How Much Money to Start an Amazon Business in the UK? (Accountant’s Breakdown)

How much money to start an Amazon business is the question clients ask us most. The realistic answer: it depends on what you sell, how you fulfil orders (FBA vs. FBM), and how quickly you want to scale. Below is a practical, accountant-approved budget you can adapt to your goals—plus the latest on Amazon fees and UK VAT.

Core Amazon Costs You’ll Pay

• Selling plan: Individual (pay-per-sale) or Professional (flat monthly). See UK pricing.
• Referral fee: A % of the total sale price (varies by category). Check the ranges on Amazon’s UK pricing page.
• FBA (optional): Fulfilment, storage and other programme fees if Amazon ships for you. Use the fee/revenue calculator before you price.
• Other costs: Inventory, shipping to Amazon (if FBA), barcodes/packaging, listing content, launch ads, and accounting/compliance.

Typical Startup Budgets (UK Sellers)

These example budgets assume a private-label or branded product. If you’re reselling/retail-arbitrage, the low end may be lower; brand-building usually sits mid–to–high range.

1) Lean Test (FBM or very light FBA): £500–£1,500

• Amazon plan (1–2 months): £25 + VAT/month (Professional) or 75p per sale (Individual)
• Starter inventory (small batch): £300–£900
• Listing content & photos (DIY or budget): £50–£200
• Ads/test promos: £100–£200
• Basic packaging/barcodes/misc: £50–£200

Best for validating demand fast without big cash tied up.

2) Balanced Launch (FBA): £2,500–£5,000

• Amazon plan (3 months): £75 + VAT (Professional)
• Inventory (2–3 months’ cover): £1,500–£3,000
• Freight to Amazon & prep: £200–£600
• Branding, photography & A+ content: £300–£800
• Ads & product sampling (launch phase): £400–£900
• Contingency (returns, re-orders, fee variance): £200–£400

3) Brand-Build Launch (FBA + faster scale): £7,500–£15,000+

• Inventory (3–4 months’ cover, multiple SKUs/variants): £4,000–£10,000+
• Pro creative (studio photography/video, A+ & Storefront): £800–£2,000
• Ads (PPC + external): £1,000–£2,000+ in first 60–90 days
• Trademark/IP, packaging upgrades, QA: £700–£1,500+
• Working capital buffer for re-orders: £1,000–£2,000+

What Drives the Budget Up (or Down)?

• Product economics: Higher COGS and bulky items raise freight and FBA fees.
• Fulfilment method: FBA improves conversion and Prime access but adds fulfilment/storage fees; FBM reduces fees but adds your time/ops.
• Advertising pace: Faster ranking needs more PPC budget early on.
• Compliance & insurance: Some categories need testing or certifications; Amazon also requires commercial liability insurance based on marketplace rules.

Tax & Compliance Watch-outs (UK)

• VAT: Track taxable turnover—if you cross the current registration threshold, you must register and charge/submit VAT. See the latest threshold on GOV.UK.
• Bookkeeping: Reconcile Amazon disbursements, fee detail and ad spend; map FBA/FBM fees to your chart of accounts so margins stay visible.
• Pricing: Use the FBA calculator and include referral + fulfilment + VAT in your landed price model.

Quick Checklist: Keep Costs Under Control

• Validate demand with a small test (keywords, competitor reviews, small batch).
• Price backwards from target margin after all Amazon fees and VAT.
• Keep 60–90 days of stock to avoid stockouts and excess storage charges.
• Monitor fee updates—FBA fulfilment/storage rules change periodically.
• Reinvest early profits into re-orders and better creative that lifts conversion.

So… how much money to start an Amazon business?

For most UK starters, a sensible answer is £2,500–£5,000 for a solid FBA launch, with lean tests possible around £500–£1,500 and brand-first launches from £7,500+. Your exact figure turns on product size/weight, category referral fee, fulfilment route and speed of growth. If you want help building a launch budget and cash-flow plan, our ecommerce accounting team can model scenarios with your real numbers.

Bottom line: Decide your entry point, run the fees in the calculator, and build a cash buffer. That’s the smartest path to profit on Amazon.