Test the UK first: how US brands run a six-month UK market test

When a US brand looks at the UK and the EU, the first plan is often too big: a company in each market, a warehouse on each side of the Channel, ads in five languages. The second plan is often too small: ship from the US, see what happens, and never learn what local stock and local support would have done.

There is a middle path that we recommend to most brands: test one market properly, for six months, and decide with real numbers. For most US brands, that market is the UK.

Why the UK first

• One language, one currency, one set of rules. You can sell in English, price in pounds and deal with one tax authority, HMRC.
• Demand you can already see. Many US brands get UK orders and traffic before they have done anything for the UK.
• A clean read. Since Brexit, the UK is a separate customs and VAT territory from the EU. A UK test tells you about UK demand without mixing in 27 other countries.
• The parcel model is changing. The UK is ending its £135 customs relief for low-value imports by October 2028 at the latest. Brands that ship every UK order from the US today will need a plan for local stock anyway.

The EU stays on the table. A good UK test shows you whether your product, prices and marketing travel, which is most of what you need to know before the EU.

Months 1 to 2: set up properly, once

A test only tells you something if customers get the same experience they would get from a local brand. That means:

• A UK company and bank account, so you can hold stock, pay local suppliers and get paid in pounds. Your company, bank account, VAT number and stock should be in your name, not a provider's.
• VAT registration. A US business selling goods located in the UK has no VAT registration threshold: it registers from the first sale. Prices shown to UK consumers include VAT, at 20% for most goods.
• An EORI number to import, and a clear answer to who acts as the importer of your stock.
• Product compliance. Labels, a UK address where the rules require one, and, for cosmetics, a UK Responsible Person and notification before sale.
• A UK warehouse (3PL) connected to your store and marketplaces.
• Customer support in UK hours, with a returns process that follows UK rules: online buyers can cancel within 14 days of delivery, and you refund within 14 days.
• A localized store: prices in pounds with VAT included, UK delivery times and costs, UK spelling, payment methods UK shoppers expect.

Done in parallel, this usually takes 3 to 8 weeks. The bank account is the step that varies most, because the bank decides.

Months 2 to 5: run it like a real market

Once stock is in, the test is about running the market, not just being present in it:

• Imports and stock replenishment
• Order fulfillment, returns and refunds
• Bookkeeping and VAT returns
• Customer support, in UK hours
• Marketing adapted to the UK: offers, claims and ads that are allowed here

If you run the test from the US with nobody on the ground, you measure your team's bandwidth, not UK demand.

The five numbers to watch

Agree on these before month one, and review them monthly:

1. UK orders and revenue, against the same period before the test.
2. Conversion rate of UK visitors, before and after local prices and delivery.
3. Delivered cost per order: shipping, fulfillment and duty, compared with shipping from the US.
4. Returns and support contacts per 100 orders, and how fast they are resolved.
5. Contribution per order after all UK costs, which is the number that decides month five.

Month 5: decide

By month five you have four months of trading data. There are three honest outcomes:

• Scale: the numbers work. Keep the UK running and plan the EU, usually with stock in one EU country and VAT handled through the EU's One Stop Shop for sales to other EU countries.
• Stay: the UK works, the EU can wait. Keep running one market.
• Step out: the numbers don't work. Close cleanly: stock sold through or moved, final VAT returns filed, the company kept dormant or closed. This only works if everything was in your name from day one, and if your contract says how the handover happens.

What a UK test costs

The costs fall into three groups: the operation itself (company, accounting, VAT, compliance and someone managing it), stock and logistics (3PL fees and freight, which depend on volume), and marketing. Ask any provider to price all three for six months, and to show what is included and what is billed at cost.

At Atlantic Link, we run this as Your European Office: one market, from $5,000 a month, with the company, bank account, VAT, compliance, stock and support management run for you, and a review of the numbers in month five. If your company, VAT and warehouse aren't live within 8 weeks for reasons on our side, your first month is free.

Questions

Why test the UK before the EU?

One language, one currency, one tax authority, and demand many US brands can already see. A UK test shows whether your product, prices and marketing travel, without the complexity of 27 countries.

How long does it take to start selling in the UK?

Usually 3 to 8 weeks for the company, VAT, warehouse and store. The bank account is the step that varies most.

Does a US company need to register for VAT in the UK?

If your goods are stored in the UK and sold to UK customers, yes, from the first sale: there is no registration threshold for businesses not established in the UK.

What happens if the UK test doesn't work?

If the company, bank account, VAT number and stock are in your name, you can step out in order: sell or move the stock, file final returns, and close or keep the company dormant.

This article is general information, not legal or tax advice. Rules change; check the current position before acting.

Sources

• GOV.UK: Reforming the customs treatment of low value imports into the UK
• HMRC: VATREG37210, non-established taxable persons, overseas sellers
• GOV.UK: VAT rates
• GOV.UK: Get an EORI number
• GOV.UK: Submit a cosmetic product notification
• legislation.gov.uk: Consumer Contracts Regulations 2013
• European Commission: One Stop Shop (OSS)