Reasons to Investigate Selling Internationally on Amazon -
The opportunity - intro
Amazon stats
2019 Amazon GMV 2019 worldwide was 280.5 Billion USD
All of Amazon outside USA: Was 87B USD GMV in 2019 (31% of total)
Amazon International selling summit:
Global Empires Summit - Hosted by Kevin Sanderson
My presentation for Summit:
Overview of some lessons from the British Empire
- the 4 horsemen -
- and the “Merchant Mindset” BASH
- and Merchant Skills that you need….
Why consider Amazon selling internationally?
Reason 1: Additional Revenue
- USA is about ⅔ of total
- So even on average, you could add another ⅓ or so to sales by being fully diversified
Reason 2: one of the easiest ways to expand
- Identifying a market is hard
- Getting a quality, differentiated product is really hard
- Doing so profitably even harder!
- Expanding once you’ve done all that EVEN in an era of more bureacracy is easier
- Mostly because you can outsource the bureaucracy (tactical) but you CAN’T really outsource great sourcing (strategic)
Reason 3: Profits/low competition
- Fewer competitors in some places. Barriers to entry.
- Inertia
- Language barrier. EU Japan
- Cultural barrier. Japan
- VAT/Sales tax etc. barriers. EU. Japan etc
- Strong currency EUR/DE
- Wealthy consumers (EUR/DE)
Reason for Amazon Selling Internationally: Diversifying Risk
Reason 4: Currency risk - Diversifying risk 1
- Fluctuations
- GBP to USD
- Currency being punished
- GBP!
- EUR to USD tight range last few years
Reason 5: COVID Risk Diversification - Diversifying risk 2
- Demand shock
- US helicopter money coming to end
- UK furlough coming to end
- UK GDP sank 20% in Q2 2020!
- USA only 10%
- Supply shock
- Fr. And IT FCs shutdown height of COVID spring 2020
- US FC
- US FC shutdowns to come?
Reason 6: Amazon Suspension Risk - Diversifying Risk 3
- Reduce single-Amazon marketplace dependence
- Individual countries can change regulations and lead to suspended listings
- Eg Hazmat in Germany for client account
- In USA, same exact product selling, no issues
- An entire marketplace Amazon account can be suspended while others remain open
Reason 7: Cashflow/Working Capital trick
- MOQs - profit per unit
- Stock turn (cashflow)
- WC - function of profit and stock turn
Cost-Benefit analysis
Upside (Benefit) assessment
- Possible upside
- Probability
- Downside assessment (Cost)
- How bad it could be
- Possibility
3 Amazon overseas expansion opportunities - low hanging fruit
Canada for US based sellers
- Physically close so can affordably send stock
- Straightforward. Helpful customs agents in Govt.
- Speak English
For UK sellers: Germany is a huge market
Bigger than say Italy
But similar costs/time to comply with VAT registration
- All things being equal, better value
Etc etc
For all sellers - Japan
- About same size as U.K. market GMV
- 2 weeks shipping time to China. This is huge for cashflow!!
- Only 10% sales tax on import cf 20% VAT into U.K. or EU
- no research tools. Most sellers stay out. Again huge.
Next steps
Get informed about international Amazon
Global Empires Summit - Hosted by Kevin Sanderson
My presentation for Summit:
