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If you want to sell on Amazon UK and find out the advantages, disadvantages and fees for Amazon sellers, read our full Amazon review.
What is Amazon marketplace?
Amazon is like a market, but online (and much bigger). If there’s competition in a farmers’ market, you can imagine the level of competition in a global market such as Amazon.
By learning how to sell on Amazon UK, any seller can start selling products without the complications of creating a website, speeding up the preparation of the online settings. Simply enter some basic information about your company and start processing incoming orders.
We believe that the information we have gathered will help you decide if Amazon is the perfect solution for you, or if you should opt for another eCommerce platform.
What are the advantages of selling on Amazon?
Selling through this platform comes with many advantages for an Amazon seller:
- Segmented traffic
- You don’t need to create an online shop or website
- Potential for internationalization
- Trusted by buyers
What are the disadvantages of selling on Amazon?
Selling on Amazon also has its disadvantages. For example:
- Competitors. This competition doesn’t only apply to other Amazon sellers and manufacturers, but also to Amazon itself since they commercialize products from their own and other brands
- You cannot migrate your business data
- Another downside of selling on Amazon are the rates or commissions and the monthly subscription that you’ll need to pay
How much does it cost to sell on Amazon?
If you want to become an Amazon seller, you need to choose between one of their two plans: the Individual plan (for smaller sellers) and the Professional plan.
Under the Individual plan, sellers will be charged £0.75 for every sold item. On the other hand, the Professional plan has a price of £25/month, but eliminates the sales commission and includes additional tools for the growth and development of sellers who have a considerable sales volume.
The Individual plan doesn’t offer as many tools or functionalities as the Professional plan. In fact, if you have a monthly volume of 40 orders or more, it’s already more profitable to use the Professional plan.
Sales fees on Amazon
The sales commission or, as Amazon calls it “selling fees”, are charged for every sold item and include a referral fee, plus additional fees that are only applicable to multimedia.
Apart from the sales fees, you’ll likely need to pay for other costs such as shipping fees, fulfillment fees, referral fees, etc.
When you manage your Amazon orders from the marketplace, shipping fees will be charged. These vary depending on the product category and the shipping method chosen by the buyer.
For those products managed by Amazon (FBA), there are also charges to fund the fulfillment tasks, storage costs, and additional services.
Referral fees represent a percentage of the total transaction. They vary depending on the product category.
Refund administration fees
When a customer returns a product and asks for reimbursement, Amazon will give the seller back the referral fees without the administration fees (20% of the referral fees or £5, whichever is lower).
How to sell on Amazon UK
To sell on Amazon UK, simply follow the instructions below. You’ll be able to publish your first products within minutes.
First, you need to register. For this you’ll need:
- A business email address or an Amazon customer account
- A card to make payments
- A valid identification document
- Registry data from your company, including VAT number
- A phone number
- A bank account to receive payments
Now that you know how to sell on Amazon UK, you need to determine which sales strategy you want to follow. You can be either a reseller, brand owner, or both.
After this, you can start publishing your first products. To do so, create a product listing or associate your product with an already existing product listing. Later, we will explain how you can upload your products.
With Amazon, you can sell in other European countries from a single account (amazon.co.uk, amazon.nl, amazon.de, amazon.fr, amazon.it, amazon.se, and amazon.es). Amazon will help you with the management of your taxes without additional charges during the first year.
What is Seller Central?
After having registered as an Amazon seller, you’ll have access to Seller Central. This is the hub for all your Amazon operations (sales, product information, inventory updates, payments, and more).
You can also view and download professional reports, see your performance as an Amazon seller, ask for assistance, answer customers queries, edit product pictures, and even create product listings from your smartphone.
How to publish products on Amazon
To start publishing your products, you’ll need a global trade item number (GTIN), like a UPC, an ISBN, or an EAN. The listing must also include a SKU. Here’s a checklist of all the necessary details needed to upload your products:
- Title. Write a maximum of 200 characters and start every word with a capital letter.
- Pictures. (500 x 500 or 1000 x 1000 pixels).
- Variations. Required if there are more than one color, size, number of units, etc.
- Keywords. They should be related to what users search for and the characteristics of the product.
- Featured offer. “Buy Box” and other promotions (price, shipping, etc.).
- Description. Remember to also use the keywords in this section.
How to ship orders on Amazon
Once you start selling on Amazon, you need to choose how you want to process your Amazon orders and ship your parcels.
With Amazon, you have two options. The first option is to do it yourself (FBM) — this doesn’t mean doing it alone; you can use a fulfillment tool like Outvio. The second option is to do it through Amazon FBA. They will take charge of the packing, labeling, and shipping of the products.
Delegating these tasks to Amazon can be tempting, but you need to consider the additional charges and your profit margins since they can be considerably reduced when outsourcing to Amazon.
Below, we explain, briefly, how every fulfillment system works to make your decision easier. For more information, read our article on Amazon FBM and Amazon FBA.
Fulfillment by Amazon (FBA)
If you choose to work with Amazon FBA, you need to send all of your stock to Amazon. Amazon will take it from there: scanning, packing, shipment, and everything else that goes into fulfillment.
They will also answer customers’ queries, manage returns and reimbursements, receive the payment, and transfer the corresponding sum to you. This transfer will take place every two weeks.
Small and light program
The small and light program offers certain advantages such as a reduction in shipping costs of items with specific features:
- A weight of 225g or less
- Dimensions of 33 cm x 23 cm x 5 cm or less
- A price of £9 or less or
- Items that are quickly sold under one ASIN
Registering in the “Small and light program” means that you can qualify to provide free shipping to Prime customers.
Heavy and bulky program
The heavy and bulky program allows you to store large products in Amazon’s warehouses and ship them through Amazon. The marketplace also offers customer support for these products. Customers can choose when they want to receive the package, ensuring deliveries without incidents. You can only take part in this program by request.
Multi-channel fulfillment enables automatic inventory updates every time you sell through Amazon or any other sales channels. If your logistics system is outsourced with Amazon, they’ll also take care of receiving the orders, picking them up, preparing them, and shipping them.
With multi-channel fulfillment, your shipments will be charged with a standard rate according to the size of the product and the destination of the parcel.
Fulfillment by merchant (FBM)
In this case, Amazon will only charge the shipping fees according to the product category and the shipping method selected by the customer. Then, Amazon transfers the money to sellers as a shipping credit. Shipping fees will be applied to all sold products under the Individual plan.
If logistics and fulfillment bore or overwhelm you, you don’t need to choose Amazon FBA. Simply connect your Amazon seller account with Outvio and see how easy it is to process your orders, from picking and packing to shipping, tracking, and returns. Outvio even comes with pre-set domestic and international couriers and rates, although it also gives you the chance to bring your own: UPS, DPD, MRW, DHL, GLS, and many more!
Payment methods supported by Amazon
On Amazon, customers can pay with Visa, Visa Electron 4B, Euro6000, MasterCard, American Express, Maestro International, a SEPA bank account (Single Euro Payments Area), Amazon gift cards, and much more.
In addition to these systems, Amazon customers can also pay through Amazon Pay. This payment method is easier and faster for customers, and boosts sales since they can pay with their Amazon account using the data they had already saved in it.
Connect your Amazon business account with other sales channels
Amazon allows for integrations with other sales channels such as your website or other marketplaces. Products can be also shared through affiliate links on social media and in blog posts.
Marketing and branding on Amazon
Advertising on Amazon
Amazon includes several advertising functionalities:
- Sponsored Products. The sponsored products will show on the result pages and product pages.
- Sponsored Brands. In these advertisements, you can include your brand logo, a customizable title, and up to three products.
- Amazon Stores. These are places where your brand story and discounted items will appear.
- Sponsored Display. This is a program for reaching potential customers inside and outside of Amazon. On Amazon, you will only pay for the clicks your ads receive. The Sponsored Display campaign can be set up for more than one country, with a limit of 12 countries.
Amazon has a program to promote products in foreign markets. The Amazon Global Selling program works for North America, Europe, and Asia.
Promotions and coupons
Amazon offers the ability to create promotions and coupons for your sales: discounts, free shipping, and 2-for-1 offers.
Important metrics when selling on Amazon
The Brand Analytics functionality, only available for brand owners, can help those sellers to make better decisions about their products and marketing strategies.
Performance indicators can be seen in your Seller Central area. These indicators are used by Amazon to check your business performance. They should be constantly consulted since they are extremely valuable to Amazon. Reaching Amazon’s requirements means having advantages that your competitors may not have.
Some of the key indicators are the Order Defect Rate (must be below 1%), the Cancellation Rate (must be below 2.5%), and the Late Dispatch Rate (must be below 4%). It’s also fundamental to have good reviews.
Other than this, Amazon doesn’t share any other data about your business, which means that only they have access to certain metrics.
Amazon has created a range of programs to help sellers worldwide grow and develop their businesses. These programs are specially designed for businesses that are unique in some way or another. If you think that your eCommerce business has its peculiarities, keep reading to know if you can opt for any of Amazon’s special programs.
Amazon Business is designed for established businesses, SMEs, and freelancers that fit certain characteristics.
Working under the Amazon Business plan can be beneficial to you since it eases the management of taxes, improves the chances of being featured in the Buy Box B2B, obtain volume discounts, and have more control over your purchases.
You can also limit the categories you can make a purchase from, set up a multi-user account, receive purchase reports, assign payments to one or more users, and more.
Amazon Business can be connected to ERP systems and allow sellers to commercialize their products on amazon.fr, amazon.it, amazon.de, amazon.nl, amazon.se, amazon.es, and amazon.co.uk.
Project Zero is a program whose mission is to eliminate counterfeit with help from automated protections, self-service tools for the elimination of counterfeits and product serialization.
This program is created for handmade and artisanal products. To qualify for this program, you first need to register as an Amazon seller and then request to be part of the Amazon Handmade program.
Amazon carries out audits to verify the truthfulness of these products and sellers. Being part of this programme means that the referral fees will be 12%.
The Amazon Renewed program was created for items that have been reconditioned and resold. These second-hand products must be proven to be of high-quality and as-new.
They must be sold with all accessories, as they were when originally sold. Amazon offers a special guarantee for these products called Amazon Renewed.
The products sold under the Amazon Renewed programme must be able to be repaired or refitted.
In other words, they must have electric or mechanical components that can be replaced or updated to revert the item to its previous status.
The refitting of a product includes a diagnosis of the product, the replacement of pieces that don’t work, an exhaustive process of cleaning and inspection, and a packaging process that mimics the way it was originally packaged, if necessary.
Amazon Custom is a program for product customization, from text personalization (engraved, embroidered, printed, painted, etc.), to picture customization (either images or texts), as well as product configuration with a list of options.
Amazon Launchpad is a program to encourage the creation of new and innovative items. Amazon Launchpad provides tools for customer attraction and loyalty, like the creation of personalized content and exclusive videos. They also offer free translation services to make selling worldwide even easier.
Tools for brand owners
If you’re a brand owner, Amazon includes functionalities for the creation, development, and protection of your products. In order to customize your brand and product pages, protect your brand and intellectual property, and improve the experience of your customers, you first need to register your brand (Brand Registry).
Some of the advantages of having your own brand are:
- More control and influence over your product listings
- A+ content creation for better traffic, sales, and conversion results
- You can promote yourself through Sponsored Brands and Store pages
- Obtaining more metrics
- Protecting your brand from counterfeits
Resources for Amazon sellers: Seller University
Seller University is a resource page for eCommerce and online retail education. This program includes guides, videos, tutorials, and other helpful content aimed at improving your business on Amazon.
Special offers for loyal customers
The “Subscribe and pay” program provides special prices, free shipping, and the ability to schedule regular deliveries of products in a more convenient and affordable way, for those customers willing to keep purchasing your products.
FAQs about Amazon Marketplace
VAT number and Amazon
If you want to sell professionally in the European Union, you’ll need a VAT number. Depending on the location of your business and the number/ value of your sales, you also may need a VAT number.
Featured offer (Buy Box)
Sellers commercializing more than one product compete to appear in the Featured offer or “Buy Box”. To appear in the Buy Box, sellers must meet certain performance criteria. You can see your performance in Seller Central.
Selling products with restrictions
There are some products that require additional actions, like performance controls, additional fees, etc. If you want to sell products that belong to a restricted category, —like food products or items related to vehicles— you’ll need to request authorization in Seller Central.
We hope that this article cleared all your doubts and answered all the questions you had about becoming an Amazon seller. Maybe now you’re unsure if selling through Amazon is the best option for your business, or maybe you don’t want to put all your eggs in the same basket. In that case, check out our articles about Shopify, WooCommerce or PrestaShop. Remember that you can sell your products in more than one marketplace!