Changes to EU Fulfilled by Amazon (FBA) rules – Comment

PJ Scott, Director, Velocity Commerce:

“Between anxiety around what the first Coronavirus Winter will hold and relentless Brexit negotiations, it’s a complicated time to be selling on Amazon. And now, the recent announcement from Amazon regarding the withdrawal of the European Fulfilment Network, and the end to Pan-European FBA inventory transfers between the UK and EU, adds much uncertainty to an already turbulent market.

Come January 1st UK Amazon sellers will no longer be able to fulfil orders from any Amazon European marketplace using Amazon’s fulfilment centres in the UK. This essentially means that to retain the possibility of reaching a potential 446 million customers in Europe, sellers need to actually ship stock to an EU Amazon hub, and pay to store it there, before making a sale. This can be quite a gamble for brands and sellers who do not have a full understanding of the region or the individual country’s market; if you take the risk and embrace the fees moving your stock to a European centre, and desired sales are not achieved, the end result will just be wasted stock and unnecessary overheads.

While this announcement is set to cause yet another headache for Amazon sellers, the influence of Amazon in Europe cannot be denied. In 2019, Germany alone was ranked Amazon’s second-biggest market with net sales of 22.2 billion U.S. dollars, ahead of the UK with 17.5 billion. Following the changes, in order to capitalise on the potential – and growing – sales opportunities in the EU, brands need to be armed with more expertise, market awareness and agility than ever before. In order to achieve this its paramount that brands either invest in the knowledge and capacity within their own team, or, a potentially cheaper alternative, partner with a specialist agency to advise on where in Europe your sales opportunities are (your product could sink in Germany, but fly in France), manage the logistics and deal with the ever-increasing volumes of paperwork.

At Velocity Commerce, we work with our partners to provide them with as much data and insight as possible so they have a competitive edge with everything, from expansion into new territories, to trends to inform new product development. Selling our own brand of technology products, Majority, through Amazon enables us to remain at the forefront of developments on the Amazon marketplace. We’re not just advising clients on how to manage their sales, we’re living and breathing their experiences and therefore understand the hidden obstacles first-hand.”

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