Even in the age of Brexit, selling on EU online marketplaces makes sense, says Dan Wilson, editor of our sister title, tamebay.com
AMAZON [IRDX RAMZ] CERTAINLY GETS the column inches and any examination of the marketplace environment in Europe will reveal the Seattle-based ecommerce giant as a dominating force. But it’s important to remember that it isn’t the only show in town.
eBay [IRDX REBY] remains a key player that’s still popular with many retailers. It also operates in more EU countries than Amazon, which only has dedicated websites in the UK, France, Italy, Spain and Germany, with some fulfilment in Poland and the Czech Republic.
But even these two marketplace titans don’t have a stranglehold. In France, PriceMinister (part of the Rakuten Group), CDiscount and La Redoute are all powerful. For the BeNeLux countries, Bol is vital. Looking east, Allegro is bigger than both Amazon and eBay in Poland. And don’t forget the likes of Zalando [IRDX RZAL], Spartoo and Fruugo – all are open to thirdparty retailers that want to sell online via marketplaces in various parts of Europe.
The challenge for retailers, big and small, is to be platform agnostic. It isn’t a case of having an ‘Amazon-like strategy’ or an ‘eBay-type approach’. The focus must be on making sales to customers via any channel that doesn’t damage or dilute the brand.
The everyday tasks of fulfilling one marketplace or another are not markedly different, as long as retailers have the backend management and despatch processes in place. Language can be a problem but once that’s cracked, retailers can sell pretty much anything, anywhere. The many multichannel marketplace providers that can plug into many (if not all) of the 400 or so EU online retail sites can do much to grease the wheels of commerce.
And what about Brexit? There is one obvious upside: the relative strength of the euro means sales in sterling look rather attractive right now, so long as you’re in the UK and selling to the EU. Naturally, there is also uncertainty. Will the UK adopt a Norwegianstyle EEA position, a hard Brexit or retain free movement of goods? Nobody knows and any change in circumstance is still nearly two years away. There doesn’t seem much point in dragging your heels until there is clarity as that’s most likely still a long way off.
Even in a hard Brexit situation, it strikes Tamebay that the best place to be selling is on pan-EU marketplaces. It will be expedient to them to help merchants to surf any storm. Indeed, that’s exactly what they do already.
The greatest single headache right now for marketplace sellers trading cross-border among all the member states is VAT. If merchants sell to each country, then this could mean filing as many as 50 separate VAT returns a year. Needless to say, services have emerged that will cope with that problem. Even Amazon will do returns for a fee. But the point remains that it always makes sense to be part of the club.
It is very tough, and very expensive, to make a splash quickly with a retail brand selling directly from a website. But as a marketplace seller, retailers can find sales faster. The question of where to sell depends on you and your goods.