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Amazon updates its Brexit guidance, advises seller action

by Mark Tyson on 20 July 2020, 12:12

Tags: Amazon (NASDAQ:AMZN), UK Government

Quick Link: HEXUS.net/qaem3i

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The UK left the EU on 31st January 2020, but entered a transition period where existing arrangements continue until 1st January 2021. In January we were told we had an oven-ready deal - but it wasn't a deal, rather it was simply a withdrawal agreement. The government are very publically negotiating a trade deal with the EU right now.

Thus, although we are being told to prepare, people/businesses don't know how to prepare as a lot depends on the results of current negotiations. Nevertheless, Amazon has recently updated its Brexit guidance, as the wheels of commerce must keep turning, whatever happens between now and next year.

Given the uncertainties, Amazon has provided quite a lot of solid advice for its sellers as the New Year approaches. Nevertheless, due to the nature of the Brexit beast there are quite a few ifs and buts. It recommends a number of actions depending upon your current selling practices and markets you address. Unfortunately all of the actions seem to involve more legwork, paperwork and fuss.

As it is quite a complicated set of impacts on Amazon Selling Partners, I've reproduced the official Amazon bullet point guidance for 1st Jan 2021, below:

  • FBA (Fulfilment by Amazon) offers using EFN (European Fulfilment Network) 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

In brief, the 1st Jan 2021 split will break Amazon's third biggest world market (6 per cent) after the US and Germany, from the EFN. A popular full service global agency for Amazon sellers, Molzi, has reinforced Amazon's call, telling UK based sellers to take urgent action to move inventory to the EU to continue to get access to the market of 450m people there. There will be possible impacts for US sellers too, for example, especially those that hold stock in the collective European fulfilment network.

Official UK government advice

Sadly at this time, the UK economy is still suffering under the uncertainty of any upcoming deal which could be precipitated as anything between the previously much fancied 'Norway' deal - to 'no deal' which has recently got a new lick of paint as an 'Australia style deal'. Whatever happens, there could be some very big changes to trade, shipments, pricing, and so on.

Sources: Amazon Brexit guidance, The Information, UK Government Transition website.



HEXUS Forums :: 31 Comments

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Even with normal Amazon purchases,just tracking a number of packages(bought on the UK website),a surprising number are sent from German fulfillment centres. So expect the same things to apply to many Amazon purchases too,so expect prices to rise. I also noticed due that suppliers for electronics use EU wide mechanisms,so I suspect the same applies for a lot of our local sellers too,as they are probably imported via places such as Holland. This is why when Apple tried to ban import of HTC phones to Europe they targetted banning sales in Holland first. I also noticed a lot of US companies when starting European operations,tend to have operations in Holland,ie,when Massdrop used to operate in Europe,their warehousing was in Holland.

The problem is even though our ports can accept some of the biggest container shops,the capacity is significantly lower than the ones in Holland,Belgium and Germany,which is kind of ridiculous(and a distinct lack of foresight too for an island nation such as ours - more of that short termism at play). I suppose a free trade agreement with the US might help,so we use US centric suppliers instead of EU based ones! ;)
Typo - “oven ready” instead of “over ready”.

Not that it really changes the context. We've still been sold the contents of the proverbial Bournemouth beach burger box.
CAT-THE-FIFTH
Even with normal Amazon purchases,just tracking a number of packages(bought on the UK website),a surprising number are sent from German fulfillment centres. So expect the same things to apply to many Amazon purchases too,so expect prices to rise. I also noticed due that suppliers for electronics use EU wide mechanisms,so I suspect the same applies for a lot of our local sellers too,as they are probably imported via places such as Holland. This is why when Apple tried to ban import of HTC phones to Europe they targetted banning sales in Holland first. I also noticed a lot of US companies when starting European operations,tend to have operations in Holland,ie,when Massdrop used to operate in Europe,their warehousing was in Holland.

The problem is even though our ports can accept some of the biggest container shops,the capacity is significantly lower than the ones in Holland,Belgium and Germany,which is kind of ridiculous(and a distinct lack of foresight too for an island nation such as ours - more of that short termism at play). I suppose a free trade agreement with the US might help,so we use US centric suppliers instead of EU based ones! ;)

Fully agree - Crazy to do all this so quickly. I can't see how this is going to end well. We have near zero the infrastructure for this and jamming in something into a field near Ashford is far to little far to late.
cheesemp
Fully agree - Crazy to do all this so quickly. I can't see how this is going to end well. We have near zero the infrastructure for this and jamming in something into a field near Ashford is far to little far to late.

It doesn't affect them - shortage of champagne due to border delays you say?? Just get Jeeves to fly over on one's private jet to retrieve a few bottles from the Chateau! ;)
thank you very much brexiteers