How Amazon sellers can avoid hefty currency exchange fees
Australians selling on Amazon should consider how they pay international suppliers.
Now that Amazon has officially launched in Australia, many local sellers will be flocking to the retail giant's online marketplace to sell their products. The launch of Amazon Australia is great news for local businesses that have already been selling products on the US site, as their sales from the Australian site will be made in AUD. Previously, if local sellers were selling on the US marketplace, their sales were made in USD meaning they'd lose a portion of their profits to currency exchange fees and foreign transaction fees.
However, this doesn't guarantee that local sellers will avoid currency exchange costs altogether. Managing director of WorldFirst Australia Ray Ridgeway says Australians planning to sell products on Amazon Australia should still consider how they pay their international suppliers, to stretch the savings even further.
"A large portion of Australian sellers will be sourcing their products from China, from platforms like DH Gate. These sellers will generally request payment in USD, so using one of the Big Four banks can cost up to seven times more through poor exchange rates and fees," said Ridgeway.
Despite the poor foreign exchange rates, research released in November revealed half of all Australians are still relying on their bank to send money overseas, and only one in 20 are opting for a non-bank money transfer service. Previous data revealed this inertia is costing Australians over $3 billion annually.
Tips for Australians planning to sell on Amazon
First and foremost, Ridgeway urges Australians thinking about selling products online or needing to pay international suppliers to use a dedicated money transfer service to dodge these highly avoidable fees and charges. "Find an eCommerce money transfer business with lots of experience with Amazon. Having a local account manager is really important. They can help you through the process and even at times provide advice on how marketplace and platforms work."
"Educate yourself on Amazon’s policies and procedures. If you don’t comply, your account can be frozen. Also, be cautious of copycats once you become successful. Stay vigilant and use Amazon’s brand registry."
And if you still need some more assistance, take advantage of forums that allow you to learn from others in the same position as you. "Connect with Facebook groups! The eCommerce market is a very connected community who are always keen to help others. Our favourite is Amazon Sellers Australia," he added.
If you're selling products online on international marketplaces such as Amazon US, check out our guide here to learn how savvy online sellers save on foreign exchange costs.