Expanding as an Amazon seller into new countries has become increasingly popular, as Amazon make it easier to launch your private label business into new territories. In the UK, there’s been growing interest from sellers looking to launch not just into new European markets, but also into the US marketplace too. Based on personal experience, here are some of the pros and cons.
Benefits of launching in the United States
#1 Profit (Size of the Market)
The benefits of expanding into the US market can be the scale of the US market on amazon.com. It’ll be subject to the product you sell and some products will work better than others in the US, but sales volume increases of 100-200%+ compared to the UK market can be possible in some niches on Amazon.com. This means selling on Amazon in the US has the potential to be a money maker.
#2 English Speaking
Another benefit of the USA is that there is no real language barrier to overcome. Re-creating your ASINs in the USA should be a breeze.
Apart from a few spelling changes (and possibly some tweaks to keywords), your existing copy should be good to go. No major translation work needed.
#3 US Customers Don’t Mind if You’re a UK Business
Most people who purchase products from Amazon have a perception they are buying that product from Amazon ( rather than ‘through’). If you’re a private label seller in the UK using FBA to sell on Amazon.com, your country of origin is rarely going to be a problem for the US consumer – most will be oblivious.
The common customer interpretation is that all products are sold by Amazon. If you’re a company from overseas this can be quite advantageous. In some ways you actually get to piggy-back off Amazon’s US brand in a legitimate and mutually beneficial way.
#4 You Stay Ahead of the Curve
An aspect I like about the US marketplace is that it’s Amazon’s hub. Any changes they’re looking to roll out tend to happen on amazon.com first. If you sell on there, it can help you stay ahead of the curve if you also sell in Europe too.
Changes tend to happen many months sooner in the US marketplace, so by the time they hit Europe, as a seller you’re familiar with them. You’ll usually have learnt to adjust, and stay ahead of your non-US marketplace competitors (who could be experiencing that update on Amazon UK for the first time and panicking).
Cons of launching in the United States
Its not all plain sailing if you sell in the USA. A few challenges you can face may include some (or even all) of the following.
#1 Additional Costs
If you’re going to launch into a fresh market there will be some costs and it may not be cheap.
You’ll need to ship inventory out to the US or produce new inventory in the US and for some private label companies 500-1000 units may be the minimum order quantity (MOQ). For larger suppliers it may be at least 5000 units.
You’ll also have to launch your product to a fresh new market, spend money on advertising and additional inventory for product launches and reviews.
#2 It’s More Work
Again launching new products into a fresh marketplace will require more work and the time zone issues may mean you end up working late into the night, especially if you need to speak to people on the West Coast of the US. So, it may mean goodbye to the 9-5, In fact it could become the 9-9 pretty quickly.
As a private label seller, you’ll likely need to find some new suppliers. This could include setting up new agreements with factories, packaging firms or printers. All of this takes time and effort.
You are responsible for any compliance that applies to your product and business. In the US this is usually different to the EU laws and regulations. That’s not to say its any easier to understand than in the EU!
It can be a complex area if you sell in health or beauty for example – but with some research and legal assistance if you need it, you can usually discover what you need to know to be compliant.
Obviously you can’t export banned ingredients into the USA and there may be some changes needed to the packaging design. Another area to be aware of is sales copy. Stay on the right side of the law – be careful not to make false claims about your product!
#4 High Competition
Another aspect of selling in the US is that the competition can be more aggressive and possibly even a little underhand – just be prepared for this. This is not to say Americans aren’t lovely people (most of the ones I’ve met are!) or that people in business in Europe can’t be unscrupulous too, it’s just from my own experience that aggressive competition seems to become more apparent in a larger marketplace.
Expect some resistance. Be prepared for competitors in the US marketplace to do possibly anything they can to derail your product launches. This could include hijacking your listings, over bidding on Sponsored Ads to get market share, buying a number of your products to write bad reviews…anything is possible. People may steal your page copy, publish your images to their page or even ‘nick’ your brand name. If your listings stands out and make good gains, you will get attention, and some of it might be from people who want you to succeed.
If it’s a great product people want to buy, then make sure you lock down any potential loop holes in your Amazon business. The old adage rings true…
‘You’re only as strong, as your weakest link…’
With a hot product, chances are someone will find spot any loop holes and could look to exploit them, so do your homework first. If 3-5 times as many people see your listings, product and brand on Amazon.com, some additional competition is inevitable. Just be prepared.
Overall launching into the US can be an exciting and rewarding experience for UK sellers if they get it right and are ready for the competitive element.
In respect to what country to launch into if you’re already in the UK but want to launch elsewhere within Europe…then for many product types, it’s probably worth looking at Germany.
Amz Pro helps private label sellers win on Amazon. If you’d like to speak to us about working with your Amazon business then get in touch here.