August 14, 2015 by Andrew Minalto - 0 Comments

Your eBay & eCommerce Questions Answered #35

questions-answers-35Happy Friday everyone!

It’s time for the latest post in our Questions & Answers series. I can certainly see that the summer holidays are well and truly over for many of you as there are more and more questions being sent in!

Today we’ll be covering the following questions:

  • How to not get overcharged by couriers?
  • What is the best way to sell on regional eBay sites?
  • How to get back Top rated seller status?
  • Do you have to pay taxes on refused parcels?
  • Where is the best place to sell 150,000 used books?
  • Is it possible to buy goods from UK based manufacturers directly?
  • At what stage does being VAT registered help your business?

Let’s get started!

Hi Andrew,

Thanks for your great article:

https://andrewminalto.com/how-to-import-products-from-china/

I’m importing some products from China to the US, and I’m being quoted vastly different UPS prices for shipping – can you shed any light on this?

The supplier has quoted me $430 for 250 units via UPS and this sounds about right to me. But if I go onto the UPS website and get a quote, the price comes in at $1500.

Some other suppliers are also quoting me in the region of $1700 for UPS, shipping the same package, and some as low as $300.

In your article you are suggesting that shipping via courier is about $5/kg for a 50kg package, which is around $250.

Any idea what’s going on here? Ideally I’d like to handle the UPS side of things myself so I know I’m not being overcharged, but I’m obviously not going to pay $1500.

Many thanks,
John

Hi John,

$1700 for a 50kg package, wow, that’s really EXTREME!!!

That’s a totally unreasonable quote. In my article I mention that a courier costs about £5 per kg (not $), so it works out about $7-$8. So a quote of around $400 sounds very reasonable to me.

Couriers of course look at volumetric weight (taking into account the size of the shipment) as well but if those items are not super bulky, it won’t make that much of a difference. I always let my supplier in China handle COURIER shipments as they get much better prices.

So I can’t see any reason why you would want to do this on your own and over-pay for what is practically the exact same service.

Dear Andrew,

First I want to thank you for your wonderful blog. It has given me a lot of info on how eBay really works.

My question is as follows:

“I have an eBay store on eBay.be (Belgium) and I sell all kind of things. As eBay is big, I like to sell internationally as well. I searched for info on the web and I found several articles on how to sell internationally on eBay and one article says you just have to list on your home eBay (in my case Belgium) and simply click on the international shipping options and fill in the shipping costs and that’s it. But another article claims you should list on the eBay site of the country you want your listing to appear. So if I would like to attract American buyers, I should list on ebay.com

Andrew, is there really a big difference in sales if you list on the eBay site of the country you want to attract buyers from or does it not make a big difference if on your home eBay you simply click the option to send to (in this case) the US?

Of course creating a single listing and selecting international visibility is far easier than creating a listing on every eBay site you want your item to be sold on, but is there a huge difference in the end result?

Many Thanks!
José

Hi José,

From my experience, listing directly on regional sites DOES improve your listing’s visibility in search results. It really makes a BIG difference! If you just list on your local site and offer international postage, chances are that your listing on eBay.com will be shown at the very bottom of search results, resulting in minimal visibility.

But if you list directly on the regional site, you can basically compete on the same level as local sellers and even get TRS status for that specific regional site which means you can even out-perform the local sellers! So yes, I would recommend that you list directly on eBay.com for maximum exposure in search results.

Hi Andrew,

I hope that you’re well and don’t mind me contacting you.

I recently lost my top rated seller status. Long story short, I stopped offering tracked delivery on my items and suddenly a lot of customers were reporting their items as undelivered, which dropped me out of the program.

For the last couple of weeks since I left the program I am no longer getting any sales. What would you recommend I do to rectify this and get my TRS status back?

Many thanks,
Andrew

Hi Andrew,

First thing you want to do is go to your Seller Dashboard and in “your performance to date” block, under Defects, evaluate the reasons why you lost Top rated seller status. In the dashboard you can see precisely how many defects you got and what they were for.

Based on that information you will know which areas of your business you need to improve and how bad the situation is. If it’s just slightly above 2% (the maximum allowed defect rate), you could get it back quite easily by just selling a number of items to get your defect rate below 2%.

However IF it’s a very high number, like 5% or more, you may have to consider opening a new account as it will be easier and faster to reach TRS with a fresh account than to turn a bad account good again.

But most likely it’s not that bad and all you need to do is improve your defect rate by selling a number of items quickly and cheaply. If eBay is giving your current listings poor search rankings, the best way to turn this around is to start listing cheap, used goods as auctions as they get featured higher in search results by default.

You can basically follow my “Buy a TRS account for £200” guide to improve the defect rate on your account and get your listings back up in search results:

Hi Andrew,

I refused a parcel that was sent from Australia to the UK, via DHL. I have now been notified that I am required to pay £76. Can DHL do this for a parcel I refused?

Thanks,
Andrea

Hi Andrea,

No, I don’t think they can do that if you refused the package. It could be that it was an automatic notification sent in error? You should really call DHL and find out what’s going on. But as I said, if you didn’t accept the package, then you shouldn’t be liable for any import taxes (as far as I know).

Otherwise people could theoretically send high value packages to other people and make them liable for the import duty and VAT, which obviously doesn’t make any sense.

I hope you can get this sorted out directly with DHL.

Hello Andrew,

Thanks for your blog!

My friend has bought more than 150,000 used books and he has asked me the best way to sell them all online?

Should he create his own website? Sell them one by one on Amazon? Or can he contact Amazon and sell them all in one transaction? We are based in France if that makes any difference.

Regards!
Soso

Hi Soso,

Creating your own website wouldn’t be a very smart thing to do as you would have to spend months advertising it etc. and even then – there would be no guarantee that you could get in a large volume of sales.

The best way to sell these would be to simply list them on eBay and Amazon! These are the two places where most people go by default to purchase a used book, so that’s where you want to sell them.

If you have a list of the ISBN codes for these books, listing them will be much easier as you could simply upload a CVS file with these codes to automatically create listings. If you don’t have such a list then you will have to manually enter these codes on Amazon and eBay to create a listing for each book.

You could also try splitting this huge job lot into smaller lots (like 100, 500 or even 1000 books) and list them on eBay, under the wholesale category.

I don’t think you can sell them as a single job lot to Amazon, no, as they don’t deal with used books directly.

Hi Andrew,

Is it possible or advisable to try and contact UK manufacturers directly?

I am finding it difficult to find UK wholesalers who can offer prices much above 5% margin on any items I have looked it, even with special offers.

Thanks,
Mark

Hi Mark,

I don’t know what products you’re sourcing but you can of course try contacting UK based manufacturers, if you know they make the goods you’re interested in. But before you do, you should know that most manufacturers won’t deal with small time eBay traders!!!

And some won’t deal with you even if you can reach their MOQs for the simple reason that they want to protect their pricing structure for long-term distributors, wholesalers and B&M shops, which are the main clientele for many of these wholesalers.

There’s no harm in trying of course so you can give it a go! Just be prepared for a very low response rate. If the products in question are NOT branded, I would recommend you instead look for manufacturers in China as they have no problems dealing with small time eBay traders and in general are easier to deal with than traditional, large, UK based manufacturers.

Hi Andrew,

I just (re)read your blog post ‘The Biggest Tax Mistake an eBay Seller Can Make’ – very good advice! And I am relieved to have recently checked HMRC’s website and seen that the VAT threshold was higher than I thought it was!

But how would one weigh up the pros and cons of registering for VAT when selling on eBay and Amazon? As when you do not have a VAT number, Amazon charges you 20% on top of the fees they already charge you! As they want to recuperate the VAT they would otherwise have claimed back I guess?

The back of a napkin calculation modification I have to your post is to assume we buy two lots of goods and sell on both platforms –

Two lots of £1,000 worth of goods + VAT = £1,200
£1,200 x 2 = £2,400

Plus two lots of P+P costs of £200 + VAT = £480

Total expenditure – £2,800

Reclaimable VAT = £80 (leaving £2,720)

Now let’s keep it simple and say we sell one lot on eBay and one lot on Amazon for £3,000 each

Amazon fees estimated at 15% = £450
Amazon fees plus VAT claimed from you by Amazon = £540
VAT on Amazon fees = £90

Already you have paid more in VAT alone on Amazon fees than you claim back on P+P

If we take the other part of your calculation as it is – ‘VAT from sales (£500) MINUS VAT from purchases (£240) = £260’,

Then does this mean, £260 being just under three times as much as the £90 paid in VAT on Amazon fees, then at the point at which you are selling three times the volume on Amazon than you are on eBay, it would save you money to register for VAT?

I was working as I went along, but I’d be interested to hear your take and anywhere I’ve made an error 🙂

Many thanks,
Mike

Hi Mike,

Your calculations are not quite right (in the beginning £2400 + £480 = £2880 and not £2800).

And reclaimable VAT is not only the £80 you pay on postage but also the VAT you paid on goods – £400.

So total reclaimable VAT at that point is £480.

Then you need to add to that the VAT you pay on fees – £90, making the total amount of reclaimable VAT £570.

And that is without any other business expenses you can claim VAT back on.

If you take in £1000 VAT in sales, you take off £570 and get £430 – this is the VAT amount you would pay to HMRC.

This is a simplified calculation but I hope you get the point.

And as I clearly explain in my recent VAT guide, in almost all cases, you’ll lose out when becoming VAT registered. That’s why I call it the biggest mistake a new trader can make – to register for VAT when they DON’T have to!! As being VAT registered really doesn’t give you any advantages.

There are some cases though when it can be a good thing to do, like when you sell zero rated goods, but in general being VAT registered means you’ll pay more in taxes – as simple as that and no amount of sales can turn this axiom around.

Hope this helps Mike!

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Ok, that’s it for today!

If you have a question or two you would like me to answer in our weekly Q&A post, then please get in touch via the contact form on this page.

Have an awesome weekend! 🙂

Andrew

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