Amazon is known for catapulting small and medium-sized businesses into commercial success. However, the path to seller stardom poses many challenges, and doesn’t come without hard work—and extensive trial and error.
When a business achieves a solid position on Amazon, and gains a positive traction with shoppers locally, it might be the perfect time to expand into new territories. One of the main concerns sellers should have when exploring uncharted marketplaces is being able to cater to their customers’ shipping needs, without jeopardizing their brand’s reputation.
Fulfilling orders effectively and having a clean shipping record is not easy. Less-than-happy reviews from international shoppers could quickly tarnish a hard-earned history of stellar seller and product feedback.
Luckily, Amazon provides sellers with a variety of tools and services that simplify the art of selling internationally, and we have all the information you need to propel your Amazon business into global success.
Where to Start?
If you’re already determined to expand your local business into new international Amazon marketplaces, the first thing you should ask yourself is: “Where do I want to sell?”
Amazon has global presence in North America, Europe, and Asia—and most recently, Israel.
Once you’ve chosen a marketplace to expand your operations to, it is important that you carry out market research and consider your end consumer preferences, culture, and language to come up with well thought-out selling, shipping, and advertising strategies for expansion. This will also enable you to tailor your products to meet your customers’ needs.
Failure to take these important factors into consideration could cause great economic hardship for your business.
World’s Top Amazon Marketplace Sellers
Last year, Webretailer.com released a list of the World’s top 1,000 Amazon marketplace sellers. The top three marketplaces were:
- The United States – 484 sellers
- The UK – 260 sellers
- Germany – 101 sellers
Dave Cooley, Manager of Marketplace Channels at CPC Strategy suggests that it is not recommeded to build an entire catalog in a marketplace that it is still in the drive for growth.
Selling internationally is a supply/demand situation, and if you decide to make your debut at an international developing marketplace, the smartest way to do it is by starting with your best-selling products rather than your entire catalog.
Handling Your Worldwide Logistics with FBA
Fulfillment by Amazon (FBA) is a pay-as-you-go program that aims to make Amazon Sellers’ storage-and-shipping experience trouble-free. There’s no minimum for the number of products you send; Amazon fulfilment centers can hold millions of items. The Amazon Baltimore Fulfillment Center, in the United States, spans the equivalent of 28 football fields. So, as you can see, Amazon has everything figured out for your international business expansion.
You can choose to fulfill orders yourself or use Fulfilment by Amazon (FBA) in all marketplaces. If you think doing things yourself is too much to handle, you can have Amazon pick, pack, and ship your orders on your behalf by using Amazon FBA.
Amazon currently offers FBA services to sellers in Canada, China, France, Germany, India, Italy, Japan, Spain, the United Kingdom, the United States, and Mexico.
These are some of the things you must consider when opting for FBA:
- If you are already an FBA user, keep in mid that your current account does not automatically extend to another region. However, if you are selling in one of Amazon’s European marketplaces, you can still fulfill your orders using your current FBA account.
- If you want to sell in a new marketplace, you must create a new FBA account and convert your listings to be handled in that marketplace.
- If you are selling in one of Amazon’s European marketplaces, you can fulfill your orders using your current FBA account.
What is FBA Export?
FBA Export is a program available through FBA. Most sellers are enrolled in FBA Export by default at no extra cost; however, you can enable or disable this program at any time. With this program you’ll be able to expand your business to more than 100 countries and regions if you are based in the US, and if you are a seller in Europe, FBA Export has presence in 26 European countries.
This what FBA Export can do for your international outreach:
- Amazon fulfills your international orders after analyzing which or your products are eligible for FBA export.
- FBA handles import duty and customs clearance, and ships your product to the international buyer’s address.
- You can exclude products and you can exclude countries from FBA Export.
- Your international customers will cover shipping costs and customs duty.
Fulfilling Your Own Orders
As mentioned previously, another way of reaching your international customers is by fulfilling and shipping orders yourself. Just bare in mind that customers don’t want to be bothered with delays, additional fees, and much less missing products. So, if you decide to go solo on this journey, cosider the following implications:
- You need to find a reliable and renowned international carrier that can safely ship your products. Remember, cheap can be costly.
- You should bear the costs for the following relevant customs:
- Parallel importation
- Markings and labels
- Intellectual property rights
- Environmental, Health, and Safety
- Export controls
- Product compliance
But don’t get discouraged, you are not completely alone in this quest, Amazon provides tools and services for individual sellers to help you cover your international customers’ needs through the Seller Central Portal, these tools are:
- Business Analytics,
- Buyer Order Communications and Payment Management, and
- A-to-Z Guarantee (in the event of a delay or missing order).
When individual sellers fulfill their own orders, Amazon gives them a standardized shipping credit. In a nut shell, this is how Shipping Credit works:
- Amazon charges the customer different rates for every order shipped.
- The seller receives the same amount the customer spent in the form of credit.
- If your customer submits a return claim, you need to provide an international return address, and you must reimburse your customer for any international shipping fees.
5 Reasons Why FBA is a Great Choice for Your Business Expansion
FBA is a cost-effective option because you are only charged for storage space and the orders Amazon fulfills. The shipping cost is already included in your fees, and you don’t get an extra charge for Amazon Prime Free Two-Day Shipping and FREE Shipping on eligible orders. In addition to this, FBA provides a list of benefits
- Amazon FBA provides customer service in the local language of the target marketplace, and it also handles returns
- Your customers can send their returns directly to an Amazon fulfillment center located in the same country as the marketplace site
- Fast shipping, package tracking, and gift-wrapping options
- Your inventory is stored in the country in which you are selling, therefore, your order to local customers will arrive faster
- FBA caters to your business’ growth and helps you handle peaks during busier times of the year
Seller Fulfilled Prime
Those who most benefit from this program are the Prime members. This tool allows you to list your products as Prime-eligible and fulfill the orders yourself.
When you list your products for the FBA program, your Prime customers become eligible for free shipping and you are able to display the Prime badge on the products you ship to your customers.
There is no additional fee to enroll in this program. However, you must meet certain performance requirements through a trial period to demonstrate you can meet your customers’ expectations.
If you past the test, congratulations! You’re automatically enrolled in the program.
These are the requirements you must meet – on a minumum of 50 Prime orders -during your trial period:
- On-Time Shipment Rate of at least 99% for Prime orders.
- Use of Buy Shipping Services for at least 99% of Prime orders.
- Cancellation rate of 0.5% or less for Prime orders.
The EOI and BIL Tools
The Expand Offers Internationally (EOI) and the Build International Listing (BIL) tools allow you to create offers and syncchronize your prices across Amazon marketplaces to help you save time and to make the most of your business expansion. This is what each tool can do:
- EOI Tool: It allows you to create offers for eligible products that you are selling across Amazon marketplaces. The way the EOI tool works is by generating an Inventory Loader feed file which is automatically populated with the following information:
- source marketplace
- target marketplace
- product categories, and
- pricing option
- BIL Tool: BIL automatically synchronizes offer prices across regions and performs currency rate conversions any time the source marketplace price changes. In order to use this tool, make sure your products meet Amazon policies and regulations and that the marketplace where you plan to sell is eligible for this service.
This tool doesn’t create product detail pages, nor offers FBA connections between North American marketplaces (i.e. US and Canada).
Optimizing your Distribution Channels
Growing your international Amazon business – outside Amazon – is now possible with Multi-Channel Fulfillment (MCF). This program allows businesses to submit order fulfillment requests for sales that they have received on other platforms.
MCF is currently available in The United States, Canada, Mexico, The UK, Germany, France, Italy, Spain, and Japan.
This is what MCF can do for your international advertising strategy:
- You can send your inventory directly to Amazon Fulfillment Center.
- Customers purchase your products from Amazon or any other 3P channels.
- Amazon receives the order. Then picks it, packs it, and ships it directly to your customers.
- You can store your inventory in Amazon’s warehouses
- Improve your customer experience with faster delivery and simplified operations
- Select standard, expedited, or next day shipping options
- Specify if they want the order to be fulfilled in an Amazon box, or a plain box that does not have any branding
- Handle all of the customer service and returns for orders fulfilled
Your customers can return items directly to a fulfillment center via a Returns Merchandise Authorization (RMA). You will be able to maintain the relationship with your customer by managing:
- all refund authorizations;
- and customer service
Note: This option is currently available on Amazon.com, Amazon.com.mx, Amazon.in, Amazon.co.uk, Amazon.de, Amazon.es, Amazon.fr, Amazon.it, Amazon.co.jp, and Amazon.cn, and Amazon.com.au.
Taxes and Regulations
There are several important factors to consider when it comes to expanding your business to new marketplaces. Each region has specific Tax guidelines and regulations, and you should be aware of how foreign legislation might affect your operations.
Other variables may include – but are not limited to – intellectual property rights, export controls, marking and branding, health regulations, safety and product compliance.
It is highly recommended that you consult local tax and regulatory professionals before deciding how and what you will sell in other marketplaces.
Whether you decide to go solo as an independent seller, or to use FBA for your international business expansion, keep in mind that your main priority should always be ensuring a good customer experience for your shoppers.
This can be achieved by choosing a fulfillment program that makes sense for your business capabilities. Also, remember that you must let your customers know from which country you are shipping your product by displaying this information in your seller profile.
Last but not least, check your performance ratings constantly, don’t expose your customers to unexpected fees, and make sure your customers enjoy their shopping experience.