What UK and EU a businesses need to know about selling to the US

Expanding into the US eCommerce market presents a huge opportunity for UK and EU businesses. With a $1.1 trillion online retail industry and a population of over 330 million consumers, the US offers unparalleled growth potential.

But breaking into this market isn’t as simple as launching a US website and expecting orders to roll in. Logistics, customer expectations, and regulations are very different from what UK and EU businesses are used to.

If you’re considering expansion, here’s everything you need to know - from warehousing and fulfilment to tax regulations and customer preferences - to ensure your US launch is a success.

Understanding the US eCommerce landscape

Before we get into the nitty gritty of it, it’s important to recognise how US eCommerce differs from the UK and EU. While there are some similarities, key differences in customer expectations, shipping, and tax laws can significantly impact your strategy.

Key differences between US and UK/EU eCommerce

These differences will directly impact pricing, fulfilment, and customer service strategies for UK and EU businesses entering the US market. Please also remember that many of these policies, preferences and marketplaces can differ dependent on state too, so ensure you do your own due diligence.

Navigating US fulfilment and logistics

Shipping and fulfilment are among the biggest challenges of selling to the US. With a landmass 40 times the size of the UK, achieving fast and cost-effective delivery requires a well-planned fulfilment strategy.

Warehousing: Choosing the right fulfilment network

Unlike the UK, where one or two warehouses can serve the entire country, a single US warehouse is unlikely to provide the fast delivery speeds customers expect.

There are three main fulfilment options:

• Single warehouse (East Coast or West Coast) - Lower costs but longer shipping times to certain areas. Best suited for brands just starting out in the US.
• Bi-coastal fulfilment (East + West Coast) - A great middle-ground for scaling brands, allowing for faster delivery across major population hubs while keeping inventory management efficient. Some brands also opt for central fulfilment hubs in locations like Texas or Ohio, which can reach most of the US within 2-3 days, balancing cost and speed without needing multiple coastal warehouses.
• Multi-warehouse network - Ensures fast nationwide delivery but increases inventory holding costs. Best for high-volume brands with significant demand across the country.

Many UK and EU businesses start with an East Coast fulfilment centre (such as New York or New Jersey) before expanding west as demand grows.

Shipping expectations: Managing costs while staying competitive

Amazon has set a high standard for fast delivery, with more than 60% of US shoppers expecting same-day or next-day delivery.

To compete, UK and EU brands should:

• Partner with a US fulfilment provider or fulfilment partner with a strong US base to avoid costly international shipping.
• Use carrier partnerships (USPS, FedEx, UPS) for cost-effective domestic rates.
• Offer tiered shipping options, including free standard delivery and express paid upgrades.

Without a strong fulfilment strategy, high shipping costs can reduce profit margins and impact conversions.

Understanding US tax and regulations

Unlike the UK and EU’s VAT system, the US operates on a state-by-state sales tax model, which can be confusing for international sellers.

Sales tax vs VAT: What you need to know

• VAT is included in pricing in the UK and EU, but in the US, sales tax is added at checkout.
• There is no federal sales tax - each state has its own rules.
• A business must collect sales tax if it has a tax nexus in a state, which is triggered by:
  • Physical presence (warehouses, employees).
  • Economic thresholds (e.g. $100,000+ in sales in a state). Please note that some states have a lower threshold.

How to stay compliant

• Use a sales tax automation tool, like Avalara or TaxJar, to track and file tax obligations.
• Register for sales tax permits in states where your business has a tax nexus.
• Display tax-exclusive pricing to align with US customer expectations.

Failure to comply with state tax laws can result in fines and penalties, so getting it right from the start is crucial.

Meeting US customer expectations

Customer expectations in the US are not the same as in the UK and EU. Businesses must adapt to different shopping behaviours, return policies, and payment preferences to succeed.

Customer service: Fast responses are non-negotiable

Customer service is a major factor in brand reputation. US consumers expect:

• Live chat or 24/7 support for immediate assistance.
• Fast email and social media responses (within hours, not days).
• Clear refund policies, with many expecting a no-questions-asked approach.

A slow or unresponsive support team can quickly damage a brand’s credibility in the US market.

Returns policies: More flexible than in the UK/EU

US consumers expect generous return policies, often 30-90 days, compared to the 14-30 days common in the UK.

To build trust, UK and EU businesses should:

• Offer prepaid return labels for domestic orders.
• Partner with local return hubs to simplify the process.
• Provide store credit incentives to reduce refund costs.

Ignoring US return expectations could result in lower customer retention rates, as 92% of shoppers say a good returns policy influences their loyalty.

Payment preferences: Credit cards and BNPL dominate

Unlike the UK and EU, where debit cards and PayPal are widely used, US shoppers prefer credit cards and Buy Now Pay Later (BNPL) services.

Most popular US payment options

1. Credit cards (Visa, Mastercard, Amex) - The most widely used method.
2. PayPal - Trusted but less dominant than in the UK.
3. Buy Now, Pay Later (Affirm, Klarna, Afterpay) - Rapidly growing in popularity.
4. Apple Pay & Google Pay - Frequently used for mobile transactions.

Offering a range of payment options increases conversions and ensures a frictionless checkout experience.

Should UK and EU businesses expand to the US?

Selling in the US can be highly profitable, but it requires careful planning. Businesses that fail to navigate fulfilment, tax laws, and customer expectations often struggle to scale.

Before expanding, ask yourself:

• Do we have a fulfilment plan? Shipping from the UK/EU isn’t cost-effective - US-based warehousing is essential.
• Are we prepared for US sales tax compliance? State-by-state tax laws differ significantly from VAT.
• Can we meet fast shipping and return expectations? Customers expect Amazon-level service.
• Do we offer the right payment options? Credit cards and BNPL dominate the US market.

If you can confidently answer these questions, the US market offers huge potential for revenue growth.