Selling Online to the USA: A Five-Step Guide to Setting up US Fulfilment

70% of UK retailers say that the US is a priority export destination, according to a recent Tamebay survey. While it’s fairly simple to set up the commercial aspects of selling online to US consumers, handling the logistics is a bigger challenge.

One solution is to use a US fulfilment centre. It’ll give you a base to hold stock locally and give your US customers a much better experience, with cheaper shipping, faster delivery, no customs duty surprises, and hassle-free returns.

So how do you get started? In this post, we show you the five steps you’ll need to take to use a US fulfilment centre, using James and James’s own location in Columbus, Ohio as an example.

1. Register as a foreign for-profit corporation

The first step is to register as a foreign for-profit corporation, which essentially gives you a licence to do business in the USA. In Ohio, you can do this by completing a 530A form, which requires:

• Page 1: Your existing business contact details
• Page 2: A Certificate of Good Standing, which you can get from Companies House
• Page 3: A Notary Public, who should be local to you, to sign and seal a hard copy of the form.

Once you’ve returned the form to the Ohio Secretary of State, you’ll then receive your licence, enabling you to move on to step 2.

2. Register to collect and remit sales tax

Unlike in the UK, there’s no blanket Value Added Tax (VAT) in the US. Instead, different states have different rules around sales tax.

Usually, you’ll have to collect sales tax from consumers and pass it on (or remit it) to the state, if you have “nexus” there. And there are two types of nexus:

• Sales tax nexus: which results from having a physical presence in the state, including inventory in a fulfilment centre
• Economic nexus: which results from achieving a certain amount of revenue or orders from a state.

So if, for example, you hold stock in Columbus, while your biggest markets are Los Angeles and New York, you’ll collect and remit sales tax in Ohio, California and New York.

They also provide more detailed advice on how sales tax works, what the rules are in Ohio (and all other states), and how to register for a sales tax permit there.

3. Set up your local fulfilment centre

The next step is to set up an American fulfilment centre. There are a few things to consider when making the choice:

Location(s)

The USA is obviously a big place, so shipping nationwide isn’t as quick or easy as it is in the UK. Having a few US fulfilment centres can help, but it also adds complexity to inventory management. James and James opted for a Midwest location, as it enables 2-3 day shipping across North America (the bar set by Amazon Prime) from one central spot.

At James and James, we make setting up in the US a breeze, get in touch and find out how.

Support

Managing your orders and inventory in another country, with a five to eight hour time difference, will be tricky, so consider this when choosing a fulfilment centre. James and James’s cloud-based software and UK-based client success team have helped many retailers make the transition, and now provide ongoing support.

4. Send stock in bulk to the USA

Once you’ve chosen your US fulfilment centre, it’s time to send your stock to it in bulk. Using a freight forwarding company will remove a lot of the hassle of this. They can help with:

• Logistics: organising the transportation of goods to the US, whether from your existing UK stock or from a manufacturer in another country
• Customs: acting as the Customs Broker or Importer of Record (IOR), easing the path for your goods through customs and ensuring the correct duties are paid.

If you need assistance sending stock to the US, contact us and see how we can help.

5. Sell, sell, sell

While you’re likely to be making some sales to the US already, once you’re properly set up, you can really turn your marketing engine on. Think about:

• Localising your store for American customers, with prices in dollars and sizes in US or imperial measurements
• Making the most of your local fulfilment centre, by promoting cheaper shipping, faster delivery and simpler returns to US customers
• Tuning your email and social campaigns to US culture, with its more direct approach, and numerous national holidays and discount days
• Ensuring you register and protect your trademarks and intellectual property in the US, as well as at home.

Want to know more?

Speak to one of our fulfilment specialists and we’ll arrange a consultancy call, to discuss your current operations, future ambitions and barriers standing in your way.

About the Author