Why the Pan-EU Program Is Essential for Amazon FBA Sellers
Many Amazon sellers one day reach the point where they want to go international or scale up their business. If that is you, Amazon FBA’s pan-EU program might be just the right fit. In this article, we will discuss the main features and advantages of the pan-EU shipping program and how you can effortlessly internationalize your Amazon business across the EU with VAT-automation.
How does Amazon FBA work across Europe?
Amazon FBA across Europe works very similarly to the domestic FBA program. If you are not familiar with Amazon FBA, here is a quick explanation: FBA is short for fulfillment by Amazon.
What is Amazon FBA?
The program allows Amazon sellers to send their stock to an Amazon logistics centre. Amazon then takes care of shipping the products to the customers. This allows Amazon sellers to offer their products with Prime shipping advantages and use the label “Shipping by Amazon”. Amazon also is in charge of handling customer service and returns.
In the same way, Amazon FBA sellers who take part in the pan-EU program can ship their products to local Amazon logistic centres. In the next step, Amazon will move these products to other logistic centres depending on local demand without you having to do anything. If a EU customer orders a product, the order will then be fulfilled from the fulfillment centre closest to them.
The advantages of using Amazon FBA pan-EU
International shipping can easily result in high costs which would make it unattractive for both the seller and the customer to order internationally when the same products are also available locally. Thanks to Amazon FBA however, you only have to pay your local shipping fee and the Amazon FBA fulfillment and storage fee. In many cases, this can make international selling more attractive, especially because your customers can benefit from lower shipping charges as well.
In addition to that, you also do not need to have your own warehouses in other European countries, nor do you have to ship products from the country you are based in directly to customers in other countries. Deliveries will be faster and you benefit from the conditions that Amazon has for shipping or, in some cases, products can even be delivered by Amazon Logistics, instead of the conditions that you would get with your business.
Who should use Amazon FBA pan-EU?
While the pan-EU option of the Amazon FBA program offers many advantages and the potential to lower costs, this may not apply to every individual scenario. Unfortunately, as of now, oversized products do not fall under the rule where only a local shipping fee has to be paid. Depending on your turnover, taking care of shipping and logistics may be a more economical solution.
In general, Amazon FBA pan-EU is the best option for sellers with a turnover of more than 1,500 units per month. Thanks to multiple FBA calculators available online, you can arrive at an estimation of how much using Amazon FBA pan-EU would cost you and what your profit margins could be.
Another option that needs to be taken into account is that as you store goods in other European countries, even if it is through the Amazon FBA program, you have to register for and pay VAT in these countries. This can lead to additional bureaucratic work for your business. One way to reduce this work is to automate your VAT as an Amazon seller.
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HelloTax has a free pricing plan for their VAT software. It doesn’t require a credit card and anyone can signup.
VAT automation for Amazon sellers: Internationalization made easy
If you decide to use Amazon FBA to sell products across Europe or if you use other methods to facilitate your European sales, you can benefit from VAT automation. VAT automation basically means using software tools like hellotax and others that monitor your sales and calculate your VAT filings accordingly. They automatically apply the correct VAT rate that corresponds to the country of sale and the product group.
Additionally, these tools keep track of delivery thresholds and are up to date with the latest VAT regulations such as the One Stop Shop (OSS) VAT reform for distance selling to European countries where you do not store your goods.
About hellotax
Hellotax is a software developed specifically for eCommerce sellers to stay VAT-compliant across Europe. It can be used by EU and non-EU companies alike and all of Amazon’s European stores are being covered. For Amazon sellers, the tool also offers a handy Amazon integration which allows you to transfer and use data directly from your seller’s central account. Then, you can also track the movements of your goods via hellotax.
Conclusion
Amazon FBA allows Amazon sellers to easily access markets across the EU and scale their businesses. In combination with VAT automation, the program offers benefits for many sellers. It is therefore always worth looking into the model to maximize your European sales as an Amazon seller.
What to do if your Amazon orders are pending? Find out more in our article below:
