five steps: Seller Agreement, Seller Information, Billing/Deposit, Tax Information, and Product Information.
Then you can set up your Seller Central space and get selling!
Check out these guides to help you with the next steps of selling on Amazon:
- The Best Products To Sell On Amazon
- How To Pack Products for Amazon FBA
- Amazon SEO Guide
- Amazon VAT Guide
- The A2X Amazon Accounting Hub
What You Need To Know About VAT
Amazon sellers in the UK will need to register for, collect, and remit VAT.
The rules changed in July 2021, in response to the consistent increase in cross-border trade, and to prevent VAT fraud.
- Distance sales of goods within the EU carried out by suppliers or deemed suppliers;
- Domestic sales of goods by deemed suppliers;
- Supplies of services by EU and non-EU sellers to consumers in the EU;
- Distance sales of goods imported from third territories or third countries carried out by suppliers and deemed suppliers, except for goods subject to excise duties.
Tax obligations for ecommerce sellers worldwide have evolved with the times, and you will be on the radar of HMRC who moderate taxes in the UK.
So make sure you’re up to date with your responsibilities.
You can also get up-to-date information from the European Commission Taxation and Customs Union.
Automate The Hardest Part Of Selling On Amazon
Amazon sellers in particular have a hard time when it comes to accounting.
The complex fee structure along with minimal detail from Amazon settlement statements is largely to blame.
Take it from a fellow seller:
“We had no easy way to account for our Amazon sales. It was too laborious and confusing to manually enter all the fees and revenue numbers associated with Amazon…”
- Alexander M., Capterra.
A2X was conceived by Amazon sellers looking for a better way.
By automating an otherwise time-consuming, error-prone process, business owners get back valuable time and peace of mind that their books are reliable.
“This software is magical. What used to take my team hours to do each billing cycle, now takes a few seconds. Accounting for Amazon is a nightmare, but A2X turns it into a dream.”
- Monil K., Capterra.
For each Amazon settlement, A2X splits transactions out by month and generates a journal summary with every income and expense line for the corresponding payout for you - all automatically.
Your books are organized via the industry-standard accrual method of accounting, and reconciliation takes you a few minutes rather than hours.
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