For more information, see the recording of our live webinar here: https://www.facebook.com/497939927271696/videos/225492478569154/
What did Amazon announce in France and Italy?
Amazon Announced on Sunday that they would stop customer orders for non-essential products in Italy and Spain. Unlike last Wednesday’s announcement, they did not give a clear indication of which product or categories would be affected.
We have seen some items that are still able to be sold in France than are not available for sale in Italy anymore and vice versa. There are also some items considered essential and available for 2-day delivery in Italy or France but not in the other country.
What has Amazon changed in the background without announcing anything (yet) in most countries?
If you try and buy any of your items that are classed as none essential you will see that they are not available for delivery until late April or May, which means that at present if your consumers buy your items, they will have to wait 1 month or more for delivery. This is the case in the USA and also becoming the new norm in most countries.
What affect will this have on my sales?
Expect your prime sales to grind to a halt pretty quickly once consumers realize that they will not receive their items for such a long period of time.
While the action taken in France and Italy is the most extreme, the action being taken elsewhere is just as bad, because if a consumer has to wait such a long time to receive his items then he will stop ordering.
Because this change has been made in the background without any official announcement, this could also have a negative effect on consumer’s perception of Amazon because they will see that all the items they want to buy cannot be delivered quickly. Don’t forget these consumers have paid for Prime.
You should also have noticed that in your Seller Central under the Manage Order sections most of your orders of none essential items are still in the pending phase which shows that Amazon is taking a lot longer than normal to process them.
I suspect that Amazon has also stopped shipping goods between their warehouses meaning that your goods might not be as close to customers as usual.
Why are some of my items not available for sale in Italy and France but Amazon can sell them?
If you have allowed Amazon to sell and ship your items globally, they will be able to sell your items in Italy and France using your stock from other EU or North American countries.
Why has this come about?
The reason that this is being implemented is that Amazon is the biggest logistical platform in these countries and so it is being overwhelmed by the volume of order. Normally, for example, before Q.4, they would have months to plan for the increase in sales, but in this case, they have not had the time to prepare.
Furthermore, they are also dealing with having do impose social distancing measures which reduce the number of packages that can be shipped per day.
Finally, it would not also be a stretch to think that some of their employees may have been unwell and not able to work.
Why should I worry if I do not sell in Italy and France?
All of the factors above will be happening in every Amazon marketplace right now so you should expect that the same or similar action could be taken in other countries as the situations there sadly get worst.
Also, if your stock is located in France or Italy Amazon will not use that stock to fulfill orders of nonessential items in the UK, Germany, or Spain using the Pan EU program or the EFN program.
What about storage fees?
Amazon has stated that items affected by the sales limit in Italy and France will not be subject to Storage or deal fees.
Also, Amazon announced that they would be waiving Long Term Storage Fees due on April 15th in United States, United Kingdom, Germany, France, Italy, Spain, Poland, and the Czech Republic and that they were delaying removal orders.
What should I do to mitigate the impact on my business?
Last week we talked about spreading out your FBA stock so that it would last until April 5th by pausing ads and as a last resort increasing prices, however depending on how much stock you actually have you may want to reconsider that approach.
This new announcement means that having stock in Amazon’s warehouse may not be enough to maintain your sales so you should be planning on using other logistic providers.
What are your FBM options?
Last week we talked about using FBM, SFP, and finding a third-party warehouse to handle your FBM shipments. You should be thinking about this more seriously as unfortunately, it looks like this crisis may last longer than initially expected.
If it does, you may not be able to send your stock in on April 5th, and even if you do your customers may no longer be able to order it.
Are there other options to consider?
You can create FBM listings in Italy and France and when you get a sale in those countries you can use your UK, German or Spanish stock to fulfill those orders. In order to do this, start by checking the cost and delivery time if you were to use stock in the UK, Germany, or Spain to compare which is the best country to use (you can do this by selecting the item and then selecting Create Fulfilment Order).
The estimated shipping fee in Milan, Buccinasco Italy is € 4.05
Then update your FBM price and do not forget to update your delivery time in your shipping information.
However, if you have Small and Light stock you will not be able to use that as you cannot use Small and light stock to fulfill orders in other countries (even in Europe).
Alternatively, speak to your factory to see if exceptionally they would ship over individual orders? I know this sounds unlikely but I have spoken to a few factories in China, who are willing to do it if I run out of FBA stock.
This might sound like a lot of work but you should see this as an opportunity to gain market share over your competitors whose items may not be available to buy during this period.
Finally, if you have more time on your hands this would be a good time to look into the profitability of your items, review your PPC Campaigns and improve your listings. We will be doing a webinar next week explaining how to automate your PPC Campaigns.
Should I try and launch new products that are considered essential by Amazon?
It looks like Amazon is also banning sending FBA shipments of new products even if they are essential items. We work with a soap factory in France and they wanted to send in new SKU’s of hand soap, but Amazon is not allowing the shipments, as they seem to have a blanket ban in place.
So make sure that before you order you check that you can add the item and send it into Amazon (create the FBA labels as soon as possible) just to be on the safe side.