International logistics for Amazon FBA can be vexing. VAT, customs, ALL of it can be confusing. Pearl Ausch, COO of World First Shipping, joined us to help answer your questions about shipping internationally. Her immense knowledge and experience was helpful to our attendees, and we had a lot of great questions. Here are a few key Teika-ways, plus the replay and the recap.
Key Teika-Ways
- Amazon WANTS you to expand internationally, but you can’t do it without support
- Some markets really want American made products (watch the replay to learn about the unlikely product that’s HUGE in Germany)
- It might be smart to ship into the Netherlands right now, and First Choice has a beta program you can join (mention this webinar and you get a deal)
- Obviously, COVID is still a factor when it comes to planning lead times
- Try registering for VAT in Italy first
- Or, take advantage of the Pan-EU program
- Amazon will not pay your taxes
- You can save money by assessing the HS codes being used on your shipments
- China is still the leader in terms of manufacturing
- If you have a lot of product, you probably need a 3PL due to FBA restrictions in different international marketplaces (list forthcoming)
- You need a really smart advertising strategy for EACH international marketplace in order to be successful
Check out the replay and transcript below, and let us know if you want to nail down an advertising strategy for your international Amazon seller accounts.
Watch the Replay
Read the Transcript
Liz Downing: Hi, everybody. Thanks for attending another Tuesday webinar. I’m Liz Downing, eCommerce Marketing Manager, Teikametrics. I’ve got my friend Pearl, from First Choice Shipping with me today. Pearl say, hi.
Pearl Ausch: Hello. Thanks for having me, Liz.
Liz Downing: And so good to see you. We were just now talking about seasonal allergies and all the pollen out there. So if either of a sneeze, you’ll have to excuse us. It’s just extra pollen. It’s 2021, so why not have that just added to the challenges and opportunities that we face.
Liz Downing: A couple of housekeeping items. We are recording this session. I see the little red thing that says, “This session is being recorded.” The recording will go out with the transcripts, and with a short little recap to all attendees. That’s good, and to all registrants too. So if you’ve got a friend that can’t be here today, and they’re missing it and they’re telling you, “I’m so sad that I can’t join the webinar,” tell them not to worry. It will be okay. I think that we have our friend Andrew Johnson joining us in a couple of moments. He’s got a nice perspective that relates to our content.
Liz Downing: We’re going to talk about overcoming supply chain disruptions. And there’s nobody better to talk about that than Pearl, because she and First Choice Chipping have sort of paved the way for brands and sellers on the Amazon platform to be able to achieve international expansion, to get their products into other markets. I thought it would be helpful if we started off with a little background on First Choice, just for the people that don’t know you. And then at the end, I’ll talk a little bit about Teikametrics.
Pearl Ausch: Sure, absolutely. I love talking about our origin and where we’ve come from, because it’s such a great story. Because, when things happen to people that don’t expect it, it’s so much more exciting, I guess. We started about 11, 12 years ago. We initially started out as a company that was just trying to help sellers that were looking to ship into Amazon, UK. And that’s fine. It was considered like, literally the gold rush of Amazon markets. It was something that people were exploring to do when they couldn’t figure out how to ship there in a affordable way and a successful way. We started offering shipping into the UK. The same ideas like how you go to Costco, and you get from Costco’s really great brands at much better rates, because of their buying power. Same ideas like what we do with carriers like UPS, FedEx, DHL. We’ll give you their service, but we do it in a very large scale. And we’re able to then offer much better rates than when you go with them directly.
Pearl Ausch: Now, why do people use us? Because Amazon doesn’t provide international shipping. Because they don’t want to get involved with all the little details of customs, importer of record, returns that they can’t provide because also coming internationally. We started out as a company doing just the UK and then slowly we see people need… Canada was a close second. Like, how about Canada? And we started expanding one FBA location over the other that was global, whereas Amazon didn’t provide the option.
Pearl Ausch: Fast forward a couple of years later, we actually had a couple of our clients that were visiting the CES Show in Vegas, because they were trying to source some product, it’s the biggest electronics show of the year. Amazon likes to have a presence over there where they have Amazon account managers that will help people maintain their account or Amazon global representatives. They help people that are already successful in the US expanding and branch their company out to, let’s say, the UK or Canada, etc. We had a couple of our clients that were there. And at the same time, they were meeting up with their reps that were helping them, expand their portfolio.
Pearl Ausch: They met with these reps and the reps asked them, “What would you say you’re doing differently than other sellers, because we see that you guys are super successful? What’s the secret sauce?” as they called it. And they told them, “We’re actually using this small company called First Choice Shipping located in Brooklyn. They’re doing a really good job with shipping and handling what we need in order to be able to ship successfully. The compliance stuff and all that.” They got really excited. And that night, I actually received an email from Amazon saying, “We’d like to talk.”
Pearl Ausch: And of course I answered that email literally early in the morning, 2, 3 a.m. because, “Yes,” exactly. I couldn’t believe it. Right? So fast forward, literally, we’ve been working with them over the years. We work very closely with every market that they’re looking to start an FBA program. We work with them to see how can we successfully ship into that location. I would say most of our client base is coming directly from them. It’s just been incredible. Everything we do right now is Amazon related, Amazon related shipping. We just love what we do.
Liz Downing: And you’re so, so good at it. Honestly, I’ve talked to so many sellers and brand owners, and I have never heard a single negative word about you. You especially and your commitment to customer service, your commitment to your team, and the way you just create solutions across the board. Everybody’s just got fantastic feedback. You’re a rockstar.
Pearl Ausch: Thank you. I appreciate it.
Liz Downing: Well, the whole industry appreciates what you’re doing. We’re going to do another webinar with a couple other people in about a month, a little less than a month. Those of you that are attending today that are interested in these types of topics, that’s going to be sort of a bigger, higher level strategy on international expansion on Amazon. Jana is coming back. She was with me last week with YLT Translations. We’re going to have TJ from Payoneer, Tom from AVASK, and Pearl is used to hanging out with those people because they do a lot of work together.
Liz Downing: But I really encourage you to submit your questions today, because any questions that we don’t get to, we’re going to queue up in that webinar. This is a free form conversation. There’s a question section in your GoToWebinar panel. Please just put your questions there. Don’t be shy. We’ll be taking them throughout. If we’ve got time at the end, we’ll do a Q&A to clean up questions. I find that it’s a lot more helpful to take questions as we’re on a particular topic, because it keeps the conversation flowing, and it makes a lot more sense when you’re watching it afterwards or you’re reading the transcript.
Liz Downing: Let’s talk a little bit first about why the Amazon Global marketplace opportunity is so incredibly huge right now, despite the other things we’re going to talk about. Like COVID, like Brexit, all that kind of stuff. It’s still an enormous opportunity. Why do you think that is? Why do you think that… Well, and I think that we can talk a little bit about the whole aggregator thing, too. There are a lot of businesses that are making decisions that an aggregator, like a purchaser would make for them. So instead of selling, they’re just going to do the things that they need to do to expand and they’re kind of taking a cue from how these roll ups are doing things. But do you think it’s because Amazon itself wants people to expand to other marketplaces? Or do you think that it’s the consumers in those particular areas, want the products that are available on .com and not yet available on those marketplace? Do you think it’s a combination of the two? Is there something else I’m not thinking of? Tell me what you think.
Pearl Ausch: Yeah, it’s definitely a combination of what you mentioned. Whenever there’s something that’s difficult to do, or at least from the outside, it seems like it’s difficult. It’s something new, it’s a new concept, there’s always a level of, “We could actually achieve something much bigger than what we’re currently doing, because somebody else is not going to do it.” When sellers are actually thinking that stuff, they say, “Wow, we found actually a service provider that can make this happen.” Have in mind, there’s so much of your competition that doesn’t know about that. This is like what we say, this is your golden nugget that somebody else doesn’t have the opportunity to do or have.
Pearl Ausch: Obviously there’s so many different intricate details on selling and I feel that come now, it’s all about the PPC with what you guys do and then it’s about the listings and of course it’s the product. You have to be innovative but that’s just where it stops. When it comes to figuring out how to get my inventory in, once your inventory is in FBA, great. When it comes to international selling, there’s a setup process. There’s the VAT registration, there’s getting, “Can I actually ship this in general?” Is it compliant to customs. And then once it’s compliant, need any sort of licensing? There’s certain things that if you don’t have the right guidance, it can sometimes feel very overwhelming. That’s why people are like, “I’m not even going to get started.”
Pearl Ausch: And then of course, you mentioned about people wanting those American made products. Yes. In Germany, for example, peanut butter is like, HUGE. Peanut Butter. You would never think. But when it comes to American products, people go crazy in the UK. Like candy bars and things like that. I’m talking about food, now I’m hungry. When it comes to certain items, people are like, “We can’t get this to the local grocery, but you could get in on Amazon.” The fact that you have the opportunity to just take what you’re actually selling right now, the same exact thing and expand it, there’s something to be said about it.
Pearl Ausch: Of course, Amazon wants to dominate the world. And they are going to push you. It’s interesting, but we found that sellers that expanded and they were successful… We work with some of the largest brands on amazon.com, they were already successful. We found that when they expanded, not only did their business internationally expand, but their presence in the US somehow exploded too. It almost sounded like a conspiracy. But there has to be something in the algorithm that Amazon has, where they want you to dominate worldwide. And the minute you have that presence, infects every single party of business. We found that, all across the board, it’s something that the international selling think, it’s a tremendous opportunity.
Liz Downing: Thank you for that, and I agree with you wholeheartedly. I’d like to introduce Andrew Johnson. Andrew is a Strategist here at Teikametrics. He’s got, actually his own brand too. I don’t know if I’m supposed to talk about that. And he’s encountered some supply chain disruptions. So I thought it would be great if he joined us today, so that we can talk through some real life examples. And I know Pearl’s got a ton of them.
Liz Downing: We do have some questions that have rolled in already. One person has actually asked about shipping from China to the US, EU and UK in about a month and they want to book for it. So I’m just going to send them over to you, since I don’t expect you to live quote on a webinar. But just so you know, Jen Aryan, I will be sending your question to Pearl and Pearl can respond to you offline.
Liz Downing: Another person asked, and I think this kind of queues up the whole things have changed in the EU thing, I was advised to take advantage of Amazon EU fulfillment channel. You should send your products to France because customs is holding up inventory in other countries. Is that true?
Pearl Ausch: Yes. Yes, that is true. But, we actually have a beta program we were running right now, we were shipping in through the Netherlands. And from the Netherlands, it’s cleared in the Netherlands and then it’s making entry then into whichever EU country. Because the Netherlands is considered part of the EU. And we are ejecting shipments into Germany that way and it’s moving beautifully, fantastic. If you want to join that program, we can absolutely send the shipment that way.
Pearl Ausch: Because the reality is, the problem people have with shipping into France, is that Amazon’s supply chain and their whole setup over there is just not as robust as in Germany. Nobody was prepared for Brexit. That’s the reality of the situation. Nobody, including the carriers. So up till December 31st, shipments, everything was beautiful, fantastic. January first, everybody had a whole list of all the SOPs, and how all this is going to work. Everything literally was scratched. It didn’t work. So things came up to the border and German customs said, “Okay, you’re going to have to give us the list of literally 12 different things.” It changed, it changed overnight, and it keeps changing.
Pearl Ausch: Like you said, we try to be creative over here. Instead of trying to get through Germany directly, because it’s a nightmare right now, and even if somebody figured it out, great, but you figured it out and are waiting. And it’s just taking very long to get in because everything is held up. And when it gets held up, they ask for a ton of information. Instead of going through that, we figured out a way of going through the Netherlands. Go through the Netherlands, take just a couple days, not weeks. And it’s working beautifully. The supply chain in Germany, like I said, is great with Amazon.
Pearl Ausch: The problem people have with France is that they arrive and it takes forever for Amazon to receive it. And then from there, they’re not as close to their customers. And you know how the algorithm with Amazon works. The closer you are to your customer, the better the Buy Box will be for you. The issue is that German marketplace is the largest marketplace for most people, and if their product is in France, it’s not working as effectively as they’d like it to. This solution hopefully is going to definitely change things for people.
Liz Downing: That’s great. I think the addition of Netherlands has helped a whole lot. France might be a little bit better than Germany right now, but France is also in enormous lockdown over COVID.
Pearl Ausch: Yes.
Liz Downing: It’s back, and it’s ugly right there. So France is locked down. Is that impacting?
Pearl Ausch: Yes. It’s also the local laws. Yeah, COVID is a huge factor. But some countries are implementing laws in a different way. With France, it’s not about, “Okay, if you’re going to work with social distancing, or if you’re going to comply with certain things we can make it work,” in France it’s, “You have to shut down. Period.” Even if you’re Amazon. Amazon somehow got away with everything in the US, with keeping things going. You see the Crimes Drop, they’re all around though here. I’m in Brooklyn, there’s no disruption, period. But in France, they said, “Amazon, I don’t care your name is Amazon, and you got to shut down.” They were not able to do anything. That was also a huge factor, aside from how they’re set up, they literally have to shut down their warehouses.
Liz Downing: Yeah, it’s been so long, but I was reading the news this morning. And apparently, Brazil, it’s really bad in Brazil. It’s really bad in France. It’s on the rise in the US, too.
Pearl Ausch: Yeah.
Liz Downing: It’s something to think about, definitely.
Pearl Ausch: Yeah.
Liz Downing: Let’s talk a little bit about… Well, first, we have a question about Netherlands. Are you shipping to a Netherlands FC for distribution into Germany and the EU as a whole? If so, do we also have to get a VAT for the Netherlands? This adds the cost of VAT filing in Germany and the Netherlands.
Pearl Ausch: I love that question, because I just need to pump the service even more. Why am I saying that? You do not need another one to that number, which is fantastic. We will represent you. So you do not need a VAT number for the Netherlands. It will not make a stop in the Netherlands physically. Maybe physically, but I mean to say it’s not being dropped off at any FC, and then from there forwarded somewhere else. It literally is just crossing through there, clearing there and then continuing into Germany. There’s no delay. There’s a delay by a date, but there’s no delay about dropping it off into a warehouse, and then all that stuff.
Liz Downing: Right, because Theresa just commented that she was told to get VAT registered in EU countries for Amazon, and the backlog is four months. If someone uses your services, they can kind of bypass that?
Pearl Ausch: They will need a VAT number in the EU. What I would recommend is they get registered in Italy first, because in Italy it’s pretty quick. And yeah, again, the infrastructure is not amazing in Italy, but if you want to get started, that’s a great way to start. And then you’ll be able to ship it to Italy. We can provide that service. And in the meantime, yes, you will want to get registered for let’s say, Germany or France, and then we’ll help you, get your inventory into those locations.
Liz Downing: That’s awesome.
Liz Downing: Part of that strategy, which country to choose, and where to get registered for VAT first, and all that kind of stuff is part of what we talked about when we advertised this webinar. Strategies to lower shipping costs and decrease lead time. That obviously decreases lead time.
Liz Downing: We’ve had a couple of people talk about their specific products. And I imagine that there are different logistics associated with the type of product that you’re shipping. Someone early on said that they manufacture and sell a one ounce roll-on cosmetic. What are some strategies for that type of product versus just a hard goods product that can’t leak and all that kind of stuff? Depending on the type of product that you sell, what kinds of things do you have to think about when you’re thinking about your shipping costs, packaging costs, all that kind of stuff? And then what kind of hoops do you have to jump through when you’ve got a product that might have an expiration date, might have Haz-Mat, might have some other special designation? Leakable, breakable. What are some things that people can think about in order to reduce the cost? Because that can get very, very expensive, can’t it?
Pearl Ausch: Absolutely. But I’d like to look at it in very different ways. People don’t realize that even though you’re super successful in the US right now, it takes time until a new marketplace, optimizes. Usually it takes about six months, from what we’ve seen, you know, based on the trends that people have on how they ship. It might seem that in the beginning, yeah, I want to send a whole container or even two pallets, because it’s cheaper. And I’ll use sea option, which we do provide. Depends from where or when, but we would have to quote that offline if somebody is interested. But we do provide the sea option.
Pearl Ausch: But not necessarily, does it end up being the cheapest option. Because you need to take into account, your pallet might sit there for a while. And then you have those storage costs that are going to incur. What’s the point with that? Or you might be laying out a lot of extra VAT, the import taxes on things that are not going to get sold for a long time. So might be worth it. We always tell people to quote with both options.
Pearl Ausch: It might be worth it to set a smaller shipment, just a couple of boxes. Like for this example that you gave me for this one ounce roll-on. The question is how many pieces actually fit into a box? And quote it out and see what is it worth it for me, if I do send only one carton or two cartons? And am able to fit, let’s say 100 pieces or 200 pieces, how much is it actually costing me per piece? And then do the math. And if you’re able to still make a profit, it’s still worth it, than going that route of sending us so much inventory where you don’t know for sure if it’s actually going to sell. You need to try this thing out.
Liz Downing: Well and that’s why, going back to last week’s webinar, the localization type of research that Jana was recommending. Once you choose to sell a product in an international marketplace, especially in a language that you don’t know, in a culture that you might not be familiar with, you kind of have to do your due diligence in terms of, will this product actually go over in this marketplace? She gave an example of a t-shirt with smiley faces on it, that was kitschy and kind of silly, and she showed it to her German team. And they were like, “Yeah, we wouldn’t buy that.”
Liz Downing: Getting an opinion of somebody who’s actually native to the country that you’re trying to sell in is usually a good idea before you go ahead and go to the trouble of getting your listing up, making sure it’s translated, making sure your bullet points are appropriate for that audience. And then actually shipping however many of that skew into a marketplace where you’re not sure how it’s going to perform. Doing that research ahead of time, I think is pretty important.
Liz Downing: That’s when you don’t know how many you’re going to sell. We’ve got somebody with a question about, what if you have a lot of something that you want to ship into the EU. This person, Ryan, says, “We would like to ocean ship our own product from China to Amazon FBA in the EU, but we don’t know how to send in large quantities that Amazon would accept. We can never do this with the many shipments of limited inventory that Amazon allows. Are we missing something? Is there some way to ship large quantities into Amazon EU FBA?”
Pearl Ausch: Unfortunately, with their restrictions on how much you could send in, there’s a cap unfortunately, on what you can send in. It’s something that people have struggled with. So the only recommendation I can make is to find a 3PL in the EU that you could ship it into. I know that Andy from Gee has a facility in the Netherlands, and they do a great job there. We would tell you, ship it there. And then from there, you could then send in an increments your supply. But otherwise, the small parcel way is just the best way, which is through the carriers.
Liz Downing: But obviously that’s an enormous cost if you’re trying to ship from container from China, which is obviously the most cost effective way to do it. What do you do with it in the meantime, when you can’t send it all into FBA? So yeah, 3PL is the best recommendation for that. And I’ve been meaning to come up with a good list of 3PLs. So maybe we should work on that together.
Pearl Ausch: Yeah.
Liz Downing: Yeah. I smell a white paper brewing or an E book or something but yeah. A 3PL and if you need recommendations on that, my email address, I’m going to put it in the chat right here, if I can get to the chat, is ldowning@teikadev.wpengine.com. Yes, definitely, 3PL is the answer to that question.
Liz Downing: This is like kind of unrelated to what we were talking about, but I think that is relevant to the whole conversation. It’s a good foundation for the rest of the conversation. Jane says that Amazon Global Logistics is not heavily advertised even on Amazon. Why would that be?
Pearl Ausch: So firstly, they only do it from China. Second, they don’t provide you with everything else you need. Why would a carrier like UPS want to work with a company like First Choice? Why would they partner up with us? They can do everything we can, or they can’t. When it comes to all these little… How do you say it? These little intricate details to actually make it happen, that’s why they’re not heavily advertising their service. And that’s why a carrier like UPS says, “Oh, we need First Choice Shipping. Because you need the compliance, you need the importer of record or the indirect representation as some people call it. You need somebody to guide you on that registration. And then you need someone to ultimately help you if you need to do a removal order, because Amazon won’t provide that either. And for them, that is a very personal kind of service, and they cannot provide that on corporate level.
Pearl Ausch: For those reasons, Amazon Global Logistics doesn’t provide this as a package deal. I can’t say we are a shipping provider, we are an Amazon international global expansion provider. That’s what we try to help you with. It’s much more than the shipping.
Liz Downing: Do you focus mainly on European countries or can you do Australia?
Pearl Ausch: We do Australia. We do Singapore. We’re going to hopefully very soon, Saudi Arabia. Which other ones? Canada, big one. Pretty much anywhere except for Mexico, Brazil. And that’s it. Pretty much anywhere Amazon has a global presence, and they have FBA. That’s our specialty.
Liz Downing: So we have an attendee who actually has a good customer base in Australia, but it can be difficult to get goods there. They’ve got a small product with acetone, but it manages to get an exception in terms of Haz-Mat. I’m going to actually send you their contact information so they can talk through that with you.
Pearl Ausch: Awesome.
Liz Downing: We’re getting a lot of those that I’m just going to log right over to you after. It’s already been a crazy day for you, it’s going to get a little crazier.
Pearl Ausch: Love it. We love helping people. That just makes me as happy as it could possibly make me, honestly. Best feeling ever.
Liz Downing: This is a good question. It’s very tactical. “If we have stock in the UK right now, can we ship small parcels through First Choice from there into the EU?”
Pearl Ausch: Not at the moment. Not at the moment, but tell her to send us the message. It’s something that we’re working on, and hopefully very soon. If not, we’ll make a recommendation on who else to use.
Liz Downing: Okay, Janet, I’ll get your question over to Pearl and she’ll follow up with you.
Pearl Ausch: Awesome.
Liz Downing: You guys don’t offer 3PL services, but you have 3PL companies that you trust and that you refer. So do we, and I think they’re probably the same companies.
Pearl Ausch: Yeah, we’re not in the warehousing business, but we know how important it is for the supply chain. so we work very closely with them. They know us, and we know them. We actually make sure we vet whoever we recommend. Not only that, but make sure that they keep up with those standards. We will definitely be able to make a recommendation just like you.
Liz Downing: Great. We’re getting a question about animal based products. Is there anything different that anybody needs to know about that?
Pearl Ausch: Depends to where. Animal derived products could be an issue. But again, it depends, how much of a percentage of the product has the animal derivatives in it, what kind of animals, if fish is a lifestyle? It really, really depends on that kind of stuff.
Liz Downing: I think this is particularly fish oil vitamins.
Pearl Ausch: Fish oil vitamins? It depends. They should reach out to us. We’ll take a look at the labeling and we’ll have our compliance team tell them if it’s an issue or not, depending on which marketplace they’re looking to get into. But we successfully ship this product, but it depends to where. So we could definitely-
Liz Downing: Right. I think this seller is UK based and they’re trying to ship to different European marketplaces.
Pearl Ausch: Okay, let’s look into it and-
Liz Downing: Katarina, I’ll get your contact information over to Pearl.
Liz Downing: What are some of the biggest mistakes people make when they try to do this themselves?
Pearl Ausch: What are some of the biggest mistakes? Some of the most trivial, basic ones are, trying to bill Amazon for the taxes. So typically, when you’re shipping into… I know, right? But typically the way it works in international standards is that when you’re shipping a package to somebody, the receiver pays for the taxes. People that are shipping into Amazon need to know, you need to make sure that it’s very clearly marked as a commercial invoice, which is basically the invoice letting customers know who’s paying for the shipping, what you’re shipping, where it’s shipping from and to it. Just the details, sort of like a receipt when you’re buying anything, really. And letting them know that the taxes need to be billed to the shipper, which is going to be yourself or the provider that you’re working with. Those are some basic stuff that people don’t take into account.
Pearl Ausch: You need to have somebody representing you, importer of record, which I’ve mentioned a couple times here. But you need to have somebody in the foreign country that will represent your product, or represent you as a company. So if there’s any security issues, or any questions at all, they know they have somebody they can reach out to. Some of the things that people don’t do properly. And then of course, setting up the registrations for taxes and things like that. Don’t try to do this on your own. We definitely recommend working with a provider. We recommend AVASK. We work close to them. They do a great job. Actually, Amazon recommends them as well. But some of these things are, people try to do this on their own, and then they end up just giving up before they even begin, because it becomes so overwhelming. It might just… Not might, it’s just going to be more expensive doing it yourself anyway. So you might as well work with somebody that will get you all this for an all in one deal.
Liz Downing: That’s great.
Andrew Johnson:
Hey Pearl?
Pearl Ausch: Hey.
Andrew Johnson:
I’m sorry for being late. I had some computer issues. A question for you. I have a very small brand on Amazon. It’s actually an inflatable chair brand. I noticed, in the past, a few shipments I’ve had from so far that we’ve had some serious issues with getting the products in a timely way. And we’re having a different problem with maybe like the quality of what we’re looking for. I know there’s a lot of recent changes with people manufacturing from different countries, and you find there’s a shift kind of coming away from Amazon, a different place in the world, or what trends have you seen kind of from there recently? ,
Liz Downing: People manufacturing in China, are you seeing a shift to the actual origin of the product coming from other countries lately? Mega, does the whole program about how you can source and find manufacturers in India, and there are people like doing work where you can find manufacturers in Mexico. So are you seeing a shift to more global manufacturing?
Pearl Ausch: There’s a shift. There’s definitely that shift where American made product, made in America. People have gone to the Dominican Republic, to Vietnam, India. But, the truth is, China’s still the cake. It takes way longer to manufacture in other places. the quality is not the same. Even though there are so many delays coming out of China right now, it’s still not as delayed as in places like India or Vietnam. People are not taking into account that their ports cannot handle more ships than it did till now. Very nice that you could manufacturer something but try getting it out. It’s like they’ll give you a date and who knows what. Okay, that’s going to be your sailing date. Versus in China, we see that it’s starting to loosen up. We’re predicting, the experts, I can’t say I’m the expert that controls the data on what’s going to be, but they’re predicting that in the summer, things should be much, much better when it comes to the container shipments.
Liz Downing: Provided big ships don’t get caught places.
Pearl Ausch: Right? How crazy how crazy was that? How crazy was that?
Liz Downing: How many people did you have calling you panicked?
Pearl Ausch: It was funny because we had people having shipments that were totally not related and not even passing the Suez Canal, and they thought their shipments were going to get held up. But we reassured them that you’re not going that route. But quite a bit of shipments were going that in that direction, but thank God they got it out. They thought it’s going to last longer. But yeah, I would say one thing. People want to try to say that things are changing, but the proof is in the pudding. At the end of the day, look at what stock is still coming out from China. They’re the leader at the end of the day.
Liz Downing: That’s good to know. This is a great question about customs value. I know you love those. “When we send our own product, Amazon FBA EU, how do we determine the customs value? What is the calculation?”
Pearl Ausch: That’s a great question. You’re actually going to put down the value of what you bought it for. Your costs, not what you’re selling it for, because it’s not considered items that are sold. Amazon’s going to sell it for you. You have to put down the value of what it costed you to manufacturer. So obviously, that saves you quite a bit on taxes. But, when you’re shipping into Germany directly, just so everybody knows this, shipping directly into Germany, they do require that you put the taxes of the value of what you’re selling it for. And they will take a look at your storefront to verify that. There’s a big amount of taxes that you need to layout before you’re actually even selling the product. But across the board, for most Amazon marketplaces, you’re going to put your costs.
Liz Downing: Okay, so your costs, not the value cost.
Pearl Ausch: Yeah, the selling price.
Liz Downing: Okay, good to know, good to know. That was a very good question, Ryan.
Pearl Ausch: Yeah, that was a good question. Because a lot of people mess up with that.
Liz Downing: How about the price of customs going into Japan?
Pearl Ausch: What the rate is?
Liz Downing: Vivian asks, “Is there a better way to value products going into Japan, because customs is very expensive?” What do you need to know about shipping into Japan and the customs there?
Pearl Ausch: So they are very, very stringent. They’re tough to get into. But as long as you follow the rules, and you’re very descriptive with what you’re shipping and all that stuff, your thing should move properly. I would tell her to reach out and maybe we’ll see. We’ll try to look up a harmonized code, a HS code, or tariff code. Everybody calls it something else. But that’s the number that customs uses on the declaration. Every single item that you’re shipping, has a number in the customs database that equals that item. If I’m shipping this bottle, they have a special number that they’ll know, “Okay, number one means, she’s shipping these bottles.” Everything could be declared in a smarter way. For example, you’ll have people that are shipping watches. There are gold watches, there are plastic watches, there are children’s watches, adult watches. Every single watch has a different tax rate. So maybe we could try to look up for you a better HS code, as we call it, that will be a bit cheaper. She can reach out and hopefully, we could try to help.
Liz Downing: I didn’t even know about HS codes before I did a webinar forever ago with Norm Farrar. He was talking about times that he seen an HS code applied. And there was one that was actually even more relevant to the product that had a much lower cost associated with it. Yeah, that’s definitely a strategy for saving money, I think is making sure that HS code is relevant, because you don’t want to fake that because that’s against the rules. But you do want to make sure it’s relevant to your product. But if there’s one that costs you less than there’s no harm in that at all. Because Japan uses the selling price rather than your cost, right?
Pearl Ausch: It depends. It depends. You could write the cost. It depends on how you’re doing it. What we try to help you do, is ship it actually into a warehouse first, and then we forward it into Amazon. So you could actually write your costs and not what you’re selling it for. Because then it’s outrageously expensive. And legally, you couldn’t write your selling cost, because it’s not sold yet. So whatever your cost is, that’s what it is.
Liz Downing: All right, great.
Liz Downing: Back to the EU and the UK. If someone is shipping into both… They’ve got an amazon.co.uk account, they’ve got different EU accounts, can they do one shipment into the Netherlands and it will go to both? Or for the UK do they have to ship specifically into the UK?
Pearl Ausch: It’s going to have to be two separate shipments. Yeah. So it’s going to be one to the UK and then it’s going to be one from the Netherlands, let’s say into Germany. But the good news is that, the Netherlands has a very similar rating system like the UK. They’re not so stringent on those little details. If you’re writing, let’s say… Or you’re shipping clothing and you’re not being so specific like, “I’m shipping t-shirts,” it’s not going to get flagged. Whereas in Germany, if you’re not to the letter, they’re going to flag your shipment. The laws are very similar in Netherlands and the UK, which makes it so much more pleasant and easier to ship into.
Liz Downing: So… I say so a lot. I need to knock that off. That’s an annoying tick. Because when I watch these back, and I rarely watch these back for the me parts. I skip over the me parts, and I just watch the you parts. But I get annoyed with myself and the so-ing. We’ve talked about some really kind of down in the details, strategic ways to save costs. Some strategic ways to actually get your products where they need to go. Why don’t you give me some examples of some particular supply chain disruptions that some of your clients have seen lately. And you don’t have to name names or give damning details. But let’s just get a couple of stories from the field that will resonate with the people that are here.
Pearl Ausch: Yeah, the biggest disruptions have been, what we brought up earlier, where certain FCs are just getting shut down, and people cannot ship into FBA. Brampton, in Ontario in Canada had a situation last week, the week before, really the last two months, where they shut it down, which is like the main hub where Canadian shipments are going into. It’s been a huge, huge disruption for people. It’s been really difficult. And France, it’s the second time now, maybe the third time, where people that was their only entry into the EU, and I’ve had a client pull me up and he’s like, “[Crawl 00:42:11] might chill about 50%,” because Brexit happened, and their inventory, where they used to keep it in the UK, was now in the limbo because Amazon wasn’t doing…
Pearl Ausch: They have this, the Pan-EU program, as they call it, where you were able to ship let’s say to the UK, and then Amazon then distributed your product throughout the EU, which then included all the countries. And Brexit hit, and he wasn’t able to ship just to the UK and then rely on his inventory getting into Germany through the Pan-EU program. So he started shipping through France, because it does take about six months to get a VAT number in Germany, which is a huge headache. So whoever is thinking of selling into Germany at one point, just sign up. Get started because it takes a while. But going back to this, so he settled for France, because France takes much faster to get a VAT number. He had a French VAT number, so he shipped it there, but then the shutdown happened. These people really… These are real people with employees that are unfortunately really getting hit. It’s just sad to watch. It’s very unfortunate, but this is what’s happening.
Pearl Ausch: Of course, Andrew, you mentioned that you’re having the laser stuff. This is like the game the whole year really is playing, game is the wrong word. But this is the trend of where people have had their factories turned from manufacturers, that all of a sudden to PPE gurus. They were just knocking out masks and their inventory was on the back burner. It didn’t matter. And then once they’ve started manufacturing again, it’s like, “Oh, now I can’t get a sailing day, because there’s so many boats going out and I just can’t get my inventory on.”
Pearl Ausch: It’s been really difficult. But the good news is that we definitely, definitely see a light at the end of the tunnel. And we definitely see things loosening up. Like I could say, the first part of April has been a huge decline once. I’m going to say for Canada, but then we see that it’s up ticking. Things are opening back up, obviously not as fast as we’d like for it to happen. That’s why people need to diversify and people need to have more than just one marketplace present, because the minute one went down they’re like, “Okay, at least I can have something coming from somewhere else.” I think that’s the reason why it became this crazy rush to expand. It became… After season was over, quarter four was over, quarter one we’ve seen this tremendous, almost desperation. Like, get me started, because people just are sick and tired of relying and saying, “Okay, this government is shutting things down now, because there is an outbreak. There’s a situation. But, I need to have an alternative.”
Pearl Ausch: I think that the people that were just smart and did the right things, or the ones that are getting smarter now, are definitely, hopefully going to have a much easier time. Because, yes, it’s been disruptive as you said. It’s been difficult.
Liz Downing: We had a question on how long it takes to get started. If somebody hasn’t done the rush yet, and they just now want to get started on expansion, and this person actually says, “We have everything ready to ship and we’ve got the listing setup,” on their different marketplaces, but they don’t have a VAT in EU, and you have to get a VAT number for every marketplace. Right?
Pearl Ausch: Right.
Liz Downing: There’s not just a-
Pearl Ausch: No, not for everyone. You don’t need to get for everyone. Unless you’re doing Pan-EU. If you’re storaging it just in one place, that’s good enough. You could just get for one. But, the good news is that actually, Amazon has another Pan. They have a visa program, paid visa program. Yeah, something like that. The visa program, let’s call it that. But they’re actually paying you to get registered. And they have a list of different companies that they’re actually giving you a voucher, so you could get free VAT registration in all seven countries. So you should take advantage of it.
Pearl Ausch: Just do your due diligence on the list and use the ones that are actually good. Don’t use the ones that are… Their service is terrible. If you need a recommendation, feel free to reach out. I recommend AVASK. They do a great job. Amazon reimburses for that. But I would recommend it in terms of speed. If somebody wants to do something, really quickly because VAT registration does take some time, I will tell you to go for it. But if you want to get started like… Who asked this question? I’m sorry, I don’t see the chat box. What’s her name?
Liz Downing: Oh, sorry about that. Fernando.
Pearl Ausch: Fernando. So he. Fernando, I would say get started with Canada. Because Canada, we can get you started as fast as two to three weeks, you could be live and shipping into Canada. We’ll help you to hold an NRI number, which is a non-resident ID, which is going to basically allow you to have somebody representing you in the foreign country. We can set it up for you in-house. Actually, I’m going to throw this out right now. We’ll do a promotion special for our listeners for today. If you mention this webinar, we’ll do that for free. Once you have that you can start shipping right away. Yeah, you can still make this happen, at the end of this month or the beginning of next month. It’s super fast.
Liz Downing: We do have someone based in the UK area who sent stock to Canada and it wouldn’t go through customs because they needed to have an OIR to sign off on it. So you can help with that kind of stuff.
Pearl Ausch: The NRI it’s essentially the importer of record for them, and we’ll will help them to get it set up.
Liz Downing: Mention this webinar, and they will do this for you for free.
Pearl Ausch: Well, yeah.
Liz Downing: Actually Fernando is already a customer of yours. He’s just typed in the questions. And he says he can 100% recommend First Choice Shipping.
Pearl Ausch: Love that. Thank you-
Liz Downing: Which is not a surprise to me at all.
Pearl Ausch: Thank you for your business, Fernando.
Liz Downing: I’ve actually gotten a couple emails asking for that list of 3PLs, so we kind of need to get on that pretty fast.
Pearl Ausch: Oh, okay. We have work there.
Liz Downing: Yeah, we have homework. You guys don’t necessarily have homework, but we have homework.
Liz Downing: I wanted to touch on just a couple of… Obviously lead time is sort of an X factor right now because there are delays because of COVID or delays because of other things. Ships stuck places. Not anymore, but then we know exactly the thing. Generally, I think people are most interested in how to save money, once they figure out the logistics end of things, which obviously is very complicated and they should use a partner like you to help them figure that out. But how do you help people just reduce the overall cost of shipping altogether?
Pearl Ausch: Yeah. The way we do that is firstly, we’ll recommend to ship a bit more in a shipment just to reach a certain bracket so they can get the rates. We’ll do that. With time, if there is a larger shipment, we’ll recommend going with a different method of shipping, that will be a little bit cheaper. And the good news is that we do have a variety. For Canada, we’ll do this whole parcel for the most part, which just so people know, we actually have a lot of people that are getting onboarded for Walmart Canada now. Walmart’s telling them, “Oh, so you could use…” in this case it was FedEx. And people were using it through Walmart, and then they’re like, “Wait, the rates are better with First Choice.” The point is that the buying power, the same idea when you’re buying me shipping through Amazon, and locally here in the US, nobody can compete with that. There’s no way, because of the amount they’re doing.
Pearl Ausch: With us, essentially, what we’re doing is we’re bringing you our customer base all together, and we’re bringing you those rates that are affordable. Those people for Walmart are starting to use First Choice’s services as well, because it made sense for them. But for Canada, we offer trucking, and we offer a small parcel. Based on the quantity, the type of item, we’ll advise what makes the most sense for you. For some people, keeping their listings going is more valuable and is more cashflow and more money than paying a little bit less for shipping. Even though trucking might be a little bit cheaper, they’ll still go with small parcel. Why? Because for trucking, it’s going to take three weeks till it gets to the Amazon. Small parcel? Two days. It really depends on your business model, how you run things, but according to that, we will definitely advise what makes the most sense for you.
Liz Downing: That’s awesome. I loved what you said about keeping your listing going. Because obviously, you can have the best supply chain strategy in the world, but if your product isn’t selling in these different marketplaces, then you’re dead in the water. That gives me the opportunity to talk a little bit about Teikametrics, because obviously, to keep your listing going, you’re going to need to advertise. And before that, you actually need to have a really good listing. That was why I had Jana on last week, because you might have the best optimized listing in the world on .com, but the way you’ve structured it, the words that you’ve used, the tone that we use might not work in Germany. Might not work in France. Step one, have a great product, always. Step two, have an optimized listing that’s localized for the marketplace that you’re targeting. And step three, have a smart advertising strategy. Andy, I know that you’re not so much in the service space, but I think that we’re seeing an uptick in people who want to advertise on international platforms. Would you agree with that?
Andrew Johnson:
100%. I think there’s so much opportunity outside of just the US to advertise on. Especially when it’s so easy to advertise in Canada, Mexico, all the EU, India. There’s just a lot of opportunity. I will say that usually, I recommend is that sometimes people will get it because it’s very different, especially when someone doesn’t really have an effective or a strategy yet for actually how to ship product to different countries. I usually recommend that sellers, really make sure that we’re getting all the low hanging fruit and really optimize as much as possible for the country they’re currently selling in before they jump in different countries. Nothing’s worse than barely being… Just starting off in one country, then trying to branch off into four other different countries. You might get kind of one down and then move on to the next one, as usually I recommend. But definitely, we’re seeing a lot of interest in trying to advertise outside of just one particular area.
Liz Downing: I was talking to one of our brands the other day, and they were like, “I’m really bummed because on this marketplace or that marketplace, there aren’t as many advertising options,” which obviously .com is the most established, the oldest, the biggest Amazon Marketplace, and it does take time to catch up on other marketplaces. But I think that the lower competition and perhaps the potential of your product and the opportunity for your product might kind of make up for that. And if you can only do sponsored product ads on a certain platform. I feel like I’ve talked to a lot of people that have said, “The opportunity is there because your competition is low or the opportunity is there because,” like you said, “they love peanut butter in Germany.” If you’ve got a peanut butter brand, you’re probably going to kill it. You just need to get over there. You just need to be like, “Get your peanut butter to Germany.” If you listen to these types of educational forums and you get into the LinkedIn groups and get into the Facebook groups… I don’t know. Are you doing Clubhouse, Pearl?
Pearl Ausch: Oh, you bet. What a time waster but, yeah, I love it. I love it, but it’s a time waster
Liz Downing: So many people too. I was just doing an interview with somebody the other day that runs an influencer business, a marketing and influencer business. And she says she goes to sleep listening to Clubhouse every night. And I’m like, “Well, I guess that knowledge is seeping in your sleeping brain too.” I kind of keep missing the things that I want when I log on to it because I’m just like-
Pearl Ausch: I have the same thing. Room is gone. Yeah.
Liz Downing: I’ve definitely fallen into some completely non-industry related conversations too, which have been… Right now, it’s just kind of a free for all and people are saying whatever they want. If you’re not on Clubhouse yet, and you have an iPhone, I strongly suggest you check it out. You can catch Pearl on there. I think Yoni’s on there a good bit. Several of our industry friends are on there, and they’re just giving out free advice. And you don’t even have to register for it, because people are just talking. You can drive while you’re listening. You can cook dinner. You don’t have to be on camera, which is super compelling for me, because my eyelashes a break. Right?
Liz Downing: Oh, we do have one question, and Jan has asked twice. When the US is an international marketplace to someone because they’re based in another country, do you help with that, too?
Pearl Ausch: Yes, yes. We can definitely help with that.
Liz Downing: Okay, good. And how complicated is that?
Pearl Ausch: It’s not complicated at all, actually. It’s sometimes even easier than any other marketplace. Depends on the product. But in general, it’s easier. Yeah. The US is like a free situation.
Liz Downing: We love good news.
Pearl Ausch: Yes.
Liz Downing: But one thing to keep to be aware of too, and I’m sure that you see this a lot is that, the rules are different depending on the marketplaces. Amazon.com has more rules than other marketplaces because it’s more established, it’s older, it’s been around longer. There are things that you can do on other marketplaces that you can’t do on .com. If you’ve been selling in the EU, or you’ve been selling on .co.uk, and you’ve got a certain product review strategy, or you’ve got a certain listing strategy, you need to make sure that you’re very, very familiar with the .com. rules. What we used to call ToS, and now they’re not calling it ToS anymore, Terms of Service. But the seller policies on .com are different than other marketplaces. So I urge you to study those, and maybe make flashcards. I’m just kidding. Don’t make flashcards. But just be really, really familiar with the rules of .com because they are different than other marketplaces.
Pearl Ausch: That’s a great point.
Liz Downing: Really foreboding too. Just like, end on a sour, sour note.
Pearl Ausch: It’s true. But it’s true, because people don’t know what hit them. It’s like, “Whoa, I can’t do that, and I can’t do this?” Yeah, just be prepared.
Liz Downing: It’s definitely, definitely different.
Pearl Ausch: Yeah.
Liz Downing: We’re getting close to the top of the hour. I think most of the people who attended today, want your ear, and send you big, big thank yous for such great information. We’re going to have you back on the 15th. We’re going to be addressing big success with global expansion. What are the pieces of the puzzle to put it together for you to be very, very successful, internationally, globally on Amazon? I’m going to send Pearl all of the questions that were submitted today, along with your email addresses. You guys have said that that’s okay. Pearl, thank you so much. You’re a wealth of information, and just a delight.
Pearl Ausch: My pleasure. Right back at you. I really-
Liz Downing: Oh, thank you. We have so much fun together. And Andy, thank you for hopping on. I’m sorry that… I sent him a bad link, so it’s totally my fault. But we will see you next week. I’m going to have Don Henig on here talking about some Amazon success stories from different brands, so that should be fun. If you have any questions, you can share @Teikametrics. I’m going to be including a special link in your replay email, encouraging you to sign up for this cool analysis that we’re doing. Watch out for that. Watch, the replay. Let us know if you have any questions, and we’ll see you next time. Thanks.
Pearl Ausch: Thank you. Thank you so much, guys.
Liz Downing: Thank you.
Pearl Ausch: Bye-bye.
