Your complete checklist for selling on Amazon

Published Thursday 7 May 2026

Table of contents

• What you need to start selling on Amazon
• Step-by-step Amazon seller checklist
• Tips for new Amazon sellers
• How Xero helps Amazon sellers manage their finances
• FAQs on selling on Amazon

Key takeaways

• Selling on Amazon requires a business registration, tax ID, bank account, and a choice between Individual and Professional seller plans ($39.99/month for Professional).
• Amazon charges referral fees of 8–15% per sale plus additional fees for Fulfillment by Amazon (FBA), so understanding your cost structure before listing products is critical to staying profitable.
• Optimized product listings with strong keywords, quality photos, and competitive pricing give you the best chance of standing out in a crowded marketplace.
• Tracking Amazon fees, reconciling payouts, and managing sales tax across states is easier with accounting software built for small businesses.

What you need to start selling on Amazon

Before you create your first product listing, you'll need a few essentials in place. Getting your legal, tax, and account setup sorted early saves you time and helps you avoid delays once you're ready to sell.

Business registration and legal structure

You don't strictly need a business license to sell on Amazon, but registering your business gives you legal protection and credibility. Most Amazon sellers operate as a sole proprietorship, limited liability company (LLC), or corporation.

An LLC is a popular choice because it separates your personal assets from your business liabilities. Check your state's requirements, as some states and cities require a general business license or seller's permit even for online sellers. If you're exploring other online business ideas, registering a business early makes it easier to expand later.

Tax requirements (EIN, SSN, sales tax)

Amazon requires either a Social Security Number (SSN) or an Employer Identification Number (EIN) when you register. If you've formed an LLC or plan to hire employees, you'll need an EIN from the IRS.

Sales tax is another consideration. Amazon collects and remits sales tax in most states through its Marketplace Facilitator program, but you may still need to register for a sales tax permit depending on your state. Keep records of all transactions so you're prepared at tax time.

Amazon seller account types (Individual vs Professional)

Amazon offers two seller plans. The Individual plan has no monthly fee but charges $0.99 per item sold. The Professional plan costs $39.99/month with no per-item fee, plus access to advanced selling tools and reporting.

If you plan to sell more than 40 items per month, the Professional plan is the better value. It also unlocks features like bulk listing, advertising tools, and eligibility for the Buy Box. Many sellers start with the Individual plan to test products before upgrading.

Step-by-step Amazon seller checklist

This checklist walks you through everything from account creation to your first sale. Follow these steps in order to build a solid foundation for your Amazon business.

1. Create your Amazon seller account

Head to Amazon Seller Central and click "Sign up." You'll need your business name, address, phone number, tax identification (SSN or EIN), a chargeable credit card, and your bank account details for deposits.

Amazon verifies your identity during the registration process, which can take a few days. Have your documents ready to speed things up.

2. Choose the right selling plan

Decide between the Individual and Professional plans based on your expected sales volume. The Individual plan works well for testing the waters with fewer than 40 sales per month. The Professional plan at $39.99/month removes the per-item fee and gives you access to advertising, reporting, and bulk listing tools.

You can switch plans at any time through your Seller Central account, so there's no pressure to commit upfront.

3. Research profitable products to sell

Product research is one of the most important steps. Use tools like Amazon's Best Sellers list, Jungle Scout, or Helium 10 to identify products with strong demand and manageable competition.

Many new sellers start with retail arbitrage (buying discounted products locally and reselling on Amazon) before moving to private label or wholesale. Look for products with consistent sales history, healthy margins after fees, and room for differentiation. If you're just starting an online business, focusing on a single product category helps you build expertise faster.

4. Understand Amazon's fee structure

Amazon charges several types of fees that directly affect your profit margins. Knowing these upfront helps you price products accurately.

Here are the main fees to account for.

• Referral fees: 8–15% of the sale price, depending on the product category
• FBA fees: per-unit fulfillment fees based on size and weight, plus monthly storage fees
• Monthly subscription: $39.99 for the Professional plan, or $0.99 per item on the Individual plan
• Additional fees: long-term storage fees, removal order fees, and advertising costs if you run Sponsored Products campaigns

Use Amazon's Revenue Calculator (available in Seller Central) to estimate your net profit per product before you commit to inventory.

5. Choose the right product category

Amazon organizes products into categories, and some require approval before you can list. Open categories like Home and Kitchen, Sports and Outdoors, and Books let you start listing immediately.

Restricted categories (also called "gated" categories) such as Grocery, Jewelry, and Watches require an application. Check Amazon's category requirements in Seller Central to confirm whether your product needs approval.

6. Set competitive pricing

Your pricing strategy directly affects your Buy Box eligibility and sales volume. Research competitor prices for similar products and factor in all Amazon fees, shipping costs, and your desired profit margin.

Amazon's Automate Pricing tool lets you set pricing rules that adjust automatically in response to competitor changes. Start with competitive pricing to build sales history and reviews, then adjust as your listing gains traction.

7. Create optimized product listings

Your product listing is your storefront on Amazon. A well-optimized listing with the right keywords, clear images, and compelling copy drives clicks and conversions.

Focus on these listing elements.

• Title: include your primary keyword, brand name, and key product features (up to 200 characters)
• Bullet points: highlight 5 key benefits and features using natural language
• Description: expand on your bullet points with detailed product information
• Images: use high-quality photos on a white background, including lifestyle images showing the product in use
• A+ Content: if you're brand registered, use A+ Content to add rich visuals and comparison charts to your listing

8. Decide between FBA and FBM

How you fulfill orders affects your costs, customer experience, and workload. Amazon offers two fulfillment options, and each has clear trade-offs.

Fulfillment by Amazon (FBA) means Amazon stores, packs, and ships your products. Your listings become Prime eligible, and Amazon handles customer service and returns. The trade-off is higher fees, less control over inventory, and long-term storage costs for slow-moving products.

Fulfillment by Merchant (FBM) means you handle storage, shipping, and customer service yourself. You keep more control over margins and inventory, but you're responsible for meeting Amazon's shipping standards. FBM works well for oversized items, low-margin products, or sellers who already have their own warehouse setup.

9. Set up shipping and packaging

If you're using FBA, follow Amazon's packaging and labeling requirements closely. Products that arrive at Amazon's fulfillment centers with incorrect labeling or packaging get rejected or incur additional prep fees.

For FBM sellers, choose reliable shipping carriers and set realistic delivery estimates. Amazon tracks your shipping performance, and late deliveries hurt your seller metrics. Consider negotiating volume discounts with carriers like UPS, FedEx, or USPS as your order volume grows.

10. Launch and market your products

A strong launch strategy helps your listing gain visibility quickly. Amazon offers several advertising options to drive traffic to your products.

Consider these advertising tools.

• Sponsored Products: pay-per-click ads that appear in search results and on product pages
• Sponsored Brands: banner ads that showcase your brand and multiple products
• Sponsored Display: retargeting ads that reach shoppers both on and off Amazon

Start with Sponsored Products using automatic targeting to identify which search terms convert best. Then refine your campaigns with manual targeting and exact-match keywords to improve your return on ad spend.

11. Manage inventory and track sales

Running out of stock hurts your search rankings and sales momentum. Use Amazon's inventory management tools to monitor stock levels and set reorder alerts.

Track key metrics in Seller Central, including your unit session percentage (conversion rate), Buy Box percentage, and inventory performance index (IPI). Regular inventory reviews help you avoid both stockouts and excess storage fees. For sellers running an ecommerce business across multiple channels, centralizing your financial data makes it easier to see the full picture.

12. Collect reviews and build your brand

Product reviews build trust and directly influence buying decisions on Amazon. After your first sales, use Amazon's "Request a Review" button in Seller Central to send automated review requests to buyers.

Enroll in Amazon Brand Registry if you have a registered trademark. Brand Registry gives you access to A+ Content, Sponsored Brands ads, and tools to protect your listings from counterfeit sellers. Building a recognizable brand on Amazon creates long-term value beyond individual product listings.

Tips for new Amazon sellers

Getting started on Amazon can feel overwhelming, but a few smart habits set successful sellers apart. These tips help you avoid common mistakes and build momentum early.

Start small and test the market

You don't need a massive product catalog to succeed on Amazon. Start with 1 to 3 products, test different price points, and pay close attention to customer feedback before scaling.

Keeping your initial investment small reduces risk and gives you room to learn. Many successful Amazon sellers spent months refining a single product before expanding into new categories. This approach is especially practical if you're exploring ecommerce for the first time.

Use Amazon's reporting tools

Seller Central includes detailed reports on sales, traffic, advertising performance, and inventory health. Review your Business Reports weekly to understand which products drive the most traffic and revenue.

Pay attention to your advertising cost of sales (ACoS) to make sure your ad spend stays profitable. The Inventory Performance Dashboard helps you identify slow-moving stock before long-term storage fees kick in.

Protect your brand with Amazon Brand Registry

If you sell private-label products, Amazon Brand Registry is essential. It requires a registered trademark, but the benefits are significant: enhanced listing content, brand analytics, and automated protections against counterfeit listings.

Brand Registry also gives you access to Amazon's Transparency program, which uses unique codes on each unit to verify authenticity. Enrolling early protects your listings and gives you tools that are unavailable to unregistered sellers.

How Xero helps Amazon sellers manage their finances

Selling on Amazon involves tracking referral fees, FBA charges, advertising costs, and bi-weekly payouts, all of which can make your finances complicated fast. Xero Accounting Software connects to your bank accounts and integrates with ecommerce tools, making it straightforward to reconcile Amazon payouts and track every fee.

With Xero, you can categorize Amazon fees automatically, monitor your profit margins per product, and generate reports that show exactly where your money goes. For sellers in multiple states, Xero's reporting features help you stay organized for sales tax compliance and IRS filings.

Whether you're a side seller or building a full-time Amazon business, having your finances in order from day one makes growth much smoother. Get one month free and see how Xero simplifies your Amazon accounting.

FAQs on selling on Amazon

Here are answers to some frequently asked questions about selling on Amazon.

How much does it cost to start selling on Amazon?

Startup costs depend on your selling plan and business model. The Professional plan costs $39.99/month, and you'll need inventory investment, which can range from a few hundred to several thousand dollars. Factor in referral fees (8–15%), FBA fees if applicable, and any advertising budget.

Do I need a business license to sell on Amazon?

Amazon doesn't require a business license to create a seller account, but your state or local government might. Check your state's requirements, especially if you plan to collect sales tax or operate under a business name other than your own.

What is the difference between FBA and FBM?

FBA (Fulfillment by Amazon) means Amazon stores, ships, and handles customer service for your products. FBM (Fulfillment by Merchant) means you handle all of that yourself. FBA offers Prime eligibility and less hands-on work, while FBM gives you more control over costs and inventory.

How do Amazon seller fees work?

Amazon charges a referral fee of 8–15% on each sale, depending on the product category. FBA sellers also pay per-unit fulfillment and storage fees. Professional plan subscribers pay $39.99/month, while Individual plan sellers pay $0.99 per item sold.

Can I sell on Amazon as a side business?

Yes, many sellers run their Amazon business part-time alongside other work. The Individual plan keeps costs low when you're selling fewer than 40 items per month. FBA handles fulfillment so you don't need to pack and ship orders yourself, which makes it practical to manage alongside a full-time job.