Amazon FBA in France Instead of Shipping from the UK to the EU: How the New Customs Duty on Shipments Up to 150 EUR Will Change Sellers’ Cost Calculations Starting July 1, 2026

For an EU-based e-commerce business expanding its sales in France, the change is important primarily because it requires the company to recalculate the full cost of serving the market. If the business keeps stock in the UK and fulfils hundreds or thousands of orders directly to French consumers, additional import charges may arise repeatedly across a large number of consignments. An alternative may be to import a larger batch of goods into France in advance and then fulfil orders from stock that is already located within the EU, for example through Amazon FBA. Amazon FBA in France does not eliminate customs duty or VAT. It does, however, change the import architecture: instead of repeatedly importing individual consumer orders, the business imports inventory in bulk, and once those goods have been released for free circulation, subsequent deliveries are made from within the European Union. This model brings its own obligations, however, including, as a general rule, local French VAT registration when a business stores its own goods in France. Customs duty must also be distinguished from import VAT. Customs duty is generally a definitive cost for the business, whereas import VAT, provided the relevant conditions are met and the business has the right to deduct it, has a different economic character and should not automatically be treated as the same type of cost as customs duty.

What exactly changed on 1 July 2026 for sellers shipping from the UK to the EU?

End of customs duty relief for consignments up to EUR 150

Until 30 June 2026, goods shipped from a third country to a consumer in the European Union could benefit from customs duty relief if the value of the consignment did not exceed EUR 150. For businesses selling from the United Kingdom, this became particularly important after Brexit because the UK is outside the EU customs territory. Small orders shipped directly to customers in France could therefore avoid customs duty, although VAT, the import declaration and other formalities still had to be handled correctly. For a long time, this mechanism meant that keeping all inventory in a UK warehouse and shipping products directly to consumers in the EU could remain economically viable, particularly for businesses selling relatively low-value products and processing a large number of orders below the EUR 150 threshold.

From 1 July 2026, the previous customs duty relief was abolished and a transitional solution designed for e-commerce was introduced. Under the model covered by this mechanism, a temporary charge of EUR 3 applies to each separate category of goods determined according to its tariff subheading. It is important, however, to consider these rules in the context of IOSS and the way in which the import takes place. It would therefore be incorrect to assume that, from July 2026, every consignment worth less than EUR 150 sent from the UK to an EU consumer is automatically subject to an identical flat charge. For businesses, the more important conclusion is that the previous customs advantage associated with low-value consignments can no longer be taken for granted as part of the business model. If France represents a significant share of a company’s revenue, the cost of each logistics route needs to be recalculated, taking into account the method used to settle the import, basket composition, product classification, VAT, customs clearance, transport and subsequent delivery costs.

The origin of the goods is equally important. The fact that a product is shipped from a warehouse in the United Kingdom does not in itself determine how much customs duty will be payable. The EU–UK Trade and Cooperation Agreement provides preferential treatment for goods that satisfy the applicable rules of origin, including the possibility of applying zero customs duties where the relevant conditions are met and properly documented. A business manufacturing its goods in the United Kingdom may therefore be in a very different position from a seller that imports finished products from China, stores them in the UK and then ships them to France. Simply storing, repackaging or forwarding a product from a British warehouse does not automatically give it preferential UK origin. Before comparing direct shipping from the UK with importing inventory into France, a business should therefore first establish the actual origin of its goods and determine whether preferential treatment under the EU–UK agreement can be applied.

EUR 3 per separate category of goods, not EUR 3 per parcel

One of the most important elements of the new rules is the way the EUR 3 amount is calculated. One of the biggest mistakes would be to treat it as a fixed fee charged once per parcel. The mechanism applies to separate categories of goods identified according to their tariff subheading. This means that the number of physical products inside a consignment does not, by itself, provide a basis for simply multiplying the charge by the number of items. If a customer orders several products that all fall under the same relevant tariff subheading, they may constitute a single category for the purposes of the mechanism. If, however, the parcel contains goods classified under different subheadings, the number of categories increases. The official logic behind the rules can be illustrated with the example of a consignment containing one silk blouse and two wool blouses. The goods fall into two different tariff categories, so under the model covered by the temporary mechanism the total charge would amount to EUR 6.

The same principle can be applied to a typical e-commerce shopping basket. Five identical T-shirts may represent a single category if all of the products are genuinely classified under the same tariff subheading. A T-shirt and a watch, by contrast, would generally fall under different subheadings, meaning that under the model covered by the mechanism there could be two categories and therefore EUR 6 in charges. With a more diverse shopping basket, the number of categories may be even higher. This is particularly important for businesses that increase sales through cross-selling, product bundles and orders combining different types of merchandise. In such cases, an increase in average order value does not necessarily translate directly into a proportional increase in margin, because additional product categories may trigger additional charges. Cost calculations should therefore consider not only the average order value but also the average number of different tariff subheadings appearing in a typical basket.

If a business processes 1,000 qualifying orders per month and each order contains, on average, two different categories of goods covered by the mechanism, a model calculation produces a cost of EUR 6,000 per month, or EUR 72,000 per year. This is an example rather than a universal rate, because it assumes that all of the consignments being analysed fall within the EUR 3 mechanism and that the average order genuinely contains two separate tariff subheadings. For a low-margin business, however, even this model scenario demonstrates the potential scale of the issue. A few additional euros in charges per order may be relatively insignificant for a high-priced, high-margin product, but the economics look very different when selling accessories, low-ticket products or bundles with limited contribution margins. This is precisely why a decision to change the logistics model should not be based on the slogan “EUR 3 per parcel”, but on actual data about basket composition, tariff classification and the method of import.

Remember: EUR 3 does not mean EUR 3 for every physical unit of a product, nor does it automatically mean EUR 3 for the entire parcel. Under the transitional mechanism, what matters is the number of separate categories of goods determined according to their tariff subheadings. A business that wants to estimate the impact of the changes on its margins should therefore first review the tariff classification of its product range and the structure of its typical orders, and only then calculate the cost per order.

Another element that should not be confused with the temporary EUR 3 charge is the planned EU handling fee for small e-commerce consignments. This is a separate mechanism, with its level to be determined through further implementing rules, and Member States are expected to begin applying it no later than 1 November 2026. For businesses, this means that calculating the cost of direct shipping from outside the EU should not stop at customs duty alone. In the coming months, businesses will also need to monitor the cost of processing low-value consignments resulting from the reform and distinguish it from fees charged by carriers, customs agents or logistics operators. From a profitability perspective, it is the combined impact of all these elements that matters, even if their legal basis and calculation methods are entirely different.

What will happen after 1 July 2028?

The EUR 3 mechanism is transitional and, under the current framework, is expected to remain in place until 1 July 2028, when the EU Customs Data Hub is due to become operational for e-commerce. There is, however, provision for the transitional solution to be extended if necessary, so the current rules should not be treated as a permanent and unchangeable system regardless of how the wider reform develops. In the longer term, goods sold to EU consumers through e-commerce are expected to be handled to a greater extent under the normal rules of the customs tariff. This will make correct product classification, value, origin and the duty rate applicable to the specific type of goods increasingly important. For a business planning international expansion, this is therefore not simply a two-year issue involving an additional EUR 3 for a certain number of product categories. It forms part of a much broader change in the way imported e-commerce goods are handled across the European Union.

For a business developing sales in France, this means that decisions about where to locate inventory should not be based solely on the costs applying in 2026. If the French market is still being tested, volumes are low and demand remains difficult to predict, direct shipping from the UK may continue to make commercial sense, particularly where the products qualify for preferential origin treatment or margins are sufficient to absorb the additional import costs. If, however, France is expected to become one of the company’s main markets and order volumes are increasing steadily, it may be worth analysing a model in which imports take place at inventory level rather than for every individual customer order. In such a scenario, the comparison should cover not only customs duty but the full landed cost, including bulk importation, transport to France, customs clearance, import VAT, warehousing, fulfilment, local VAT registration and filings and, where goods are sold from France to consumers in other EU Member States, the appropriate use of OSS. Only a comparison at this level makes it possible to determine whether moving part of the company’s inventory from the UK to France genuinely improves the economics of the business.

Why has shipping individual orders from the UK to France become more expensive?

The new customs charge is a recurring cost

The most important change from a seller’s perspective is that the cost associated with importing low-value consignments can arise repeatedly, with each successive order shipped from the United Kingdom to customers in France. For sales covered by the transitional EUR 3 mechanism, what matters is the number of separate categories of goods identified according to their tariff subheadings. If a business processes 1,000 qualifying orders per month and the average basket contains two such categories, the model calculation is as follows: 1,000 orders × 2 tariff categories × EUR 3, which gives EUR 6,000 per month. Over the course of a year, that amounts to EUR 72,000. This example assumes, of course, that all of the consignments being analysed fall within the EUR 3 mechanism and that each contains, on average, two separate categories determined by tariff subheading. It is therefore not a universal rate for every seller, but it illustrates very clearly how a relatively small unit cost can quickly become a significant expense as volumes increase.

Importantly, EUR 72,000 in this scenario is still not the full cost of operating a UK-to-France sales model. The calculation also needs to include international transport, customs clearance and import-handling costs, last-mile delivery, returns and the administrative costs associated with correctly accounting for VAT and maintaining customs documentation. On top of this, there is a separate EU handling fee for low-value e-commerce consignments, which Member States are expected to begin applying no later than 1 November 2026. Its amount is to be determined by the Commission, and the fee itself is separate from the temporary EUR 3 customs charge. This means that a business should not analyse the new charge in isolation from the other elements of landed cost. With a relatively small number of orders, the additional expense may have only a limited effect on the performance of the business as a whole. At several thousand consignments per month, however, it begins to affect margins, pricing strategy and the commercial case for keeping inventory exclusively in the United Kingdom.

The more “mixed” the basket, the greater the impact on order economics

For many online retailers, the key issue will not be the number of parcels shipped, but the structure of the average order. The EUR 3 mechanism is not a simple flat charge applied once to the entire consignment, because what matters is the number of separate categories of goods identified according to tariff subheadings. The more diverse the basket, the greater the potential impact of the new rules on fulfilment costs. This is particularly important for businesses selling accessories, complementary products, bundles and relatively low-value items. An online store may have spent years optimising its sales model so that a customer buys several different products during a single visit, because a larger basket reduced the share of transport costs in revenue and increased customer value. That model may still be profitable after the customs changes, but it needs to be recalculated. An additional product falling under a different tariff category may increase both the revenue from the order and the import charge associated with it.

Businesses with low margins on individual products may be particularly exposed, although the impact of the new cost also depends on the selling price, the number of tariff categories in the basket and the extent to which part of the cost can be passed on to the customer. If a seller offers inexpensive accessories or builds its range around numerous small add-on products, a few additional euros in charges can absorb a significant share of the contribution margin on an order. The same applies to bundles made up of different types of products. From a marketing perspective, a bundle may increase basket value and improve conversion, but from an import perspective it is necessary to establish whether the individual components are classified under the same tariff subheading or several different ones. This is why profitability analysis after 1 July 2026 needs to go one level deeper than the standard comparison between average order value and shipping cost. Businesses need data on which products are most commonly purchased together, how they are classified and what import cost a typical basket generates, rather than looking only at individual SKUs.

Why does the EUR 150 threshold still matter?

The abolition of the previous customs duty relief does not mean that the EUR 150 threshold has disappeared from the system altogether. Its function has changed. Until 30 June 2026, it primarily served as the threshold below which goods in low-value consignments could benefit from customs duty relief. From 1 July 2026, the threshold continues to play an important role in determining how low-value consignments are handled and how the transitional mechanism applies. It would therefore be incorrect to conclude that the EUR 150 value can simply be removed from financial models and sales systems now that the relief itself has been abolished. For a business engaged in cross-border sales, it still matters what proportion of orders falls below this level, how such consignments are imported and which rules apply to them. The threshold also remains relevant for IOSS, which applies to qualifying distance sales of imported goods in consignments with an intrinsic value not exceeding EUR 150.

Exceeding the EUR 150 threshold does not simply mean applying the same rule with a higher amount. For consignments falling outside the low-value solution, the ordinary customs rules must be considered, including the correct tariff classification, customs value, origin of the goods and the possible application of preferential treatment. From a seller’s perspective, this means sales data needs to be divided into different types of orders rather than reduced to a single average for the entire French market. A business where most baskets fall within the EUR 40–80 range is in a different position from one where orders regularly exceed EUR 150. A seller offering a single product type also needs to be assessed differently from an online store with a broad catalogue and multiple tariff categories in the same order. The EUR 150 threshold should therefore remain one of the core parameters used when modelling sales from the UK to France.

IOSS deals with VAT, but it does not replace customs treatment

IOSS simplifies the collection and reporting of VAT on qualifying distance sales of imported goods with an intrinsic value not exceeding EUR 150. It is not, however, an exemption from customs charges. Using IOSS therefore does not mean that a consignment automatically falls outside the scope of the temporary customs charge applying from 1 July 2026. From a business perspective, it is important to separate two issues: the way VAT is collected and reported, and the customs rules that apply when goods are imported into the European Union. These two systems operate alongside one another and may apply to the same transaction. When assessing the cost of selling from the United Kingdom, a business must therefore determine how VAT is being accounted for, on what basis the import takes place, which customs rules apply and what additional costs arise on the side of the carrier or customs-clearance provider. The mere fact that IOSS is being used is not a basis for assuming that customs-related costs disappear.

VAT and customs duty are two different charges

VAT and customs duty are separate categories that may arise in connection with the same import, but they have a different legal basis and a different economic character. IOSS concerns the collection and reporting of VAT on qualifying distance sales of imported goods. Customs duty, by contrast, is a charge connected with bringing goods into the customs territory of the EU, and its amount or method of calculation depends on the applicable customs rules. In addition, a business may incur service fees charged by a carrier, customs agent or another party handling import formalities. These amounts are neither VAT nor customs duty, even if they appear alongside them in the cost breakdown for the same consignment. The planned EU-wide handling fee for low-value e-commerce consignments should not automatically be placed in either of those categories either. It is expected to be applied by Member States no later than 1 November 2026 and is separate from the temporary EUR 3 customs charge.

Keeping these elements separate becomes particularly important when comparing direct shipping from the UK with importing inventory into France. Under a model based on storing goods in France, a business may still have to pay customs duty when importing a larger batch of goods if such duty applies based on the goods’ classification, value and origin. At the same time, import VAT arises and must be accounted for under French rules. Economically, however, these two items are not equivalent. Customs duty is generally a cost that the business does not recover in the same way as input tax. Import VAT, by contrast, may generally be tax-neutral where the relevant conditions are met and the business has a full right to deduct it. If the right to deduct is restricted or does not apply in full, the position must be analysed separately. For this reason, a complete cost model should show customs duty, import VAT, customs-clearance charges, carrier fees and other logistics costs separately, rather than grouping all import-related amounts into a single cost category.

Before comparing a UK-to-consumer model with a UK-to-French-warehouse model, the business must also establish the origin of the goods, because the country of dispatch and the country of origin are not the same thing. A product located in a UK warehouse does not automatically become a UK-origin product. A business manufacturing goods that meet the preferential rules of origin applicable under the EU–UK relationship may be in a different customs position from a seller that imports a finished product from Asia into the United Kingdom and merely stores it there before onward shipment to France. This distinction is fundamental when calculating the cost of both individual consumer consignments and a later bulk import into a French warehouse.

How does Amazon FBA in France change the calculation?

The most important difference between direct shipping from the United Kingdom and storing inventory in France is not simply that one type of customs charge is replaced by another. What changes above all is the architecture of the entire flow of goods. In a UK-to-customer model, individual consumer orders cross the external customs border of the EU. In a UK-to-French-warehouse model, a larger batch of inventory crosses the border, is cleared on import into France and is then used to fulfil sales from within EU territory. This distinction is crucial because it changes the number of customs clearances, the way charges are calculated, the structure of transport costs and the business’s tax obligations. It does not, however, mean that the second model is always cheaper. To assess that, the full cost of delivering the product to the customer must be compared, including not only customs duty but also import VAT, transport, customs clearance, warehousing, fulfilment, returns and local compliance.

UK to customer: multiple individual imports

If inventory remains in the United Kingdom and the business fulfils orders directly to French consumers, virtually every order shipped involves moving goods from a third country into the customs territory of the European Union. From a commercial perspective, the business may see a single, continuous sales process: the customer places an order, the UK warehouse picks and packs it, the carrier collects the parcel and the goods are delivered to France. From a customs-law perspective, however, the EU’s external customs border lies between the warehouse and the customer. This means that successive imports need to be handled, with factors including the value of the consignment, the classification of the goods, their origin, the method used to account for VAT and the rules applicable to distance sales of imported goods all becoming relevant. At low order volumes, such a model may still remain relatively straightforward from an operational perspective, because the business does not need to move inventory into the EU in advance or maintain stock across several markets. As sales increase, however, the same structure means that import formalities and import-related costs recur across an ever-larger number of transactions.

After 1 July 2026, this difference became even more visible. For B2C distance sales of imported goods up to EUR 150 that fall within the scope of the new arrangement, the temporary EUR 3 customs charge applies according to separate categories of goods identified on the basis of tariff subheadings. The cost can therefore recur across successive orders, and its amount also depends on the composition of the customer’s basket. Customs duty may be accompanied by customs-clearance costs, carrier fees, VAT and the separate EU handling fee for low-value e-commerce consignments. As volumes grow, the relevant figure is therefore not merely the shipping rate from the UK to France, but the full cost of processing every order that crosses the EU customs border. Sending an additional 500 orders from inventory already located in France mainly increases the number of domestic fulfilments. Sending those same 500 orders from the UK also increases the number of individual imports into the EU.

UK warehouse to France: you import inventory in bulk, not each order separately

Under a model based on holding inventory in France, the logic is different. Instead of keeping all goods in the United Kingdom and shipping them individually to consumers, the business transports a larger batch of products to a warehouse in France. The shipment goes through import clearance, the applicable customs charges are determined, import VAT is accounted for, and once the goods have been properly released for free circulation, they are already within the EU customs territory. Subsequent customer orders are then fulfilled from this stock. If a product is stored in a French warehouse and shipped from there to a customer in France, that later delivery is not another import from the United Kingdom. The customs border was crossed earlier, when the inventory batch entered the EU. This is the fundamental economic difference: importation stops being part of virtually every individual customer order and instead becomes a planned stage in the warehouse replenishment process.

Importing inventory into a French FBA warehouse is not covered by the temporary EUR 3 mechanism that applies to certain B2C distance sales of imported goods. It is a commercial import of stock and must be handled under the ordinary customs rules. The business therefore needs to determine the correct CN/TARIC classification, customs value, origin of the products, whether preferential treatment may apply, and which entity is responsible for the import. In France, the autoliquidation de la TVA à l’importation mechanism must also be taken into account. For businesses identified for VAT purposes in France, import VAT is generally accounted for through the VAT return rather than being financed in the traditional way at the border. Where the business has a full right to deduct input VAT, the VAT due and the deductible amount may be reported in the same return, which has a very different cash-flow effect from customs duty, which generally remains a real cost. At the same time, holding your own inventory in France will generally trigger a local VAT registration requirement, and OSS does not replace the obligations arising from storing goods in that Member State.

FBA France does not mean “paying EUR 3 once”

One of the riskiest simplifications would be to assume that under the direct UK sales model a business pays EUR 3 on successive consignments, while after moving inventory to France it would pay EUR 3 once for the entire shipment. That is not how the mechanism works. The temporary EUR 3 customs charge applies to certain B2C distance sales of imported goods up to EUR 150. Moving inventory to a French warehouse, by contrast, is a commercial import and is subject to the ordinary customs rules. There is therefore no such thing as “EUR 3 per pallet” or “EUR 3 once for the entire FBA shipment”. When importing a larger batch, the amount payable must be determined on the basis of the correct CN/TARIC classification, customs value and standard tariff treatment of the product, followed by an assessment of whether preferential treatment may apply based on its origin.

The delivery terms also matter, as does the question of who formally acts as the importer and is responsible for the accuracy of the customs declaration. Only once these elements have been established can the actual cost of bringing inventory into France be calculated. The business must then add the cost of transporting the batch, customs clearance, warehousing, fulfilment and local compliance, and allocate the result across the number of products sold or orders fulfilled. Only this unit cost can be compared meaningfully with the direct-shipping model from the UK. For one business, concentrating imports at the level of larger inbound shipments may significantly improve the economics of selling into France. For another, warehousing costs, slow stock turnover or additional administrative obligations may offset that advantage. The key is therefore to compare two complete landed-cost models, rather than comparing only the temporary EUR 3 customs charge with the cost of FBA.

Goods shipped from the United Kingdom do not necessarily have UK origin

One of the more common mistakes when calculating UK-to-EU costs is to treat the place from which a parcel is physically dispatched as the origin of the product for customs purposes. From an operational perspective, everything may appear “British” to the business because the product is stored in a UK warehouse, shipped by a UK logistics provider or has formed part of inventory held in the UK for months. None of these factors, however, determines its origin on its own. In practice, origin can be understood as the economic nationality of the product: what matters is where the goods were manufactured or where sufficient processing took place to confer a particular origin, not simply the country from which they were shipped to the customer. This distinction has a direct impact on whether preferential customs treatment is available and can therefore change the outcome of any comparison between direct shipping from the UK and importing inventory into France.

“Shipped from the UK” ≠ “originating in the UK”

Consider a business that purchases finished accessories from a manufacturer in China, imports them into a warehouse in the United Kingdom and then sells them to customers in France. The products may remain in the UK for many months, be picked, labelled, repackaged and dispatched there, but simply storing finished goods on UK territory does not automatically confer preferential UK origin. Where non-originating materials are used in production, the product must satisfy the specific rule of origin applicable to it, including, where required, undergoing the necessary level of processing or transformation. A finished product originating in China that merely passes through a UK fulfilment centre before onward sale should therefore not be treated as British simply because the shipping label shows a UK dispatch address.

The position may be different for a business that actually manufactures goods in the United Kingdom or carries out a production process there that satisfies the relevant preferential rules of origin. The EU–UK Trade and Cooperation Agreement provides for zero customs duties on goods that meet the applicable preferential rules of origin. This does not, however, mean zero customs duty for every product shipped from the United Kingdom. Preferential treatment must be assessed for the specific product, and the requirements for claiming it must be met. Two businesses may therefore use warehouses located in the same UK city, sell similar products to the same customers in France and still have completely different customs outcomes because their goods have different origins and different production histories.

Why can origin change the outcome of the entire calculation?

Origin may determine whether preferential tariff treatment can be applied when a larger batch of goods is imported into France, rather than the rate that would apply under the product’s standard customs treatment. Tariff classification remains the starting point, as it is needed to identify the correct tariff heading and the standard rate applicable to the goods. Only after that should the business assess whether the product’s preferential origin creates a basis for applying a more favourable rate. In EU–UK trade, this may mean a 0% rate where the product meets the relevant rules of origin and the conditions for claiming preference. On a larger import, the difference between the standard rate and a preferential rate may be spread across hundreds or thousands of units, meaning that even a few percentage points can materially change the unit cost of the entire shipment.

Before deciding whether to move inventory to France, the business should therefore know the correct CN/TARIC classification, the customs value of the imported shipment, the actual origin of the products and whether preferential treatment is available. For goods originating in third countries, it is also necessary to check whether measures other than ordinary customs duty apply because of their origin, such as anti-dumping duties, countervailing duties or other trade-defence measures. This is particularly important for businesses using the United Kingdom as a European hub for products imported from Asia. In such a model, the address of the UK warehouse should not be the starting point for assuming a particular customs rate. The business must first establish what the product is, where it actually originates and which rules apply to its import. Only then can it compare the cost of shipping successive orders from the UK with the cost of importing a larger quantity of inventory into France in advance.

UK D2C vs FBA France — what do you really need to compare?

Comparing the UK D2C model with FBA France should not come down to comparing the temporary EUR 3 customs charge with a fulfilment fee. That approach ignores most of the costs that actually determine profitability. In both models, the business incurs transport, logistics, tax compliance and returns costs, but they arise at different stages and are accounted for in different ways. The right point of reference is therefore the full landed cost: the total cost of bringing the goods to the point from which they can be delivered to the customer, combined with the cost of fulfilling the individual order. Only by comparing these expenses on a per-order basis can a business determine whether importing a larger batch into France in advance genuinely offers an advantage over continuing to ship individual parcels from the United Kingdom.

Total cost of the UK-to-customer model

Under the direct-shipping model, the calculation begins with preparing and dispatching an individual order from a UK warehouse, but it should not end with the courier rate. The cost needs to include packing, transport from the UK to France, import formalities, customs charges, VAT handling, any fees charged by the carrier or customs-clearance provider, last-mile delivery and returns. For B2C distance sales of imported goods with an intrinsic value not exceeding EUR 150 that fall within the transitional mechanism, the temporary charge amounts to EUR 3 for each separate item line in the customs declaration, with units covered by the same nomenclature grouped together for calculation purposes. For simplicity, it is still possible to refer to separate tariff categories, but in an actual cost model the way the goods are presented in the customs declaration matters.

On top of this, there is a separate EU handling fee for low-value e-commerce consignments, which Member States are expected to apply no later than 1 November 2026, with the amount to be determined by the Commission. It should not be confused either with the temporary EUR 3 customs charge or with service fees charged by the carrier or the party handling customs clearance. In France, an additional source of confusion may be the earlier national charge on low-value consignments, which was repealed when the EUR 3 mechanism entered into force on 1 July 2026. For a business, what matters is therefore not the label shown on the invoice but the total of all recurring costs associated with moving an individual order across the EU customs border. At higher volumes, even seemingly small differences per order can translate into tens of thousands of euros over the course of a year.

Total cost of the UK-to-France-to-customer model

With inventory stored in France, some of the costs that recur with successive orders under UK D2C are shifted to the warehouse replenishment stage. The business arranges transport of a larger batch from the United Kingdom to France, carries out a commercial import and incurs the associated customs-clearance costs. A commercial import of inventory into a French FBA warehouse is generally not covered by the temporary EUR 3 mechanism applicable to B2C distance sales of imported goods. It is handled under the ordinary customs rules, which means the CN/TARIC classification, customs value, origin of the product, eligibility for preferential treatment and any additional trade measures all become relevant. The business must then add transport to the warehouse, goods-receiving costs, fulfilment, storage, inventory management and returns.

FBA-related costs should also be separated from the costs of the import itself. Customs duty, customs clearance and import VAT result from bringing the goods into the EU. Fulfilment fees, storage charges, costs associated with inventory levels or long-term storage, inbound transportation to the warehouse and returns handling, by contrast, result from the logistics model chosen by the business. VAT obligations need to be considered separately as well. In France, businesses with a French VAT number that fall under the autoliquidation mechanism generally account for import VAT through their VAT return, without the traditional need to finance the tax at the border. Where the business has a full right to deduct input VAT, import VAT may be broadly tax-neutral, although correct registration, reporting and consistency of import data remain essential. Holding your own inventory in France will also generally create local VAT obligations that are not replaced by OSS.

Cost comparison per order

The most useful calculation brings the relevant expenses down to a common denominator: the cost per completed order. Under the FBA model, this means allocating bulk transport, customs clearance and any import duty across the number of products or orders served from the batch. Under UK D2C, a larger proportion of the costs is directly associated with each individual parcel. The table should not, however, be used to apply a single rate across the entire business. It is better to prepare separate versions for the most important product groups, because tariff classification, origin, dimensions, stock turnover and basket composition can produce very different results.

The final row is the most important one. The fact that a direct shipment generates several euros in customs charges does not, by itself, answer the question of whether FBA France is cheaper. Equally, a lower unit transport cost achieved through bulk shipping does not automatically prove that local inventory is the better option if products turn slowly and generate high storage costs. In practice, local inventory may be highly efficient for bestsellers with stable demand, while seasonal, niche or unpredictable products may be better kept under a different model. A business does not necessarily need to make one decision for the entire catalogue. It may be more useful to divide the portfolio according to volume, margin and predictability of demand.

Cost per order is the first metric needed, but it is not enough to make the decision. The second is break-even volume: the number of orders at which the per-order saving begins to cover the additional fixed or semi-fixed costs associated with holding inventory in France. Suppose the local model creates additional monthly costs of EUR 2,000 for inventory handling, compliance and other elements that do not arise under the current setup. At the same time, the full cost of fulfilling one order falls by EUR 4 compared with direct shipping from the UK. The break-even point is then EUR 2,000 ÷ EUR 4, or 500 orders per month. At 300 orders, the unit saving does not yet offset the additional cost of the model. At 2,000 orders, the same cost structure may look entirely different.

This calculation should be based on the company’s actual data, because some FBA costs are not fully fixed and the saving per order may vary between products. Even so, break-even volume gives management a far more useful reference point than asking whether an individual parcel is EUR 2 or EUR 3 cheaper. It answers a more commercially relevant question: at what level of sales does it become worthwhile to accept greater tax and inventory complexity in exchange for a lower unit cost and local fulfilment? For a business planning expansion, this is particularly important because the decision may not make financial sense at today’s volumes but may become justified at the level of sales expected six or twelve months from now.

Example: when does the EUR 3 customs charge start eating into margin?

The impact of the new rules is easiest to see with a simple example involving a relatively low-margin product. Assume a portfolio of 100 orders covered by the temporary mechanism. In 20 of them, there is one relevant item line, while the remaining 80 contain two separate lines under the applicable nomenclature. That gives a total of 180 lines across 100 orders, or an average of 1.8 per order. The average charge is therefore 1.8 × EUR 3, or EUR 5.40 per order. If the contribution margin on the average order before the change was EUR 8, the temporary customs charge alone accounts for 67.5% of that amount. Once it is included, the original EUR 8 falls to EUR 2.60, even before any increase in other costs related to customs clearance, transport or handling of low-value consignments.

This shows why the figure of “EUR 3” can appear deceptively small when viewed without reference to basket structure and margin. For a high-value, high-margin order, a few additional euros may have only a limited impact. For an online store selling accessories, bundles or low-ticket products, the situation can be very different. If the business previously generated EUR 8 in contribution margin per order, an additional EUR 5.40 is not a minor cost adjustment but a fundamental change in the economics of the sale. The business may try to increase prices, change its free-shipping threshold, restructure its offer or pass part of the cost on to the customer, but each of these decisions may affect conversion and price positioning. Contribution margin after the full cost of fulfilment is therefore what ultimately shows whether increasing sales under the existing model is still improving the company’s result, or mainly scaling import and logistics costs.

Is Amazon FBA in France right for my business?

A decision to move part of the company’s inventory to France should not be based solely on the fact that direct shipping from the UK became more expensive from 1 July 2026. FBA France is not automatically the better solution for every seller. In practice, profitability depends on a combination of order volume, order value, basket structure, margin, origin of the goods, the cost of bulk importation and the cost of local warehousing and VAT compliance. The most useful question is therefore not “is FBA cheaper?”, but rather: “given my current and planned volumes, product mix and unit costs, which model leaves me with the higher margin after the full cost of fulfilment?” The answer may be different for bestsellers, seasonal products and items sold only in small quantities.

FBA France is worth modelling seriously if…

Holding inventory locally in France should rank high among the scenarios to analyse if you regularly fulfil a large number of orders from the UK to French customers and a significant proportion of those consignments falls within the EUR 150 threshold. Basket structure matters as well. If customers frequently purchase goods together that are shown as separate lines under the relevant nomenclature for customs-declaration purposes, the cost of the temporary customs mechanism may rise faster than in a business focused on a single product type. For readability, these cases can be treated as separate tariff categories in the analysis, although technically the key issue is how the goods are classified and presented in the customs declaration. The same applies to ranges with low unit prices or limited margins, where a few euros of additional cost can represent a substantial share of the contribution margin. The higher the volume, the more important it becomes to ask whether it still makes sense to import practically every order into the EU separately rather than moving a larger quantity of inventory into the Union in advance.

FBA France becomes particularly worth considering when demand is stable enough for stock levels to be planned with reasonable accuracy. Local fulfilment may also create more value in businesses where delivery speed, simpler returns and the overall customer experience have a meaningful effect on sales. For a company thinking more broadly about expansion across continental Europe, a French warehouse may also become one component of a wider European logistics model, although sales from France to consumers in other EU Member States create their own VAT consequences and require an appropriate analysis of intra-EU distance sales and OSS. In practice, the strongest signal that a detailed calculation is needed is usually a combination of several factors: growing volume, repeatable demand, a significant share of low-value B2C consignments and margins that are beginning to feel the effect of recurring import costs.

Continuing to ship from the UK may still make sense if…

Direct shipping from the United Kingdom did not suddenly stop being a reasonable model for every seller. If sales into France are small, irregular or highly seasonal, the cost of creating and maintaining local inventory may be higher than the savings achieved by changing the import model. The same applies to businesses with broad catalogues but slow stock turnover. In that situation, moving a larger number of SKUs into a French warehouse may increase storage costs and tie up capital without any guarantee that the products will sell quickly. The UK D2C model may also remain easier to justify economically where a typical order contains only one product type, unit margins are high and additional import costs represent only a small percentage of sales value.

The origin of the goods and the availability of customs preferences may also materially affect the wider UK-to-France calculation, particularly for ordinary commercial imports. Goods shipped from the UK do not acquire UK origin simply because they were stored there. Businesses should therefore not assume that preferential origin automatically neutralises the temporary EUR 3 customs charge where that mechanism applies to B2C sales. A decision to remain with UK D2C needs to take the economics of the entire model into account: volume, margin, parcel-handling costs, basket structure and operational risk. If local VAT registration, reporting, bulk imports, additional warehouse processes and maintaining inventory in France create a burden that is disproportionate to the level of sales, continuing with the existing model may still be commercially rational. The important point is that the decision should be based on an up-to-date calculation, rather than on a cost structure that applied before the regulatory change.

7 numbers you should know before making the decision

Before changing the logistics model, it is worth collecting seven figures. Without them, any comparison between UK D2C and FBA France will be largely guesswork. The first is the monthly number of orders shipped to France and other EU Member States. The second is the share of consignments with a value not exceeding EUR 150. The third is the average number of separate tariff categories appearing in orders covered by the EUR 3 mechanism, based on the actual classification of the goods rather than simply the number of SKUs. The fourth is the real contribution margin on the average order before and after import-related costs. The fifth should be the full cost of shipping and clearing one order from the UK, including transport, customs clearance, duty, service fees, last-mile delivery and returns. The sixth is the full cost of importing, storing and fulfilling inventory in France, calculated per order. The seventh is the monthly fixed and semi-fixed cost of operating the French model, including VAT compliance, additional administration and those warehousing and operational costs the company incurs regardless of order volume.

These seven parameters make it possible to move from general assumptions to an actual financial model and calculate the break-even point. If the additional fixed and semi-fixed costs of the French model amount to EUR 2,000 per month and the full cost of fulfilling one order falls by EUR 4 after moving inventory, the break-even volume is 500 orders per month. Below that level, local inventory may not yet generate enough savings to justify its additional complexity. Above it, the economics can become progressively more attractive. It is also worth calculating the threshold separately for different product groups, because the saving on one order may be completely different for a fast-moving bestseller than for a seasonal product. That means an FBA decision does not have to be “all or nothing”; it can apply only to the parts of the catalogue that genuinely achieve sufficient scale.

What happens if I change nothing?

Keeping the same logistics model is not necessarily a mistake. The problem arises when the business does not make that decision consciously and simply continues operating as before without recalculating costs after 1 July 2026. In that scenario, sales growth may continue to look very strong at revenue level while margin on individual orders gradually deteriorates. This can be particularly dangerous for businesses scaling quickly and focusing mainly on turnover, order volume, AOV and ROAS, while paying far less attention to the full import and fulfilment cost of an individual basket.

The new customs charge can absorb several euros of margin per order

Under the temporary EUR 3 mechanism, the recurring nature of the cost matters more than the nominal figure itself. If the average qualifying order includes two separate tariff categories, the charge amounts to EUR 6. Across 100 such orders, that is EUR 600; across 1,000 orders, EUR 6,000; and across 3,000 orders, EUR 18,000 per month. This does not mean that every order shipped from the UK will generate exactly EUR 6 in charges, because the result depends on whether the transaction falls within the scope of the mechanism and how the goods are classified. It does, however, illustrate the scale effect: a cost that may look small on a single transaction can become a significant component of the monthly result at higher volumes.

Nor does this mean that local inventory automatically solves the problem. FBA France introduces its own costs and obligations, so the business still needs to determine whether the saving at fulfilment level genuinely compensates for them. The greater risk is that no calculation is performed at all and products continue to be priced as though the cost structure that existed before 1 July 2026 were still current. At high margins, the effect may be modest. At margins of only a few or a dozen euros, however, an additional EUR 3, EUR 6 or EUR 9 can completely change the unit economics, particularly where there is little room to increase prices or pass the cost on to the customer.

Your best-selling product may remain profitable — while the overall basket does not

Profitability analysis carried out only at individual SKU level can create a false sense of security. A high-margin bestseller may still look very attractive after the new rules are taken into account. The problem may arise when the customer adds several cheaper products classified under different relevant nomenclatures. From a marketing perspective, the basket is growing, average order value is improving and cross-selling is working exactly as intended. From an import perspective, however, each additional separate line classified under a different relevant nomenclature may increase the amount payable. Adding another SKU does not therefore automatically mean another EUR 3 if the goods are classified in the same way.

After 1 July 2026, businesses should therefore analyse not only margin by product, but also margin across real basket types. Orders containing a single product may remain highly attractive, while certain combinations of two or three tariff categories may begin generating significantly weaker results. That insight can lead to a range of different decisions: changing the price of selected products, redesigning bundles, adjusting the delivery policy or moving the most popular SKUs into a local warehouse. Without basket-level analysis, a business may try to solve the problem blindly, even though the actual source of declining margin is a specific product combination rather than the French market as a whole.

Fulfilment costs can rise disproportionately to basket value

The risk is particularly visible in low-ticket e-commerce. If an additional product increases the order value by EUR 10 or EUR 15 but is classified under a different relevant nomenclature and therefore increases the amount payable by another EUR 3, the increase in revenue does not necessarily translate into a similar increase in margin. Additional packing, transport or handling costs may also arise. In an extreme case, a business may actively increase its average order value while simultaneously reducing both the percentage margin and the absolute margin on some orders. This is a common problem in models where the unit cost is relatively high compared with the price of the product.

It is also worth remembering that customs duty is only one component of the total cost. A consignment may generate transport, customs-clearance, last-mile, returns and other fulfilment-related charges. If several of these cost items increase at the same time, the impact on profitability may be significantly greater than the EUR 3 mechanism alone would suggest. Businesses should therefore monitor not only AOV, but also landed contribution margin per order: in simplified terms, net revenue less the cost of goods, customs duty, transport, customs clearance, fulfilment, last-mile delivery, returns and other variable fulfilment costs. This metric gives a much clearer picture of whether additional volume is genuinely improving performance or simply increasing the scale of sales with progressively weaker unit economics.

You may not discover the problem until several months later

New costs are not always immediately visible in standard sales reports. Revenue may continue to increase, order volumes may reach record levels and average order value may even improve. At the same time, customs-clearance, transport and import costs may be recorded elsewhere, appear with a delay or be aggregated on invoices from logistics providers. If a business does not allocate these costs to specific orders or groups of orders, the deterioration in margin may only become visible at month-end, quarter-end or after several reporting periods. In a fast-growing e-commerce business, several months of this kind of delay can represent a substantial amount of money.

For this reason, after the changes it is worth monitoring fulfilment cost per order much more frequently than before. It is particularly useful to compare landed contribution margin by market, order value, number of tariff categories and product group. This makes it possible to see quickly whether the problem affects the entire UK D2C model or only a selected part of the business. Without this breakdown, management may conclude that “France has become less profitable”, when the actual issue may relate only to orders below a certain value, multi-product bundles or a specific product category. The earlier the business identifies this distinction, the easier it is to adjust prices, logistics or inventory structure without making abrupt changes.

Delaying the decision may mean implementing a new model under pressure

Moving inventory to France is not a change that can be reduced to arranging a single pallet shipment. The business needs to prepare the commercial import model, determine the classification of the goods, verify origin and potential preferential treatment, identify the party responsible for the import and ensure that the correct EORI number is used for customs purposes. Separately, French VAT registration and ongoing VAT compliance need to be prepared. EORI and VAT numbers serve different purposes and are not simply two stages of the same registration process. Import VAT also needs to be considered in light of the French autoliquidation mechanism, which, for businesses holding a French VAT number and covered by the system, generally means accounting for the tax through the VAT return rather than financing it in the traditional way at the border.

There are also warehouse processes, inventory forecasting, inbound transport, fulfilment configuration and returns handling to consider. Each of these elements can be prepared methodically if the business starts its analysis early enough. This is why the greatest risk of “doing nothing” is not necessarily remaining with UK D2C, but failing to prepare an alternative scenario. A business can define a migration trigger in advance, such as a specific monthly order volume, a minimum saving per order or a maximum acceptable share of import and logistics costs in contribution margin. This allows the move to local inventory to become a planned decision activated when previously defined parameters show that the French model is becoming economically justified, rather than a reaction to a sudden deterioration in performance.

VAT, EORI and compliance — what changes when you store inventory in France?

Moving inventory from the United Kingdom to France changes not only the logistics model but also the way the business operates within the local VAT system and handles imports. As long as the goods remain in the UK and are shipped directly to French consumers, the business primarily operates under a distance-sale-of-imported-goods model. Once its own inventory is imported into France, placed in a local warehouse and subsequently used to fulfil sales, different reporting and record-keeping obligations arise. This is therefore not simply a matter of replacing one delivery method with another. FBA France changes where the goods are located before the sale, how they are imported and the set of tax obligations associated with subsequent transactions.

Why does local inventory create local VAT obligations?

Under a typical FBA France model, where a business imports its own inventory into France, stores it there and sells from that stock, appropriate VAT identification in France and compliance with local filing obligations will generally be required. What matters are the actual transactions involving the inventory, rather than the physical presence of the goods considered in isolation from the rest of the model. If the business sells from a French warehouse to French consumers, it makes domestic sales taxable in France. If it moves its own goods between EU Member States, reporting obligations relating to transfers of own stock may arise. If it imports goods into France and accounts for import VAT there, it also enters the local VAT system.

For an EU-based business, the fact that it has no company or office in France does not automatically mean that it has no local VAT obligations. What matters is what happens to the goods after they are imported. A model in which inventory remains in the UK until the point of sale differs in this respect from one in which goods are first imported into France and only then sold from a local warehouse. Care is also needed with configurations in which a fulfilment operator may move the business’s own inventory to warehouses in other EU Member States. Such transfers may create additional local VAT and reporting obligations, which is why a model involving a wider European warehouse network should be analysed separately from a simple scenario in which the inventory remains exclusively in France.

OSS does not replace local VAT registration

OSS simplifies the reporting of certain cross-border B2C supplies between EU Member States, but it is not a “European VAT number” that replaces local obligations arising from warehousing. If goods are located in France and are sold from there to a French consumer, this is a domestic French sale and is not reported through OSS in the same way as a cross-border sale to a consumer in another Member State. OSS becomes relevant when qualifying intra-EU distance sales are made from French inventory, for example to consumers in Germany, Spain or Italy. In that situation, the scheme may simplify the reporting of VAT due in the Member States of consumption, but it does not remove the obligations connected with the French inventory itself.

From an operational perspective, this means several transaction streams need to be separated. Sales in France should be treated as domestic transactions, B2C sales from France to other EU Member States may, where the relevant conditions are met, be reported through OSS, while transfers of the business’s own inventory between warehouses in different countries may require a separate analysis. The more extensive the fulfilment network, the more important it becomes to track the location of the goods and allocate transactions to the correct VAT returns. This is why, before launching a broader European model, it is worth checking whether the chosen logistics setup allows stock to be moved automatically between countries and what VAT consequences each such transfer creates.

EORI and the importer — what needs to be established before the first shipment?

Before sending the first batch of inventory to France, the business needs to establish who will act as the importer, who will act as the declarant and whether the customs representative will operate under direct or indirect representation. This matters for responsibility for the declaration and for any potential customs debt. In practice, simply naming one entity as the “importer” does not complete the analysis. The business needs to know who supplies the data for the customs declaration, who is responsible for its accuracy, what form of representation is being used and which party may bear specific customs obligations. The correct EORI number, used to identify the business in customs operations, must also be in place.

A French VAT number does not mean a French EORI number. Moving inventory to France may require French VAT identification, but it does not automatically mean obtaining a second EORI number. EORI is an EU customs identifier and, as a general rule, one legal entity has one valid EORI number within the EU. A business that already holds a valid EORI issued in another EU Member State does not automatically obtain or need an additional French EORI simply because it begins importing into France. Separately from EORI, the business must establish which VAT number will be used for the import, prepare origin documentation, verify whether preferential treatment may apply and clearly define the delivery terms. These elements are operationally connected, but they serve different legal purposes and should not be treated as a single registration process.

Import VAT in France and cash flow

When importing inventory into France, it is important to distinguish clearly between customs duty and import VAT, because the two affect profitability and cash flow in different ways. For businesses holding a French VAT number and covered by the relevant system, import VAT is generally accounted for through the autoliquidation mechanism. This means that the tax is reported in the VAT return and, where the business has a full right to deduct input VAT, the VAT due and the deductible amount may be included in the same return. From a cash-flow perspective, this is fundamentally different from having to finance the full VAT amount upfront at the time of customs clearance.

This does not mean, however, that importing inventory is economically neutral. Customs duty remains a separate charge and cannot be deducted in the same way as input VAT. There are also customs-clearance costs, transport, documentation handling, accounting and other compliance expenses. For this reason, a financial model should show customs duty, the cash-flow impact of VAT and administrative costs separately. If a business groups all three under a single heading such as “taxes and import charges”, it may either overstate or understate the real cost of the French model. A proper calculation should distinguish between items that represent a genuine economic cost and those that may be tax-neutral where the relevant conditions are met.

How do you calculate which model is more profitable?

The best decision does not come from comparing one customs rate with one fulfilment fee. Two parallel cost models need to be built and reduced to the same unit, ideally the full cost per completed order. The first model should show the actual cost of UK D2C after the changes introduced on 1 July 2026. The second should cover the commercial import of a batch into France, local inventory, fulfilment and compliance. The comparison should then consider not only the unit cost, but also the additional fixed and semi-fixed costs and the volume at which the French model reaches break-even.

Step 1: calculate the current UK-to-customer cost

The first step is to calculate the actual cost of one order shipped from the UK to a French consumer. The calculation should be based on financial and operational data, not simply on the carrier’s price list. It should include the cost of goods, packing, transport, customs clearance, customs duty, service fees, last-mile delivery, returns and other variable fulfilment costs. If some costs appear on aggregated invoices, they need to be allocated to the relevant orders or sales segments. It is worth doing this separately for several typical basket types, because a single bestseller can generate a very different margin from a bundle containing several products classified under different tariff categories.

For the purposes of this analysis, this metric can be called landed contribution margin per order. It is not a formal accounting standard, but a practical KPI showing how much net revenue remains after deducting the cost of goods, customs duty, transport, customs clearance, fulfilment, last-mile delivery, returns and other variable fulfilment costs. This allows the business to see not only the cost of the parcel, but the actual economics of the order. The metric is worth tracking by market, basket value and product structure, because one average margin across the entire business may conceal segments that remain highly profitable as well as those that are beginning to lose their economic justification.

Step 2: add the new customs charge from 1 July 2026

The second step is to account correctly for the temporary customs charge applying to covered B2C distance sales of imported goods up to EUR 150. Technically, the EUR 3 amount is applied according to the relevant item lines in the customs declaration, with units covered by the same nomenclature grouped together. For readability, the model can use the simplified concept of a separate tariff category, provided it reflects the actual classification of the goods. For the segment covered by the mechanism, the formula can therefore be expressed as: average number of relevant tariff categories × EUR 3. If the average is 1.8, this gives an average charge of EUR 5.40 per order within the scope of the mechanism.

It is important, however, to distinguish between the average cost for the segment covered by the mechanism and the average cost across the entire portfolio. If only 70% of all orders fall within the relevant scope, then with an average of 1.8 tariff categories the simplified portfolio-wide cost is 70% × 1.8 × EUR 3, or EUR 3.78 across all orders. For the segment itself, the average remains EUR 5.40. This distinction matters because it is easy to make the mistake of applying the average cost for qualifying consignments to the entire sales base and thereby overstating the impact of the reform on the business.

Step 3: calculate the cost of importing a batch into France

The third step is to build a separate calculation for the commercial import of inventory into France. The temporary EUR 3 mechanism should not be used as the basis for calculating a larger batch import, because such imports are generally subject to the ordinary customs rules. The business needs to determine the CN/TARIC classification, customs value, actual origin of the products, standard tariff rate and whether preferential treatment is available. For goods originating in third countries, it is also worth checking whether trade measures such as anti-dumping duties or other additional charges apply.

Import costs should not then be divided mechanically by the number of units in the shipment if the catalogue contains products that differ significantly in value, weight or dimensions. A better approach is to allocate costs to individual products using a rational allocation key, such as value, weight, volume or the actual share of a given SKU in the customs charges, and only then convert those amounts into typical order-level costs. This prevents an expensive, heavy product from being allocated the same share of transport costs as a lightweight accessory simply because both count as one unit. This type of allocation provides a far more reliable basis for comparison with UK D2C.

Step 4: add local warehousing, fulfilment and compliance costs

The cost of importing inventory alone does not answer the question of how much selling from France will cost. Warehousing, fulfilment, last-mile delivery, returns, inventory-turnover costs and local VAT compliance all need to be added. It is useful to separate variable costs from fixed and semi-fixed costs. Some expenses increase with order volume, while VAT compliance, part of the administrative workload and certain warehouse costs may be incurred regardless of volume. This distinction is necessary for calculating break-even volume later.

The cost of capital tied up in inventory and the risk of slow stock turnover should also be included. Goods sent to France remain tied to the local market or fulfilment network until they are sold or moved again. For bestsellers, this may be economically justified, but for seasonal or long-tail products it may lead to increasing storage costs. In addition, if the chosen model allows inventory to be moved to other EU Member States, the business needs to consider the possible expansion of local VAT and reporting obligations. In practice, this means that the cost of FBA France should not be calculated simply as “fulfilment fee + storage”, but as the full operating cost of maintaining inventory under the chosen configuration.

Step 5: compare cost per order, not the cost of one customs clearance

Finally, both models need to be reduced to the same unit. The most useful measure is the full cost of one order and the contribution margin remaining after fulfilment. Under UK D2C, a large part of the cost arises when each individual parcel crosses the customs border. Under the FBA model, some costs arise earlier, during bulk transport and batch importation, so they need to be allocated across products and typical orders. Comparing the customs-clearance cost of one parcel with the customs-clearance cost of one pallet says very little about profitability because each operation supports a different number of future transactions.

The final decision should combine unit cost with volume. If, in a simplified model, local inventory reduces the full fulfilment cost by EUR 4 per order while generating EUR 2,000 per month in additional fixed and semi-fixed costs, the break-even point is 500 orders per month. This assumption only makes sense if the EUR 4 behaves as a genuine marginal saving on additional orders and the EUR 2,000 can reasonably be treated as fixed or semi-fixed within the analysed volume range. Businesses should therefore look at cost per order, landed contribution margin and break-even volume at the same time. These three measures provide a much clearer view of the economics of FBA France than simply comparing the temporary EUR 3 customs charge with a single fulfilment fee.

The most common calculation mistakes after 1 July 2026

The change in the rules for low-value consignments may appear simple: a new customs charge has been introduced, so all that is needed is to add a few euros to the shipping cost. In practice, this kind of simplification is exactly what most easily leads to incorrect calculations. The difficulty is that businesses also need to separate B2C distance sales of imported goods from commercial inventory imports, VAT from customs duty, country of dispatch from origin, and IOSS from OSS. If all these elements are combined into one cost model without distinction, a company may either overestimate the benefits of FBA France or fail to notice that its existing UK D2C model has become less profitable. For simplicity, in the sections below, a separate tariff category means a separate item line in the declaration resulting from the relevant nomenclature, with units covered by the same nomenclature grouped together for the purposes of calculating the EUR 3 charge.

“The new customs charge is always EUR 3 per parcel”

This is one of the most dangerous simplifications. The temporary charge is not a flat EUR 3 fee added once to every box. For B2C distance sales of imported goods with an intrinsic value of up to EUR 150 that fall within the mechanism, each relevant item line in the customs declaration is subject to a EUR 3 charge, with units covered by the same nomenclature treated together. In practice, this means that several units of the same product may not increase the amount payable, while a bundle containing products classified under several different nomenclatures may generate a multiple of EUR 3. For modelling purposes, the average number of separate tariff categories per order can therefore be used, but it must be based on the actual classification of the goods rather than simply on the number of SKUs in the basket.

“I use IOSS, so customs duty does not apply to me”

IOSS is a mechanism connected with accounting for VAT on qualifying distance sales of imported goods. It is not a general exemption from customs charges. Holding or using IOSS therefore does not mean that a consignment can automatically be excluded from customs analysis after 1 July 2026. The EUR 3 mechanism needs to be considered independently from the mere fact that IOSS is being used, because its application is not limited to a single method of VAT accounting. For a business, the key is to separate two questions: how VAT is collected and reported, and which customs rules apply to the specific import.

Carrier fees, customs-clearance costs and the separate EU handling fee for low-value e-commerce consignments, due to apply from 1 November 2026, may also arise. All of these elements may relate to the same order, but they are not the same charge. In practice, businesses should therefore avoid the shorthand assumption that “IOSS takes care of the import”, because IOSS only addresses a specific part of the VAT obligations and does not replace customs analysis or the assessment of the remaining costs involved in handling the consignment.

“The goods are shipped from the UK, so they have UK origin”

A UK warehouse address does not give a product UK origin. If a finished product was manufactured, for example, in China, then imported into the United Kingdom and only stored, picked or forwarded from there, this does not automatically mean that it can be treated as a product of preferential UK origin. Rules of origin focus on where and how a product was manufactured and whether it meets the relevant production or processing requirements. This is particularly important when commercially importing inventory into France, because the availability of preferential treatment can materially change the outcome of the entire calculation.

The EU–UK Trade and Cooperation Agreement allows zero customs duties to be applied to goods that meet the relevant preferential rules of origin, but this does not mean zero duty for every product leaving a UK warehouse. Before building the calculation, the business should therefore determine the classification and origin of the goods, and then assess whether preferential treatment is available and what documentation is required. Goods originating in third countries may also be subject to additional trade measures, including anti-dumping duties, countervailing duties or other safeguard measures. Country of origin is therefore one of the factors that can fundamentally change the economics of importing inventory.

“Moving inventory to France eliminates customs duty”

FBA France changes the timing and structure of the import, but it does not turn imported goods into duty-free goods. A commercial import of inventory into a French warehouse is generally not covered by the EUR 3 mechanism that applies to the relevant B2C distance sales of imported goods. Instead, the ordinary customs rules and the Common Customs Tariff apply. The business needs to determine the CN/TARIC classification, customs value, origin, standard rate and whether preferential treatment is available. A financial model therefore cannot be built on the assumption that moving one pallet to France means “paying EUR 3 once instead of EUR 3 on every order”.

The potential advantage of FBA lies elsewhere. Rather than repeating the import process across a large number of individual orders, the business commercially imports a batch of goods and then fulfils sales from inventory that is already located within the EU. This may move the unit fulfilment cost in either direction, depending on classification, customs value, origin, preferential treatment, transport costs and warehousing costs. What unquestionably changes is the frequency and structure of the import process. FBA France should therefore be analysed as a different goods-flow model, not as a way to “avoid customs duty”.

“OSS is enough if I store goods in France”

OSS can simplify VAT reporting for qualifying cross-border B2C supplies within the EU, including intra-EU distance sales, but it does not replace obligations arising from transactions involving locally held inventory. Under a typical FBA France model, where the business imports its own goods into France, stores them there and sells from that warehouse, French VAT identification and local obligations need to be taken into account. A sale from France to a French consumer is a domestic French sale, while a qualifying intra-EU distance sale from France to a consumer in another Member State may be reported through OSS.

The position becomes more complex when inventory is moved between warehouses in several EU Member States. Transfers of a business’s own goods may trigger additional registration and reporting obligations. A business therefore needs to know not only that it uses OSS, but also where its inventory is physically located and what transactions are being carried out in each country. In fulfilment models spanning several countries, the location of the goods can be just as important a VAT parameter as the place of consumption.

“You only need to compare the new customs charge with the fulfilment fee”

Comparing a few euros of additional customs charges with a single fulfilment fee says very little about the actual profitability of the two models. On the UK D2C side, the calculation needs to include transport, customs clearance, customs charges, VAT handling, carrier fees, last-mile delivery and returns. On the FBA France side, the business needs to include bulk transport, ordinary commercial import, customs clearance, fulfilment, warehousing, inventory-related costs, returns and local VAT compliance. Some of these costs are variable, some are fixed or semi-fixed, and others depend on the value, weight, dimensions and stock turnover of the individual product.

The most meaningful comparison should therefore be made at the level of full cost per order, contribution margin after fulfilment and break-even volume. FBA may reduce the cost of fulfilling the average order, but at the current volume the saving may not yet be sufficient to cover the cost of operating a local model. The opposite may also be true: a relatively small per-order saving can create a significant difference in company performance when multiplied across several thousand orders per month. A fulfilment fee on its own answers none of these questions.

“Import VAT and customs duty are the same cost”

Import VAT and customs duty may arise as part of the same transaction, but from an economic perspective they should not be placed in the same cost category. Customs duty is generally a real cost for the business and cannot be recovered in the same way as deductible input VAT. Import VAT, by contrast, may be broadly tax-neutral where the relevant conditions are met and the business has a full right to deduct it. In France, for businesses holding a French VAT number and covered by the relevant system, import VAT is generally accounted for through autoliquidation in the VAT return, which can have an important cash-flow effect.

This does not, of course, mean that VAT can simply be ignored. The business still needs the appropriate VAT identification, must report the transaction correctly and must satisfy the conditions for deduction. The point is that the financial model should distinguish definitive costs from tax cash flows. If customs duty and import VAT are treated as a single cost item, the business may wrongly conclude that importing a larger batch into France is significantly more expensive than it really is or, conversely, fail to include costs that will genuinely reduce margin.

Summary: after 1 July 2026, the question is no longer “how much does the parcel cost?”, but “where should my inventory be located?”

Following the changes introduced on 1 July 2026, continuing to treat shipments from the United Kingdom to French consumers as though they operate under the same cost model as before can lead to an increasing gap between revenue and actual margin. The temporary EUR 3 charge does not, by itself, determine whether any particular strategy is profitable. Its impact depends on the proportion of orders that fall within the scope of the mechanism, the number of separate tariff categories appearing in typical baskets, the margin, and the other costs that recur with each import. For a retailer selling an expensive, high-margin product in a single tariff category, the impact may be limited. For a low-ticket seller processing thousands of multi-product orders every month, the same reform can materially change the economics of serving the French market.

The new customs charge does not mean that FBA France will be better for every seller. It does mean that the existing UK-to-EU-consumer model needs to be recalculated. Under the direct model, successive orders cross the EU customs border as individual imports. Under the FBA model, the business first carries out a commercial import of inventory into France under the ordinary customs rules and then fulfils sales from goods that are already within the Union. This does not automatically mean lower customs duty. What changes above all is the frequency of imports, the way charges are calculated and the structure of costs that need to be allocated across subsequent orders.

At higher order volumes, with limited margins and baskets containing several tariff categories, the difference between importing a large number of individual B2C consignments and importing a planned batch of inventory in advance can fundamentally alter unit economics. At the same time, local inventory creates its own costs and obligations: bulk transport, customs clearance, potential customs duty under the ordinary rules, warehousing, fulfilment, inventory management and French VAT compliance. For bestsellers with stable stock turnover, the numbers may support local inventory much earlier than they do for seasonal or long-tail products. Inventory location can therefore be treated as a portfolio-management decision rather than an “UK or France” choice applied to every SKU at once.

The best starting point is three metrics: the full cost of fulfilling one order, landed contribution margin per order and break-even volume for the French model. If these figures are calculated using real company data, the business can define its own migration trigger, such as a minimum monthly order volume, a minimum per-order saving or a maximum acceptable share of import and logistics costs in contribution margin. Moving inventory then becomes a planned element of expansion into France rather than a reaction to a sudden decline in profitability.

Check whether your UK-to-France model still makes economic sense after the changes introduced on 1 July 2026. Calculate the full cost of one order under UK D2C and compare it with the cost of importing inventory, fulfilment and VAT compliance under FBA France.