Updated: 2 July 2024

Thinking of selling on Amazon? You’ll be joining hundreds of thousands of sellers who use the platform to make money and get their products out there.

In fact, over half of all products sold on Amazon are by third-party sellers.

Whether you have a clothing brand or a handmade craft business, being a successful Amazon seller involves good customer service, careful stock management, and a strong brand.

Read on to find out:

is it worth selling on Amazon?
Amazon seller fees
how to start selling on Amazon
how to make money selling on Amazon in 6 steps

Is it worth selling on Amazon?

Amazon Marketplace is one of the largest online sales platforms in the UK. According to Amazon’s SME Impact Report, more than 85,000 UK small businesses sold on its website in 2021 (up 25 per cent on 2020).

These sellers sold more than 950 million products across a year, equivalent to an average of 1,750 a minute.

Amazon figures show that over 15,000 UK small businesses made revenue of over £100,000 in 2021, with 700 reaching sales of £1 million or more.

There’s clearly money to be made on Amazon, but it can be tricky to stand out in such a busy marketplace.

A few benefits include:

optimised search results (helping your products appear higher up the listings)
reach more customers – even internationally
easy to use platform
no marketing costs

If you get your product right, nail the description, and have eye-catching imagery, then you could be on your way to earning passive income.

Amazon seller fees – what you need to know

Amazon has two different price plans: individual and professional. Amazon selling fees also vary depending on your product category and whether you choose to ship your products yourself or use Amazon’s fulfilment service.

Use the Amazon fees calculator to give you an idea of how much your monthly costs could be.

Amazon fees
Individual plan	75p for each unit sold
Professional plan	£25 a month (plus VAT) to sell unlimited units
Referral fee	8% to 15% (for both individual and professional plans)
Fulfilment fees	See Amazon fulfilment fees for more information on shipping costs and fulfilment

Read our detailed guide to Fulfilled by Amazon (FBA) for more information on whether this is the right option for your business.

Should you choose the Amazon professional plan?

When comparing Amazon professional selling fees, the easiest way to choose which plan is right for you is to consider how much you sell each month and how much you want to grow your business.

If you sell fewer than 35 items a month – or are still in the early stages of planning your stock – the Amazon individual plan will probably work better for your business. Whilst this keeps costs lower, the main drawback is that you won’t get access to the advanced selling and advertising tools on the premium plan.

The Amazon professional plan is a better option if you plan to sell more than 35 items each month. Whilst you’re paying a higher fee up front, the cost will work out less the more you sell.

You’ll also have more opportunities to grow your business. The Amazon professional plan has more ways to advertise your products and be more visible on product detail pages. You’ll be able to use advanced selling tools, such as reports.

How to start selling on Amazon

To start selling on Amazon marketplace, you need to:

Register as an Amazon selling partner (you’ll need an Amazon account first)
Comply with VAT regulations
Create your product listing
Ship your products
Get paid – Amazon Payments will send proceeds from sales to your bank account within five days
Manage customer reviews – make sure you respond to reviews and let people know you’re a trustworthy brand that really cares about customers

How to make money selling on Amazon: a 6-step guide

Selling on Amazon is quick and easy, but there are several steps you should follow if you want to make it a long-term success.

Here’s an overview of how to get started:

Step 1: Choose a product that sells

To make money selling on Amazon (or anywhere) then you’ll need to choose the right product.

Some of the best selling products on Amazon include:

beauty products
fitness equipment
books and board games
electronics like cameras and speakers
handmade products like candles and prints
pet supplies
home and kitchen supplies
clothing and shoes

There are certain rules for selling alcohol on Amazon, and some other products like jewellery and food need special approval, so be sure to check the seller rules for different product categories.

Step 2: Create a listing that stands out

It’s important to optimise your product listing page so it appears high up the search results and in front of as many potential customers as possible.

First you need a product title that people are searching for. Then choose a category, write a detailed description, and add photos that help your product stand out on the listings page. Meanwhile, encouraging and engaging with customer reviews will help you build a brand.

For more tips, read Amazon’s guide to optimising a product listing.

Step 3: Form a pricing strategy

When pricing your products you need to factor in the cost of selling on Amazon, so you have a good profit margin. You should also consider packaging and shipping costs.

Fast selling products on Amazon will usually be priced between £10 and £50 for impulse buys. If it’s priced too low then you won’t make a profit, but if it’s too expensive people won’t find your product as it will appear too far down the listings page.

Make sure you keep track of what’s selling well in your Seller Central dashboard and adjust your prices if you need to. You can also use a price tracking tool to help you adjust your price positioning on the market.

Step 4: Analyse your competition

Look at what sells well on Amazon. This can change depending on the time of year, market conditions, and business trends. For example, sales of things like gym equipment tend to trend upwards in January, while garden furniture is more popular in the spring and summer months.

Check the ‘Frequently bought brands’ and ‘What do other customers buy’ sections for inspiration for related products. This can also be useful if you’re looking to develop a new product for your business.

You can also view Amazon Best Sellers, which is updated every hour. You can view this by category and see what products are trending to help give you inspiration.

Other lists you might find useful for product ideas:

Hot New Releases
Movers and Shakers (biggest gainers in sales rank compared to 24 hours previously)
Most Wished For
Most Gifted

Or have you found a gap in the market? This can be a great opportunity to stand out in the product listings if it’s solving a problem for consumers, but there aren’t any other sellers out there doing it quite like you.

Step 5: Get the right insurance

If a product you sell accidentally injures someone or damages something, then you could be held responsible. That’s why product liability insurance is a good idea to protect you and your products from a potential legal claim.

With online retailer insurance you can make sure you have the cover you need for your business, whether you design products yourself or are selling items from a third-party manufacturer.

Recent changes to Amazon’s terms mean that UK sellers who make sales of more than £4,000 a month must have at least £500,000 of public liability cover.

These sellers must also have Amazon named as an Additional Insured Party or Indemnity to Principal on their insurance policy.

Find out more about having the right insurance to sell on Amazon.

Step 6: Pay your taxes

As with any business, it’s important to register as self-employed with HMRC and pay your taxes. You’ll need to file a tax return in January even if selling on Amazon is just your side hustle.

VAT regulations for Amazon

As with any business, you only need to register for VAT in the UK if:

you store goods in the UK,
you sell them to consumers based in the UK, and
your sales exceed the VAT threshold of £90,000

However if you sell to EU countries, you may need to register for VAT separately and get an EORI number.

Read more about your tax obligations when you have a side hustle, tax dates you need to be aware of, as well as a general guide to starting a business.

What’s your experience selling on Amazon? Let us know in the comments below.

More useful small business guides

Looking for self-employed insurance?

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Photograph: ArLawKa/stock.adobe.com

A quick guide to selling on Amazon in the UK