Getting Started with eCommerce Sales in Europe
by Liz Fickenscher, on October 28, 2016
Have you thought about expanding your sales to European marketplaces? Opening your brand to new countries could significantly increase your profits because you may be facing less competition for your products.
Carina McLeod of eCommerce Nurse recently shared her insights on the subject of European sales in a webinar with eComEngine. McLeod is a former Amazonian with 7 years of experience in the UK marketplace. She has the unique perspective of someone who understands the eCommerce world from within and as a seller.
There are a lot of things to consider when it comes to expanding your brand to Europe, including:
- European consumer rights
- Shipping logistics
- International order fulfillment
- Which country to begin in
This post is accurate as of the date of publication. Some features and information may have changed due to product updates or Amazon policy changes.
A Beginner’s Guide to Selling in Europe
Are you interested in growing your private-label brand or increasing your eCommerce sales? Maybe it’s time to consider offering your products in more Amazon marketplaces.
There are a lot of factors to consider when it comes to growing a brand internationally. Carina McLeodof eCommerce Nurse recently shared her expertise in a webinar on the subject of European eCommerce. Highlights from that conversation are shared below. The full presentation can be viewed here.
Test Products with Minimal Risk
Selling products in the European marketplaces can be a good starting point for brands that are looking to expand internationally for several reasons. Merchants can sell throughout the U.K. and Europe (including Germany, France, Spain and Italy) with a single unified Seller Central account. Investing in Europe allows sellers to reach millions of new customers and test products without a high amount of risk. After all, as McLeod notes, “Sellers can start with a small FBA shipment.”
Merchants who are interested in offering their products in European marketplaces need to take the time to understand the culture of those marketplaces. Currency differs, and the exchange rate will make an impact on the bottom line, so it needs to be taken into consideration. Listings need to be translated into the dominant language for each marketplace and should be keyword-optimized in that language. Amazon.com, Inc. (“Amazon”) will translate listings and manage customer service for sellers who fulfill orders through one of the European FBA programs.
For Americans who are interested in selling in the U.K., it’s important to remember that there are nuances to British English. For example, Carina pointed out that “pants” means two different things. In America, “pants” are slacks, but in the U.K., “pants” are underclothing. A buyer searching for slacks in the U.K. would search for “trousers.” It’s essential to understand how to reach the customer, because a seller who has not optimized listings for the local marketplace will lose potential sales.
There are a number of legal issues to consider when selling in a new country, so Carina recommends consulting with an attorney to ensure the local rules are being followed. European countries have different packaging and labeling requirements which must be met. Toys, medical devices and certain electronics are the major categories where compliance with EU standards needs to be considered. Sellers should also consult with their suppliers about intellectual property rights and the accessible sales territory for their products.
International Fulfillment Logistics
There are a number of fulfillment options available for international sellers in the European marketplaces. Third-party companies can manage everything on a merchant’s behalf. McLeod notes that sellers need to apply for an EORI, which is a specific number required to import products, and have a plan in place for product returns. In the EU, a value added tax (VAT) is automatically included in retail prices. This needs to be taken into account when setting prices. If a seller is holding inventory in Europe, they will need to register for a VAT number.
Amazon’s European fulfillment options include:
- Seller-fulfilled from U.S.: seller holds stock in the U.S. and only ships internationally after receiving an order. This is a low-cost option, but customers are charged a VAT on the imported item and shipping takes a long time.
- Seller-fulfilled from EU: product inventory is located within the U.K. or the Europe Union. There is a shorter shipping period, but there are a number of setup costs and fees to consider. Sellers will likely need to set up a European headquarters or work with a logistics company.
- FBA European Fulfillment Network (EFN): Products are stored and shipping from one EU location, then shipped to other countries as needed. Items can be eligible for the Prime program in the home marketplace (where the inventory is held.)
- FBA Pan-European: Stock is sent to one fulfillment center in a seller-selected country and Amazon redistributes the products to other marketplaces on behalf of the seller. The only shipping fee for the seller is to the selected fulfillment center. Products can be eligible for the Prime program.
- FBA Multi-Country Inventory (MCI): inventory is shipped to multiple countries at cost to the seller. Items can become eligible for Prime fulfillment.
Merchants can select one of these options or mix and match as needed for their products.
How to Get Started
Sellers who are ready to start selling in Europe can begin by selecting their chosen marketplace and fulfillment option. Carina recommends consulting with a tax advisor as well as an attorney who is familiar with that marketplace prior to getting started, and then opening an EU seller account. Merchants can add listings to this account and use Amazon’s built-in tools to help translate and localize those descriptions.