Selling in the EU? You Need Better Conversions Rates

If you are currently selling on Amazon in Europe then you will be making sales in Euros, not Pounds (GBP). After Amazon has taken its fees from the sale price, it then transfers you the rest of the money from the sale. If you are set up with a UK bank account, Amazon will convert your money from Euros into Pounds and then transfer the money to you. Amazon does this at 4% less than the market exchange rate. Yes, 4% which is awful!

But my bank account can accept EURO’s

Now you might be thinking that you are able to accept Euro’s into your account and then the bank converts them to GBP for you. This is wrong because Amazon will only pay out in the local currency where the receiving bank account is located.

This why services like Revolut don't work, because they are physically located in the UK and so Amazon pays out in GBP, not Euros, even though its a Euro Account.

Why do you need to consider currency conversions? Currency conversion companies are able to create a local European bank account for you at zero, yes £0 cost. They still charge a fee, generally the difference between the market rate and the amount you receive, to support their costs. This is normally less than 2%, which is much better than the 4% Amazon charge.

But my bank account can accept EURO’s

This why services like Revolut don't work, because they are physically located in the UK and so Amazon pays out in GBP, not Euros, even though its a Euro Account.

How much can I save?

If you currently sell on average £1,000 per month across the whole of Europe, which can easily be higher in Q4, then you will save £240 going from 4% down to 2% and maybe more.

If you are selling £3,000 a month across all of Europe then this works out to £720 saved for very little work.

How does it work? The process is simple, instead of Amazon paying directly into your UK bank account they pay into your new European bank account. You then convert this from EURO's into GBP with your new bank and then transfer this into your UK bank account. The process generally adds an extra day or two on your transfer time, but it's worth it.

How much can I save?

If you currently sell on average £1,000 per month across the whole of Europe, which can easily be higher in Q4, then you will save £240 going from 4% down to 2% and maybe more.

If you are selling £3,000 a month across all of Europe then this works out to £720 saved for very little work.

How do I get setup? After choosing your service of choice, you simply email them some documents to prove who are you and usually within 24 to 48 hours you have have a new European bank account. Once you have the account details, you then login into Amazon Seller Central and update your European (Germany, France, Italy and Spain) dismemberment bank account details. 72 hours later you can start dismemberments to your new Euro bank account.

What are the options

Payoneer – https://www.payoneer.com/industries/online-sellers/ Payoneer works very closely with Amazon Sellers and they have competitive rates although not the cheapest. They have a great platform which allows for easy transferring of money.

WorldFirst – https://www.worldfirst.com/uk/online-sellers/amazon/
WorldFirst are similar to Payonner in that they work closely with Amazon sellers, have good rates and an easy to use platform.

CurrenciesDirect – https://www.currenciesdirect.com/en/business/online-sellers
Another great provider with great support for Amazon sellers, good rates and an easy to use platform.

TransferWise – http://transferwise.com/u/thomasp1096 TransferWise is similar to the other payment provider with an easy to use the platform and working closely with Amazon seller. We have found TransferWise to be the cheapest solution for currency conversion, coming in around 1.5%. One thing we really like about Transferwise is that they are the only payment provider to show you the costs and fees on their website without having to contact them. This shows you the faith they have in how cost-effective their service is.

Extra Note We not only use these services to receive money from Amazon but also to pay for staff and suppliers all over the world.

If you are considering hiring support from aboard then most people consider PayPal as the normal way to pay, but the fees on PayPal transactions are huge. Real savings can be made when a dedicated currency conversion service is used. For example, to pay someone in the Philippines 20k PHP, sending this through PayPal will cost you £11.20 more than TransferWise.