Sales Tax Nexus Issue to be Decided Soon
The eBay & Amazon Seller's News ~ April 24, 2018 ~ Volume 19, Issue No. 8
Tips, Tools, News and Wholesale Resources for eBay and Amazon Sellers
Tomorrow on April 25th, I am doing a webinar with CJ Rosenbaum of Amazon Sellers Lawyer on the subject of Intellectual Property Issues facing Amazon Sellers. You can click here to watch it live at 2:00 PM Eastern, (11AM Pacific).
Or click here to see a recording the following day, if you miss the live event.
In the last issue, I had an article about Consignment selling. What I forgot to mention is that my consignment training manual - Making Money with An Online Consignment Business was updated for 2018.
Terapeak, the best research tool on the market for eBay sellers is offering an extended free trial for my readers if you use this link. Note - This is a limited time offer. If you visit Terapeak and only see the 7-day free trial, then the promotion has ended. I know they are all about eBay, but I find their keyword research works great on Amazon too.
This contest has been running a while, but you still have 2 weeks left to participate.
Testimonial Contest: Win a $100 Amazon Gift Card!
I get a lot of positive mentions in my email from those of you who have bought my courses, but many of them are now somewhat out-of-date, so I am looking for some fresh testimonials.
Therefore, I have decided to run another testimonial contest. You can refer to a product you purchased or how useful this newsletter is to you.
Here is what I am looking for:
Sign your testimonial with your first name and last Initial plus the name of your city. For Example, Bob W., Pittsburgh, PA.
We reserve the right to make minor changes to spelling, punctuation and grammar that do not change the specifics, or content of the Testimonial.
The best testimonial (in the judgment of our coaching staff), will win a $100 Amazon Gift Card.
Everyone who enters will go into a drawing for a $50 Amazon Gift Card. I will announce the winners in the May 22nd newsletter, and the winners will get an email from me before that.
eCom Engine has created a special offer on their three best-selling Amazon services:
You can read the details on the special offer for my readers here.
Listing Mirror is a multi-channel integration service that supports Amazon, Jet, Etsy, eBay, Wal-Mart, Shopify, Woo Commerce, Overstock, Big Commerce and ShipStation.
I have been recommending Joelister for those who just sell on Amazon and eBay, and they are still a good choice, but if you hope to expand to other channels, they you may just want to start with Listing Mirror.
I chatted with them last week and they have offered a 10% discount on you first year's service if you use the promo code skipmcgrath. Note: That is all lower case.
Important Amazon Announcement
This just arrived from Amazon a few days ago
Lets get started with this month’s in-depth articles:
Last week on April 17th, the Supreme Court of the United States (SCOTUS) heard arguments in the case of South Dakota vs. Quill. The decision in this case (expected sometime in June) will determine the fate of thousands of sellers on eBay, Amazon, Etsy and other online selling sites.
In 1992 The Supreme Court ruled in the case of Quill vs. North Dakota. That ruling stated that selling a product into a state would not trigger local sales tax, unless a seller had a presence (nexus) in a state such as employees, an office, store or warehouse.
Now, the State of South Dakota is challenging that decision, and has petitioned SCOTUS to rehear the case and force any party selling products in the State of South Dakota to collect and pay sales tax. The population of South Dakota is quite small at only 890,000 people so sellers don't see that many orders there.
If it were only South Dakota in play, it would not be that big a deal. But the original Quill decision applied to all states that charge sales tax, and if the Court changes the original ruling, it will affect all 46 states that collect sales tax. (The non-sales tax states are: Delaware, Oregon, New Hampshire and Montana. Alaska has no state sales tax but individual cities and towns have a local sales-tax that averages about 1.7%)
Many legal scholars have taken the position that current state laws forcing sellers into collecting sales taxes when they do not have a presence in the state are unconstitutional. But, if SCOTUS decides in favor of South Dakota, that will no longer be the case.
If SCOTUS decides in favor of South Dakota, theoretically all states with sales tax could force eBay, Etsy and Amazon sellers to register, collect and pay sales tax in all 46 states. This would drive many of them out of business, which is what big store chains want.
Part of the presentation to the court was information about the challenge to small independent sellers, and there is a possibility the Court will carve out a segment of the law to protect them.
Sadly, I think a bad decision will discourage many very small sellers that they will just abandon their eBay or Amazon business. But medium to larger size sellers can avail themselves of services from companies such as Tax-Jar. Tax-Jar provides a wide range of services related to sales tax in the different states and can connect you with companies that will handle the registration for you.
Tax-Jar's basic service includes one-click linking to you accounts (eBay, Amazon, Etsy, PayPal, Shopify, etc.), preparing your returns and auto-filing them for you.
This is a guest post by Brittany Fischer of FinanciallyWell, a service to help you get control of your personal finances.
Since the dawn of the Internet Age, entrepreneurial men and women have taken to the net to take control of their finances. But there's much more to it than simply listing a product and hoping for success. Here, we will briefly cover managing business expenses, collect money and making your business more convenient for hundreds of millions of online shoppers with credit card in hand.
What is a business expense?
The IRS defines a business expense as those related to "carrying on a trade or business." These are expenses that are deductible on your taxes. Your business expenses will be based on your industry and the type of business you run. For instance, if you open an Amazon store and stock products at your home and use a dedicated office space to conduct business, you may be able to count the cost of your inventory and some of your home's utilities on your taxes at the end of the year.
Many sellers often overlook the not-so-obvious expenses related to being an online entrepreneur. This includes the cost of shipping, industry publications and subscriptions, and online or in person classes you take to help you run your business. As an online seller, you can deduct things such as mileage driving back and forth to the post office and possibly even write off a portion of your expenses related to travel if you must leave your home area to research goods for your online store.
Keeping it straight
One of the biggest challenges for online sellers is learning how to effectively manage and separate business expenses from personal expenses. As a general rule, if it's necessary to your business, it's an expense. But when you work for yourself - especially if you run your online store from home - there is a line that's easy to blur. Your best bet is to do everything in your power to keep personal expenses separate. Fortunately, since the bulk of your business will be handled online, it's not that difficult to keep track of the money your business intakes and expends. Your electronic payment system is your biggest ally when it comes to balancing the books.
According to Square, an electronic payment system will benefit your business in a number of ways in addition to asset and liability tracking. Most notably, having a secure system in place keeps your customers' information safe while making it easier and more efficient to purchase from you. The ability to take electronic payments also opens the door to a larger audience of consumers. With the right payment system, you can even take your products on the road such as to a trade show, flea market or boutique bazaar. Payments taken at these events via your integrated payment system can automatically be figured in with your monthly accounting so you won't have to keep track of multiple accounts for different selling platforms.
There are millions of competitors on eBay and Amazon. In order to be successful, you must embrace not only online sales but also all of the pros and cons that come along with doing digital business. Entrepreneur explains that successful online sellers must develop and continually refine specific skill sets to secure both short- and long-term advantages over other sellers. You must learn to read and understand online analytics, master the art of negotiation with vendors, and embrace automated processes.
Every online seller goes into the business to serve a specific purpose. Yours might be to supplement your income to give yourself the opportunity to stay home with children, or simply take control of your financial future. And while there are many success stories of people who've broken the mold and made it online, it isn't as easy as it looks. Being an online seller requires hard work and dedication, business and financial acumen and the ability to cut the clutter so you can stand out in a competitive marketplace.
AliExpress is the younger brother to Alibaba. Where Alibaba focuses on manufacturers who sell in large quantities, AliExpress offers many of the same products in quantities as small as one or two each.
Let's say you were looking for a knife sharpener to sell on Amazon. The reason I picked a knife sharpener is they have excellent sales ranks in both Home & Kitchen and Tools & Home Improvements categories.
I would go to Aliexpress and type knife sharpener in the search box. That would bring up a page that looked like this:
As you can see there are a variety of knife sharpeners priced from about $8.00 to $23.00. Don't worry about the prices. Remember, at this stage we are just test marketing. The prices you see are for very small quantities. Once you request a quantity such as 100, the prices you see will be much lower. That $14.19 sharpener will cost you more like $6.00 landed cost when you order a larger quantity. I would start out with 100 each after my test marketing proves there is a market.
If I could buy that sharpener for $6, I could price it at $19.99 which is where the competition is and still make a nice profit. And, once I start selling, if the product sells well, then I could up my next order to 500 and get my landed cost down to under $5.00 each.
We are just test marketing now -not trying to make money at this point, so don't worry about that. All research has a cost, and you need to compare the cost to your potential profits. If the test marketing ended up costing you $25, but once you get into production, you could make a profit of $25 a day, then that is an excellent ROI (Return on Investment)
The New Edge Knife Sharpener Professional is going for $14.19 each with free shipping to the United States.
As you can see, at a cost of $14.19 and a selling price of $19.99 on Amazon, you will probably break even, or even lose a little if you sell via FBA (which I strongly recommend for testing). That is OK. If these sell quickly, and I can get them at a landed cost of $6.00, I will do very well with these.
Now we get to the issue of branding. Obviously you cannot poach an existing seller's brand on Amazon, so you need to come up with a brand of your own. At this point you want to invent a brand name, for example you could use something like CoolKitchen that is:
Don't worry about a Trademark at this point. You need a trademark to register your brand on Amazon, but you do not need a trademark to sell under that name. There is a bit of risk doing this as your brand name could be poached and there would be nothing you could do about it, but I am willing to take that risk until I know the product will sell.
Registering a Federal Trademark costs $275 to $375. I don't suggest you incur that expense until you know you have a winner. When you are ready for a Trademark, there are two places that can help My Corporation and TrademarkEngine.com. I recommend My Corporation as you get a little more for your money including the ability to get help.
You can do it yourself, but the process takes 5 or 6 months. Make just one tiny mistake, they return the paperwork and the 5 or 6 months starts all over again (This just happened to some friends of mine).
Once you receive the 4 or 5 of each item you bought, start by creating a listing on Amazon using the brand name you selected. Price them competitively and sit back and wait. Don't fret if you don't see immediate sales. On most of my PL products, it took up to a month to get that first sale. If you want to spend the money, you can invest in a sponsored product ad, but even those are not guaranteed to work.
If you want to learn more about Private Labeling, I cover it in The Complete Amazon Marketing System . I cover PL both in the course itself -and you get a special bonus report on Private Labeling that I just updated for 2018.
This is a guest post by Andrew Wanschura of etail Solutions. They offer dynamic repricing software as well as several other services for online sellers.
Competition is getting tougher every day.
Obvious and Not-So-Obvious Costs That Must Be Counted When Repricing
If any of these costs go up and you don't raise your floor prices, your
items will be underpriced and your gross profit margin will shrink. But
what if costs go down and you don't lower your floor prices? Your items
will be overpriced and you could lose the Buy Box - and many potential
sales orders - depending on how competitive your category is. Neglecting
even a slight cost savings might be the difference between winning and
losing the Buy Box. In either case, you're putting your business in a
highly uncompetitive position.
Why and How You Should Respond to Cost or Competitors' Price Changes
There are several options. These include:
There are also systems that combine rules-based and algorithmic repricing. However, there is a downside to using them.
Rules-based and algorithmic repricers don't consider the total cost of selling the product. For example, your product or shipping cost will change after you set up the repricer and establish your initial prices. So while these repricers may help you win the Buy Box, you could still lose money on the sale. To prevent this from happening, you have to manually adjust your prices soon after every time your costs change. For sellers with high SKU counts, this task can be a full-time job. A better option might be:
Bottom line: knowing your full, real costs and factoring them into each decision is the key to profitable repricing. You can't expect to be able to manually raise or lower prices for all your SKUs, across all your channels and listings, as frequently as your costs - and your competitors' prices - change. The Amazon sellers who set and forget their costs or who adjust their prices manually are putting their businesses in a highly uncompetitive position.
Always Sell At Your Most Competitive Price While Protecting - and Growing - Gross Profit
So, if you're tired of the never-ending battle of trying to keep your prices right …
If you're tired of not knowing if you're losing money or leaving money on the table …
If you're tired of being out-priced and outsold by your competitors, visit etailsolutions.com.
Request a demonstration of our Sales and Supply Chain Management Platform - which includes Integrated Dynamic Repricing - today.
With the ability to reprice 9 million SKUs up to 600,000 times per hour, you'll see why some of the largest Amazon sellers (And those who want to grow their business) in some of the most competitive categories depend on our Integrated Dynamic Repricer to get the job done.
This is a guest post by Cyndi Thomason who is a Profit First Professional, Mastery Level, and Founder of Bookskeep, a eCommerce Bookkeeping specialist. If you need some help with your eBay or Amazon business, be sure and reach out to Cyndi -she is a real expert.
Yesterday I spoke with a client and my heart is soaring! This client sells his private label products on Amazon. We have been working together for 2 1/2 years implementing and maintaining a cash flow system called Profit First. His business has grown according to several metrics during this time. Many business owners want to grow. For them that means they want to increase their revenues. With Profit First, we concentrate on growing profits. We have learned that revenue growth does not always lead to growth in the bottom line.
Profit First is a system that allows business owners to grow in a healthy way. This method works with a behavioral and economic law called Parkinson's Law. C. Northcote Parkinson was a British naval officer and in the 1950's he determined that the British Navy bureaucracy would expand to use the resources available to it. For example, if the budget was $1 million, then the expenses would come in at $1 million. Parkinson's Law applies to money and time. He states specifically, "work expands so as to fill the time available for its completion" or "you get what you got."
Business owners fall victim to Parkinson's Law by using bank balance accounting. Do you look at your bank account online daily? Do you make business decisions based on the balance in your checking account? If you do, you're not alone. Many of us operate this way. So let's put that behavior to work for us.
The Profit First system operates with several bank accounts. Each bank account is designated for a specific use. For Amazon clients, we create an account for inventory, profits, owner pay, taxes, and operating expenses. As you receive your Amazon settlement, we designate a percentage, based on historical analysis, to each of those accounts. When you purchase inventory, pay yourself, pay operating expenses, these purchases are taken from the designated account. When you check your bank balance each day, you will have a more accurate picture of the available funds for the specific use.
Many small businesses wait until the end of the year to determine if they are profitable. It's an annual event that we just completed - tax filing. Profit should be First in your business; it should be a habit. To make sure it's a habit, we must put Profit dollars aside on a regular basis. With each Amazon payout, set aside your Profit. If you leave the funds in your operating expense account, Parkinson's Law will be at work to ensure there is no profit left at tax time.
There is also another benefit to putting Profit First and reducing your operating expenses. Businesses that are frugal, efficient and innovative are more likely to succeed. With reduced operating funds, you are forced to emphasize efficiency and innovation and as a result you improve your business. If you're not looking for ways to improve, watch out; because your competitors are.
The concepts described above are just two of the many concepts that make of the Profit First system that was developed by Mike Michalowicz and is explained in his book also named Profit First. The concepts are simple to grasp and for some, simple to implement. Others need a little help. That's where people like me, an accountant and Profit First Professional can help.
If you're interested in a free digital copy of the core chapters of Profit First, you can download it here. If you would like to get started implementing Profit First in your business, my speech at ASD Market Week 2018 is available here. It is a quick way to get started right away.
If you need a little incentive, let me tell you about my client's improved numbers. Cash grew 23% even after investing funds in a non-Amazon venture to diversify income streams, all credit cards and debt are paid off, inventory is up 683% and he didn't run out during his busy season, he paid himself 500% more, income was up 39% and profits were up 43%. Are you ready to take your Profit First?
Remember - a lot of these websites do not show wholesale information, because they don't want the general public to see it. When you run into this, just email them using the Contact Us form on their website.
St. Thomas Greeting Cards sells a nice line of greeting cards with uplifting messages.
Milestone Candles is a line of candles where a greeting card met a candle. Milestone candles are Made in the USA, women owned
Notes & Queries imports and distributes upscale greeting cards, gift packaging, and stationery items from more than 25 publishers in the UK, The Netherlands, Germany and Israel.
The Ruff Ruff Couture Collection of high-fashion dog wear includes dresses, tanks, t-shirts, hoodies, jackets, coats, rain-slickers, sweaters, blankets, jewelry, bowls, toys and travel carriers. All Made in the USA
Foreside Home & Garden is a home décor manufacturer known for its unique artisan- inspired designs that offer affordable décor for the home
Magid Handbags makes and sells fashion & designer handbags, purses, and women's accessories. Products include daytime and evening bags that range from casual everyday totes to fashionable handbags.
Myleather is one of the largest direct Manufacturers and Importers of leather products in the world with a wide range of products.
Drugstore Products, Inc . is a discount wholesaler of Health & Beauty Care and Cosmetic products.
Fun Express carries wholesale toys, novelties, party favors and decorations.
Style Asia Inc. is a wholesale distributor in East Coast. Product lines include Tailgating accessories, Housewares, Electronics, gifts, novelties and promotional products.
Boogaloo Bracelets are very unique and come in over 20 styles in 4 different sizes. Hand- Made in the U.S.A.
Patti Boo sells custom embroidery, screen-prints and wholesale items that include dickies, onesies, creepers, polos, hats, jackets and more.
Wholesale Baby Blanks sells the WeeWearz brand of blank baby clothes so you can, heat press, screen print, or embroider you own designs.
D&L Stained Glass Supply, Inc . is a wholesale distributor of supplies for the art glass industry. Products include glass and tools and they offer same day shipping.
El Cheapo Posters is a "wholesale to the public" website offering a small line of unique posters at great wholesale prices - lower than most others.
That’s it for now. See you again in a couple of weeks.
P.S. If you missed the last issue, click here to read it.
© 1999- Harry McGrath, Inc., DBA Skip McGrath, Auction Seller's Resource and Vision-One Marketing. All Rights Reserved.
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