I get this question fairly often and I found this great video breakdown from our friends over at Jungle Scout so rather than recreating the wheel check out the video below.
Also if you have not already checked out Jungle Scout click here to do so because I use their tools every day in my Amazon Wholesale Business.
Also check out the links below the video to everything they talk about in the video.
- Amazon Global Selling Information
- Payoneer International Online Payments
- Guided Imports -- China Inspection Service I have Used Personally
- AsiaInspection now QIMA -- China Inspections
- Webinar: Amazon VAT in Europe
00:00 Hey, guys, it’s Lenny from Jungle Scout. Today, I’m gonna show you exactly how you can sell on Amazon from anywhere in the world.
00:11 To kick things off, let’s look at this page from Amazon and I’ll drop the link below in the description too. If you scroll down you can see all the Amazon marketplaces that are now operating and you can sell in. The US is by far the biggest and where most people choose to sell because there’s so much demand there. Germany and the UK are the next biggest and you can definitely look into some other marketplaces as well. Going through this page is very useful to familiarize yourself with some of the tax and regulation differences between the marketplaces.
00:43 I started selling a couple years back in the US market, and I’m from Australia, if the accent didn’t give it away. Now there are a few challenges and extra considerations being outside the of the US.
00:55 Number one: Receiving US dollar payments. You can nominate a bank from your own country to receive payments from Amazon; however, they’re always gonna send it in the currency of your country. So for me, that was Australian dollars. Then to pay suppliers in China, I would have to convert it back to US dollars and actually lose money in that double exchange, which you don’t want.
01:18 So there were two solutions that I found to help this, WorldFirst and Payoneer. Both allow you to receive payments in US dollars and then make payments to suppliers in US dollars as well. So I recommend checking them both out. They both offer a variety of different currencies, so if you’re selling in another marketplace outside the US, they can help with that too. Payoneer even offers a debit card, which you can then use for your business expense, subscriptions, et cetera.
01:49 Number two: Not being able to inspect shipments. If you’re based in the US, a lot of sellers will get their shipments sent from China direct to their house, giving them the option of inspecting the product before sending it to the final distance to Amazon. Plus, Amazon gives you discounted shipping rates within the US which is nice.
02:09 Being in Australia, of course, or any other country, doesn’t really make sense to do this and it would be super expensive; so, there’s a couple of things you can do. First, don’t inspect your goods. I got a few samples from my first shipment sent to me, and since then, I’ve now built a great relationship with my supplier and I know they’re always gonna provide me with the best goods.
02:32 The other option, if you’re a little bit worried, is to get an inspection done in China. This is a good idea if it’s your first shipment and a new supplier that you’ve never dealt with. We’d recommend AsiaInspection. I haven’t used them personally, but Greg has and a few other people on the team but there are others out there also.
02:51 Just quickly, guys, if you’re getting value from this video, please give us a “thumbs up” below. We truly appreciate it.
02:58 All right, on to number three: Setting up a company. If you’re an American living and selling in the US, then the easiest and best legal structure is a limited liability company or LLC. However, for those of us outside the US, it can be a few different options. Generally, the easiest though is setting up a company in your own country. There can be a few different options to set up in the country that you’re selling in, such as getting an LLC in the US but that can get complicated and bring up potential tax issues. So it’s usually best just sticking to your own country. So those are some considerations if you’re looking at selling from another country outside of the US.
03:39 Now if you wanna start selling in one of the European markets, then another consideration is VAT, which is the equivalent of sales tax in the US. Basically, if you’ve got inventory being stored in Europe, like fulfilled by Amazon, then you want to register for VAT. VAT varies from country to country. For example, 20% in the UK, 21% in Germany, but it’s always included in your retail price, so you need to keep that in mind.
04:05 In the US, you would calculate your price like this. Product and shipping cost per unit, $5; Amazon fees, $5; you want a profit margin of $10; therefore, you set your price at $20. You could get more detailed with your cost breakdown, but this is just rough estimation.
04:25 In comparison, in the UK, the calculation will be similar but you’d add one more thing. VAT here is 20%. So you’d take product and shipping cost, Ł5; Amazon fees, Ł5, profit margin, Ł10; and now you’d add 20% or 20 times 0.2 which equals Ł4. So you would set your sales price at Ł24 to account for that extra Ł4 to be paid to the government.
04:54 In terms of getting set up for V.A.T. or VAT, it can be fairly straightforward. First, you need a VAT number. You can do this yourself, but the easiest way is to get a fiscal agent to help you through the process. You also need an EORI number in order to import to Europe. This is easy to apply for online and free. This is not legal advice by any means, we do have a detailed webinar though that goes a lot more in depth and you’ll find a link to that one in the description below. My point here though is that if you’re thinking about selling in Europe, to not be put off by VAT because it’s definitely possible to figure it out.
05:32 So those are some considerations if you’re thinking about selling on Amazon from a country outside of the US or in a country outside of the marketplace you’re selling in. “Thumbs up” if you’ve enjoyed this video and please subscribe. Until next time, guys, take care.