Brexit & Amazon FBA - heads up

Discussion in 'Ecommerce Forum' started by Pish_Pash, Aug 26, 2020.

  1. Pish_Pash

    Pish_Pash UKBF Ace Free Member

    2,487 645
    Just taken a call fro Amazon today....once Brexit happens (31st dec), they will not fulfill any FBA customer sales from UK-> EU.

    Bit of a bombshell that (only 3.5 months to go)

    the solutions aren't great...

    1 Register for Pan-European FBA (VAT registration in 7 countries - jeez!) ...low commission if going this way though (& you only then have to get your stock to one Country...e.g. Germany Fulfilment centre)

    2. Register for VAT in one country (e.g. Germany), send your stock to Fulfilment centres in that country (low commission for sale in that chosen country, high commission for other countries)

    3. Register for VAT in say 2 or 3 countries (Germany/France/Ital)...low commission for sale in those countries, but a right royal pain keeping stock topped up (3 countries to send to!)

    4. Switch over all your products to Fulfilled by merchant...eek!

    5. Give up on the EU & watch your income get mullered.

    Carry on.
     
    Posted: Aug 26, 2020 By: Pish_Pash Member since: Feb 1, 2013
    #1
  2. The Byre

    The Byre UKBF Legend Full Member

    10,256 4,252
    6. Set up a company in Germany and carry on as per normal.
     
    Posted: Aug 26, 2020 By: The Byre Member since: Aug 13, 2013
    #2
  3. Mr D

    Mr D UKBF Legend Free Member

    24,443 2,970
    Have some products as FBA for UK sales.
    Have some products as FBM for EU sales.

    Ok yes have to do some work - how many potential orders are you looking at per day from EU after Brexit transition finished?
    Lots? Use another fulfillment service. Not a lot? Send yourself.
     
    Posted: Aug 26, 2020 By: Mr D Member since: Feb 12, 2017
    #3
  4. Pish_Pash

    Pish_Pash UKBF Ace Free Member

    2,487 645
    that was my option 4 (in other words, FBM all EU sales ...not attractive ...I'm sort of caught between "lots" & "not a lot")

    Either way...a lot of grief.

    I'd thought that - bearing in mind how Amazon adore skimming fees - that they'd have enough nous to be able to generate a customs label for UK-> EU Customer Sales.

    But then I'd not be carrying on as normal...two companies, two locations, twice as many staff, more VAT returns...hardly "normal" ...and a little outside the scope of most Mom & pop small biz operations
     
    Posted: Aug 26, 2020 By: Pish_Pash Member since: Feb 1, 2013
    #4
  5. Mr D

    Mr D UKBF Legend Free Member

    24,443 2,970
    Look at your EU sales. Either they are cost effective to carry on selling over there or they are not.
    If you do not have the time then use another fulfillment place for those orders and adjust prices accordingly.

    Could be Amazon next year decide to recapture some fees by offering FBA services across the water from UK stocks. But until they do you will have to plan to sell or not sell as your business allows.
     
    Posted: Aug 26, 2020 By: Mr D Member since: Feb 12, 2017
    #5
  6. Pish_Pash

    Pish_Pash UKBF Ace Free Member

    2,487 645
    Oh I'm aware of the options (&/or how to work out the way to proceed) ....I wasn't seeking advice ...look at the thread title (reason for posting was that there may be others who were unaware that Amazon are basically going to choke UK->EU FBA sales from Jan 1st)
     
    Posted: Aug 26, 2020 By: Pish_Pash Member since: Feb 1, 2013
    #6
  7. The Byre

    The Byre UKBF Legend Full Member

    10,256 4,252
    But it's what you voted for! (Not you personally, but Englandshire. You wanted restrictions of trade and customs barriers with the EU. Well, now you're going to get what you wanted and what you voted for!)

    When enough companies start to realise what is going to happen, I might set up someone in the EU to deal with this - but then why bother? I could do this easily in Germany and/or France, but it probably would not end up being of any true benefit to me personally and I am too old to worry about making life better for others.
     
    Posted: Aug 27, 2020 By: The Byre Member since: Aug 13, 2013
    #7
  8. Mr D

    Mr D UKBF Legend Free Member

    24,443 2,970
    There will be some who get surprised and start complaining end of January.
    Not being aware of what is happening.
     
    Posted: Aug 27, 2020 By: Mr D Member since: Feb 12, 2017
    #8
  9. Pish_Pash

    Pish_Pash UKBF Ace Free Member

    2,487 645
    Which is why I initiated this thread ;-)

    My biggest issue is not the extra VAT registrations, but more so I've still yet to find a mainstream accounts package that allows multiple VAT agencies in multiple currencies (so I'd need to have 2 x VAT agencies in my accounts software, which Quickbooks does...but to track VAT in GBP & EUR, which Quickbooks doesn't do) ....because of Amazon FBA, what you have here is Mom & Pop operations now trading globally like IBM & Apple...yet the main software houses are still stuck in 1986!
     
    Posted: Aug 27, 2020 By: Pish_Pash Member since: Feb 1, 2013
    #9
  10. The Byre

    The Byre UKBF Legend Full Member

    10,256 4,252
    Gnucash
     
    Posted: Aug 27, 2020 By: The Byre Member since: Aug 13, 2013
    #10
  11. samuel5

    samuel5 UKBF Regular Full Member

    273 19
    We are using Pan EU FBA, I have a call booked in with them tomorrow to discuss this massive headache!
     
    Posted: Aug 27, 2020 By: samuel5 Member since: Apr 25, 2010
    #11
  12. Ray272

    Ray272 UKBF Regular Free Member

    313 43
    8% returns electronic item 100 sales per month.
     
    Posted: Aug 27, 2020 By: Ray272 Member since: Jul 5, 2017
    #12
  13. billybob99

    billybob99 UKBF Regular Free Member

    1,739 556
    Nice to know Pish.

    Just started my FBA side hustle, 4 weeks ago. Only selling in the UK but sold out of stock in 4 days and been tempted to sell internationally.

    I checked out the Register for Pan-European FBA option, said it was free for the 1st year then 2400 smackers a year.

    Haven't decided yet but good to know options.
     
    Posted: Aug 27, 2020 By: billybob99 Member since: Apr 23, 2013
    #13
  14. Clinton

    Clinton UKBF Legend Full Member

    5,015 2,180
    Brexit? Damn, that happened suddenly!

    I wish they had told us a few years ago that the UK is going to be leaving the EU. We could have prepared.
     
    Posted: Aug 28, 2020 By: Clinton Member since: Jan 17, 2010
    #14
  15. Pish_Pash

    Pish_Pash UKBF Ace Free Member

    2,487 645
    Personally, I think the best strategy for most would be to register for VAT in the strongest EU marketplace for sales (in my case Germany)...this then allows a continuation of sales in the EU, without having to deal with 7 VAT return in 7 different countries. There are people o the likes of fiverr who will do your VAT registration for fairly modest cost.

    Sort of like a baby steps approach...the notion of going from 1 VAT return (UK) to 8 (UK + SEVEN EU countries), is a head trip.

    There could be two saviours here....

    1. The UK/EU may thrash out a trade deal at the 11th hour
    2. Amazon will gt their backside & gear & deploy automation re creating the export documentation for EU sales (which will then allow everyone to carry on as before)....they'll be looking at significant revenue loss if they don't...and Amazon seem to have the hang of automating things at scale ;-)
     
    Posted: Aug 28, 2020 By: Pish_Pash Member since: Feb 1, 2013
    #15
  16. consultant

    consultant Your Business Community Staff Member

    5,667 797
    If you have more business in the EU than UK could you move everything over there, somewhere, and even fulfil UK orders from there?
     
    Posted: Aug 28, 2020 By: consultant Member since: Jan 21, 2008
    #16
  17. Mr D

    Mr D UKBF Legend Free Member

    24,443 2,970
    Yes, could do that. However you'd be competing with sellers who are able to deliver next day to customers by using stock in this country.
    So don't expect to keep the same UK sales if moving business overseas.
     
    Posted: Aug 28, 2020 By: Mr D Member since: Feb 12, 2017
    #17
  18. The Byre

    The Byre UKBF Legend Full Member

    10,256 4,252
    The Brits will muddle through!

    I ordered some specialist materials from a wholesaler a month ago using their online shop. After two weeks I sent an email asking if the order had been dispatched. No reply. I called - we're out of stock. Well, what do you have that is in stock? I reordered. After a week, I gave up and ordered the original stuff from Germany. Yesterday, both packages arrived.

    I won't make that mistake again - next time, I'll order from Germany and know that I am not dealing with people who muddle through. You know the sort - the stock control is integrated with the stock levels and with the online shop: it's all one integrated system and not a bloody spreadsheet that Mavis in accounts has to transfer to the website - if she remembers!

    Years ago, I was representing two UK magazines at a trade fair. The team from the UK arrived. The dedicated fair stand from their fair representation team did not. Neither did the magazines we were supposed to be giving away. We all ran up a goodly hotel bill and put all the drinks and tips onto the publisher. Both magazines folded later on. Muddling through was not a good idea.

    I could fill page after page with similar stories - and they would all have one thing in common. Every time it happened, it was a British company!

    Brits are a magnificent people and yes, they really do live on the principle of muddling through! They muddled through two world wars with botched equipment built at the last minute. They've muddled through several economic crises. They have an eye-wateringly expensive health system that is just one huge inefficient exercise in muddling through, usually at the expense of the employees and patients.

    The road and rail and other public transport systems are the very epitomai of muddling through: they are not even integrated with themselves, let alone with one another!

    It is one of the charms of living here! Everything is a muddle and a mess. Prisoners are let out of prison by mistake - and on a regular basis! Oh, somebody got the date wrong! We'd better ask him to come back inside - and he does!

    Only in Britain do prisoners come back when let out by mistake! In America, the average prisoner would be over the state line and long gone and on his way to Mexico. In Germany, our efficient prisoner would adopt a new name and start a restaurant in Spain, returning a wealthy man and become a local politician.

    Driving through London is to step back in time - by about 70 years. Trucks and busses belch blue Diesel smoke. Traffic lights seem to switch at random. Traffic signs countermand one another. One-way systems defy all logic. Forced off the roads by the sheer madness of it all, taking public transport is no alternative to the chaos! Taxis on principle ignore all attempts to hail them and our bewildered visitor is reduced to walking. He or she has learned to muddle through!

    But here's the fun part about living in Britain - if you try to make the natives efficient, they object. New bypass? Objections rain down on such things. A motorway that goes somewhere where people actually want to get to (i.e. not Birmingham)? Massive protests and middle-aged women, men with beards and a chap called Swampy start living in trees to stop the building works. One of the largest protest marches in Edinburgh was to stop the building of modern electricity pylons so that all that alternative energy might actually reach someone who wants to use it.

    If you have money, watching others muddle through is amusing, well, at least it amuses me. If you are poor and rely on systems that don't work, muddling through ain't that pretty!
     
    Posted: Aug 28, 2020 By: The Byre Member since: Aug 13, 2013
    #18
  19. Darren_Ssc

    Darren_Ssc UKBF Ace Free Member

    1,276 395
    The UK and USA are both, seemingly, despised by most people yet given a choice of where to live they are always top of the list, for some reason?
     
    Posted: Aug 28, 2020 By: Darren_Ssc Member since: Mar 1, 2019
    #19
  20. Wren

    Wren UKBF Newcomer Free Member

    1 0
    We have the most spoken language in the world, everyone on the planet has some outpost of family in one or other?
    Even if you love German efficiency you need to grasp the nominative to communicate.
     
    Posted: Aug 28, 2020 By: Wren Member since: Apr 20, 2018
    #20