Amazon’s EU marketplace: A Perfect Place for You to Expand Your Amazon Private Label Business

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Entering Amazon’s EU marketplace is a perfect way to expand your Amazon business. EU nations are Amazon shoppers with a large ecommerce penetration percent.

 

Amazon’s EU marketplace has less competition, making your products easier to rank and Amazon ads cheaper to run.

 

You already have the Amazon selling machine built. It would be very easy for you to take the same processes and apply it to Amazon EU.

Looking for Expansion Opportunities? Why Not Europe?

 

If you have been selling a long time on Amazon, you probably noticed that the US market has become quite competitive. If you have been following our blog, then you already know our feelings about this.

 

Gone are the days when you can source a crap product, get a few reviews from family, friends, and review clubs, and watch your sales skyrocket.  The secret is out and the game has definitely gotten more competitive. Indeed, just by doing simple product research, we have noticed an influx in private label sellers.

 

Don’t get me wrong, our position has not changed on Amazon.com. It is still the best possible way to make money online, especially in the US market. The US market is still the largest Amazon market, and if you can rank well, you can still make a killing.

 

However, we have recently been looking into expanding into the European Amazon market. Why? Its simple. People in Europe buy products online, and the competition there is significantly less.

 

Indeed, there are a number of sellers who focus exclusively  on the Amazon EU market. They are driven there by the low competition, and stay there because they are able to make a killing.

 

So what makes Europe such an exciting market?

The European Market Is Filled With Ecommerce Shoppers

 

Europe is the perfect market for any online business. Over 529 million people in EU use the internet  and 65% of those people shopped online in 2015.

 

Ecommerce penetration, which is the percent of people using the internet who also made an online purchase, is among the highest in EU member states when compared to other countries. Indeed, 4 out 5 countries with the top ecommerce penetration percent are in Europe- with the UK leading the pack at 87.2%.

 

Not only are people in Europe shopping online, they are doing so in a big way. For example, 4 out of the top 10 ecommerce countries in terms of turnover are in Europe.

 

The UK comes in 3rd, only trailing the US and China, with an ecommerce turnover of $142.3 BILLION. Germany and France also come in the top 10 with  $84.2 billion and $67.8 billion respectively.

 

Not only are Europeans buying online, they are buying from Amazon. Amazon is an “Elite Seller” in the UK, posting some of the highest ecommerce sales in that country in 2015.

 

Amazon has steadily increased its sales in Europe since 2010, and will continue to do so in the foreseeable future.

 

So what does this mean for you?

 

The Next Step in Your Amazon Business Should Be to Expand into the European Market

 

Beyond the above statistics, you should be excited to expand your business into Europe, because, just from a logistics and business standpoint, it makes sense.

 

  1. The Amazon market in Europe has less competition:

 

For years, most private label sellers have focused on the US market. Their success is a testament to the private label business model and the Amazon US market.

 

However, their success has also led to a word of mouth awareness of the private label business, which has caused an increase in private label sellers entering into the market.

 

Most of these sellers, have shied away from the European market. The general consensus in mastermind groups and Amazon forums has been that the European market is simply not as profitable as the US market.

 

However, this attitude has shielded the European market from the increase in competition seen in the US market.

  1.  Less competition means it is easier for you to rank

 

With less competition means less products sold by private label sellers, which means that you are competing with less products to get on page 1.

 

Because there are less products to compete against when trying to rank, the less work you will have to do to rank including

  • the less products you will have to give away
  • the less promotions you will have to run
  • the less reviews you will have to get
  • the less ads you will have to manage

 

With less products to giveaway and less promotions to run, you will greatly save in sourcing and manufacturing cost compared to sourcing the same product in the USA.

 

In addition, the time it takes to rank on page 1 should be less, because the competition is not as fierce as the US market.

 

Therefore, you should be able to make more organic sales faster than if you were trying to rank in the US market. This means a faster return on investment which can be reinvested into more stock.

  1. Less competition means cheaper PPC

 

With less competition comes cheaper Amazon PPC Ads.

 

This will greatly reduce your ACos, which is your total Amazon ad spend divided by your total sales, which is the general measure of ad health in Amazon . The lower your ACoS, the better.

 

Cheaper PPC allows you to increase your profits per sale when using Amazon Ads. It will also make any promotions or liquidations easier and cheaper for you.

 

Although your impressions might be lower than ads run in the US because the European market is smaller, the lower ACoS will help you increase your profits.

  1. You can store your products in any one of Amazon’s EU marketplace, and have Amazon ship them anywhere in Europe for a small fee

 

Normally, using FBA would require you to place your inventory in the country you were selling in.

 

However, if you already sell in one of Amazon’s EU marketplaces, and fulfill with FBA in that marketplace, you can fulfill orders from other EU marketplaces using your current FBA account. You can do this  by using the European Fulfillment Network(EFN).

 

EFN is a simple way to store and ship your inventory across all five of Amazon’s European marketplaces. Here’s how:

  1. You ship your inventory to fulfillment centers in Europe
  2. You list the products in one or more of Amazon’s European marketplaces
  3. Customers across Europe can order your products, and Amazon fulfills those orders from that single pool of inventory.
  4. When customers track their orders, they can see where it is shipping from and the expected arrival time.

 

The current EU marketplace countries include

  • UK
  • Germany
  • France
  • Italy
  • Spain

 

This means you don’t have to store your inventory in different countries throughout Europe, which would be a logistic nightmare.

 

  1. You already have the machine built

 

If you are reading this blog, you likely already have an Amazon business set up. You likely already have sourced a product and are already selling it in the US marketplace.

 

You already have the pictures. You already have the listings. You have a working knowledge of Amazon and how to make sales. You know how to get reviews and increase rank. You know how to optimize ads.

 

So, how hard would it be to take these resources and knowledge and apply it to the European market? Likely, not hard at all.

 

You already have the machine built; Europe is a perfect way to expand it.

 

If you are just starting out and don’t have an Amazon selling machine built, you should start in the US market, which is still the biggest. However, you should build the machine in mind that eventually you will expand to other markets like the EU.

 

Conclusion:

 

Amazon’s EU marketplace is a perfect place to start expanding your business. Most European countries in Amazon’s EU marketplace buy ecommerce products in large quantity.

 

There is less competition, which leads to easier rank and cheaper amazon PPC ads. In addition, you already have the machine built. It would not take much effort to take this machine and apply it to Amazon’s EU marketplace.

 

What are your thoughts? Will you be expanding into Amazon’s EU marketplaces? Have you already tried expanding into this market? If so, what are your findings so far?

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James Andrews

James Andrews

Code Wizard at Splitly
A data fanatic with degrees in BSc Physics and MSc Financial Mathematics, James likes Thai food, scuba diving and all things SaaS.
James Andrews

Comments 1

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