Taking your Amazon FBA international may sound daunting, but it’s easy with the proper research, preparation, and the right partner.

Below we’ve compiled a list of common mistakes first-time shippers may run into. These include:

1. Not doing market research
2. Not ensuring tax compliance
3. Not marketing
4. Ignoring the competition
5. Not partnering with third-party experts

1. Not Doing Market Research

Once you have decided to leap from local to global, you may become over-excited and jump into a country without doing enough research. One of the biggest mistakes FBA sellers going global make is assuming that because their product is selling in their local market, it will sell elsewhere.

However, territories will differ according to religions, traditions, laws, and tastes. That is why it is essential to do market research before sending your goods into a new market.

For example, the US home DIY chain Home Depot was forced to close its stores in China after only six years in the market. This was because most Chinese citizens live in apartment blocks and homes that don’t require or allow for many renovations. This simple misunderstanding due to incomplete research led to Home Depot’s costly failure to enter the market.

2. Not Ensuring Tax Compliance

Amazon requires sellers in certain countries to be registered for VAT. When you expand into one of these countries, you will need to register for a VAT number in that country.

Understanding local tax is difficult at the best of times. This can make the idea of figuring out whether you’re required to collect sales tax in a different country almost impossible. For example, if you’re located outside the U.S., you may be required to collect sales taxes in states where you have a certain level of revenue or number of transactions. However, if you plan on selling in the EU, it’s a bit more straightforward as VAT applies to all imported products sold to EU citizens. However, the VAT rates vary according to each EU country.

Failure to comply with tax and VAT regulations in your chosen import country may result in stuck and returned shipments.

3. Not Marketing

ECommerce’s explosion in popularity has led to stiffer competition than ever. Brands must constantly vie for their audience’s attention and continuously change and adapt to stay top-of-mind.

As a seller, you must remember that just because something is working in your local market doesn’t mean it will work in a foreign economy. Failing to adapt your marketing strategy to match your new audience is a gamble that is unlikely to pay off. There are many aspects to consider here, including language, imagery, packaging, and what is important to your new audience.

Austrian energy drink producer Red Bull is an excellent example of an adaptive marketing strategy for international audiences. Red Bull cans in North America are red, silver, and blue. In the U.S., red symbolizes action and courage, and blue youth and dynamism. Therefore, any object presented in these colors is seen as aspirational and attractive to North Americans. In contrast, Red Bulls in China are gold and red because, in the Chinese culture, gold represents wealth and happiness, and red is
associated with good luck.

4. Ignoring The Competition

If you are investing in a market where a local competitor already exists, you may be at a disadvantage. But not entirely. Do your homework by exploring their profile and products on Amazon. What are their reviews like? Is their product of inferior quality? What is the price difference? Can you offer customers a similar product at a lower cost? How can you set yourself apart?

As with most things in life, a little healthy competition never hurts. In fact, it could push you to reach greater heights.

5. Not Partnering With Third-party Experts

Third-party experts’ sole focus is your international success. While bringing a third-party supplier onboard may seem expensive initially, having a professional on your side will save costs on stuck, returned, or destroyed shipments and time delays.

Examples of third-party experts include:

• Importer of Record (IOR): This is the person or entity responsible for making sure a shipment of goods complies with all the legal requirements and regulations of the destination country. Essentially, the IOR signs all legal responsibilities and pays duties and taxes on your behalf.
• Customs Brokers: A customs broker’s job is to know precisely what is needed in terms of information and documents and professionally prepare the proper documents to ensure the process runs smoothly.
• Third-Party Logistics (3PL): Allow you to outsource operational logistics from warehousing through delivery and enables you to focus on other parts of your business.

It is advisable, where possible, to partner with a third-party expert who can do it all. This reduces back and forth and allows you to focus on what you’re good at, selling. Zee is a Compliance, Importer of Record, and Logistics specialist that offers a one-stop-shop solution for the global expansion of your eCommerce business.P