Blog/ Entering Amazon EU: A Guide for FBA Sellers Going Global

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f you’re an FBA seller looking to expand your business internationally, or if you’re just getting started and see that Amazon EU offers ripe consumer markets and huge opportunities for growth, you’ve come to the right place.

Entering the European market means that you will have access to millions more online shoppers with the same ease and convenience of the Amazon FBA program in the U.S. You’ll be able to sell your products in five separate marketplaces (UK, Germany, France, Spain and Italy) and ship to 26 countries around Europe from one central seller account.

We’re here to help you learn more about launching your FBA businesses in Amazon EU and answer the most common seller questions.

Why Amazon EU?

First, let’s establish why so many sellers are looking towards expanding into Amazon EU.

–  The EU market is actually much bigger & it’s growing.

–  Amazon EU is significantly less saturated with products.

–  You can still find plenty of high volume niches that aren’t very competitive.

–  There are significantly less experienced FBA sellers competing for rank

–  CPC ads are much cheaper

Cutting through the Red Tape
From this list, Amazon EU appears to be an obvious move for FBA sellers; however, it’s easy to feel overwhelmed and be tempted to drop off once you get into the nitty-gritty details of setting up your EU Seller account, sorting through tax regulations and calculating the entire cost of your operation.

Fear not, Sellers! What seems daunting is actually quite dry and straight-forward, and you should look at it this way – these regulations are an added obstacle that many FBA sellers just aren’t willing to go through. This means competition is kept low, and that equates to more sales for you!

Likewise, there are services such as FBA Frontiers which offers everything you’ll need to set up your business. From setting up your VAT, providing translation services, assisting with shipping, or offering crash courses on how to do it yourself, these services are totally worth investing a little time and money into as they can save you money and headaches in the long run.

Does FBA work the same way in Europe and the UK?

 

Obviously, there are some slight differences between shipping your inventory to the U.S. and Europe. But again, the beautiful thing is that once your Amazon Europe Seller account is set-up, all of your orders can be managed from one Seller Central Account.

Fulfillment Options

When you’re setting up your account, one of the fulfillment options you’ll need to decide is where you want your inventory to be shipped. For this, there are three fulfillment options.

The first is European fulfillment Network (EFN). This option allows FBA sellers who are registered in the UK, France, Germany and Italy to store their inventory on one country’s Fulfillment Center and fulfill orders throughout these countries from one central location.

The second fulfillment option is Multi-country Inventory, which means your inventory will be held and fulfilled in individual countries.

The third option is the newly launched Pan-European FBA program, which allows you to ship all your inventory to a single fulfillment center, but then, Amazon will then allocate your inventory across different fulfillment centers in other European countries based on demand.

We’re going to save you a lot of time and just tell you now, start with EFN . MCI is one big costly logistical nightmare, and Pan-EU should only be considered once you’ve hit distance thresholds and have been in the EU for awhile.

Does each product need to be listed separately for each country?

Once you set up your European seller account, this automatically enables you to sell in all European marketplaces. That said, you would still need to set up each product listing individually in each marketplace. They need to be optimized in the local language and include the correct keywords.

Should I hire a translation service to create my listings in the local language?

While Amazon doesn’t require sellers to translate their listings into the local language, there’s no question that you will probably yield better results if everyone shopping in a particular marketplace can read your product description and details.

The same goes for Product packaging. Amazon only requires the product packaging to be only in the language of the country of origin, but as a seller – you should aim to provide the best customer experience for your customers. Having your product’s packaging, instructions and inserts translated into the local language will avoid a lot of possible customer service issues and possible negative reviews you could receive from people who need clarification about your product.

Should I need to hire someone in each country to handle Customer Service issues?

Each country’s Amazon Marketplace has different rules, however, they do ask that you provide basic customer service. This includes handling customer’s VAT invoice requests in the local language of the marketplace where you list your products.

Again, there are reasonably-priced services that can make this easy you . You can also hire a translator yourself to create response templates based on the most common inquires. If you can use a free translation site to translate messages, it’s entirely possible for you to rely on these templates for the majority of customer emails.

What Preliminary Form Do I Need to Fill out to Register for an Amazon EU Sellers Account?

You’re going to need an EORI Number and a VAT Number.

When you import your products into the UK or Europe, this means you will need to pay import taxes and duties upon arrival. Your chosen shipping carrier may assist with this. Likewise, you’ll also need to apply for and obtain an Economic Operator Registration and Identification Number (EORI) in order to import your goods.

One key factor to remember is that you shouldn’t import goods as “Amazon” or show Amazon to be the declarant, importer of record or co-signee. Your company or your freight forwarder needs to be listed as the importer and co-signee, and you should nominate a customs broker.

When you send inventory to an Amazon fulfillment center, this needs to be sent under “Delivery Duty Paid Destination” with all relevant import duties, VAT and other taxes paid by you. Amazon will return any inventory, at your expense, if it arrives at Amazon with any unpaid taxes or duties.

What is VAT and how do I register, collect and pay VAT when selling on Amazon EU?

VAT stands for Value Added Tax. It’s a consumption tax that applies to all goods and services that are bought and sold for consumption in the EU. VAT is collected from the buyer at the point of sale, and it’s currently 20%.

As a seller, you are required to forward this VAT payment to a country’s revenue authority on specific dates.

If your inventory is sent and held in the EU, you must collect and pay the VAT. To complete your account registration, Amazon requires a VAT number.

It can be tedious, and that is why we recommend you consult a professional firm that specializes in VAT applications and will take care of the ongoing reporting on your company’s behalf.

Some sellers try to avoid VAT by selling low-value items outside the EU which are in small packages and addressed to individual customers. We recommend against trying to do this as you’ll most likely incur high international shipping fees which will result in less profits.

So, to get the ball rolling, here’s a recap of exactly what you will need to set up your private label on Amazon EU:

1) Apply for a VAT number.

If you are applying in the UK, go HERE .

You will find links to apply for a VAT number. You should get a VAT registration certificate within 14 working days. You can also apply for a VAT number in other countries on the site.

2) Apply for a Seller Account in your selected marketplace.

This is different account from your North American Seller Account.

To Apply, you will need:

  • A valid credit card
  • Phone number
  • EIN (or equivalent if you’re not a US Entity)
  • VAT number
  • Bank Account, which is in a country and currency supported by Amazon (such as the USA)

3) Enroll in FBA in your selected marketplace.

While Amazon goes through the process of verifying your business registration information, you may experience payout restrictions on your current account.

4) Prepare your inventory for import into Europe.

  • Apply for an EROI number HERE
  • Select a Freight Forwarder or customs broker to help with the importing and customs procedures.

5) Set up plans for customer service, product returns and labeling in the marketplace’s local language.
For language translation and customer service issues, consider using a seller-friendly service.

For product returns, you will need to provide amazon with a return address in the country of the fulfillment center. Without a local return address, your products may be disposed without reimbursement to you.

As a default option, however, Amazon can repackage and re-sell returned items for you.