How to start an online shop in the UK: step by step

To start an online shop in the UK, you pick a product people already search for, register with HMRC, choose a shop platform, set up payments and delivery, add the legal pages UK law expects, then launch and start bringing in visitors. You can do the basics in a few weeks without writing any code.

This guide walks through each step in order, with the small details that trip people up the first time.

1. Decide what you’ll sell

Everything else follows from your product: your prices, your delivery costs, your marketing and even which platform suits you. Before you spend money, check three things.

• Demand. Are people already searching for it? Free tools like Google Trends and the Google Ads Keyword Planner give you a rough idea.
• Margin. After the product cost, packaging, delivery, payment fees and advertising, is there still money left? Many first shops fail here, not on sales.
• Practicality. Is it easy to post, unlikely to break, and legal to sell without special licences or safety testing?

2. Choose how you’ll run the business

Most people start as a sole trader or a limited company. As a sole trader you are the business: it’s simple to set up and you report profits through Self Assessment. A limited company is a separate legal body, which can protect your personal assets but comes with more paperwork, like annual accounts and a confirmation statement at Companies House.

• Sole traders need to tell HMRC they’re self-employed and register for Self Assessment once they earn more than the £1,000 trading allowance in a tax year (as of October 2026).
• Limited companies register with Companies House, then for Corporation Tax.
• You must register for VAT if your VAT-taxable turnover goes over £90,000 in any rolling 12 months (the threshold as of October 2026). You can register voluntarily below that.

Open a separate bank account for the shop too. It keeps your records clean and makes tax time far easier.

3. Find your suppliers and work out stock

You have three common options:

• Make it yourself. Full control, but your time is the limit.
• Buy stock in bulk. Better margins, but you tie up cash and need space (or a warehouse).
• Dropship or print on demand. No stock to hold, but thinner margins and less control over delivery times.

Order samples before you commit. Check the quality, the packaging and how long it takes to arrive. If you plan to use a fulfilment warehouse, ask how they receive stock, what they charge per order and how they connect to shop platforms.

4. Pick a name and a domain

Choose a short name that’s easy to say and spell, then check it’s free as a domain, on social media and at Companies House if you’re forming a company. A .co.uk or .com usually costs a modest yearly fee. Our guide to choosing a domain name goes into more detail.

5. Choose your shop platform

There are two broad types. A hosted platform (Shopify, Wix, Squarespace and others) runs everything for you for a monthly fee. A self-hosted setup like WooCommerce on WordPress gives you more control but you look after hosting, updates and security yourself.

For most first-time sellers a hosted platform is the quicker start. When you compare them, look at:

• The total monthly cost, including the paid add-ons you’ll actually need.
• Fees on each sale, on top of payment processing.
• Whether it handles UK delivery options, VAT-inclusive prices and, if you want them, other countries.
• How easy it is to edit your pages without a developer.

Merchella is one hosted option built in the UK by people who run their own online shops. It has a 30-day free trial with no card needed, and no Merchella fee on sales.

6. Set up payments

Shoppers expect to pay by card, and many like PayPal, Apple Pay or Google Pay. Your platform will connect to one or more payment providers. Each charges a fee per transaction, usually a percentage plus a small fixed amount, so build that into your prices.

Check how quickly money reaches your bank, what happens with refunds and chargebacks, and whether the provider needs ID checks before you can take payments. Do this early: verification can take a few days.

7. Sort out delivery

Delivery is where many shops win or lose customers. Decide:

• Which couriers you’ll use (Royal Mail, Evri, DPD and others) and your cut-off time for same-day dispatch.
• Whether delivery is free, flat-rate or free over a certain spend.
• If you’ll offer next-day delivery, and what it costs you.
• How you’ll handle returns, including who pays for the return postage.

8. Build your pages

Your home page should say what you sell and why someone should buy from you, in one glance. Each product page needs:

• Clear photos, including one showing scale or the product in use.
• A short, honest description that answers common questions.
• Price, delivery cost and delivery time, visible without scrolling far.
• Your returns promise and how to contact you.

Write for people first, but use the words they’d type into Google. If shoppers search “cordless hedge trimmer”, say that, not just a clever product name.

9. Add the legal pages

UK online shops need terms and conditions, a privacy notice, a returns and refunds policy (reflecting the 14-day cancellation right under the Consumer Contracts Regulations) and, if you set non-essential cookies, a way to get consent. Limited companies must also show their company details. Our guide to the legal pages every UK online shop needs covers each one.

If you collect customer data, you will usually need to pay the ICO’s data protection fee. As of October 2026 the lowest tier is £52 a year (£47 by direct debit). Check ico.org.uk for whether you need to pay.

10. Test, then launch

1. 1Place a real test order from start to finish, on your phone as well as a computer.
2. 2Check the order email, the payment arriving and the stock going down.
3. 3Refund the test order and make sure the refund works.
4. 4Click every link in the footer and menus.
5. 5Ask a friend to buy something without help, and watch where they hesitate.

11. Bring in your first customers

A new shop gets very few visitors on its own. Pick one or two channels and do them well rather than trying everything:

• Google Search and Shopping ads reach people already looking for what you sell.
• Social media works well for products that look good or solve a visible problem.
• Email costs little and brings people back. Collect addresses from day one.
• Search engine optimisation (helpful product pages and articles) is slower but builds free traffic over time.

Track where each sale comes from so you know which channel to spend more on.

In short

Start small, check your margins, get the basics right (payments, delivery, legal pages) and test properly before you spend on ads. Most successful shops didn’t start perfect. They started, watched what customers did, and improved a little every week.