Once you’ve established a successful ecommerce business in the UK, you might start to think about selling online internationally - it's a great way to increase your turnover, and expand your customer base. According to a recent Royal Mail study, 48% of the UK's small online retailers are aiming to sell their products in Europe in 2016, with many others setting their sights further abroad to Asia and Australasia. However, before you jump into selling internationally here are a few things to take into consideration.
Options to sell internationally
When you decide to start expanding your ecommerce business abroad you’ll need to spend some time deciding which of these options is the best for you:
Sell on domestic marketplaces with international shipping options
Most of the popular UK marketplaces such as eBay and Amazon will allow you to offer international shipping. This is one of the simplest ways to sell to customers overseas, however, you won't be specifically targeting potential customers abroad so if you want to seriously expand you business abroad it's worth putting some time and effort into looking into other options.
eBay Global Shipping Program or Fulfilled by Amazon
The eBay Global Shipping Program allows you to offer international shipping without extra hassle, you just have to send your products to a UK warehouse and eBay will ship it abroad for you. Similarly, Fulfilled by Amazon means that you can store your stock in a UK FBA warehouse and Amazon will ship it abroad for you, or you can store your inventory in FBA warehouses in foreign country ready to ship.
List your products on foreign marketplaces in the local currency and language.
eBay has 14 international websites that you can list your products on to directly target customers in those countries. Amazon also makes it easy to list on all five of its European marketplaces by signing up for a European account, £25 per month - this lets you build international listings, and translate your product descriptions. To target other international customers in countries that aren't served by eBay or Amazon specifically, it's worth looking into selling on other foreign marketplaces.
What are the top international sites to sell on?
Although eBay and Amazon are both global marketplaces, there are many other ecommerce sites originating in different countries that offer a wider foreign audience.
- New Zealand - Trade Me is the largest auction website in New Zealand. To sell from the UK on Trade Me you have to be specifically accepted as an 'international seller', and you can only accept Pay Now payments.
- China - Alibaba Group (Alibaba.com, Tmall International, Taobao) is the biggest ecommerce site in China. Alibaba.com is a business to business marketplace, Tmall is a business to consumer retail site for selling brand name goods to Chinese customers, and Taobao is an online marketplace.
- JD.com is the second largest ecommerce company in China. In 2015 it launched JD Worldwide, a new sales platform, which allows overseas traders to sell directly to Chinese buyers.
- Japan - Rakuten is the biggest internet retailer in Japan and has taken over several other ecommerce sites worldwide.
- India - Snapdeal and Flipkart are India's two biggest ecommerce sites. Snapdeal was originally a daily deals platform, while Flipkart started out selling books, they have both changed to online marketplaces and are the best way to target India's online shoppers.
VAT and Customs charges
When you're selling online internationally there's far more to consider than just the higher postage costs.
- If you charge VAT to your customers in the UK then you will need to charge VAT to customers in the EU.
- If the value of the items you're selling is above the 'distance selling threshold' in any EU country then you'll need to register and charge VAT in that country. Find out the distance selling thresholds for each EU country here.
- Customers outside of the EU don't have to pay VAT. When you ship the items you will have to fill out a customs declaration. You also have to keep 'proof of export': the customer's order including name and address, internal correspondence, sales invoices, advice notes, packing lists, commercial transport documents, details of insurance or freight charges, bank statements, consignment notes.
- When you post to a non-EU country customs duties and import taxes have to be paid. Excise duties are applicable on some imported goods, and some countries may have customs fees. Make it clear in your listings whether you or the customer has to pay for these, and if you offer to pay these you will need to be familiar with customs procedures and tax obligations in the countries you're posting to.