Chris Poad – Director of Merchant Services of Amazon UK is here today to talk about Amazon’s offerings.
Highlights: Chris announced that 3P/FBA are coming soon to Italy and also hinted that Amazon is working on a EU VAT tool to help with the complexity of managing VAT across ~25 EU member countries.
Chris reviewed the Amazon Customer Segments:
Amazon has presence in EU in
Amazon is launching marketplace in Italy later this year (later this year – very soon). They haven’t announced fees, but they will be similar. They will also launch FBA in Italy later this year.
Launched in 2002, Sell on Amazon, very successful – everyone knows how this works.
Amazon Cross Marketplace sales
Amazon makes it very easy for a seller to sell across the EU – gave example of a DE page with a UK seller
A mature service now where Amazon will store your products for you and pick, pack, dispatch for you (returns too) – available for domestic and international sellers. We have lots of US/EU customer that send product to our UK FBA centres for local distribution.
Why FBA? Think of it as a sales tool, vs. a fulfilment option. If a product is in FBA, it qualifies for a number of programs – SuperSaver (every item is eligible – free 3-5 day shipping). Also, Prime – Prime is for next day delivery. The third benefit is the fast track message at the bottom.
Another benefit of FBA is you can fulfill to any sites such as your own website and eBay.
Sellers send products to FCs across the world to benefit from everything we’ve talked about. Our ambition is to build a program that link sellers across the world with buyers across the World. We’ll take care of all the hard stuff (fulfilment, taxation, etc.)
FBA Export Option
You don’t have to send your products to all EU FBAs – send it to the local one and Amazon will take care of moving your products (with your permission) to the appropriate FC.
Allows you to take Amazon checkout on your site.
Conclusion – Amazon is building a bunch of services for merchants that work together that allow you to take advantage of Amazon’s scale, computing platform and expertise. Various solutions can be put together in a no-obligation, pay as you go opportunities.
Q: I sell on eBay and have been asked to sell on Amazon, but want a discount for selling on Amazon. I’d like an account manager as well.
A: We have a level playing field. It’s also true that we have higher fees from different marketplaces. If you look at your cash flow, Amazon has an ability to turn your inventory more frequently than other platforms and at higher ASPs. I encourage you to compare and look at the cash flow of the two platforms on top of the percentages. We have built an infrastructure optimised for scale. We try to use machines/algos whenever possible. We try not to add headcount as we grow so we invest in tools to help you grow your business. Having said that, I’d like to understand why you would want an AM and how you would see them helping you grow.
Q: Amazon has an amazing logistics system, are there any plans to enable a seller in one country then have Amazon send the products trans-ocean to the other FBA facility for us.
A: We’re not ready to make that announcement today (interesting choice of words!). If you look at how we’re building our offerings for sellers, the most efficient model is the maximum number of sellers having access to the most global number of buyers.
Q: Do you have plans to help with VAT administration?
A: I can safely say yes here. We’re not quite there, but it’s something we’re looking at.
Q: I’d like to echo the account management sentiment earlier. On FBA, you said as a UK seller we can send to the UK FBA and DE FBA. In your slide you mentioned we can take it to one EU FBA centre and can effectively market to any of the 27 EU countries. Do you also advertise them on amzon.fr or the buyer has to go to .co.uk site?
A: Today the item is only available on the UK site.
Q: What do you say to someone with concerns that if you are too successful on Amazon, Amazon will compete directly with us.
A: The good thing of working with Amazon is you get the benefits of our retail business. The downside is that we are also a retail business competing on the same marketplace. Frankly, Amazon retail will compete with you regardless of where you are – e.g. your website and what not. It depends on your category. If you are bookseller, you will have a tough time competing with us. Many other categories Amazon isn’t in and there are lots of opportunities.
A2: To your point on Account Management – We have a sales team here (in London/Slough) a support team in Cork, IE and an email team in Luxembourg.
Q: Do you use the data from marketplaces in your first party business? Gave example of putting an electronic item on Amazon and then you started lowering your price to beat me.
A: Our pricing practices are very sensitive. Fear that selling on Amazon will increase your competition is over stated.
SeekingAlpha Disclosure – I am long Amazon and Google. eBay is an investor in ChannelAdvisor where I am CEO.