Why selling to the USA just got easier for SMEs

The Internet has removed boundaries for trade. Now, even the smallest business can have global ambitions, selling via the web to an ecommerce audience that, at the last count, numbered some 220 million active users[1].

With such a huge potential audience comes complexity. If businesses are to trade internationally, they must put the processes in place to ensure a smooth, seamless customer experience. Each country will have its unique challenges in terms of the most appropriate carrier to use, the best delivery method to reach the customer-base and more. Many small businesses are choosing to work with third-party distribution experts who can identify and implement best-practice delivery and returns processes and who have knowledge of the particular nuances applicable to each territory.

The USA provides a case in point, in particular, a recent change of regulation which may prove beneficial to ambitious SMEs. A number of countries set a minimum threshold for goods below which no import duties or taxes apply and customs procedures are simplified. Previously, the USA set this de minimis value at $200 – making it relatively easy to import any goods below this value.

The good news is that, as from March 2016, this threshold was raised to $800. What does this mean for businesses? Quite simply, the raising of the threshold means lower costs and strengthened opportunities to trade internationally.

This is a particularly welcome change for small and medium-sized businesses who often feel the impact of duty costs and taxes more acutely than bigger enterprises.

Nobody starts a business for the love of administration, so any legislation that reduces this burden is sure to be met with approval. Again, for SMEs, admin can be time consuming and expensive – often completed by seniors within the business whose time is expensive and better focused on strategic decision-making. Less paperwork can also help to decrease compliance costs and can help to speed-up the time taken to get a product to market.

Raising the threshold also impacts the speed and effectiveness of delivery. Accelerated delivery enables a smoother e-commerce experience for customers and a reduction in ‘where’s my?’ queries. The net result for businesses is faster cash-flow – an essential factor for organisations of every size but particularly for SMEs.

It will be interesting to see the effect of this legislative change. In 2015, U.S. Customs and Border Protection processed more than $2.4 trillion in trade, processed approximately 33 million import entries and collected roughly $46 billion in duties, taxes and other fees – the largest amount collected in the last five years.

America is open for business and this latest duty ruling reduces the headache for those operations wanting to benefit from the country’s proven spending power. SMEs are well-advised to seek expert third-party help in order to broaden their trading horizons.

[1] Nielsen//NetRatings 2016

Paul Galpin, Managing Director, P2P Mailing.

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