USA Business

Discussion in 'International Business' started by Toon, Jul 14, 2020.

  1. Toon

    Toon UKBF Enthusiast Full Member

    873 10
    Anyone have a US business? I have a successful UK based ecommerce company and want to replicate it in the US. I'm in the final stages of researching and could do with opinions on the following things please:
    1. Which state do you recommend to register in? I think I'm going with Delaware as it's the best for tax reasons.
    2. Should I use a company to create my company for me? I saw some who will do this for $180.
    3. I'll be starting off with Amazon FBA but I will probably need to find a prep company. Any recommendations?
    4. Any recommendations for who can help with ongoing tasks like tax returns?
    5. Anything else I should be made aware of?
    Many thanks
     
    Posted: Jul 14, 2020 By: Toon Member since: Jul 17, 2004
    #1
  2. RobinBHM

    RobinBHM UKBF Regular Free Member

    385 123
    I hope you aren't selling masks, they aren't popular over there :)
     
    Posted: Jul 14, 2020 By: RobinBHM Member since: Apr 14, 2012
    #2
  3. Toon

    Toon UKBF Enthusiast Full Member

    873 10
    Haha, funny enough we just got some Levi's masks in :)
     
    Posted: Jul 14, 2020 By: Toon Member since: Jul 17, 2004
    #3
  4. marcoichnossports

    marcoichnossports UKBF Newcomer Free Member

    2 0
    Great website Toon! We are in the same position as you, we want to do the same, fba to test and see if it's worth it. Hopefully somebody will reply here
     
    Posted: Aug 13, 2020 By: marcoichnossports Member since: Aug 12, 2020
    #4
  5. Mister B

    Mister B UKBF Ace Free Member

    2,461 574
    We've got the t shirt on this one. Started off over there around 5/6 years ago and built turnover up to around US$300k a year.

    All gone south now though as we were continually attacked by Chinese competition, screwed over by the FBA returns policy and to cap it all, Amazon's AI system decided that our gear contained pesticides, (sports clothes,) which meant that we could no longer sell our goods on the platform. We appealed and they said that we could recall the stock back to the UK, give it new skus and we could then go on as normal. We decided to bring it all back here, (over 1,000 pieces,) and stopped selling on .com. We still have the account open as we may well return there in the near future. Other markets to target in the short term.

    In answer to your specific questions:

    1. Why do you need to set a company up over there? The US have a recipricol tax arrangement with the UK which makes things a lot easier so you don't really need to open a company over there.
    2. If you're sending goods direct from Asia, or from the UK, to make the shipping cost effective you'll need to get yourself an FEIN. This will allow you to send large volumes over by sea and pay import charges direct.
    3. Be warned-import duty to the US is currently around 30% for our products and set to go up.
    4. Make sure that you get yourself a USPTO trade mark. We use Josh Gerben in Washington. Really easy process.
    5. Dependent on volume and state, you will be liable to register for sales tax. This is a real ballache and changing all of the time. Some register, some don't. If you don't and you get caught, they can really come after you. Especially in dollar starved states like CA. For state tax filing, we used Sovos compliance who were spot on.
    6. Make sure that you have adequate public liability insurance.
    7. You will also need a returns address in the US, from which you can get back your FBA returns. And be warned, you will have loads.
    8. Federal and state corp tax returns, we used a company called Consult BC who again, are very efficient.

    Since we pulled out we have regular enquiries about stock availability in the US, so it may be that we return to the US. If we do though, we'll look at doing it independently as well as with Amazon, of whom there are many pitfalls.

    HTH.

    Mister B
     
    Posted: Aug 14, 2020 By: Mister B Member since: Aug 31, 2007
    #5
  6. marcoichnossports

    marcoichnossports UKBF Newcomer Free Member

    2 0
    Thank you Mister B for the insight, it's a shame that you had to drop the market. At 300k you were building a nice business over there.
     
    Posted: Aug 14, 2020 By: marcoichnossports Member since: Aug 12, 2020
    #6
  7. The Byre

    The Byre UKBF Legend Full Member

    10,236 4,231
    @Mister B's experience is very usual. A great way for UK businesses to dig a mighty hole for themselves is to imagine that what works in the UK should work in the US. One of the biggest misconceptions is that it is one market - it isn't. It's more like the EU, but with them all speaking the same language - except in Florida of course.

    Even Tesco had to find out the hard way that what works in the UK does not necessarily work elsewhere. You need real local retailing talent (such as a local partner company) to even get a toe-hold in a regional US market.

    The UK is a tiny market and heavily centralised (but with NI and Scotland being very different). That makes it fairly easy to work from one place and do business in one way. Federal countries made up of many separate states such as Russia, China, Germany and the US do not function like that.

    Even something as fundamental as price structures and margins are not only very different to the UK, but can vary from state to state.
     
    Posted: Aug 15, 2020 By: The Byre Member since: Aug 13, 2013
    #7
  8. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    11,868 2,471
    Some US States like California are famous for the restrictions they place on items to sell or import from other states

    I belong to another predominantly US Leather forum and the moaning about local, state and interstate laws and taxes is a major complaint by the posters, life for american small business seems to be built on problems and paperwork, so worth investigating fully with a trip over there to a few states
     
    Posted: Aug 15, 2020 By: Chris Ashdown Member since: Dec 7, 2003
    #8
  9. Bob Morgan

    Bob Morgan UKBF Enthusiast Free Member

    950 258
    USA Clients = 50% Premium! PIA!
     
    Posted: Aug 17, 2020 By: Bob Morgan Member since: Apr 15, 2018
    #9
  10. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    11,868 2,471
    66 Million UK population is a fair market to crack, with less potential problems, then quite a few neighbours who are English speaking and easier to deal with ,(at least at present)
     
    Posted: Aug 17, 2020 By: Chris Ashdown Member since: Dec 7, 2003
    #10
  11. Bob Morgan

    Bob Morgan UKBF Enthusiast Free Member

    950 258
    It would help if they spoke 'English!'
     
    Posted: Aug 18, 2020 By: Bob Morgan Member since: Apr 15, 2018
    #11
  12. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    11,868 2,471
    They have been saying that about Glasgow people for years, nothing new
     
    Posted: Aug 18, 2020 By: Chris Ashdown Member since: Dec 7, 2003
    #12
  13. Bob Morgan

    Bob Morgan UKBF Enthusiast Free Member

    950 258
    Should I worry?
     
    Posted: Aug 18, 2020 By: Bob Morgan Member since: Apr 15, 2018
    #13
  14. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    11,868 2,471
    Who knows
     
    Posted: Aug 18, 2020 By: Chris Ashdown Member since: Dec 7, 2003
    #14
  15. Sanjay Patoliya

    Sanjay Patoliya UKBF Newcomer Free Member

    7 1
    You must prepare a good website and enough social media presence before launching your new business anywhere.
     
    Posted: Aug 31, 2020 By: Sanjay Patoliya Member since: Apr 2, 2020
    #15