How to get started as a Seller with Amazon FBA in the UK
The year was 1994 when Amazon founder Jeff Bezos quit his job and launched Amazon. Within the first month, Amazon had already generated $20,000 per week in sales. Twenty-seven years later, Amazon is a household name and the world’s largest online retailer.
In the UK, 90% of shoppers use Amazon, while 40% have access to its Prime subscription service. Most Amazon shoppers visit the online marketplace at least once a month. If you’re planning on selling your products through the biggest marketplace and use Fulfillment by Amazon, you’re in the right place.
In this guide, we explain the steps necessary to start selling with Amazon FBA UK.
What is Amazon FBA?
Fulfilment by Amazon or FBA is a service offered by Amazon to automate seller’s order fulfilment and shipping. Basically, Amazon handles packing, shipping, refunds and returns, plus storage in Amazon warehouses.
The Amazon FBA is one of the most advanced fulfilment networks in the world. Not only can the service help you scale your business and reach more customers. But save you money on expenses such as warehouse, shipping, packing and more.
In the UK, 45% of Amazon sellers are using Amazon FBA service. Over the years, the service has experienced an increasing adoption rate among UK sellers.
As such, it has grown by more than 10% every year. Today, Amazon has more than 21 FBA distribution centres across the UK. The largest Amazon warehouse in Britain covers 1 million square feet. It’s located in Dunfermline, Scotland. The warehouse is equivalent to 14 football pitches and employs more than 1,000 permanent workers.
What Are the Benefits of Amazon FBA?
There are several benefits of Amazon FBA.
- All your products are eligible for Amazon Prime
- FBA makes it easier to sell in the UK and Europe
- Helps you reduce the cost of fulfilling orders
- FBA handles customer inquiries
- Amazon handles returns and refunds on your FBA orders
With Amazon FBA, you can grow your business, reach more customers, save money and time.
How Amazon FBA Works
Amazon started its FBA service in 2006 to help small businesses benefit from its own fulfilment network. Basically, the online retailer wanted to share its business model with third-party sellers and help them profit big.
Fulfilment by Amazon is constantly evolving and changing to meet customers’ needs in the UK and worldwide. Keeping up to date with the latest changes and consumer demand helps businesses stay on top of their game. For example, in 2020, Amazon added the commingling of inventory.
Commingling is where Amazon stores every unit of a single product together. This is regardless of the seller. Also called stickerless inventory, it saves you money and ensures your products reach your customers fast. The problem is your customers can receive counterfeits instead of high-quality products. It’s critical that you keep an eye on things if you plan to use this feature.
The way Amazon FBA works is straightforward. You send your items to Amazon FBA, and they store your products. Customers purchase your products, and Amazon FBA picks, packs and ships your products to them. But first, label your products according to Amazon guideline. To help you with this, check out the FBA Label Service.
Upon arrival at the Fulfilment centre, Amazon will apply barcodes using the information provided. Per item, Amazon charges £0.15. You can choose to apply the barcodes to individual products. Just select “Merchant” under Who Labels during the shipment creation process. To track your inventory, use the manufacturer barcode.
Amazon will handle your customer service, including dealing with refunds and returns. Every two weeks, the online retailer will deposit your sales profits directly to your bank account. Amazon now provides workshops and Amazon FBA webinars to educate potential sellers. You can also check out the Amazon Seller University on YouTube.
Getting Started with Amazon FBA
The following are steps to get started with Amazon FBA UK.
Set Up Your Seller Central Account
The Seller Central Account is your go-to resource and a portal to your Amazon business. As a one-stop page for managing your selling account, your Seller Central Account allows you to do the following:
- Track your inventory
- Update your product listings
- Download business reports
- Monitor seller performance
- Keep track of daily sales
- Contact Selling partner support
- Manage payment and much more
To get started, choose a plan – Individual or Professional. We recommend Professional if selling more than 35 items. Create your new Amazon Seller account. Before signing up, have the following:
- Business email address
- Valid passport or National ID
- Chargeable credit cards (international credit cards accepted)
- Company registration details (with VAT number)
- Business phone number
You also need to have a bank account where Amazon will send your profits from your sales. During the registration process, provide your business name, legal name and address. Amazon will store these details for reference.
If you’re a registered company, use the exact name and address under which your company’s registered. Amazon allows you to change this information on the “Account Info” page under the “Settings” tab.
Amazon also requires you to enter your:
- VAT Number
- Bank account information
- Credit card information
If you fail to input your VAT number or if your business is not VAT registered, Amazon will charge you VAT on your seller fees. Once you register for a Seller Central Account, you can set your shipping rates. Shipping information is essential for an excellent customer experience.
It’s critical that you define the location from which you ship, countries you ship to and shipping rates. To provide a consistent buying experience, Amazon sets shipping rates for Books, Music, Video and DVD. For other products, you’ve the choice of three pricing structures.
- Price based
You can also set up your information and policies. Just fill in the “Your Info and Policies” page under the “Settings” tabs. Do not add a URL to your website in your information. This would be a breach of Amazon’s Seller Agreement.
Create Your Product Listing
To start selling on Amazon, create a product listing in Seller Central. Your product listing should include:
- A product identifier such as ISBN or EAN
- An SKU – product ID that allows you to track your inventory
- Details such as name, brand, description, images, price, quantity, and production condition
- Keywords to help buyers find your product
Your product title should be 200 characters max, and you must capitalize the first letter of every word. Images should be 500 by 500 or 1000 by 1000 pixels. This helps to increase listing quality.
Add variations such as sizes and colours plus bullets points in your product description. This helps to highlight key features and benefits. Don’t forget to make use of the “Buy Box” feature.
You can set up Fulfilment by Amazon on your Seller Central account. Under the Inventory tab, click “Manage Inventory” then click “Add a Product.” Search the Amazon catalogue using the product name, UPC, ISBN, ASIN or EAN. If the product is not available in the catalogue, create a new product listing.
If you find your product, click “Sell Yours.” Enter the price and condition of the product. Click “Advanced View” for more options to add to your product listing. Check “I want Amazon to dispatch and provide customer service for my items if they sell,” then click “Save and Finish.”
On the next page, Amazon will ask if you want to convert to Fulfilled by Amazon. Click “Back” to load up your inventory. Repeat the steps above to add more products. When ready, click the drop-down menu with your selected products and select “Send/Replenish Inventory.”
Check “Create a new shipping plan” and “Individual products,” then click “Continue to shipping plan.” Enter the number of products you’re sending in, then choose who will label the products.
Amazon charges 0.15 per item to label your products. We recommend you select “Seller.” Apply to all and print your labels. Prepare your products for secure transportation to a fulfilment centre. Ensure that you follow Amazon’s packing guidelines plus shipping and routing requirements.
Create Your Shipping Plan
Create your shipping plan, print the Amazon shipment ID labels and send your products to an Amazon fulfilment centre. Your shipping plan should include:
- Products you want to send to Amazon
- Quantity of each product
- Shipping method
- Shipping carrier details
Learn more about Creating your Amazon Shipping Plan. Once the Amazon team receives your product at the fulfilment centre, they can pack and ship it to customers.
Read: Manage FBA Orders.
How Much Does Amazon FBA Cost?
The Individual selling plan costs £0.75 per unit sold while the Professional plan is £25 exclusive of VAT per month. Under the Individual plan, you can sell fewer than 35 items per month, add new products to the Amazon catalogue, and grow your business with FBA.
The Professional plan is right for your business if you:
- Sell 35+ items a month
- Want to advertise your products
- Want to use advanced selling tools
- Want to sell your products in restricted categories
- Want to qualify for top placement on product detail pages
- Grow your business with FBA
- Increase selling efficiency with API integration
- Run promotions including free shipping
- Add multiple users to your Seller Central account
For all Amazon FBA efforts that include packing, storage, and shipping your products, they take a fee. The Fulfilment fee is a flat fee that sellers pay per unit. It’s based on the product type, the product’s weight and dimensions.
For example, you’re selling an item priced between £0 to £9. The item’s dimension is less or equal to 23 x 15.5 x 0.4cm and weighs between 0 to 92g. The Fulfilment fee will be £0.61. If you sell products priced more than £10, weighs 901 – 1,400g and packaged as a standard parcel (45 x 34 x 26cm), the fulfilment fee is £2.65.
If selling on European stores and fulfilling from inventory in the UK, the fulfilment fee is £7.94. But if fulfilling from local inventory, the fee is €3.78 Euros. The storage fee is usually charged per cubic metre per month or cubic foot per month.
For example, Amazon FBA charges £0.40 per cubic foot for storing clothing, shoes and bags in standard size from January to September. From October to December, they charge £0.56 per cubic foot. For all categories, the storage fees from January to September is £0.66 per cubic foot for standard size and £0.93 per cubic foot from October to December.
These fees include an additional charge of 2% for items sold on Amazon UK. This is to reflect the Digital Service Tax introduced in the UK. Additional inventory storage fees apply for units stored in a fulfilment centre for more than 365 days.
There are optional service fees that include:
- Bubble wrap
For a complete set of Amazon FBA fees, check out this downloadable rate card.
Want to know how much you can make selling products on Amazon. The online retailer has a revenue calculator. It provides you with revenue, fulfilment cost, seller proceeds and net profit.
For example, I want to sell personalised engraved pocket watches for men and women. The package dimensions are 2.8 x 1 x 12cm, and weight is 0.11 kg. I plan to sell each pocket watch for £11. Here is Amazon’s FBA breakdown:
- Item price: £11
- Fulfilment by Amazon fees: £2.21
- Monthly storage cost per unit: £0.01
- Seller proceeds: £9.32
If I fulfil one order, my Net profit will be £9.32, and the net margin is 84.73%.
Let’s take another product such as a Novelty hanging plaque sign. The package dimensions are 0.508 x 12.7 x 25.4cm, and its weight is 0.091 kilograms. I set the price per plaque at £3.99. The breakdown is as follows:
- Item price: £3.99
- Fulfilment by Amazon fee: £1.66
- Monthly storage cost per unit: £0.00
- Seller proceeds: £3.38
My net profit will be £3.38, and my net margin is 84.71%.
Here is another example of a Levoit Smart WifI air purifier. The package dimensions are 24.5 x 41.99 x 52.39cm, and the unit weighs 6 kgs.
- Item price: £135.99
- Fulfilment by Amazon fee: £6.52
- Monthly storage cost per unit: £0.88
- Net profit: £115.18
- NetMargin: 84.70%
As you can see from the examples above, the bigger and heavier the item, the more you’ll pay for Fulfilment by Amazon as well as storage costs. For me, this is fair, considering that Amazon gives you access to millions of customers. They also handle packing, shipping, returns, refunds, and even customer service.
This means no trips to the post office for you. Basically, the service saves you money and time.
To know how much you’ll earn selling on Amazon, use the Fulfilment by Amazon Revenue Calculator.
What to Sell on Amazon?
You can sell items in the following categories:
- Films, Music and Games
- Electronics and Computers
- Home, Garden, Pets and DIY
- Clothes and Shoes
- Jewellery and accessories
- Sports and Outdoors
- Food and Grocery
- Health and Beauty
- Car and Motorbike
There are several products that Amazon prohibits. They include:
- Illegal drugs
- Guns and ammunition
- High strength alcohol (70% ABV+)
- Real fur clothing
- Lottery Tickets
- Prescription medication
- Used Clothing
- Photo processing
- Gift cards and gift certificates
- Magazine and newspaper subscriptions
Any item you sell on Amazon should be in the online retailer’s existing catalogue. Amazon does not allow sellers to add new product ranges.
How Do You Find Out What Products Are Selling on Amazon?
Amazon sells more than 12 million products that include books, electronics and much more. If you expand to the Amazon marketplace, the number is more than 350 million products. Finding the best niche to invest your time and effort in is challenging.
Lucky for you, we researched and found tips to help you know what products are selling on Amazon.
Use the Amazon Keyword Research Tool
The best selling product categories on Amazon are:
- Home and Garden
- Hair Care
- Apparel and accessories
- Home Décor
To find which products sell fast on Amazon, use a keyword research tool like Jungle Scout. It will help you find any product by keyword, categories and custom filters. It saves you time with your research by finding products that sell fast on Amazon.
This tool will help you manage and grow your FBA business, thanks to its Sales Analytics tool. Organize and track your FBA sales from the comfort of your home and view performance and other key metrics. Basically, Jungle Scout will empower you with tools that make managing your business easy.
Other Amazon Keyword Research Tools you can use include:
Use Amazon Reviews
Amazon Reviews are essential when deciding what products to sell on Amazon. This is because the reviews give you a feel for what customers want. Sellers do not have the time for focus groups to get customer feedback or what they like and don’t like. Mining Amazon reviews is far more efficient and cost-effective.
It’s essential to keep the following in mind when researching Amazon reviews:
- Find unsatisfied customers with a particular product
- Find products customers are raving about
When you read the reviews, you’ll learn what customers love and hate about certain products. Take this information into consideration when deciding what to sell on Amazon. We recommend using customer complaints to make any modifications to the products you’re going to sell.
Check Amazon’s Best Sellers List
Since you’ll be selling your products on Amazon, it makes sense to check Amazon’s Best Sellers List. Head to the Amazon website and click “Best Sellers” from the top left corner of the webpage. On the left of the page, Amazon lists the most popular products by category. Just click on a link, and Amazon will list the best sellers product.
For example, if you click “Baby Products,” Amazon will list items such as baby wipes, bottle teats, nappy bin refills, and much more. Knowing what items are the best sellers on Amazon points you in the right direction. Now, you can make wise choices when selecting your inventory to sell on Amazon.
Research on Google Trends
Google is the largest search engine in the world. As the most visited website on the internet, Google holds more than 92% of the search engine market share. Per day, Google processes over 3.5 billion searches. This means Google processes over 40,000 search queries every second.
One of the most valuable tools that Google provides is Google Trends. This tool allows you to research trending topics. As such, you can use it to narrow down your options to products that sell fast on Amazon. It does not matter what niche you’re looking to target. Google Trends will give you ideas of top sellers in a wide array of categories.
All you need to do is enter a search term or topic such as toys, supplements or skincare. Google Trends categorizes results by sub region, related topics and queries.
Spy on Your Competition
Several techniques allow you to spy on your competition legally. One way is to track your competitor’s brand. Today, we are living in an era of sharing information. People share their opinions about brands and their products on social media and forums such as Facebook, Twitter and Reddit.
By tracking your competition, you can highlight their weaknesses as your strengths. Then cleverly use them to sell your products. Another way is to check the popularity of their products. Find your competitors products on Amazon and check the user ratings. The more ratings a product has, the more popular it is.
To succeed as a seller on Amazon UK, we recommend that you use the Amazon FBA. Amazon will handle packing, storage, shipping, refunds, returns and customer service. As such, your business will experience a boost in sales by up to 26.5%.
FBA also takes the operational burden off your shoulders. Since the Amazon team will manage customer inquiries, returns and refunds on all your FBA orders, you can use your time to grow your business. Amazon has fulfilment centres across the UK and Europe. This allows you to ship your products fast to your customers.
Since you’re new to Amazon FBA, we recommend starting small. Test the waters by understanding your customers and the platform. Optimize your product listing to attract customers and boost your sales. Go mobile with the Amazon Seller app. You can track sales, fulfil orders, find products to sell, and create your product listing even on the go.