When seeking to accelerate your growth, it is essential to consider Amazon’s largest markets. The United States stands as the primary market, generating an astounding $314 billion in 2021. This equates to approximately $950 per US citizen, underscoring the immense potential and eager customer base.
If you are not a US citizen, you might be curious about how to start selling on Amazon.com. Today, we will provide you with a step-by-step guide on commencing your journey.
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The Basics: What is Amazon FBA?
Assuming you’re familiar with Amazon FBA, but just in case you’re not, here’s the simplified version: Fulfilment By Amazon (FBA) involves shipping your products to an Amazon warehouse (or multiple), where they handle the packaging and distribution for you. This means customers can enjoy the efficiency of Amazon (and potentially Amazon Prime), while you’re relieved of the packaging and shipping responsibilities.
How to Start Selling on Amazon US with FBA
Step 1: Business Registration
To start, address the legal requirements. You may or may not need to register a US business. If you have a valid business presence in your home country, you can operate on Amazon.com without a US business registration. However, it may be easier to register an LLC in the US depending on your situation.
This includes scenarios such as planning to do the majority of business in the US, being a US citizen living abroad, or having a home country with less favorable business structures. If you’re unsure about what to do or how to set up an LLC, we can assist you. We offer help with incorporating a US LLC, obtaining your EIN, bank account, and US Amazon Seller Account. Click here for more information and to get started.
Step 2: Set Up Your US Bank Account
While optional, it’s worth considering having a US business bank account. It allows you to keep funds in dollars without constant currency exchange and dealing with exchange rates. Holding multiple currencies can be advantageous, providing flexibility in purchasing based on the most cost-effective currency.
Utilizing a Transferwise Borderless account can help reduce exchange rate fees. Receiving payment in dollars directly provides greater freedom to manage funds. If you need assistance setting up a US business account, we are here to help. Follow this link: we can help.
Step 3: Set Up Your Amazon.com Seller Account
If you sell in any other Amazon marketplace, you may be aware that you only require one account for selling in certain territories. For instance, a single account is sufficient for selling in all European countries. However, this changes when it comes to Amazon.com – to sell in North America, you need a new US Amazon seller account.
While a European account grants you the ability to sell in the UK, Germany, France, and other countries, a North American account allows you to sell in the US, Canada, and Mexico.
This essentially means starting from scratch. You will need to go through the verification process and pay an additional monthly fee for your US account. While the fees are nominal if you’re making thousands of dollars a month, they are something to consider if you’re initiating a new business.
One exception to the above scenario is if you already sell in the UK. In this case, you can use the same account information for your US account, and only provide your verification documents. If you already sell in the UK, your account is likely to be approved faster, but don’t stress either way.
Step 4: Create Your Listings
After setting up your account, you can begin creating your listings. This step is crucial before sending your stock to Amazon.
If you already have listings for your UK products, you can easily import them. However, some users have experienced issues with this feature. If it doesn’t work for you, don’t worry. It’s important to optimize any listing for the US market.
Keep in mind that anything that seems “off” can create a sense of distrust or unease in potential buyers. This can lead them to choose a competitor instead. Therefore, it’s essential to ensure that all your listings and descriptions are tailored for the US market. Pay attention to spelling, terminology, and measurement differences.
Step 5: Send Your Stock to Amazon US FBA
Arranging this step isn’t always as straightforward as one would hope. If you’re a new seller, you might assume that it’s as simple as having your manufacturer (often located in China) ship your inventory directly to an Amazon warehouse.
However, this approach is not feasible. Amazon US does not act as an importer, which would be necessary for this process. Instead, you must find a third-party importer to handle this task for you. Although it incurs an additional cost, choosing the right partner can make this step headache-free. They will manage the customs process and forward your inventory to Amazon.
Most shipping companies, including industry leaders like DHL, TNT, and UPS, offer this service. Simply reach out to them to obtain quotes and select your preferred company.
Please note that import duty in the US typically amounts to around 3% of the goods’ cost, although this can vary depending on the nature of the goods. Your shipping company will typically invoice you for these charges.
Step 6: Get Your Taxes Straight
Taxes are an inevitable part of doing business. If you reside in the UK or another European country, the US has an agreement in place to prevent double taxation, relieving you from paying income tax in the US. However, if you have no US business presence, you must complete the W-8 form within your Amazon account to indicate that you’re exempt from US taxes. Instead, you’ll pay taxes for the business you conduct in the US in your home country.
If your country doesn’t have a tax agreement with the US, it’s advisable to consult with an expert to determine the most cost-effective approach to conducting business on Amazon.com.
Selling on Amazon.com used to be complex, especially regarding sales taxes. Foreign sellers often waited for clarity on whether they were legally obligated to collect sales tax from buyers. However, the process has become simpler nowadays.
In most cases, you don’t need to worry about sales tax unless you have a “sales tax nexus,” meaning a significant connection in a specific state. Since you plan to sell on Amazon.com with FBA, it’s safe to assume this won’t apply to you. However, it will apply if you have a physical presence, employees, dropshipping partnerships, affiliates (excluding Amazon affiliates), or conduct in-person sales or store inventory in a particular state.
The most crucial factor is storing inventory in a state, but fortunately, almost all Amazon fulfillment centers operate under the Marketplace Facilitator Law, which means Amazon will handle sales tax collection on your behalf. Therefore, if you exclusively sell through Amazon, you shouldn’t have to file taxes related to these sales.
If you have a US business entity, such as an LLC, you’re responsible for paying taxes in the US. If you’re unsure about your obligations, it’s advisable to seek assistance from a tax professional. Various online services are available to help you manage this aspect of your business.
Is it necessary to register a trademark in the United States?
If you sell branded products, it is essential to create an Amazon.com Brand Registry account, even if you already have one elsewhere. Registering a trademark is not required if you already possess one in the UK; all you need to do is set up your Brand Registry account.
To establish this account, you will need to provide your logo, product images, and trademark information. If you already have a UK Brand Registry account, simply add your US seller account as an “additional user” to your existing Brand Registry account.
FAQs
Do I need to register a US business to sell on Amazon.com?
No, if you have a valid business presence in your home country, you can operate on Amazon.com without a US business registration. However, depending on your situation, it may be easier to register an LLC in the US.
Do I need a separate Amazon seller account for selling in North America?
Yes, to sell in North America (US, Canada, and Mexico), you need a new US Amazon seller account. A European account is not sufficient for selling in the US.
Can I import my UK listings for my US Amazon account?
Yes, you can import your UK listings, but it may not always work smoothly. It’s important to optimize your listings for the US market, paying attention to spelling, terminology, and measurement differences.
How can I send my stock to Amazon US FBA?
You’ll need a third-party importer to handle the shipping of your inventory to Amazon. Contact shipping companies like DHL, TNT, or UPS to obtain quotes and select your preferred company. Import duty in the US typically amounts to around 3% of the goods’ cost.
Nabin Adhikari
