Amazon has increased fulfillment, removal order and referral fees on 1 April 2020. For some sellers, this might change quite a lot and deciding to start with Pan-European FBA could potentially save a lot of money – especially when selling standard size items and when selling with EFN.
Maximilian GamplLast Updated on
Why these new fees for fulfilment?
So far, Amazon has already invested more than $4 billion to expand its infrastructure, programmes, employees, tools and services in 2020. The high costs were mainly due to the free One-Day Delivery which was added to more than 6 million prime items.
In addition, a new starting programme was introduced as well as an adjustment for fulfilment and other fees. We will take a closer look on the last aspect, the rising fees ins this article.
As already mentioned, the changes came into force on April 1, 2020 and are applicable in all European marketplaces.
How are the Amazon FBA fees going to change?
FBA fulfilment fees were adjusted for local FBA, Pan-European FBA and the European fulfilment Network (EFN) in all countries with Amazon marketplaces. For CEE still the €0,50 reduction per unit is valid, calculated from the new fees.
As you know, Amazon has marketplaces in the United Kingdom, Germany, France, Italy, and in Spain. Especially in Germany and the UK, the rise of the fees is quite significant, with increases of up to 15%.
We created a calculation spreadsheet for all fees, all product sizes, all countries and all FBA programmes. This is not only super useful, but also, we don’t have to include huge tables of different fees in this article.
Simply use the Excel spreadsheet, to see how much you need to pay for fulfilment and when the hellotax service is already covered.
Before you start calculating, let’s take a look on how these changes affect the differently sized products, as the change of your current FBA programme makes sense especially when selling standard-sized products or when selling OVERSIZE products via EFN. Let’s find out if you should take action.
1. Standard-size fulfilment fees
Fulfilment fees for standard-sized envelopes and parcels were increased on all Amazon marketplaces – with individual rises in each country (as there are currently individual fees as well) when we talk about local fulfilment and shipping with Pan-EU. The increases of EFN fees are, just like before, divided into two categories: UK and non-UK.
IMPORTANT: The increase in fees for standard-sized products not only varies from country to country, but also depends on the FBA service which is used! This means that Amazon sellers who sell standard-sized products should consider selling with the Pan-European Fulfilment Network (Pan-EU) instead of Amazon’s EFN or CEE program, as the fees for Pan-EU have increased comparatively little. More about that later.
2. Oversize local fulfilment fees
When it comes to local fulfilment fees for OVERSIZE products, interestingly, these fees remained the same in Italy in France. However, in the UK, in Germany and Spain, the fees were increased as well.
Example: Local fulfilment of standard oversize packages of 5,000g for example, the French fulfilment fee of €9,46 will stay at €9,46, while for the same package sold and shipped in Spain, the fee increases from €5,99 to €6,89.
3. Oversize EFN and Pan-European FBA fulfilment fees
When selling oversize products with EFN, the fulfilment fees for countries outside the UK did stay the same, the fees in the UK were increased a little bit. The fees for Pan-EU when selling oversize products were increased in Germany, the UK and in Spain – in Italy and France the fees stayed the same.
However, compared to the EFN fees for oversize products, the according Pan-EU fees are still way lower and therefore, a calculation for those products also makes sense.
What to do now?
Step 1: Check the adjustments for your product(s).
As the product size is crucial, identify your product’s size tier, take its dimensions (in centimetres) and its shipping weight (in grams), and start your calculation.
Product types and size tiers
To know into which category your products belong, here are the Amazon definitions for standard-size and oversize.
- Standard-size: A packaged unit that weighs 12 kg or less, measures 45 cm or less on its longest side, 34 cm or less on its median side and 26 cm or less on its shortest side.
- Oversize: A packaged unit that exceeds any of the following measurements is oversize: 12 kg, 45 cm on its longest side, 34 cm on its median side or 26 cm on its shortest side.
The shipping weight is equal to the weight of your unit(s) plus the packaging weight. Click here to see the official Amazon regulations for product size tiers.
Step 2: Think about changing your current FBA programme
When you are selling STANDARD-SIZE products, EFN and CEE sellers have to deal with the biggest increases for fulfilment fees. Pan-EU is of course connected with higher administrative tasks but as for this FBA service the increase is not that significant, it pays off rather quickly.
If you mainly sell oversize products, of course you need to recalculate you pricing but at least changing your current FBA service is not really relevant.
Book a free consultation
Our VAT experts are happy to help you. Book a free consultation today!
Why Pan-EU can be worth it
We already spoke about that going for Pan-EU could really save a lot of money, mainly when selling standard-sized items. Let’s make it a bit clearer with an example:
Example: A parcel of 1000g shipped from Germany via EFN will cost €7.23 (+€0.5 if you’re not in the CEE programme) in fulfilment fees, while the same package sent from a German warehouse when using Pan-EU costs “only” €3.22. That’s a difference of 4.01€ PER UNIT!
If you choose Pan-EU, we can take care of all registrations and VAT returns, EC sales lists, etc. in all Pan-EU countries. That means countries with Amazon warehouses: Germany, France, Italy, Spain, United Kingdom, Poland and the Czech Republic.
For example, if you are now selling with EFN and you are only registered in one country, then Pan-EU means VAT registrations, returns, EC sales lists, etc. in 6 additional countries.
Now you might think that this will be really expensive and that the savings from the lower fees are already gone again. But we can reassure you… that’s not the case!
Just do the math
We offer 2 different subscriptions on our pricing page:
- Yearly Subscription:
FREE VAT registrations in all Pan-EU countries if you book our service for one year – you will only have to pay the monthly price for the ongoing VAT service. That means €99 per country/month for our VAT service and €0 for VAT registrations.
- Monthly Subscription:
If you decide to go with the monthly subscription, we offer (EXCLUSIVELY THIS MONTH!) a 50% discount for each registration (so 150€ instead of €300 – this is a one-time cost) and the VAT service on a monthly basis costs €119 per country/month.
So how does this save you money?
Let’s assume you add to your one country subscription, the yearly subscription for the remaining 6 Pan-EU countries which costs 594€/month – so you will then be registered in all EU countries with Amazon warehousesand we take care of all VAT-related tasks.
Continuing the example with the saving of about €4 per unit, when selling 150 units per month, our service is already covered.
When you want to give it a try first and start with the monthly subscription, the monthly costs for 6 countries would be €714 and it is covered when you sell 180 units per month.*
For each and every unit you sell above those minimum turnovers, you already save money!
On top of that, you become a Pan-EU seller which brings a lot of other advantages. Pan-EU is not only the FBA programme with the highest potential turnover, you also have the fastest delivery times, highest visibility on Amazon and – and this will be a biggest plus from next month on – the lowest fulfilment fees!
*This does not include the one-time registration fees. But those are comparatively low and as already mentioned, there is even a 50% discount this month.
Not only Fees for fulfilment were changed
Despite the fulfilment fees for Amazon FBA, there are also other fees which were adjusted on 1 April 2020. These fees are:
- FBA minimum long-term storage fees
- FBA removal order fees
Click here to read more about this topic.