Starting an online store sounds simple: pick a product, list it on Amazon or Shopify, and wait for the orders to roll in. At first, that part can feel exciting. Watching sales come in feels like proof that things are working. But there’s a whole other side to selling online that doesn’t get talked about as much — the part that involves money, numbers, and staying organized.
It’s easy to focus on sales and ignore what happens behind the scenes. But sooner or later, things like fees, taxes, and profit margins start to matter a lot more than they did at the beginning. If those things aren’t handled properly, the business might still look busy, but it won’t be making real money.
Sales Are Just One Piece of the Puzzle
When most people start selling online, the goal is usually to get that first sale. After that, the focus turns to getting more customers and selling more products. That makes sense. But here’s the part that often gets missed — more sales don’t always mean more profit.
Every time a product sells, there are hidden costs that take a chunk out of the money earned. These might include platform fees, transaction charges, shipping, returns, ads, or packaging materials. And if someone is using Amazon FBA, there are even more charges like storage or pick-and-pack fees.
A lot of sellers don’t realise how much of their money disappears this way until it’s too late. That’s why tracking every part of a sale — not just the final number — matters from the start.
For UK sellers, this gets even more important when taxes enter the picture. Some choose to work with professionals who understand how ecommerce platforms work. One option is Your Ecommerce Accountant, but there are others too. The key is to work with someone who knows how Amazon, Shopify, and similar platforms operate — not just someone who handles general accounts.
VAT Isn’t Optional
Taxes can feel confusing. Some people assume that they won’t need to think about taxes until the business is much bigger. That’s not always true.
In the UK, there’s a VAT registration threshold, and once the business passes it, VAT needs to be collected and sent to HMRC. Even before hitting that level, it’s smart to know how VAT might apply in the future — and how international sales can make things even more complicated.
Some platforms collect VAT automatically, but that doesn’t mean the seller is off the hook. It’s still their job to report the numbers correctly and understand what’s been paid, what hasn’t, and how that affects their profit.
Profit Margins Can Disappear Fast
Let’s say a product sells for £20. That sounds like a solid amount — until everything is taken out. After Amazon’s fee, advertising, shipping, and maybe a return or two, there might only be £4 left. That’s the real profit.
Profit margins get squeezed without warning. A small change in supplier cost or shipping prices can turn a winning product into one that loses money. If those numbers aren’t checked regularly, a store might be busy but not earning anything real.
That’s why understanding margins is so important. Not just on paper, but in real time — knowing what products are actually making money, and which ones are just creating work.
Ads Are Great — Until They Eat All the Profit
Running ads is a big part of selling online, especially for people using Amazon or Facebook to promote their store. But ads come with a cost. If they’re not tracked closely, it’s easy to spend more than a product is worth just trying to get sales.
Return on ad spend (ROAS) is something to watch carefully. If £10 is spent on ads to sell a £15 product, and £6 of that sale goes to fees and shipping, that’s a loss — even though a sale was made.
That’s why it’s not just about getting traffic or clicks. It’s about knowing how much every sale costs and whether those ads are helping or hurting the business.
Spreadsheets Are Not a Business Plan
In the beginning, most people track their numbers in a simple spreadsheet. That works fine for a while. But as the store grows, keeping everything in one place starts to fall apart.
Receipts get lost. Some sales don’t get tracked properly. Tax time comes around and it becomes a nightmare trying to pull everything together.
Setting up proper systems early — even just using better software or working with someone who knows ecommerce finance — can save a lot of time and stress later. It also makes it easier to grow. When things are organised, decisions are based on facts, not guesses.
Refunds and Returns Still Cost Money
Returns are part of online selling. But many sellers forget to factor in how much they really cost.
Every return means the original sale amount needs to be paid back. But the advertising, transaction fees, and shipping often aren’t refunded. That money is gone. Over time, that can add up to a huge loss if returns aren’t managed properly.
Knowing the return rate — and understanding why customers return products — helps reduce this problem. Sometimes it means changing the product photos or descriptions. Sometimes it’s about packaging or delivery speed. Either way, it’s something that needs attention.
Growth Without Planning Leads to Problems
It’s fun when a store takes off and starts getting lots of sales. But if that growth isn’t handled the right way, things start to break down. Orders get delayed, mistakes happen, or worse — money goes missing because no one’s tracking what’s going where.
Scaling a business means being ready behind the scenes. That includes better tools, smarter workflows, and support from people who understand ecommerce. Growing fast is great, but it needs structure to stay sustainable.
Takeaways That Actually Matter
Selling online can be a smart way to earn money, but it only works long-term if the business side is taken seriously. That means understanding fees, tracking profit, planning for taxes, and not just chasing sales for the sake of numbers.
It doesn’t have to be complicated — but it does have to be organised. Every product sold should bring in more money than it costs. Every ad should be tracked. And every tax rule should be followed from the start, not guessed later.
There’s nothing wrong with learning as things go. But skipping the money side completely can cause real damage. Sales make a business look busy. Profit — and keeping that profit — is what makes it successful.
