If you sell your products in the UK and EU (European Union) Amazon marketplaces, get ready for some big changes that will significantly impact your FBA business.
Because of Brexit, Amazon announced on July 14 that Amazon’s UK FBA operations will be split from the EU. This means you will no longer be able to fulfill all of your European marketplace orders from a UK warehouse.
As of now, the UK and the EU are in a transitional phase. Existing arrangements are being kept in place until December 30, 2020. On January 1, 2021, the UK will formally leave the EU.
Amazon’s official 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.
What does this mean for my Amazon business?
Fulfillment of EFN orders across the UK-EU border won’t happen
With EFN, you can sell on all five EU marketplaces while storing your products in one country. It also means that you only need one registered VAT (value-added tax) number instead of five separate VAT numbers — if you stored inventory in each country individually.
However, because of Brexit, that’s all about to change.
Starting on January 1, 2021, Amazon will no longer fulfill EFN (European Fulfilment Network) items across the UK-EU border and sellers will need separate VATs for each country in which their inventory is stored.
Transfers of Pan-European FBA inventory between the UK and EU will stop
With Pan-European FBA, UK sellers send all of their inventory to a single warehouse in the UK. Amazon then distributes the inventory across all EU countries. This way, your inventory is closer to the end customer.
And as a Pan-European seller, you are only responsible for the fulfillment fee for the marketplace in which the product sells.
But, if you currently send all of your products into the UK to take advantage of the Pan-European option, on January 1, 2021, your inventory will no longer be distributed throughout the EU.
Note: You can still use the Pan-European fulfillment plan. If you send your inventory to another EU country, Amazon will still distribute your stock. They’ll move it to warehouses located elsewhere in the EU. They just won’t transfer inventory into the UK.
How do you handle your UK and EU FBA inventory now?
If you’re selling in all five countries currently, Amazon suggests splitting your shipments. They recommend sending some inventory into the UK and some inventory into the EU. This is so you can ensure you have sufficient stock on either side of the new customs border when the UK exits the EU officially..
Sellers have plenty of time to figure out how to handle their UK and EU inventory, though. With six months’ notice before these changes go into effect, solutions are possible.
Again, using the Pan-European FBA fulfillment method is still possible; sellers will just send inventory to the UK separately.
You can read Amazon’s official announcement in your UK or EU seller central account. Amazon has also provided you with additional resources (BREXIT guidance help guide and the UK government website.) to help prepare for these upcoming changes.