The Amazon FBA Brexit bombshell has dropped which will significantly impact your Amazon business from the 1st of January 2021. Amazon’s UK FBA operations will be split from the EU with no more EFN (European Fufilment Network) and an end to Pan-European FBA inventory transfers between the UK and EU.
Amazon FBA Brexit Bombshell 1 – EFN
EFN allows you to fulfil orders from any Amazon European marketplace, while you ship your goods to Amazon’s fulfilment centres in just one country such as the UK.
From the 1st of January 2020 goods in Amazon’s UK fulfilment centres will no longer be used to fulfil orders in Europe. Effectively your sales opportunity from selling on Amazon UK dropped from 446 million EU consumers to 66 million brits.
Amazon FBA Brexit Bombshell 2 – Pan-European FBA
Currently, with Pan-European FBA, when you send your products to fulfilment centres in the UK, Amazon distribute them for storage across Europe. Your products become Prime eligible and visible to millions of customers, with faster delivery while you pay only UK local fulfilment fees.
This will end for stock in Amazon UK warehouses on the 1st of January 2021. However if you send stock to an Amazon warehouse in Europe then it will still be distributed to other European warehouse, with the exception that it won’t be sent back to the UK.
The difference between EFN and Pan-European FBA
EFN is effectively keeping your stock in the UK and picking up the shipping cost when you get an international sale. Pan-European FBA means only paying local shipping charges but Amazon can move your stock out of the UK into Europe so that it is closer to the end customer and can be fulfilled quicker.
EFN is an easy way into international selling whereas Pan-European FBA will generally involve having higher levels of inventory. Ending both of these programs for UK merchants means if you want to sell into Europe you will have to split your stock, send some to FBA in the UK and some to FBA in at least one other European country.
Sales impact
Whilst Amazon say that the changes will apply from the 1st of January 2021, in reality you might find impacts of the Amazon FBA Brexit bombshell start to impact you earlier. For instance, if you already have stock in Pan-European FBA it is feasible that Amazon will repatriate your stock before the end of the year and certainly are likely to stop sending your stock to Europe at an earlier date. This means that certainly around Christmas, perhaps sooner, your European sales will start to decline.
Definitely, from the 1st of January 2021, if you do nothing then the full impact of the Amazon FBA Brexit bombshell will be a complete cessation of your European sales.
The logistical impact will be a higher barrier to entry to selling on mainland Europe from the UK. If you want international sales from Europe then you will be forced to split your stock (which will probably mean higher inventory holding and additional costs) and send part of your stock to a warehouse in Europe (with the associated additional shipping costs compared to the UK).
Note for German, French, other EU sellers and for sellers outside Europe
A heads up for merchants based on mainland Europe, your stock will be treated similarly and if you want to continue to sell to UK customers after the 1st of January, you too will have to split your stock and hold some in Amazon’s UK warehouses.
If you are a seller from outside Europe, perhaps selling into Europe from the US or China, you will also need to split your stock into European mainland stock and UK stock and send to at least two Amazon FBA warehouse – one in the UK for selling to UK customers and another on the continent for selling to mainland Europe.
Full Amazon FBA announcement
“On January 31, 2020, the UK left the EU and entered a transition period where existing arrangements are being kept in place until December 31, 2020. The UK is due to formally leave the EU’s Single Market and Customs Union from January 1, 2021.
While UK-EU negotiations are ongoing (including determining what tariffs, if any, will apply), from January 1, 2021 there will be a customs border between the UK and EU which will have an impact on businesses working across this border.
This will have the following impact for Amazon Selling Partners from January 1, 2021:
- FBA offers using EFN will not be fulfilled across the UK-EU border.
- Pan-European FBA inventory transfers will stop between the UK and EU (however, Pan-European FBA will continue to transfer inventory within the EU region, supporting your sales on Germany, France, Italy and Spain sites)
- To mitigate the impact of these changes, you should consider splitting your inventory and sending it to a fulfilment centre in the UK and the EU, so that you have sufficient stock either side of the new customs border
- This may require you to ship your products across the new UK-EU customs border and provide additional information as part of a customs declaration
Your Amazon business will continue to operate as usual until January 1, 2021. However, there are actions you can start taking now to prepare your business for the new customs borders. For information about how you can prepare for these changes, and for all of the latest information about Brexit, please see our BREXIT guidance help pages and the UK government website.
Thank you for selling on Amazon. We remain committed to supporting your business selling in the UK and in the EU as we make this transition, and we will continue to provide the latest information to support you and help your business thrive in the future.”
– Amazon
91 Responses
Not a bombshell, just a logical and legal decision arising from Brexit. AMAZON and all others suppliers will have to take the same decision: creating a restricted market from a large common one.
Brexit means severance from the EU free market, regaining UK’s sovereignty and installing new commerce conditions which will be inferior as UK won’t part of the EU and its customs zone.
The only bombshell: taking four years to discover that.
See the bright side, AMAZON may create a new zone uniting UK, Australia and NZ. It those two countries don’t see that as an infringement of their sovereignty.
“See the bright side, AMAZON may create a new zone uniting UK, Australia and NZ. It those two countries don’t see that as an infringement of their sovereignty.” looking forwrd to seeing all htose amazon trucks driving to and from Oz in 24 hours…
This was to be expected and is just a logical consequence of Brexit. The people voted for it, now the people can have at it. Smaller companies that rely on exports to the EU (no matter what channel), will be damaged by this. This has been made clear for years. Importing and exporting post Brexit won’t be easy and straight forward as advertised by the “winners”.
I stopped arguing against Brexit after the general election. They won, so they can own it now. My company will suffer as well (we rely on imports, so face huge costs and delays due to customs), but we will be able to cope. In worst case we will need to downsize our workforce and increase pricing.
Customs declarations are a massive PITA and quite complex (and expensive – it’s not as simple as just supplying a few custom codes and country of origin information). So I am not surprised that Amazon has no interest in sorting this for a random British seller who wants to sell a few units to Europe.
What was claimed to be ‘Project Fear’ proving to actually be true.
We will be poorer with fewer rights but hey ho we have blue passports.
Regarding PAN EU FBA, having the additional cost of shipping goods from the UK to a French, German or Polish Fulfilment Centre to enter the EU FBA system will make it unviable for most.
“And if Amazon can’t (or won’t) handle the post Brexit process of shipping from the UK to the EU and vice versa under EFN, what chance that merchants will find the process manageable?”
Very little chance!
Thank the foolish public and government who voted for Brexit without considering the damage to UK exports. This is not a marginal effect either, it will effect thousands of UK businesses who will likely see a huge drop in international orders due to increased hassle of completing customs.
It’s not Amazon’s responsibility or in their interest to offer work arounds for a country that willingly establishes barriers to trading with it’s neighbours.
The government should provide systems and resources to make it less painful for sellers to export goods to the EU.
Whilst it shouldn’t really come as as surprise its still going to be devastating for many sellers. The question is, what is going to replace this? (spoiler alert, probably nothing)
Anybody know how will this affect digital sales (books, music etc)
Aaaaaannnnd it’s over for me.
Its all over folks.
So we will have very costly access to the EU market, with possible delays and checks, whilst the Chinese sellers carry on doing exaclty the same in the UK.
Pure quality.
Id prob just stop if EU access become too expensive or move to the EU.
We have been planning for this potential barrier for months now and been advising clients to plan towards perhaps shipping stock from e.g China into e.g France and having the majority of their stock in the EU and full-fill stock from the EU into the UK.
In addition to this gaining VAT numbers in each of the EU locales too.
This is another 100% own goal by the UK Gov and could of been avoided by staying in the Single market….
We import a lot from EU and non-EU. I don’t mind paying the import taxes and the extra paperwork involved.
Smaller business like us importing from EU will have the extra burden of import tax/VAT payable upon goods delivery. The VAT is claimable back however small businesses’ cash flow could be seriously affected.
Meanwhile I’m looking forward to the “bespoke” and “easy” trade deals the UK will have with each and every country in the EU and the whole world. Easy life for Mog, easy life for us 😉
Brexit, the promised land, the land of milk and honey, the land of opportunities…
We sell on Amazon UK & all the other EU sites. Will we still be able to sell on the Amazon EU sites but fulfil orders from our own warehouse?
I wouldnt expect anything else. I am no Amazon fan but cant blame them at all for this
Things will evolve once the deal has or has not been reached. Solutions will appear and just a case of wait and see.
Net result of this will be
1) Make less
or
2) Put up prices in Europe and make less.
Companies who cannot afford to open warehousing in the EU, wont really be able to compete in Europe and if they do it will be on Tiny and likely not worth it margins.
Lets not forget returns via FBA often marked as faulty and normally come back with tags in place in a new condition. Either you will have to pay expensive return and handling fees under this scheme via a 3rd Party or Scrap the item via FBA, as youd need to pay
1) Return shipping to amazon FBA
2) Shipping and handling to Amazon to Ship to a 3rd party
and finally
3) Pay the third party shipping and handling to get the product/s back to you.
And yet Amazon UK just emailed me today with a webinar promoting Pan-EU and EFN, as well as their VAT services! Why??
I only just went ahead and submitted VAT registrations using Amazon’s VAT Services offer. Looks like by the time we are fully registered we may have about 2 months worth of sales at most before we have to stop.
I guess we will be liable for the fees for deregistering VAT in 6 EU countries after barely making use of it.
Clearly if Amazon are not going to make this work then the small sellers are really going to struggle to make it work especially for low value high volume products.
Find another platform to sell your goods on. Almost 4 years after the event & people still moaning. There’s life outside the EU , if folk don’t like it then the EU can still be your oyster!
I think that many comments on here are forgetting – I don’t think anyone who voted for Brexit wanted to cut easy trade with the EU or anywhere else, there would be no reason to do that. What made people vote “out” is because it was no longer just a trade relationship – because of the requirement to level the playing field with standards etc. it became a behemoth that many couldn’t stomach – European Parliament, European Commission, European Court of Justice, Freedom of movement and so on. The fact that England at least were net contributors to the huge amounts of money to be in this club also didn’t sit will with many. Not saying we shouldn’t have left but I doubt many voted not to buy and sell with EU countries. Their principals overrode their decision at the ballot box.
Leaving aside your that comment is a pile of rubbish that you made up, wasn’t it Fromage, Gove and the rest who were saying “Of course we won’t leave the Single Market”?
Or did we all imagine that?
Why didn’t your liars put
“You’ll odds on lose your job and forget buying stuff on the internet, oh, and Immigration won’t change – but you’ll get a Blue Passport!!”
on the side of a bus?
January 1st is a long ways away. People are forgetting that Amazon has a history of announcing things and never putting it in place or reversing the decision. Do I think that will happen here? No not really because Amazon isn’t the one that voted to leave the EU and certain parts of this are out if its control. I wouldn’t be surprised one bit if some backroom plan is hatched although what it wouldn’t know. I don’t live in the UK and do not know all the details of the split so I can’t really say. Amazon will only make the effort to try to help sellers if it benefits them. It might make the number of sellers selling on the platforms go down quite a bit but I doubt that the actual products total will go down, will just be purchased from someone else. It seems to me that this would have, or should have been a large part of the exit vote, but we all know how crappy politics can be
Everywhere you go another simpleton. Being an idiot isn’t a principal (sic). If English racists aren’t intellectually equipped to understand that erecting trade barriers with your major trading partners is a bad idea, they should sit at home on referendum days. And election days too, by the way.
Taking back control = reducing your potential customer base by 86%
Tariffs will cripple SME’s should our incumbent government fail to get a deal with the EU. British businesses who’s market is in Europe, will be uncompetitive due to having to increase their costs to cover longer transport times and costs incurred due to export controls. Unless they can hold unlimited stocks in Amazon warehouses on the continent, which is unlikely.
Edward your comment is by far daftest I have read and pretty much sums up the collective ignorance of those who voted leave. You clearly have zero concept of how trade works. It’ll be interesting to see your moaning when the economy tanks and you lose your job because of the impact of this.
Perhaps you can stick your fingers in your ears and sing the national anthem? Funnily enough there is life outside Britain also, be interesting to see how well Europe does while we flounder accepting poor trade deals from the USA to keep some semblance of relevance on the world stage. Again futher making British business less and less competitive. You voted for it, you own it.
The article mentions EFN and Pan EU but there are other EU selling options in place so I wonder what will happen with those? I guess the “Allow Amazon to buy my products to sell globally” option will also be affected in the same way that EFN is – but MCI will stay the same since it already requires stock to be shipped directly to EU. The interesting one is FBA Export because enabling this option covers more than just EU? So will it fully or partially remain in place?
And there are still Brexiters trying to Justify the disaster they have caused.
Getting rid of more pile it high sell it cheap sellers. Music to my ears.
Bye Bye Amazon sellers. You will be missed like a new found lump
“Getting rid of more pile it high sell it cheap sellers. Music to my ears.”
Yup, Brexit has really showed the Chinese, hasn’t it.
And they say leave voters weren’t thick……
Given the way the EU has taken action on the Brexit threat so far, I would all but shocked if THEY announce a free trade agreement with NZ and Australia on Jan 1th, 2021 🙂
The free trade deal between EU and Japan killed manufacturing of Japanese cars in the UK already.
Brexit is a dump idea, executed by ignorant poshs. UK could have worked inside the EU with partners to fix EU shortcomings. But bottom line, those poshs thought what ever went wrong in the UK, and foremost England, can only be tracked back to the EU, because “They never fail”. And “Cool Britannia”, aka Labour, tried to be better conservatives than the conservatives; didn’t speak up to make people aware what was going on.
So sad.
But heh, if you want to get back in one day, I am sure we Germans are the first to welcome you. What an irony that would be
Good, who cares about some multi-billion dollar company like Amazon that treats its workers like trash. Communities need to be self-reliant instead of dependent on these impossible to maintain supply chains.
So many tropes, and so much whining – both left and right, but mostly left.
Whether Brexit was a good idea or not, there’s no point banging away on keyboards venting frustration. In the UK we live in a democracy and need to be big enough to acknowledge that decisions are made at the ballot box and thereafter honoured.
When we cast our votes, we are agreeing to be bound by the terms of the result. If anyone can’t subscribe to that basic principle, even when a result angers, irritates or otherwise offends their delicate sensibilities, then perhaps they would be better off moving to Russia, China or even North Korea.
The world changes, trade barriers rise and fall in line with the geopolitics in play. Deal with it! If a business model is not agile enough to cope, then perhaps the business model needs revision.
Of course, Brexit will bring various positives and negatives – as will start playing out over the coming years. Business models and sales channels will need to adapt – but that is fundemental to any sound business plan. Any business that simply relies on whatever status quo is in play being eternal is a business that needs to revise it’s model.
Strictly speaking the negotiations between the EU and UK are not done yet, but there are a lot of tricky issues to deal with, not least in IT, should the UK leave the Single Market, as is likely, and a company like Amazon can’t afford to improvise the day before the UK leaves the SM. One aspect of this is giving sufficient advance notice to sellers, which is very professional of then, as can be expected (unlike the total shambles of HMG, which will not be ready until six months’ later at best). That’s also why Amazon is not taking responsibility for customs clearance the way it does for some orders shipped from Amazon US to the UK. Given the total chaos that will likely unfold on January 1, 2021, it would be irresponsible of them to undertake commitments on matters beyond their control.
It is only a bombshell and surprise to someone who had their head in the sand for the last 4 years.
I just have to look at the supporters of leave to know that they don’t have the best interests of everyone in the UK in mind.
One solution around this would be to register for VAT in one of the EU amazon marketplaces and use that marketplace such as Germany to fulfil your EU sales whilst running UK as as standalone marketplace. Downside is splitting inventory but I can’t see any other option. The next step is to understand which EU marketplace to choose based on taxes, import duties, FBA fees etc, get set up and get stock sent in before the 31st December deadline.
Brexit-the gift that keeps on taking.
This will affect a small number of businesses that find it harder to trade in the EU, but it will also benefit many businesses by reducing competition in what is a saturated market for most things because competitors from the EU will also find it more difficult to sell in the UK.
There will be winners and losers, but overall, the net effect will probably be zero.
It probably wasn’t logical that a UK seller would sell an item to somebody in the EU and an EU seller would sell the same item to somebody in the UK.
Does anyone know if products be shipped into/stored in Southern Ireland to be distributed across the FBA network or does it have to be a location in mainland Europe?
Thanks John 🙂
great news for mainland europe, cheap UK stuff s banned 🙂
So if we do what Amazon suggests; split our stock into European mainland stock and UK stock and send to two Amazon FBA warehouse – one in the UK for selling to UK customers and another on the continent for selling to mainland Europe..
If we send our stock then to a German FBA warehouse lets say, then Germany essentially becomes our target market place for EU so Germany, France, Italy and Spain.
But how will it work with the packaging?
I thought if you have a different marketplace than UK in Europe, then the packaging of the product has to be translated into that country’s language.
Anyone know if this is right?
If so that will be weird for the French, Italians and Spanish cause whilst some in those countries will definitely understand English I think that there is going to be a very small percentage that knows German.
How is one suppose to work around this? Anyone knows?
@ Anna
“Find it all very confusing.. ?”
Brexit: Monkeys got to vote on whether they could fling shit. Surprise outcome…
Re packaging – perhaps check out for instance a windscreen wiper for a car ?
Brand
Type / Code – states which cars fitted
Product description in umpteen different languages.
Although I have to say, with so much English spoken on the Continent, cant see a huge issue for the end user – plus as long as you state somewhere “packaging & documentation in English” – I cant see you getting any comebacks?
I think it’s just going to be one of the many “suck it and see” scenarios …
Perhaps Amazon will set up a forwarding/shipping company in the UK or at least partner with one contractually and exclusively whereby the UK seller still sends stock to an Amazon UK fulfillment centre and then Amazon technology will split the stock at that fulfillment centre and disperse to the shipping company who will then send bulk consignments to an Amazon EU fulfilment centre.
Yes they will need the relevant data for customs but Amazon can get this from sellers at an ASIN level.
Yes there will be lots of paperwork etc but that is what shipping companies specialise in.
I can’t see Amazon walking away from PAN EU considering the investment they have put in and Brexit was on the cards when they started PAN EU so I would assume they have some sort of future plan for 2021 and beyond.