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eBay Global the Smart Way: Buying and Selling Internationally on the World's #1 Auction Site / Edition 1

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Overview

"Buying and selling on any of the many international eBay sites opens up a huge range of possibilities for American users. The globalization of eBay -- with 28 sites worldwide -- offers vast new markets for American merchandise overseas, as well as the opportunity to buy items globally with the aim of selling them profitably in the U.S.

But along with these opportunities come new questions: Do you need a license to buy and sell internationally? How do you set prices, handle cultural differences, and arrange shipping? And how do you determine which markets are most likely to benefit you? eBay Global the Smart Way shows readers how they can operate safely and profitably, offering in-depth and accessible information, and step-by-step instructions on topics including:

• Marketing to customers in foreign countries

• Ensuring quality

• Using customs brokers

• Making payments to foreign vendors

• Finding economical shipping

• Avoiding credit card fraud

• Avoiding product taxes

• Handling the language barrier

Filled with the unique brand of practical wisdom that have made Joe Sinclair’s other eBay books bestsellers, eBay Global the Smart Way helps readers take advantage of this huge new market, setting the stage for global success."

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Product Details

  • ISBN-13: 9780814472415
  • Publisher: AMACOM
  • Publication date: 8/6/2004
  • Edition number: 1
  • Pages: 320
  • Product dimensions: 6.70 (w) x 9.40 (h) x 0.76 (d)

Meet the Author

Joseph T. Sinclair (Vallejo, CA) is the author of <eBay Business the Smart Way and eBay the Smart Way. Ron Ubels is a licensed Customs broker with over 27 years of experience in customs brokerage and international trade.

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Table of Contents

I.    Introduction

1.   Introduction

2.   Global Prototypes

3.   Compliance, Finance, and Safety

4.   Your Trade Reference System

II.    Customs

5.   Customs Clearance

6.   Customs Documents

7.   Import and Export Licenses

8.   Customs Brokers and Shipping Agents

9.   Restricted Imports and Exports

III.   Finance

10.  Taxes on Sales

11.  Import Duties

12.  Means of Payment

13.  Letters of Credit

14.  Currency Exchange

15.  Operational Costs

16.  Fraud

IV.  PayPal Finance

17.  PayPal Basics

18.  PayPal International

19.  PayPal Import-Export

V.   Shipping

20.  Package Shipping

21.  Bulk Shipping

22.  Insurance

VI.  Business and Culture

23.  Communication

24.  Business Culture and Travel Abroad

25.  Cross Border Relationships

VII. Special Ventures

26.  Manufacturing Abroad

27.  Warehousing

28.  Services and Digital Content

Glossary

Bibliography

Appendices

1.   Top 9 Tips for Selling to Consumers Abroad (2)

2.   Top 10 Tips for Buying on eBays Abroad (2)

3.   Top 7 Tips for Importing to Sell on eBay USA (2)

4.   Top 8 Tips for Exporting to Other Countries (2)

5.   USA Export Assistance Centers and CAN Resources (8)

6.   Countries Abroad (20)

7.   USA/CAN Ports of Entry (12)

8.   Government Resources (2)

9.   Industry Resources (2)

10.  Internet Resources (2)

11.  Frequently Asked Questions (8)

Index

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First Chapter

eBay Global the Smart Way


By Joseph T. Sinclair

AMACOM Books

Copyright © 2004 Joseph T. Sinclair
All right reserved.

ISBN: 0-8144-7241-9


Chapter One

Introduction

What an exciting opportunity to expand your sales! Simply sell in other countries. Your potential market is bigger, and consequently profits can be greater. And American goods are very popular abroad. But before we get carried away with this idea, let's take a look at a major barrier, language. What is its significance? No one can argue that language doesn't matter.

Well, according to the Foreign Language Department of the Curso Experimental Bilingue, San Paulo, Brazil (the_english_dept.tripod.com/esc.html), English is used as a primary language by 375 million people, as a second language by another 375 million people, and as a foreign language by another 750 million people. That's a pretty big market. Potentially via eBay you can reach millions of consumers abroad-in English!

If, in addition, through eBay and other resources you can joint venture (partner) with people in other countries to increase your sales, selling internationally provides even greater opportunities. When you consider that English has become perhaps the primary language for commerce worldwide, you understand that by using English you can leverage your sales. That is, you can potentially sell well in markets that don't speak English by selling through a partner who does speak English.

It works the other way too. Consumers can find a wide variety of useful goods and exotic goods on eBay in 27 other countries for bargain prices. In addition, US importers through eBay and other resources can partner with people in other countries to import goods to sell in the US on eBay. Going global opens amazing opportunities. And what better way to go global than through eBay?

Today eBay operates auctions in the following countries (as of spring 2004):

Australia

Austria

Belgium

Canada

China (minority interest)

France

Germany

Hong Kong

Ireland

Italy

Mercado Libre (minority interest)

Argentina

Brazil

Chile

Columbia

Ecuador

Mexico

Uruguay

Venezuela

Netherlands

New Zealand

Singapore

South Korea

Spain

Sweden

Switzerland

Taiwan

United Kingdom

United States

eBay also owns PayPal, which is now established in 38 countries (as of spring 2004), which are listed in Chapter 18. PayPal enables you to conduct business in those countries more easily and more safely.

According to the 2003 eBay annual report, at the end of 2003 eBay had:

* 95 million registered users

* 41 million active users

* 40 million PayPal accounts

* A staggering 720 million page views per day!

* $85 million in sales each day!

About one-third of eBay is abroad. Extrapolating the end-of-year 2003 statistics, that means eBay had abroad:

* About 32 million registered members

* About 14 million active users

* As many as 13 million PayPal accounts

Does mean that you can increase your sales by 50 percent just by selling abroad? (If the US has two-thirds and countries abroad have one-third of the eBay volume, then reaching all of the eBay markets abroad from the US would theoretically increase your sales 50 percent.) Not likely. Many countries abroad have language barriers making significant market penetration without an English-speaking partner in those countries unlikely. Nonetheless, there is plenty of opportunity to expand your sales.

About 27 percent of goods exported via eBay go to Canada, 16 percent to Great Britain, 8 percent to Germany, and 6 percent to Japan. As you might expect, eBay business is a little more brisk in English-speaking countries.

Canada provides eBay US with 15,000 purchases per day. Over 25 percent of sales in 20 major subcategories are abroad. About 21 percent of the stamps, 18 percent of the music, 8 percent of the computers, and 5 percent of the auto parts are sold to buyers abroad. This gives you an idea of the range of sales abroad over a selection of major items.

Hey! If you have a global perspective, this eBay thing is really turning into something.

Pitfalls

The pitfalls in carrying on commerce abroad are many. This is great news. Why? Because as every good businessperson knows, it excludes much of the competition. Those who take the trouble to learn the byways of foreign business will find greater opportunities than those who don't. Most often the rewards are greater than the extra effort. But let's survey some of the pitfalls.

Markets

eBay Business the Smart Way said, "Oddly enough each item, no matter how similar to another item, has its own market. Don't assume that similar items will produce the same sales results." That is true in a national market. Add to that differences in affluence, culture, language, and business practices between countries and that observation is compounded. The pitfall is that you can't assume anything about an item's market until it is proven either by existing sales or by experimentation. Indeed, a common US item popular in France may have no significant sales in Brazil.

Paperwork

Conducting business between countries is an exercise in paperwork. Bureaucracy controls the borders. Even for simple transactions, you must provide some paperwork. Moreover, the paperwork must meet the established bureaucratic standards, or the transaction may be jeopardized. Much of the agony caused by the required paperwork can be bypassed by the use of computer-generated documents, but you will still have pay attention to detail. Or, you will have to pay to have someone else do it for you.

Shipping

Other countries are often far away. That means shipping will be more expensive for items sold in those countries than for local sales. This is particularly true for overseas sales. Your choices aren't great. One to eight days by air or one to eight weeks by ship. The latter is less expensive but not practical for consumer sales. Consequently, there will be plenty of items that you can sell locally but not abroad. The cost of shipping overseas will put many items out of the market.

Payment

In the import-export business, businesspeople have traditionally used cashier's checks, wire transfers, or letters of credit for payment. And exchanges are often necessary from one currency into another. This archaic infrastructure for payment is expensive. It nickels and dimes you to death. A new less expensive infrastructure for payment is starting to be established, but it will take some time for it to become widespread. In the meanwhile, receiving payments and making payments will continue to restrict the markets for many consumer goods.

Communication

The computer age eliminates all long distance communications problems. Or, does it? Although email is instant and inexpensive, language barriers still remain. You can't run a business depending on computer translations. Consequently, where your potential customers don't speak your language, your sales efforts may not be cost-effective.

Taxes

Often duties must be paid for merchandise to cross borders. This is simply a government tax on certain goods. This can become an important factor regarding whether you can make your sales profitable in a foreign country. In addition, whether a duty is paid or not can depend on how an item is classified. Put in one class (category) the item is duty-free. Put in another category it has a 15 percent duty.

In addition, some countries have a sales tax or a value-added tax (VAT) or both. How those taxes are handled-or if they are even collected-can make or break a sales effort.

And to add insult to injury, every country is different when it comes to taxes.

Third-Parties

Your goal in import-export is to take care of as much of the routine business and paperwork yourself as possible. If you have to get third-parties involved, it's going to cost money. Yet, it's often impossible to do what you need to do without third-party assistance. Accordingly, your profit margin must be higher for items sold abroad.

Information

Anytime you must comply with government regulations, you need to know the regulations in order to comply. For instance, if you sell a dangerous item locally, you may have to comply with the different regulations of several different government agencies. This can be a nightmare, unless you can easily and cost-effectively access the information you need in order to comply. Thus, information becomes an important component of successfully making sales.

On an international scale, information is more often an important component of your sales effort because you have to comply with regulations in every country in which you do business. Many items, not just dangerous items, are subject to the regulations of each country. This means you will have to collect informational resources to use in your day-to-day business.

Fraud

Fraud is rampant in many parts of the third world. Many underdeveloped countries cannot control massive fraud in the new online markets that the Internet has opened. This has caused a huge stumbling block in the path of increased global online commerce. Nonetheless, as businesspeople and consumers learn to discriminate between countries, the situation will improve greatly. Through PayPal and other safe payment mechanisms, many countries will come to dominate global online trade. Other countries may come to be shut out as their national reputations for fraud become widely acknowledged. The name of the import-export game is to learn which countries to trust, and already national reputations are beginning to emerge. The international markets are still huge even after you eliminate the countries that can't be trusted.

Individuals

It's a little crazy to talk about trusting countries when it's really individuals who you can or cannot trust. In the most untrustworthy countries there will always be plenty of people you can trust. To be successful in business, however, you have to play the statistics. In countries where there are inadequate commercial regulations, controls, and law enforcement, the statistics work against you. It's not so crazy to be extra cautious when dealing with individuals from such countries.

Chapter 16 provides a list of the countries that already have a reputation for online fraud. Your best policy may be to refuse to do business with people from such countries. At the least, be super cautious about doing business with individuals from such countries.

This Book

This book helps you get the information you need to carry on commerce safely and cost-effectively in foreign countries and avoid many of the pitfalls. As mentioned above, information is an important component of global commerce. You can't leave home without it and expect to do well. Therefore the goals of this book are to:

1. Explain key concepts of global commerce.

2. Explain certain important mechanisms necessary for doing business outside your own country.

3. Provide bountiful references (in English) to resources you can use for global commerce.

4. Help you make import-export via eBay safe and profitable.

Unfortunately, this book cannot feature a national-centric view of the global marketplace for each country. But many of the principles of international business are universal. The book uses the United States (US) and eBay in the US (eBay US) as well as Canada (CA) as the examples to illustrate how global online commerce works. Although some of the information herein is national-centric, we make an effort to express the concepts and mechanisms in more general terms so those readers outside the US and Canada will find the book useful.

Prototypes

To make it easy to understand what information in this book is for you and what is for those who play a different role in international commerce than you, the book uses the prototypes outlined in Chapter 2. Keeping the prototypes in mind will help you understand the information in the chapters more easily.

eBay Basics

This is a specialized eBay book. It doesn't cover the eBay basics. For the basics we recommend eBay the Smart Way Third Edition or a similar book. To learn the basics for operating a business on eBay we recommend eBay Business the Smart Way or a similar book. eBay Global the Smart Way assumes that you have used eBay and are confident in your basic eBay skills. If you don't yet have the necessary skills and confidence, you will probably not get the most out of this book. Moreover, this book assumes that you are confident that eBay is a safe place to buy and sell almost any type of goods, except in other countries. The purpose of this book is to provide you with the information you need to expand your eBay buying and selling to other countries with confidence and safety.

eBay is not a passing fad. It is the first great institutional marketplace of the new digital age. Indeed, it is the first great global online marketplace. It couldn't-and didn't-exist before the Internet. The Internet is here to stay, and the Internet is worldwide. And so is eBay. Consequently, it's to your benefit to learn the basics and develop the confidence to use eBay whether it's for your everyday buying and selling activities or for buying or selling as an eBay business.

And beyond that, it's also to your benefit to use eBay globally in order to maximize your buying and selling opportunities. This book will help you do so.

Motors

If you're interested in buying and selling vehicles, try eBay Motors the Smart Way. However, we don't recommend casually buying or selling vehicles abroad on eBay. There are too many problems internationally, particularly when most vehicles are available in North America.

(Continues...)



Excerpted from eBay Global the Smart Way by Joseph T. Sinclair Copyright © 2004 by Joseph T. Sinclair. Excerpted by permission.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

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