Amazon is the world’s largest online marketplace, and for many brands, it represents an enormous opportunity to reach millions of shoppers across Europe and beyond. But with rising fees, fierce competition, and an increasingly complex advertising landscape, the question is no longer just whether to sell on Amazon, but whether it is the right move for your business in 2026. If you are a brand considering your next step in e-commerce, this guide gives you the honest answers you need. You can also explore how we help brands scale on marketplaces if you want to see what a full-service approach looks like in practice.
Is selling on Amazon still profitable in 2026?
Yes, selling on Amazon is still profitable in 2026, but profitability is no longer automatic. Success depends on your product category, margin structure, and how well you manage costs. Brands that treat Amazon as a strategic channel with a clear plan consistently generate strong returns. Those that list products without a strategy tend to struggle.
The marketplace continues to grow, with millions of active buyers across Amazon’s European storefronts. Demand is not the problem. The challenge is that the cost of doing business on Amazon has increased significantly over the past few years. Advertising spend is now nearly essential to gain visibility, fulfilment costs have risen, and competition in most categories is more intense than ever.
Profitability on Amazon in 2026 comes down to three factors:
- Gross margin: Products with margins below 30% are very difficult to make profitable after fees and advertising.
- Category competition: Niche categories with strong brand differentiation outperform commoditised ones.
- Operational efficiency: Brands that manage listings, logistics, and advertising in a structured, data-driven way consistently outperform those that do not.
The short answer is that Amazon FBA remains a viable and often highly profitable channel, but it rewards preparation and penalises guesswork.
What does it cost to sell on Amazon?
Selling on Amazon involves several layers of cost. At a minimum, you pay a monthly subscription fee for a Professional seller account, a referral fee on every sale (typically between 8% and 15% depending on category), and fulfilment costs if you use Amazon FBA. When you add advertising, total costs often represent 25% to 40% of revenue.
Here is a breakdown of the main cost categories:
- Seller account: A Professional account costs around €39 per month.
- Referral fees: A percentage of the sale price, varying by category, typically 8% to 15%.
- Amazon FBA fees: Cover picking, packing, and shipping per unit, plus monthly storage fees.
- Advertising (PPC): Sponsored Products, Sponsored Brands, and Display Ads are increasingly necessary to generate visibility, especially for new listings.
- Returns and refunds: Amazon’s buyer-friendly return policy means return rates can affect margins, particularly in apparel or electronics.
Understanding your total landed cost before launching is essential. Many brands underestimate how quickly referral fees, FBA costs, and advertising stack up. Running a detailed margin model before you go live is one of the most important steps you can take.
How does Amazon’s algorithm decide who gets visibility?
Amazon’s algorithm, known as A9 (and its successor A10), ranks products based on their likelihood to generate a sale. The two primary signals are relevance and performance. Relevance is determined by how well your listing matches a search query. Performance is driven by your conversion rate, sales velocity, and customer satisfaction metrics.
In practical terms, the algorithm rewards listings that:
- Use the right keywords in the title, bullet points, and backend search terms.
- Convert well, meaning a high percentage of visitors actually buy.
- Generate consistent sales volume over time.
- Maintain strong review scores and low return rates.
- Deliver reliably and quickly, which Amazon FBA naturally supports.
This creates a reinforcing cycle: better-optimised listings convert better, which improves ranking, which drives more traffic, which generates more sales. New listings break into this cycle through advertising. Sponsored Products campaigns allow you to buy visibility while your organic ranking builds, which is why Amazon PPC and organic performance are closely connected rather than separate strategies.
What are the biggest challenges of selling on Amazon?
The biggest challenges of selling on Amazon in 2026 are rising advertising costs, intense price competition, account and listing suspensions, and the difficulty of building brand equity on a platform you do not own. Each of these can significantly erode profitability if not actively managed.
Rising advertising costs
Cost-per-click on Amazon advertising has increased steadily as more sellers compete for the same keywords. In many categories, advertising is no longer optional, it is the entry price for visibility. Brands without a structured Amazon PPC strategy often overspend without clear returns.
Price pressure and competition
Amazon’s marketplace surfaces competing products directly on your listing page. Winning the Buy Box, the primary purchase button, depends on price, fulfilment method, and seller metrics. Brands that compete on price alone find margins eroded quickly.
Operational complexity
Managing inventory, FBA shipments, listing quality, customer messages, and returns requires dedicated attention. Many brands underestimate the operational load until they are already live and struggling to keep up.
Platform dependency
Selling exclusively on Amazon means your brand’s growth is tied to a platform you do not control. Algorithm changes, policy updates, or account issues can disrupt revenue overnight.
Should you sell on Amazon or your own webshop?
You should ideally sell on both, but for different reasons. Amazon gives you immediate access to a massive, intent-driven audience without needing to build traffic from scratch. Your own webshop gives you control over the customer relationship, brand experience, and long-term data. The two channels serve complementary roles in a healthy e-commerce strategy.
Amazon is particularly strong for:
- Reaching new customers who are already searching for your product category.
- Generating volume quickly with Amazon FBA handling fulfilment.
- Building social proof through reviews that also benefit your brand more broadly.
A webshop is stronger for:
- Owning the customer relationship and building loyalty.
- Capturing email addresses and retargeting audiences.
- Offering a full brand experience that Amazon’s template-driven pages cannot replicate.
- Higher margins, since you avoid referral fees and have more pricing flexibility.
The most resilient brands treat Amazon as a customer acquisition channel and their own webshop as a retention and brand-building channel. Starting with Amazon FBA to build volume, then gradually developing direct-to-consumer channels alongside it, is a proven approach for scaling brands.
How do you start selling on Amazon successfully?
To start selling on Amazon successfully, you need to complete four foundational steps before you go live: validate your product-market fit for the Amazon audience, build optimised listings, set up a fulfilment strategy, and allocate budget for advertising from day one. Skipping any of these steps is one of the most common reasons new sellers underperform.
- Research your category: Understand the competitive landscape, typical price points, and what top-ranking competitors do well in their listings.
- Optimise your listings: Write keyword-rich titles and bullet points, use high-quality images, and complete your A+ Content to improve conversion rates.
- Choose your fulfilment model: Amazon FBA is the recommended starting point for most brands because it unlocks Prime eligibility and removes the complexity of order management.
- Launch with advertising: Use Sponsored Products campaigns from day one to generate initial sales velocity and feed the algorithm with performance data.
- Monitor and iterate: Track your key metrics weekly, including conversion rate, advertising cost of sale (ACoS), and Buy Box percentage, and adjust based on data.
One of the most important decisions is whether to manage this in-house or work with a partner who already has the infrastructure, platform connections, and operational expertise in place.
How Distrilink helps brands grow on Amazon
At Distrilink, we help brands grow quickly and in a controlled way on Amazon and other major European marketplaces. Instead of building a full marketplace team, IT infrastructure, and logistics operation from scratch, brands can activate and scale through us immediately.
Here is what we take off your plate:
- Full account and listing activation: We set up and optimise your Amazon presence from the ground up.
- Data-driven advertising management: Structured Amazon PPC campaigns built to grow visibility while protecting margin.
- Fulfilment and logistics: Managed through our own warehouse and Distrilink Acceleration Platform, giving you flexibility and real-time insight.
- Customer service: We handle buyer communication so your team does not have to.
- Performance reporting: Clear, centralised insight into how your products perform across all connected marketplaces.
We represent more than 25 brands and are connected to all major European marketplaces. Brands grow their e-commerce presence through us without adding complexity, with speed, control, and clear visibility into their results. Ready to activate on Amazon without building everything from scratch? Get in touch with our team and let us show you how we can get your brand live and scaling.
Frequently Asked Questions
How long does it typically take to become profitable on Amazon after launching?
Most brands should expect a ramp-up period of 3 to 6 months before reaching consistent profitability on Amazon. The first weeks are typically spent building sales velocity through advertising, accumulating reviews, and improving organic ranking. Profitability timelines vary by category and competition level, but brands that launch with a solid listing, adequate ad budget, and realistic margin expectations tend to break even faster than those who underestimate the initial investment required.
What is the minimum gross margin I need to sell profitably on Amazon?
As a general rule, you need a gross margin of at least 30% before Amazon fees to have a realistic chance at profitability. Once you account for referral fees (8–15%), FBA fulfilment costs, and advertising spend, your total Amazon cost can easily reach 30–40% of revenue. Products with margins below 30% leave very little room to absorb advertising costs and still return a profit, so running a detailed margin model before listing is essential.
Do I need to register my brand on Amazon, and what does it unlock?
Enrolling in Amazon Brand Registry is strongly recommended for any serious seller. It requires a registered trademark but unlocks significant advantages, including A+ Content (enhanced product descriptions with images and comparison tables), Sponsored Brands advertising formats, the Brand Store, and access to brand protection tools that help you report and remove counterfeit listings. Brand Registry also gives you access to valuable analytics through Brand Analytics, which provides insight into search terms, market basket data, and competitor performance.
What are the most common mistakes brands make when launching on Amazon?
The most common mistakes are launching without enough advertising budget, underpricing products to compete on price alone, and neglecting listing optimisation in favour of simply getting live quickly. Many brands also fail to account for the full cost structure before launch, only discovering that margins are too thin once fees and ad spend are factored in. A close second is ignoring the importance of early reviews — without a strategy to generate initial verified reviews, conversion rates stay low and the algorithm has little reason to surface your listing.
Can I sell on Amazon Europe if my brand is based outside of Europe?
Yes, Amazon allows brands based outside of Europe to sell on its European marketplaces, but there are important compliance requirements to address first. You will need a VAT registration in the relevant EU or UK countries, and depending on your product category, you may need to meet specific regulatory standards such as CE marking or REACH compliance. Working with a marketplace partner or fulfilment provider with established European infrastructure — like a 3PL with local warehouse capacity — can significantly simplify this process and reduce your time to launch.
How important are customer reviews, and how can I get more of them legitimately?
Customer reviews are one of the most influential factors in both conversion rate and organic ranking on Amazon. Products with fewer than 10 reviews are at a significant disadvantage, especially in competitive categories. The most effective legitimate strategies for generating reviews include using Amazon's built-in 'Request a Review' button in Seller Central, enrolling in the Amazon Vine programme (which provides free units to trusted reviewers), and ensuring your post-purchase packaging or inserts encourage customers to share feedback — without incentivising or directing them to leave positive reviews, which violates Amazon's policies.
When does it make sense to work with a marketplace partner instead of managing Amazon in-house?
Working with a marketplace partner makes sense when the operational complexity of Amazon — managing listings, advertising, logistics, customer service, and compliance — would require hiring a dedicated internal team that your business is not yet ready to build. It is also the right move when speed matters: a partner with existing platform connections, warehouse infrastructure, and advertising expertise can get your brand live and scaling in weeks rather than months. For brands expanding into European marketplaces specifically, a partner with local market knowledge and established logistics networks provides a significant advantage over building that capability from scratch.
