Amazon European Fulfilment Network is back but is it as good as before and what do you need to know before you turn EFN back on?
I started selling on Amazon in October 2020, just when all the “seasoned” sellers were turning off their EFN (European Fulfillment Network) settings and disconnecting all those extra sales after Brexit pulled that plug. So I never really missed them or got to feel the loss in sales.
I hear it was super simple and there were no complicated forms or procedures to go through. Just connect and sell.
Many people thought Amazon was going to come up with a plan, I mean they couldn’t possibly lose out on all those fees without putting up a fight, could they?
But the deadline came and went and nothing really helpful came about for the smaller seller. Sure there was Pan-European, but this involved a lot of VAT faff and compliance rules and just wasn’t worth it for the average Online Arbitrage seller.
Then there was the IOSS (Import One Stop Shop) which again was a faff and more paperwork blah blah boring, time-consuming, and didn’t work very well on Amazon, especially if you were not VAT registered.
So when the announcement came that EFN was back I was really pleased and thought great, I can sell my Heinz Beans and Hp sauce to those lovely Germans who could smother their Frankfurters in our British delicacies.
But again, things are not as simple as Amazon leads us to think.
After watching Nevermind the Buybox on Youtube with Natalie Cromie and Matthew Wright last night, there are a few things that you might want to consider before you jump in and connect those Amazon European Marketplaces.
You may need to price your goods up to 50% more to cover the costs and still make a profit.
Amazon will take VAT for each country you list on & for every product, even if you are not VAT registered. So this means those who aren’t VAT registered will have to calculate this into their margins.
For each product you are selling in Europe there needs to be a “responsible person” named on the listing. (if a product is already listed then this means there already is, but if you are listing a new product then you need to add this).
Going forward things may get tricky in terms of compliance as Britain and the EU will have different rules and regulations, especially for things like food and toys, and this could lead to compliance issues.
If you are selling over the VAT threshold in European countries you will need to register for VAT in those countries and then you may as well do Pan-European. These are the current VAT thresholds - France €35k, Germany €100k, Spain €35k, and Italy €35k.
I am still on the fence about whether I will sell via EFN. I am not yet VAT registered and will have to check the margins and how high my products will have to be priced., also there are more questions I'd like answered like what happens when you get a return? and if you have a bundle of different products will you need a "responsible person" for each product?
I use Buy Bot Pro as an Amazon profit calculator and they are currently making sure their software is ready to use with EFN, this is going to be really useful in making my decision on whether my products will work with the higher EFN fees.
I also use Profit Protector Pro as my Amazon repricer, which will also enable me to price my products differently for each European marketplace, and I will be able to see which, if any, are working with my profit margins.
I totally recommend you watch the replay of the EFN Episode on Nevermind the Buy Box on the Secret Wealth Youtube Channel and hear all the facts that I have briefly outlined above, and make up your own mind.
Let me know in the Mrs Prime Facebook group where we can carry on this conversation whether you have decided to sell via EFN or Pan-European or why you have decided not to,?.