Amazon FBA, FBM & UK E-Commerce Terms Glossary
Terms like Amazon FBA, Amazon FBM, prep centre, fulfilment, VAT, and EORI are some of the most common concepts entrepreneurs come across when starting an e-commerce business in the UK. Understanding these terms properly is essential for reducing operational mistakes, controlling costs, and protecting account health. In this guide, we explain the most commonly used terms across Amazon selling models, warehouse operations, logistics processes, and UK business infrastructure in a simple and easy-to-understand way.1. Amazon Selling Models
One of the first major decisions when selling on Amazon is choosing the right fulfilment model.- Amazon FBA (Fulfilled by Amazon): Products are sent to Amazon warehouses, where Amazon handles storage, packing, and shipping.
- Amazon FBM (Fulfilled by Merchant): Products are stored and shipped directly by the seller.
2. Product & Barcode Terms
Product identification systems play a huge role in Amazon operations.- SKU (Stock Keeping Unit): A product code created by the seller for stock tracking purposes.
- FNSKU: Amazon’s unique barcode system assigned specifically to the seller. Required for FBA shipments.
- ASIN: Amazon’s unique product identification number used within the marketplace system.
3. Warehouse & Fulfilment Terms
Warehouse and fulfilment processes sit at the centre of any e-commerce operation.- Prep Centre: An operational warehouse where products are inspected and prepared before being sent to Amazon.
- Fulfilment: The complete process from receiving an order to delivering it to the customer.
- Pick & Pack: The process of picking products from shelves and packing them after an order is placed.
- Square Metre Storage Pricing: A warehouse pricing model based on the amount of space used.
4. Returns & Amazon Removal Processes
Returns are a normal part of e-commerce, but poor return management can quickly increase operational costs.- Removal Order: The process of having inventory returned from Amazon warehouses back to the seller.
- Quality Control (QC): Inspecting returned products to determine their condition.
- Bundle / Kit: Multiple products packaged and sold together as a single unit.
5. UK Company & Tax Terms
Running an e-commerce business in the UK requires the correct legal and tax setup.- Limited Company (Ltd): The most common company structure in the UK.
- VAT (Value Added Tax): A consumption tax that becomes mandatory once businesses pass the required turnover threshold.
- VAT Number: The company’s VAT registration number.
- EORI Number: A registration number required for businesses importing or exporting goods.
- Companies House: The official UK government body responsible for company registrations.
6. Account Health & Performance Terms
Account performance is one of the most important parts of selling on Amazon.- Account Health: A dashboard showing the account’s compliance and performance status.
- Order Defect Rate (ODR): Amazon’s metric used to measure seller performance issues.
- Suspension: Temporary or permanent account deactivation due to policy violations or poor performance.
Conclusion
Amazon FBA, FBM, and UK e-commerce operations involve a wide range of technical terms and processes. Understanding these concepts helps reduce operational risks, control costs, and support sustainable growth. Having a solid understanding of e-commerce terminology is one of the building blocks of a strong and scalable online business.