Foreign Currency and Overseas Banking Services
for Online Sellers (Amazon, eBay, Ali, Rakuten or others)
If you are selling online and catering to an international audience, you must have realised by now that you will be spending vast amounts of money on foreign exchange fees and potentially losing buyers or narrowing your profit margins.
Did you know?
- If you are selling on Amazon and using their default setup, you will lose up to 4% of your sales in foreign exchange fees when using their Amazon Global Seller Program.
- If you are using eBay, your items will appear more expensive than their listed price for international buyers (due to Paypal’s high currency exchange fees).
- If you use your bank to exchange overseas funds to domestic currency, it may cost you up to 5% of the lump sum.
Selling internationally is somewhat complex and and expensive as it is, but nevertheless – a necessity. Using the right services together with your seller central tools can and will help with the complexity and related fees. This guide will explain the ins and outs of alternatives to Amazon’s currency exchange via its Global Sellers Online centre, eBay’s currency exchange fees, or other high-cost solution offered by eCommerce marketplaces.
Your Savings using Online Seller FX Demonstrated
|Annual Turnover||Amazon Currency Exchange||Specialist Provider||Saving|
|$10,000||$400 in currency fees||$150-$200 in currency fees||$200-$250|
|$50,000||$2,000 in currency fees||$500-$750 in currency fees||$1,250-$1,500|
|$100,000||$4,000 in currency fees||$500-$1,000 in currency fees||$3,000-$3,500|
|$1,000,000||$40,000 in currency fees||$5,000 in currency fees||$39,500|
Notes: The table above is not marketplace specific. The currency exchange services for online sellers can be applicable to your business regardless of whether you sell on Amazon, Ali Baba, TMall, Overstock, eBay, Ubid, Bonanza, or any other online marketplace. The figures used in this table are only meant to demonstrate what could you could potentially save; They use 4% as the base figure for currency exchange fees, and 0.5%-1% in foreign currency fees when choosing a specialist provider – this is not necessarily what you’re paying at the moment, or what you’ll be paying with a currency provider, but rather a rough figure based on Amazon’s FX fees and information supplied by currency providers.
Top Recommended Services for Online Sellers 2019
The following services provide the functionality of opening collection accounts on your behalf abroad, transferring funds accumulated in such overseas sub-accounts back into your back account in domestic currency, and the ability to transfer money abroad for payments for a fraction of what banks charge.
Do you require more information on those Amazon alternatives?
Committing to work with an external provider in something as delicate and sensitive as foreign currency bank accounts abroad or overseas money transfers is never easy. As a business owner, you must have had bad experiences with certain providers – so did we at Money Transfer Comparison.
This is why our recommended online seller foreign exchange services are only 2 companies, which are considered as top-tier in this foreign exchange industries. Both of these companies move many billions of dollars in foreign currency every year, operate for at least 15 years, and boast servicing tens of thousands of corporate clients each year. For your convenience, we have created thorough reviews of these companies and the service they are offering –
1) World First Online Seller Review
Pros and Cons
- Recommended by Amazon
- Large and Trusted: 75,000+ Active Clients
- 98% Positive Client Feedback
- No Transfer Fees for Online Sellers
- Largest Variety of Currencies
- Great Online System and App
- Easiest Sign-Up
- Most Courteous Staff
- Forward Contracts Offered
- Unavailable in some U.S. states, and in Quebec
- Minimum Transfer Amount is £1,000 or equivalent
Bank accounts available in UK, France, Germany, USA, and Canada, as well as Singapore, China and Japan (recently added).
2) OFX Online Seller Review
Pros and Cons
- Recommended by Amazon
- 10 Global Offices
- Local bank accounts in UK, USA, Hong Kong, Australia, NZ (Online Sellers)
- 24/7 Customer Support
- iOS and Android Apps
- Superb client feedback
- Large trading volumes of $20bn+
- A public company – completely transparent
- No fees on transfers for online sellers
- Fewer Currencies
- Sometime actions require phone calls
- Customer Support waiting time could be too long
Bank accounts in USA, Canada, UK, Europe, New Zealand, Hong Kong and Australia.
3) Moneycorp Online Sellers Review
Pros and Cons
- Preferential Rates and No Fees for our Referrals
- Operating since 1979
- £22.6bn in Annual Turnover
- Most Traders in The FX Business
- Full Banking License
- Highest Credit Rating D&B
- Consumer & Business Awards
- 98% Positive Client Feedback
- Sophisticated Hedging Offering
- Attentive and Responsive to Client Complaints
- Welcoming and Friendly Offices*
- Slightly Outdated Look & Feel
- Not Available in Some US States
Bank accounts in the EU only for now.
Added values of FX services for international sellers
Companies like World First or OFX provide whoever chooses to use them with a lot more than simply moving money from point A to point B. It’s not only about improving the poor currency exchange rate offered by Amazon’s Global Sellers Program or improving your eBay seller account’s value proposition to overseas buyers. Both of these companies are happy to provide customers with dedicated account managers who become an integral part of your business – they can assist on the right time to exchange certain currencies, suggest hedging solutions tailored to your business’ needs, and even help on topics relating to selling internationally online based on their experience escorting many clients like yourself.
For example, we heard of cases where representatives from these companies have helped online sellers on Amazon reduce their Amazon Seller fees above and beyond the Amazon Money Transfer; they helped them understand the costs of Amazon FBA and suggested a local solution that other clients of theirs recommended.
Additionally, the power of opening a foreign bank account abroad, and accepting payments in foreign currency into your a bank account is simply unparalleled in the money transfer and currency exchange industry. Very few companies have the same capabilities when it comes to online sellers as these two companies. Here is a recap of what these companies are able to do:
|With World First You can||With OFX You Can|
|Open USD accounts from UK||Open USD accounts from UK|
|Open USD accounts from Australia||Open USD accounts from Australia|
|Open USD accounts from Europe||Open USD accounts from Europe|
|Open EUR accounts from UK||Open EUR accounts from UK|
|Open EUR accounts from USA||Open EUR accounts from USA|
|Open EUR accounts from Australia||Open EUR accounts from Australia|
|Open CAD accounts from USA||Open CAD accounts from USA|
|Open CAD accounts from UK||Open CAD accounts from UK|
|Open CAD accounts from Australia||Open CAD accounts from Australia|
|Open foreign bank accounts in China||Open foreign bank account in New Zealand|
|Open foreign bank accounts in Japan||Open foreign bank account in Honk Kong|
Will using alternatives to Amazon’s currency exchange make me a successful online seller?
So far, this article has touched a single (important) topic relating to selling online with a particular focus on international sellers. With that being said, by paying the least commission on international money transfers without having a solid business model, you will not be a great Amazon seller.
Below you can find 7 more tips that can guide you in the right direction when selling your merchandise online, and particularly to international audience:
1) Use local pricing
Using the current exchange rate to determine the local price of your products in domestic currency doesn’t always work. In some countries certain items are cheaper and in some countries they are more expensive. It all depends on the local competition!
2) Focus on reliable shipping with reasonable pricing
Amazon and eBay have great international shipping programs but they are often too reliable. For example, did you know that buying from Amazon in the middle east means almost $30 in shipping? if you are selling items that cost dozens of dollars, you are losing out on all potential customers in that region. Similarly, eBay’s international shipping program can cost up to $40 for the smallest of items (whereas using UK Post or USPS can slash that cost by a lot).
3) Use local language descriptions that make sense
Too many online sellers insist on using automated software to translate their listings. It doesn’t work and locals are likely to think it’s a scam.
4) Consider drop-shipping
If your product is manufactured overseas anyhow, why not store it in the country where it is manufactured and ship from there?
5) Expand outside of eBay, Amazon, Ali and the marketplaces
Customers always like to see that you have a “store” outside of eBay. It helps establish trust that you are indeed a serious vendor rather than someone’s side hustle on eBay.
6) Local customer support
This one is tricky but can perhaps be addressed by using a third party provider to simply accept calls and emails and transfer them to you, translated. People view local support as the ultimate sign of trust because normally, only big companies offer multi-language support.
7) Advertise and market your product the way locals do it
Many online sellers and businessmen mistakenly believe that an advertising campaign that worked in one locale will work globally, but it isn’t so. Cultural differences make a huge difference in the buying decision making process – and hence, marketing and advertising have to be adapted to the local preferences.