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Seller Central
How to sell on Amazon’s European marketplaces
European fulfillment options for Amazon sellers
European Fulfilment Network (EFN)
Pan-European FBA
Multi-Country Inventory (MCI)
We have only used the EFN and Pan-European FBA networks, so those are the two we’ll discuss here. If you want full details on all three options, you can explore further on Amazon's resources.
What’s the difference between EFN and Pan-European FBA?
The main difference between these two programs lies in the cost of fulfillment and the tax implications.
1) European Fulfillment Network (EFN)
With Amazon’s EFN, all your goods are held in one country. In our case, all our stock was held in the United Kingdom. When a customer places an order, the item is picked, packed, and shipped to the destination country.
This setup is simpler for tax purposes, as you only need to collect Value Added Tax (VAT) for the country where your stock is stored. For example, we only had to collect VAT for the UK government at 20%. In simple terms, you are required to collect VAT for the country where your inventory is located.
If you choose the EFN network, your fulfillment fees will be higher than with the Pan-European FBA network. This is because you’ll incur cross-border EFN fees. However, this option reduces the complexity of managing VAT in multiple countries.
While EFN allows you to sell across European marketplaces, you’ll pay more in fulfillment fees compared to Pan-European FBA.
2) Pan-European FBA
With Pan-European FBA, your logistics operations won’t change much. You’ll ship your goods to one country, and Amazon will distribute them across its European fulfillment centers.
This program helps you avoid cross-border fees, and you’ll only pay local fulfillment fees. Once you send goods to your home marketplace, Amazon will automatically distribute your inventory across Europe to optimize delivery times.
By using this network, Amazon stores your goods in different European countries, and your products are Prime-eligible. For example, if a customer in Germany places an order, it’s ready to ship from a nearby location.
Compared to the EFN network, your fees will be significantly lower, though this cost reduction comes with added tax responsibilities.
Tax implications
Important: I am not a tax specialist, so please consult a tax professional before making any decisions.
If you choose the Pan-European FBA program, be aware of the tax implications from the start.
To qualify for Pan-European FBA, you’ll need a VAT number for the five core European countries, which include:
United Kingdom
Germany
France
Spain
Italy
We also obtained VAT numbers for Poland and the Czech Republic, as this allowed us to take advantage of lower fulfillment fees in certain areas. However, obtaining VAT numbers for these two countries is optional and depends on your business needs.
Before joining Pan-European FBA, ensure you have a VAT number for each core country. At the time we registered, the cost for VAT setup was around £4,000. The process took us about three months due to the extensive documentation required, and we relied on advice from a specialist.
Additional costs
Once you join the Pan-European FBA program, you’ll have specific tax return requirements for each country where your inventory is stored. Some countries require monthly VAT returns, while others require quarterly returns. You’ll likely need a specialist to handle these processes on your behalf.
We pay tax consultants to manage our returns for each country. Every month, we run sales reports in each country to ensure we understand our upcoming tax liabilities.
Translations
You’ll also need to translate your product listings into the local languages of each marketplace. I recommend prioritizing quality over cost, as your listings reflect your brand’s professionalism.
You’ll also need to manage customer service. As the seller, you must respond to customer inquiries within 24 hours in each marketplace. We use a native-speaking virtual assistant (VA) for each marketplace. By setting up well-designed email templates, you can ensure your VA responds consistently with your brand's voice.
Product launch and PPC
As with any marketplace, you’ll need a strategy to launch your products effectively. Climbing the ranks in Amazon search results requires a budget for product launches and pay-per-click (PPC) campaigns.
It’s important to set a PPC budget. I aim to break even on campaigns and ensure my advertising cost of sales (ACOS) doesn’t exceed my profit margin. This strategy helps me focus on increasing the lifetime value (LTV) of customers in my sales funnel.
I also recommend working on growing your brand and selling complementary products to maximize customer value.
