One checkbox cost me 20% of our company turnover and eight months of suspended sales. I wanted to double our turnover on Amazon and ended up in a bureaucratic nightmare. Our wall decals on Amazon were selling well until some of the stock moved to a German warehouse.
At the time, we were selling through Amazon UK and using its warehouses in England. We sent our wall decals there, and Amazon packed and delivered the orders to customers. Sales were going really well. Then Amazon offered to move some of our stock to its warehouses in Germany. Customers would receive their orders faster, and we would save on shipping.
It sounded sensible because Germany was our third largest market. I thought, why not, ticked the box to agree and forgot about it. Amazon moved the decals to a German warehouse. Two weeks later, an email arrived saying our German account was suspended. We had to provide a German VAT number.
I did not understand why. We already had an Estonian VAT number, and our company was in the European Union. I called our accountant, but she did not know either. We started looking into it and learned that storing our goods in Germany and selling from that warehouse required local VAT registration in our case. Our Estonian number did not replace it. The location of our stock was the detail I had missed.
Apparently, Amazon expected me to know all this when it offered the service. I did not. But we had already registered for VAT in England, where filling in the form took us 30 minutes and the wait was one week. I thought Germany was an advanced country and would surely be even faster.
I was completely wrong. Registering for VAT in Germany became a nightmare. The websites were confusing and the requirements were strict. We had to hire a specialist agency because we could not work it out ourselves. Instead of one week, the process took eight months.
All that time, the stock sat unsold. Our product listings dropped in the rankings. Company turnover fell by 20% immediately. Only after those eight months did we receive the number, get the account restored and start rebuilding sales from zero.
My lesson was simple. Before accepting an attractive offer from a marketplace, I should look online to see how good it really is. I should also check what problems other sellers have run into. That is how one checkbox and some decals in a German warehouse stopped my business in Germany for eight months.
