At a time when the US market is being squeezed by both policy and advertising costs, a major migration from the US to Europe is quietly occurring in the cross-border circle.

1、 Selling billions in the European market

As Trump's wavering tariff policies bring more uncertainty to cross-border e-commerce sellers' businesses, more and more sellers are choosing to turn their attention to the European market.

But there is a saying in cross-border e-commerce circles: the door to the European market is never open to entrepreneurs, only mature sellers are welcome.

For a long time, the European market has rejected a large number of American sellers due to high compliance barriers, complex tax systems, and regional differences. However, a well-known brand that has long been deeply rooted in Europe has not only successfully climbed to the top of the European market, but even turned Europe into a basic market.

Zhiou Technology is like a lone wolf among cross-border e-commerce listed companies. Unlike most cross-border e-commerce listed companies that are based on the US market, Europe has long been Zhiou Technology's largest source of revenue.

According to the 24-hour financial report of Zhiou Technology, its revenue in the European market was 4.896 billion yuan, which was the company's largest source of revenue, with a growth rate of 31.31%, accounting for 60.27% of the total revenue. Among them, the sub brands songmics, vasagle, and FeAndrea have consistently ranked first in the home category on multiple Amazon sites in Germany, France, the UK, and Italy.

According to Zhiou's first quarter financial report, it once again achieved a staggering revenue of 2 billion yuan!

The success of Zhiou Technology cannot be separated from two points.

Firstly, conduct omnichannel penetration in the European market. In addition to global e-commerce platforms such as Amazon Europe and eBay, Zhiou is also actively expanding its local platforms.

The OTTO platform for 24 years to Europe generated approximately 400 million yuan in revenue, a year-on-year increase of 40%, and contributed 4.37% to the total revenue; The revenue of emerging platforms reached 903 million yuan, doubling. After TEMU opened semi hosting in August 2024, Zhiou Technology quickly settled in five countries including Spain and Italy, bringing in a large amount of revenue. At the same time, the prospectus shows that Zhiou has settled in local platforms such as Manomano and CDiscount.

Secondly, the self operated logistics network has shown its dominance. The combination of European self operated warehouses and pre positioned warehouses covers major European countries. Through pre positioned warehouse bidding, warehousing and in warehouse operation costs are further reduced, thereby increasing the proportion of pre positioned warehouses and shortening the delivery time by 1 to 2 days, which is more conducive to conversion.

Zhiou stated that its 25 year strategy focuses on increasing warehouse density and developing new products in Europe, while further optimizing inventory turnover through AI enabled supply chain forecasting (such as demand algorithms). Zhiou remains heavily invested in the European market.

In addition to Ouzhi, other big sellers have also begun to pay more attention to investing in the European market.

Taking Anke Innovation as an example, Anke Europe's revenue for 24 years was 9.111 billion yuan, a year-on-year increase of 70%; At the same time, the energy storage category, smart home, and audio-visual category are in high demand in Europe. The lawn mower robot (eufy brand) will be launched on AliExpress Germany in April 2025, with sales exceeding $10000 in the first week. Anke has clearly identified Europe as the "core of non American markets" and will focus on localizing warehousing and developing new products in 2025.

2、 More and more sellers are choosing to switch to the European platform

Cross border awareness has noticed that a topic on the forum called "Choosing between the US and European stations when energy is limited" has sparked heated discussions.

An operator who switched from the US site to the European site for precision stores said that as a non local seller, as long as you avoid products from local sellers, the European site is currently easier than the US site. This former American website operator believes that advertisements on European websites are relatively cheap, with each click costing three to four cents and dozens of clicks per day, which is unimaginable on American websites; It is relatively easy to write a listing on a unified link in Germany, and then open automatic translation and automatic listing on other sites. After setting the price, it is not complicated to operate.

Another operator expressed agreement, believing that after three years of operation in North America, the United States has been affected. Registering in Europe this year feels much easier than in the United States, as Germany's profits are almost on par with those of the United States.

The profit in the United States has been rolled up to 15000 yuan, and now the profit in Germany has reached around 15000 yuan per month. The UK is still registering VAT, and I only opened a pan European account in Germany and didn't pay attention to it. It's much more comfortable than in the United States. In fact, the North American market has a large volume and high requirements for product selection. Many products appear to have profits, but in actual promotion, the vast majority of profits are eaten up by advertising. In addition, competitors imitate very quickly, and within a year, categories will definitely start to increase prices.

Another seller believes that Europe has more regulations and various forms of compliance, WEEE， The battery law, VAT, and so on, but if these regulatory issues are resolved, it is still good. If you want to pursue performance, go to North America; if you want to pursue profit, Europe is a good choice.

Cross border knowledge believes that multi-channel, multi platform, and multi region have become the consensus for American sellers, and the European market is bound to have a wave of enthusiasm in the next 25 years.

3、 Local accounts become standard for European sellers

However, a considerable number of sellers believe that the profits in the European market are not high, mainly due to the heavy pressure of nearly 20% value-added tax withholding and payment in various European countries.

As early as July 2021, Amazon began to implement the withholding and payment of European VAT, causing a collapse of a large number of Chinese enterprise sellers. Local accounts with tax-free quotas and the ability to independently declare taxes began to circulate in large numbers; Starting from 2023, the platform will conduct strict inspections on physical operations, and non domestic FR accounts will be eliminated. A more stable domestic account will enter the seller's field of vision; In August 2024, Amazon began to withhold and pay service fees for local accounts, and small countries in Southeast Europe can help sellers waive these taxes, becoming the mainstream of the market.

At present, sellers who are deeply rooted in Europe and want to do long-term business in cross-border e-commerce will use local accounts with an annual GMV of at least 50 million yuan. These large sellers' original Chinese enterprise links were already relatively stable, usually using local accounts and seller account links to increase sales, while also transferring tax costs to the local accounts of the sellers, which can increase revenue and solve tax problems.

But for European sellers, the cost of the account is not a small amount.

Local accounts are more like expensive ammunition, which can be replaced immediately after use. European sellers will choose the strategy of replacing local large accounts once a year to avoid censorship. Local and local accounts have become standard for sellers, essentially because sellers above the waist level do not have the ability to establish a local subsidiary in Europe for brand sellers. However, expanding business is a necessity, and the 20% tax burden is like a huge stone, making European sellers breathless. And the local account and this account are the sharp swords for sellers to open up the European market, as well as the trump cards for sellers to stay on the cross-border table. Starting from the 50000 euro deposit in Italy, this account has become a ballast for sellers to resist policy changes and maintain the stability and long-term overseas business of European sellers.