Selling on Amazon USA: A Comprehensive Guide

Amazon is the world's largest online marketplace, with over 5.69 million visitors in 2022 alone. Its net sales in the same year reached $514 billion, almost doubling its revenue in the past three years. While Amazon operates in 20 countries across various continents, the USA is the powerhouse with $356 billion in sales—69% of Amazon's total revenue. Let's explore why selling on Amazon USA in 2024 could be your best move.

Benefits of selling on Amazon USA

Below are the perks entrepreneurs get when they start selling on Amazon:

1. Market popularity. With a massive American consumer base, the demand on Amazon USA is unparalleled:

• 63% of Americans start their product searches on Amazon.
• 89% of US consumers shop on Amazon more frequently than on any other site.
• The Amazon app is the second most popular shopping app in the USA, with over 98 million active monthly users.

2. Streamlined logistics with FBA. Fulfillment by Amazon (FBA) is a service that greatly simplifies the logistical burden for sellers. All you need to do is ship your products to Amazon’s warehouses. From there, Amazon handles the packaging, storage, shipping, and even customer service. This is a major reason why 73% of sellers in the USA rely on FBA for logistics.
3. Friendly taxation system. US tax obligations are relatively straightforward. Unlike many countries where taxes must be paid on import, in the USA, sales tax is only applied to the final consumer. Moreover, sales tax rates are often more favorable compared to VAT in Europe. This reduces complications for sellers and can help maximize profits.

Considering entering the US market? With access to millions of potential customers, streamlined logistics, and a user-friendly tax system, Amazon USA could be the right choice for your e-commerce expansion. At SellerSail, we can assist with any questions or concerns to ensure your success in this dynamic market.

Amazon USA vs. Amazon Europe: key differences

Although Amazon Europe is a large and thriving market, second only to the USA, there are stark differences in accessibility, logistics, and taxation:

• Logistics & accessibility

European sellers often perceive Amazon EU as a more accessible market because of the proximity and ease of logistics within Europe. However, the process is actually more bureaucratic, slower, and more expensive compared to the USA. With more relaxed regulations, the US market allows sellers to start more quickly and cost-effectively.

• Sales Tax vs. VA

• Sales Tax (USA): Paid only by the end consumer at the point of sale, and the rate varies by state and product type. When selling on Amazon, the marketplace automatically collects, reports, and remits sales tax for you.
• Value Added Tax (VAT, Europe): VAT is applied at each stage of the production process and must be reported and paid by sellers, often on a monthly or quarterly basis. This adds an administrative burden to European sellers.

Aspect	Sales Tax (USA)	VAT (Europe)
Point of Taxation	Only on final sale to the consumer	At every stage of production and sale
Tax on Import	None	Paid upon import of goods
Reporting	Managed by Amazon	Self-reported by sellers
Average Rate	6.53%	Around 20%

At SellerSail, our experts can help navigate the complexities of different tax systems and provide guidance tailored to your specific needs as you enter Amazon USA.

Understanding the US market: what sells?

Before diving into selling, it’s crucial to know what products are in demand in the US market. Here are some resources and tips to help you identify the right products to sell:

1. Amazon tools

• Best sellers rank (BSR). This ranks products in each category based on sales volume, helping you identify what’s trending.
• Movers & shakers. Highlights products with the most significant rise in sales over the last 24 hours, giving insight into emerging trends.

2. External resources.

• Google Trends. Track the popularity of search terms over time, by country, and by season.
• Unicorn Smasher. Analyze product rankings, monthly sales, and customer feedback to find high-potential products.
• Keepa. Access detailed pricing history for products on Amazon to see market trends.
• Jungle Scout’s Sales Estimator. Estimate monthly sales volumes for products in your category of interest.

3. Seasonal demand & niche analysis

• Identify seasonal trends and adapt your inventory accordingly.
• Analyze competitors’ products, reviews, and pricing to ensure your product offers a unique value or improvement.

Need assistance in product selection and market analysis? SellerSail can help you pinpoint profitable opportunities and provide a customized strategy for selling on Amazon USA.

Setting up your seller account on Amazon USA

If you’re already selling on Amazon Europe, you might consider creating a separate seller account for Amazon USA. Although it's possible to sell across regions with one Seller Central account, having a dedicated account for the USA can prevent potential disruptions in case of any issues in one region.

Creating your seller account: key steps

• Gather necessary documents, such as identification and business information.
• Choose your selling plan (Individual or Professional).
• Enter your business details and preferred payment method.
• Complete verification to get your account approved and ready to sell.

By understanding US regulations and local nuances, you can avoid unnecessary risks and costs. And remember, SellerSail is here to guide you through every step.

Choosing the right fulfillment method: FBA or FBM

Once you’ve set up your seller account and selected your products, you need to decide how to handle order fulfillment. You have two main options:

1. Fulfillment by Amazon (FBA)

Amazon’s FBA program makes logistics a breeze. You send your products to Amazon’s warehouses, and they handle the rest: storage, packaging, shipping, and customer service. Here’s a simple step-by-step process:

1. Choose the items you want to send to FBA in your Seller Central account.
2. Specify the origin address, product type, and quantity.
3. Depending on your product’s needs, Amazon may require certain packaging or labeling before shipping.
4. Amazon will direct you to the most optimal fulfillment centers.

FBA allows you to benefit from Amazon’s fast delivery networks and customer service, but it does come with storage and fulfillment fees.

2. Fulfillment by merchant (FBM)

With FBM, you are responsible for inventory storage, packaging, shipping, and customer service. While this requires more effort, it offers more control and potentially lower costs. FBM can be particularly advantageous for products with specific storage needs or slow-moving inventory.

Navigating intellectual property and brand protection

Before listing your products, it's crucial to understand and protect your intellectual property (IP) on Amazon. Here are some common IP protections:

Types of IP protection in the USA

There are several types of intellectual property protection in the USA:

1. Design patent: protects the unique visual design of a product, lasting up to 25 years.
2. Utility patent: secures the functionality of a product or process for up to 25 years.
3. Copyright: covers creative works like books, software, and even listing descriptions for up to 70 years post-author's death.
4. Trademark: protects brand names, logos, and symbols for up to 10 years, renewable indefinitely.

Amazon’s brand protection tools

Below are the tools you may use to protect your Amazon brand:

• Brand Registry: register your brand to access enhanced brand content, A+ content, and marketing opportunities.
• Project Zero: if you’ve dealt with infringement issues before, Project Zero gives you the ability to remove counterfeit listings yourself.
• Transparency Program: add unique product codes to your products to prevent counterfeiting and ensure customer authenticity.
• CCU (Counterfeit Crimes Unit): Amazon’s dedicated team fights counterfeit listings, offering legal support for sellers.

Understanding US Sales Tax and compliance

The US imposes a sales tax that varies across states and sometimes even cities. The tax rate depends on the location and type of product being sold.

When selling on your own website, managing and remitting sales tax can be complex. However, Amazon simplifies this for sellers by collecting and remitting sales tax on your behalf for all orders on the platform. SellerSail can help you navigate this process and provide expert tax advice.

Registering your IP and brand with Amazon Brand Registry

If you own a brand, it's highly recommended to join Amazon Brand Registry. This program helps protect your brand’s integrity and grants you access to enhanced marketing tools and features, such as:

• A+ content: customize your product listings with enhanced visuals and storytelling.
• Amazon stores: build a unique, branded shopping experience on Amazon.
• Brand analytics: access comprehensive data on customer search terms, buying behavior, and competitor performance.

Here’s how to register:

1. Ensure you have a registered trademark in your home country.
2. Gather the necessary documents and submit an application through Amazon Seller Central.
3. After 3-5 days, your brand will be registered, and you’ll have full access to Brand Registry benefits.

Final thoughts

Entering the Amazon USA marketplace opens a world of opportunity, but proper planning and understanding are crucial. Here's a quick recap to get started successfully:

1. Ensure compliance with US tax obligations.
2. Select a model that suits your product type and market needs (FBA or FBM).
3. Plan your shipping and inventory management effectively.
4. Register your brand with Amazon Brand Registry to access added protection and marketing tools.

SellerSail offers free consultations to guide you through the process of selling on Amazon USA. Get in touch, and let’s make your Amazon journey a success!