Amazon’s Pan-European service, which will also cease to exist, requires a seller to be tax registered in the other European marketplaces to participate. Vitally, it allows a seller’s goods to be stored and sold directly out of EU countries’ distributions centres. By opting for this service, a seller allows Amazon algorithms to look at the seller’s inventory and, at their discretion, remove stock from a UK warehouse and place it in another distribution hub in Europe. These complex algorithms tell Amazon that, for example, six items may be needed in Germany, five in France or three in Spain. The items are eligible for the ‘Prime’ service to EU customers, while the seller only pays UK fulfilment fees making it a very cost-effective option.
Although sellers will still have the option to ship stock directly into fulfilment centres in the EU, they will have to decide on what items to send, the quantity, to which destination, complete customs paperwork, and, possibly, pay tariffs. While larger businesses may choose to invest in IT solutions or staff to make these decisions, many smaller sellers will not have the resources, the know-how or the experience to do so. Stock in Amazon’s fulfilment centres carries a monthly storage fee and if it does not sell in 12 months, the seller will incur long-term storage fees, or have to pay for the return of their stock. Fundamentally, the process becomes far more expensive, complicated and convoluted.
The double whammy facing sellers this year is that Amazon will almost certainly stop locating stock throughout Europe well before the end of the transition period. Also likely is the repatriation of the seller’s products back to the country of origin before the end of December. So not only will UK sellers be losing these simple, convenient and cost-effective services in January, but they are also likely to lose out on the increased seasonal sales they would traditionally expect around Black Friday, Christmas and New Year.
They didn’t mention that on the side of a bus.
Lisa Burton, Council Member Bremain in Spain