Ecommerce And The "Reason Why"
Word Count:
533
Summary:
The other night, I watched a rerun of the original Superman film from 1978. In it I noticed a considerable amount of time was spent showing how Superman ended up on planet earth. We saw his parents on Krypton, the escalating doom affecting that planet, and why his parents took the decision to place him in a pod and send him to earth. We saw his father Jor-El rationalise this to his wife, explaining how the differing gravities, and less advanced life forms of Earth would give ...
Keywords:
ecommerce, website, web, design, designer, email,marketing,internet
Article Body:
The other night, I watched a rerun of the original Superman film from 1978. In it I noticed a considerable amount of time was spent showing how Superman ended up on planet earth. We saw his parents on Krypton, the escalating doom affecting that planet, and why his parents took the decision to place him in a pod and send him to earth. We saw his father Jor-El rationalise this to his wife, explaining how the differing gravities, and less advanced life forms of Earth would give their boy a positive advantage.
What did all this serve to do?
It rationalised Superman's superhero powers. He would be able to fly because he was from a planet with a different gravity, he would be superfast & superstrong because his molecular structure was different, etc.
Basically it gave a reason why.
However far fetched the reasons were, undoubtedly they serve to make the film more believable. They explain why Superman has superhuman powers. And so do many other Superhero films - The Hulk, Spiderman etc, all explain away the superhero's powers, adding an increased degree of believability that would otherwise be absent.
All this shows that if you can incorporate Reasons Why into your marketing, you will undoubtedly increase your sales.
So how can you make this work for you?
Special offers
Instead of just blindly putting special offers on products, explain why they are on offer. Perhaps the manufacturer had a cancelled order, and offered you an amazing deal which you can pass on to your customers. Maybe as a result of your annual stocktake, you need to reduce your inventory, and so are selling off your widgets at a ridiculous low price.
Limited availability
Tell a story as to why there is limited availability on a product. Perhaps it was the last stock of a production overrun, or "forgotten" stock that was in one of your storerooms that got "lost" behind other stuff. If the type of product you sell is not of a limited availability nature, you can tweak this to justify why a particular special price is for a limited time only.
Why you are the best choice
Perhaps you have over 20 years experience in your field which enables you to know your industry inside out. Or you have particular inside knowledge which allows you to get the best deals and pass these on to your customers. Think about it - you can always find an "angle" to justify why you are the best person to buy from.
Customer Testimonial
In a way these are "reasons why" someone should buy from you. Although they are well used in information product marketing, they are under used when selling physical products. Make an effort to collect testimonials from your customers that emphasise your quality of service, speedy service, helpfulness or cheap prices.
Give people a reason why. Make a story out of it. We all see shops with "Sales" banners up all the time, but when they say the sale is due to relocation or closing down, we take an extra special look, don't we? The "Reason Why" is a powerful technique that can add that little extra bit of credibility to give your sales a boost.
Showing posts with label INTERNET. Show all posts
Showing posts with label INTERNET. Show all posts
Monday, February 28, 2011
Saturday, February 26, 2011
Ecommerce And The "Reason Why"
Ecommerce And The "Reason Why"
Word Count:
533
Summary:
The other night, I watched a rerun of the original Superman film from 1978. In it I noticed a considerable amount of time was spent showing how Superman ended up on planet earth. We saw his parents on Krypton, the escalating doom affecting that planet, and why his parents took the decision to place him in a pod and send him to earth. We saw his father Jor-El rationalise this to his wife, explaining how the differing gravities, and less advanced life forms of Earth would give ...
Keywords:
ecommerce, website, web, design, designer, email,marketing,internet
Article Body:
The other night, I watched a rerun of the original Superman film from 1978. In it I noticed a considerable amount of time was spent showing how Superman ended up on planet earth. We saw his parents on Krypton, the escalating doom affecting that planet, and why his parents took the decision to place him in a pod and send him to earth. We saw his father Jor-El rationalise this to his wife, explaining how the differing gravities, and less advanced life forms of Earth would give their boy a positive advantage.
What did all this serve to do?
It rationalised Superman's superhero powers. He would be able to fly because he was from a planet with a different gravity, he would be superfast & superstrong because his molecular structure was different, etc.
Basically it gave a reason why.
However far fetched the reasons were, undoubtedly they serve to make the film more believable. They explain why Superman has superhuman powers. And so do many other Superhero films - The Hulk, Spiderman etc, all explain away the superhero's powers, adding an increased degree of believability that would otherwise be absent.
All this shows that if you can incorporate Reasons Why into your marketing, you will undoubtedly increase your sales.
So how can you make this work for you?
Special offers
Instead of just blindly putting special offers on products, explain why they are on offer. Perhaps the manufacturer had a cancelled order, and offered you an amazing deal which you can pass on to your customers. Maybe as a result of your annual stocktake, you need to reduce your inventory, and so are selling off your widgets at a ridiculous low price.
Limited availability
Tell a story as to why there is limited availability on a product. Perhaps it was the last stock of a production overrun, or "forgotten" stock that was in one of your storerooms that got "lost" behind other stuff. If the type of product you sell is not of a limited availability nature, you can tweak this to justify why a particular special price is for a limited time only.
Why you are the best choice
Perhaps you have over 20 years experience in your field which enables you to know your industry inside out. Or you have particular inside knowledge which allows you to get the best deals and pass these on to your customers. Think about it - you can always find an "angle" to justify why you are the best person to buy from.
Customer Testimonial
In a way these are "reasons why" someone should buy from you. Although they are well used in information product marketing, they are under used when selling physical products. Make an effort to collect testimonials from your customers that emphasise your quality of service, speedy service, helpfulness or cheap prices.
Give people a reason why. Make a story out of it. We all see shops with "Sales" banners up all the time, but when they say the sale is due to relocation or closing down, we take an extra special look, don't we? The "Reason Why" is a powerful technique that can add that little extra bit of credibility to give your sales a boost.
Word Count:
533
Summary:
The other night, I watched a rerun of the original Superman film from 1978. In it I noticed a considerable amount of time was spent showing how Superman ended up on planet earth. We saw his parents on Krypton, the escalating doom affecting that planet, and why his parents took the decision to place him in a pod and send him to earth. We saw his father Jor-El rationalise this to his wife, explaining how the differing gravities, and less advanced life forms of Earth would give ...
Keywords:
ecommerce, website, web, design, designer, email,marketing,internet
Article Body:
The other night, I watched a rerun of the original Superman film from 1978. In it I noticed a considerable amount of time was spent showing how Superman ended up on planet earth. We saw his parents on Krypton, the escalating doom affecting that planet, and why his parents took the decision to place him in a pod and send him to earth. We saw his father Jor-El rationalise this to his wife, explaining how the differing gravities, and less advanced life forms of Earth would give their boy a positive advantage.
What did all this serve to do?
It rationalised Superman's superhero powers. He would be able to fly because he was from a planet with a different gravity, he would be superfast & superstrong because his molecular structure was different, etc.
Basically it gave a reason why.
However far fetched the reasons were, undoubtedly they serve to make the film more believable. They explain why Superman has superhuman powers. And so do many other Superhero films - The Hulk, Spiderman etc, all explain away the superhero's powers, adding an increased degree of believability that would otherwise be absent.
All this shows that if you can incorporate Reasons Why into your marketing, you will undoubtedly increase your sales.
So how can you make this work for you?
Special offers
Instead of just blindly putting special offers on products, explain why they are on offer. Perhaps the manufacturer had a cancelled order, and offered you an amazing deal which you can pass on to your customers. Maybe as a result of your annual stocktake, you need to reduce your inventory, and so are selling off your widgets at a ridiculous low price.
Limited availability
Tell a story as to why there is limited availability on a product. Perhaps it was the last stock of a production overrun, or "forgotten" stock that was in one of your storerooms that got "lost" behind other stuff. If the type of product you sell is not of a limited availability nature, you can tweak this to justify why a particular special price is for a limited time only.
Why you are the best choice
Perhaps you have over 20 years experience in your field which enables you to know your industry inside out. Or you have particular inside knowledge which allows you to get the best deals and pass these on to your customers. Think about it - you can always find an "angle" to justify why you are the best person to buy from.
Customer Testimonial
In a way these are "reasons why" someone should buy from you. Although they are well used in information product marketing, they are under used when selling physical products. Make an effort to collect testimonials from your customers that emphasise your quality of service, speedy service, helpfulness or cheap prices.
Give people a reason why. Make a story out of it. We all see shops with "Sales" banners up all the time, but when they say the sale is due to relocation or closing down, we take an extra special look, don't we? The "Reason Why" is a powerful technique that can add that little extra bit of credibility to give your sales a boost.
Monday, February 21, 2011
Designing Your Ecommerce Website
Designing Your Ecommerce Website
Word Count:
479
Summary:
With an increase in consumers using the internet to shop and perform business transactions, ecommerce has become the future of the online community. It is estimated that shoppers are spending billions of dollars online each year, with a few stores even outselling their offline parallels. Benefitting completely from the ecommerce boom can be achievable. To keep consumers coming back, you need to create a unique ecommerce site, one that reaches beyond all levels of excellence.
...
Keywords:
ecommerce,business,software,online,shopping,internet,security,marketing,ebusiness,websites,website
Article Body:
With an increase in consumers using the internet to shop and perform business transactions, ecommerce has become the future of the online community. It is estimated that shoppers are spending billions of dollars online each year, with a few stores even outselling their offline parallels. Benefitting completely from the ecommerce boom can be achievable. To keep consumers coming back, you need to create a unique ecommerce site, one that reaches beyond all levels of excellence.
When designing your ecommerce website, you should have a welcome or introduction on your home page. This statement should establish the advantages of your site, and assure those visiting that they should be comfortable doing business with you. State your purpose, express your beliefs, and let the consumer know why business done at your ecommmerce outlet is always secure.
A quality website has smooth navigation. Categories to scan through and obvious search boxes on the site are a must. Design a simple site with large, easy to read fonts and images that will load quickly. Be sure to have a page with specific questions regarding some of your common business policies such as shipping and returns. You may also want to have a link on your home page that leads visitors to a privacy policy. This policy will ensure customers that you will never supply a third party with information they have entrusted with you. It is nearly essential for all ecommerce shops to display this declaration somewhere on their site.
Just as when shopping offline, customers want checkout to be as fast and easy as possible when visiting your online store. If your online store is equipped with a secure server, make your customers aware. This will put them at ease and keep them coming back. Your checkout or Òshopping cartÓ needs to be just one click away so the customer can be in and out in a minimal amount of steps. In this day and age, it is advisable to offer a variety of payment selections such as PayPal and other online payment sources, credit and debit cards, online checks, and money orders. Include a contact telephone number for customer support so the customer has assurance that they will have assistance if there is a problem with the order.
Organize a special section of your ecommerce website dedicated completely to special discounts and current sales. If you have an extraordinary amount of sales items, create a separate webpage devoted to the ones that are most preferred, and have another page with a complete listing of all discounts. During the holiday season, have a certain portion of our website set aside for customers to purchase gift certificates.
Producing a profitable, reputable ecommerce website can be a simple task with a well constructed site plan, some time and patience. Taking full advantage of the ecommerce phenomenon, you can succeed in your business marketing dream.
Word Count:
479
Summary:
With an increase in consumers using the internet to shop and perform business transactions, ecommerce has become the future of the online community. It is estimated that shoppers are spending billions of dollars online each year, with a few stores even outselling their offline parallels. Benefitting completely from the ecommerce boom can be achievable. To keep consumers coming back, you need to create a unique ecommerce site, one that reaches beyond all levels of excellence.
...
Keywords:
ecommerce,business,software,online,shopping,internet,security,marketing,ebusiness,websites,website
Article Body:
With an increase in consumers using the internet to shop and perform business transactions, ecommerce has become the future of the online community. It is estimated that shoppers are spending billions of dollars online each year, with a few stores even outselling their offline parallels. Benefitting completely from the ecommerce boom can be achievable. To keep consumers coming back, you need to create a unique ecommerce site, one that reaches beyond all levels of excellence.
When designing your ecommerce website, you should have a welcome or introduction on your home page. This statement should establish the advantages of your site, and assure those visiting that they should be comfortable doing business with you. State your purpose, express your beliefs, and let the consumer know why business done at your ecommmerce outlet is always secure.
A quality website has smooth navigation. Categories to scan through and obvious search boxes on the site are a must. Design a simple site with large, easy to read fonts and images that will load quickly. Be sure to have a page with specific questions regarding some of your common business policies such as shipping and returns. You may also want to have a link on your home page that leads visitors to a privacy policy. This policy will ensure customers that you will never supply a third party with information they have entrusted with you. It is nearly essential for all ecommerce shops to display this declaration somewhere on their site.
Just as when shopping offline, customers want checkout to be as fast and easy as possible when visiting your online store. If your online store is equipped with a secure server, make your customers aware. This will put them at ease and keep them coming back. Your checkout or Òshopping cartÓ needs to be just one click away so the customer can be in and out in a minimal amount of steps. In this day and age, it is advisable to offer a variety of payment selections such as PayPal and other online payment sources, credit and debit cards, online checks, and money orders. Include a contact telephone number for customer support so the customer has assurance that they will have assistance if there is a problem with the order.
Organize a special section of your ecommerce website dedicated completely to special discounts and current sales. If you have an extraordinary amount of sales items, create a separate webpage devoted to the ones that are most preferred, and have another page with a complete listing of all discounts. During the holiday season, have a certain portion of our website set aside for customers to purchase gift certificates.
Producing a profitable, reputable ecommerce website can be a simple task with a well constructed site plan, some time and patience. Taking full advantage of the ecommerce phenomenon, you can succeed in your business marketing dream.
Sunday, February 20, 2011
Creating A Successful Business Through Planning
Creating A Successful Business Through Planning
Word Count:
807
Summary:
When talking effectiveness, the effects of a well planned business strategy become very apparent. To find out how to create a well structured strategic business plan, simply click and read on.
Keywords:
online,home,business,internet,success,profit,income,plan,wealth,steps,keys,website
Article Body:
If you are a business owner, or are contemplating starting your own business, if you don't have a strategic plan, you are destined to fail. The creation of a effecient and effective business plan can mean the difference between having the need to work 70+ hours a week all year long - only to find out that your business is only just breaking even, or even worse, losing money.. Or being successful.
On the other end of the scale, many successful business owners and entrepreneurs who have created and implemented a business strategy generally work for less hours, and produce a more sizeable income and profit margins. You will also find, that in general, those who are successful with their own business, attribute their success to having a strategic plan.
Ok, we've discussed that having a good business strategy plan is essential, but what really is "strategic business management"? In its most basic form, its the process in which the goals and objectives for your business are defined, and an action plan is then created so you may reach your goals and objectives.
You now know what it is. So how do you go about creating a strategic plan for your business?
1) Any business owner should know, and be able to describe in detail, the vision for his or her business. Whats the image that you want your business to have?
2) Any operating business should have clear and concise company values and guiding principles. For instance, what are the reasons you are in business? Serve and protect? Provide quality soap? And how do you do business? Do you treat your customers like trash; or another form of royalty?
3) It would also be a good idea to create a 3 year and 5 year plan. Any business should implement a long-term plan in which the basis is on broad objectives that will assist you in getting your business from where it is today, to where you want your business to be.
4) Thinking not only long-term, but also short-term, will also greatly help your business develop. Each year, you should create, define, and plan specific objectives that when accomplished, will help you on the road to achieving your long-term goals. It is also worth noting, then when setting and planning your annual goals, is pays to be "SMART". Make sure your planning incorporates the following points:
- Be very specific
- Show measure
- Make the goals realistic and attainable
- Make sure they are time-oriented
Include a list of obstacles and barriers which could holter your success from achieving your goals. In any case, getting to where you want your business to be, you'll need resources. Create and define a list of resources you've already got, and the other resources which you will need to achieve your goals. At this point, you should also create a concise action plan that clearly defines how you will actually achieve the necessary goals. If your business has any employees, it is of great importance to involve them with this part of the business planning process.
5) In your business plan, you should create simple and concise milestones or benchmarks, that will define when you have actually reached a goal or objective. This is an essential part of the planning, as it will enable you to measure your progress as a business.
6) After you have created your strategic business plan, it is of paramount importance that it is shared with anyone who will be involved in the process. Your annual business plan is the roadmap which will lead your business and those involved, to the goals which need to be achieved -- but to be effective, everyone must end up at the same goals and objectives, the "destination", if you will. And to do so, everyone requires the same map.
7) Its no use having a well thought-out and planned strategic business plan, if you don't put it into action. You now have a means to begin your business journey; its time to start it.
8) Be sure to regularly check and compare the progess of your business, to the benchmarks defined in your business plan.
If something should go wrong with your business, the sooner you figure out what went wrong, or what is -happening- wrong, the sooner you can fix the problem, make the necessary adjustments and get your business back on track.
9) And finally, ensure that each year you follow the exact same cycle to create your strategic business plan. Dream, Plan, Act, Check. Thats all there is to it.
As a final comment, I'll leave you with this. Creating a business strategy and ensuring that you follow it, is not just about achieving specific goals and objectives. Its purpose is to also make sure that the journey taken to these goals, is a safe and enjoyable journey.
Having a safe trip is just as important as reaching your final destination.
Word Count:
807
Summary:
When talking effectiveness, the effects of a well planned business strategy become very apparent. To find out how to create a well structured strategic business plan, simply click and read on.
Keywords:
online,home,business,internet,success,profit,income,plan,wealth,steps,keys,website
Article Body:
If you are a business owner, or are contemplating starting your own business, if you don't have a strategic plan, you are destined to fail. The creation of a effecient and effective business plan can mean the difference between having the need to work 70+ hours a week all year long - only to find out that your business is only just breaking even, or even worse, losing money.. Or being successful.
On the other end of the scale, many successful business owners and entrepreneurs who have created and implemented a business strategy generally work for less hours, and produce a more sizeable income and profit margins. You will also find, that in general, those who are successful with their own business, attribute their success to having a strategic plan.
Ok, we've discussed that having a good business strategy plan is essential, but what really is "strategic business management"? In its most basic form, its the process in which the goals and objectives for your business are defined, and an action plan is then created so you may reach your goals and objectives.
You now know what it is. So how do you go about creating a strategic plan for your business?
1) Any business owner should know, and be able to describe in detail, the vision for his or her business. Whats the image that you want your business to have?
2) Any operating business should have clear and concise company values and guiding principles. For instance, what are the reasons you are in business? Serve and protect? Provide quality soap? And how do you do business? Do you treat your customers like trash; or another form of royalty?
3) It would also be a good idea to create a 3 year and 5 year plan. Any business should implement a long-term plan in which the basis is on broad objectives that will assist you in getting your business from where it is today, to where you want your business to be.
4) Thinking not only long-term, but also short-term, will also greatly help your business develop. Each year, you should create, define, and plan specific objectives that when accomplished, will help you on the road to achieving your long-term goals. It is also worth noting, then when setting and planning your annual goals, is pays to be "SMART". Make sure your planning incorporates the following points:
- Be very specific
- Show measure
- Make the goals realistic and attainable
- Make sure they are time-oriented
Include a list of obstacles and barriers which could holter your success from achieving your goals. In any case, getting to where you want your business to be, you'll need resources. Create and define a list of resources you've already got, and the other resources which you will need to achieve your goals. At this point, you should also create a concise action plan that clearly defines how you will actually achieve the necessary goals. If your business has any employees, it is of great importance to involve them with this part of the business planning process.
5) In your business plan, you should create simple and concise milestones or benchmarks, that will define when you have actually reached a goal or objective. This is an essential part of the planning, as it will enable you to measure your progress as a business.
6) After you have created your strategic business plan, it is of paramount importance that it is shared with anyone who will be involved in the process. Your annual business plan is the roadmap which will lead your business and those involved, to the goals which need to be achieved -- but to be effective, everyone must end up at the same goals and objectives, the "destination", if you will. And to do so, everyone requires the same map.
7) Its no use having a well thought-out and planned strategic business plan, if you don't put it into action. You now have a means to begin your business journey; its time to start it.
8) Be sure to regularly check and compare the progess of your business, to the benchmarks defined in your business plan.
If something should go wrong with your business, the sooner you figure out what went wrong, or what is -happening- wrong, the sooner you can fix the problem, make the necessary adjustments and get your business back on track.
9) And finally, ensure that each year you follow the exact same cycle to create your strategic business plan. Dream, Plan, Act, Check. Thats all there is to it.
As a final comment, I'll leave you with this. Creating a business strategy and ensuring that you follow it, is not just about achieving specific goals and objectives. Its purpose is to also make sure that the journey taken to these goals, is a safe and enjoyable journey.
Having a safe trip is just as important as reaching your final destination.
Sunday, February 13, 2011
Alas! In E-commerce Taxland
Alas! In E-commerce Taxland
Word Count:
1044
Summary:
In trying to comply with tax laws for your e-business, you may find yourself falling down the rabbit-hole, going through the looking glass, and attending a Mad Tea-Party.
Common sense, logic, and fairness never did apply fully to the field of taxation but this is especially true of e-commerce transactions.
1. Canada Customs Welcomes You to Canada!
Since I`m located in Canada, let`s start here.
Canada has what you might call a national sales tax or a value added ta...
Keywords:
VAT, GST, HST, SALES TAX,, ECOMMERCE, ONLINE, INTERNET
Article Body:
In trying to comply with tax laws for your e-business, you may find yourself falling down the rabbit-hole, going through the looking glass, and attending a Mad Tea-Party.
Common sense, logic, and fairness never did apply fully to the field of taxation but this is especially true of e-commerce transactions.
1. Canada Customs Welcomes You to Canada!
Since I`m located in Canada, let`s start here.
Canada has what you might call a national sales tax or a value added tax (VAT). This Goods and Services Tax (G.S.T.) of seven percent is applicable to many Canadian transactions.
Not only is it critical to determine whether a taxable sale was made in Canada or not, but also where in Canada. If it was made (or deemed to be made) in any of the Harmonized Sales Tax (H.S.T.) provinces (Nova Scotia, New Brunswick, and Newfoundland and Labrador), a higher, fifteen percent H.S.T. rate applies. This is because those provinces have allowed Canada to collect their provincial sales taxes for them.
As well, each province and territory has its own rules. Ontario charges eight percent retail sales tax on many typical Internet transactions whereas Alberta has no provincial sales tax.
Of course, this is only scatching the surface. This entire article is an over-simplification of a very complex subject. You will definitely need professional advice to help you through E-Commerce Taxland.
2. When Exports Aren`t Exports
In Canada, exports are "zero-rated" sales for G.S.T. purposes. This means that when you ship a product to someone outside Canada, you don`t charge G.S.T. Yet, you get to claim (or deduct from the G.S.T. collected by you) all the "input tax credits" (G.S.T. that you paid for business purposes) to make that export. The idea, I suppose, is to encourage exporting.
However, if you export products other than tangible, physical goods, beware! There are many pitfalls to watch out for.
As one example, consider digitized products that you might sell from your Canadian website, such as e-books, downloadable software, or subscriptions to content. You would be considered to be selling "intangible personal property". Unless your product is also considered "intellectual property" (such as software or e-books that you produced or have obtained the rights for), you will have to charge G.S.T. The reason why, according to the Canada Customs and Revenue Agency, is that it COULD be used inside Canada, even if it isn`t.
Say you sold a membership for accessing digitized content (from various sources) on your Canadian website to a customer in the United States. Since there are no restrictions as to where the intangible personal property may be used, and the property is not considered intellectual property (nor the provision of a service), the American customer is subject to G.S.T., even if he never comes to Canada.
Strangely, the same logic doesn`t apply when an American buys a regular book (or a car) which he COULD bring into Canada with him and use here. It is true that it is easier for Canada to assess such items at the border than in cyberspace, but I know of no cases of Americans being taxed on the books or cars they bring with them when they come to live in Canada for about half the year.
As a Canadian registrant, one way you might legally avoid this silly March Hare is to explicitly state on your website and invoice that use of such intangible personal property in Canada is prohibited (or requires an additional fee and the payment of G.S.T.).
3. When Imports Aren`t Imports
Goods shipped to Canada are subject to G.S.T. on importation. Such tax is often assessed at the border. But what if you are a Canadian registered for G.S.T., selling to a Canadian customer but your supplier is in a foreign country?
Pretend that your Canadian customer has bought a book from you from your Canadian website. Your drop ship supplier is located in the United States and is registered for G.S.T. You fax your order to the American company, and they, in turn, ship the book for you (complete with Customs Declaration and their G.S.T. Business Number).
Since they paid the G.S.T., you wouldn`t think you would have to charge it again, would you? "Wrong!", smiles the Cheshire cat. Since you are a registrant located in Canada, you are required to charge and remit the G.S.T.
But you are entitled to input tax credits, aren`t you? In many cases, the answer is "No".
It may be very difficult for you to satisfy the documentary and other technical requirements. As an example, it is not uncommon for American suppliers to absolutely refuse to give an invoice breaking down the G.S.T. or to allow you to be the Importer of Record. This complicates their life unnecessarily and they just don`t need the aggravation.
There are relieving tax provisions covering drop shipping, sales agencies, and other situations. In many cases, unfortunately, the most practical solution is to allow the tax to be paid twice.
4. When You`re Subject to Tax Where You`re Not Subject to Tax
It makes sense that countries impose a tax on sales and income made in their own jurisdiction. But does it make sense for Germany to tax sales made in the United States?
In effect, starting July 1, 2003, the European Union has done just that by imposing an online sales tax.
This means that if someone from England buys an e-book from someone in the United States, the American should submit this tax. Of course, If the sale was to someone in Germany, the tax rate would be different.
The rationale behind this follows: Since countries can`t collect sales tax on Internet transactions at their borders, the only way they can collect it (other than a self-assessment system) is with an online sales tax. Further, it is claimed that businesses in the European Union suffer a major competitive disadvantage because they have to collect Value Added Tax (VAT) but others don`t.
I know what they mean. Welcome to the club!
Word Count:
1044
Summary:
In trying to comply with tax laws for your e-business, you may find yourself falling down the rabbit-hole, going through the looking glass, and attending a Mad Tea-Party.
Common sense, logic, and fairness never did apply fully to the field of taxation but this is especially true of e-commerce transactions.
1. Canada Customs Welcomes You to Canada!
Since I`m located in Canada, let`s start here.
Canada has what you might call a national sales tax or a value added ta...
Keywords:
VAT, GST, HST, SALES TAX,, ECOMMERCE, ONLINE, INTERNET
Article Body:
In trying to comply with tax laws for your e-business, you may find yourself falling down the rabbit-hole, going through the looking glass, and attending a Mad Tea-Party.
Common sense, logic, and fairness never did apply fully to the field of taxation but this is especially true of e-commerce transactions.
1. Canada Customs Welcomes You to Canada!
Since I`m located in Canada, let`s start here.
Canada has what you might call a national sales tax or a value added tax (VAT). This Goods and Services Tax (G.S.T.) of seven percent is applicable to many Canadian transactions.
Not only is it critical to determine whether a taxable sale was made in Canada or not, but also where in Canada. If it was made (or deemed to be made) in any of the Harmonized Sales Tax (H.S.T.) provinces (Nova Scotia, New Brunswick, and Newfoundland and Labrador), a higher, fifteen percent H.S.T. rate applies. This is because those provinces have allowed Canada to collect their provincial sales taxes for them.
As well, each province and territory has its own rules. Ontario charges eight percent retail sales tax on many typical Internet transactions whereas Alberta has no provincial sales tax.
Of course, this is only scatching the surface. This entire article is an over-simplification of a very complex subject. You will definitely need professional advice to help you through E-Commerce Taxland.
2. When Exports Aren`t Exports
In Canada, exports are "zero-rated" sales for G.S.T. purposes. This means that when you ship a product to someone outside Canada, you don`t charge G.S.T. Yet, you get to claim (or deduct from the G.S.T. collected by you) all the "input tax credits" (G.S.T. that you paid for business purposes) to make that export. The idea, I suppose, is to encourage exporting.
However, if you export products other than tangible, physical goods, beware! There are many pitfalls to watch out for.
As one example, consider digitized products that you might sell from your Canadian website, such as e-books, downloadable software, or subscriptions to content. You would be considered to be selling "intangible personal property". Unless your product is also considered "intellectual property" (such as software or e-books that you produced or have obtained the rights for), you will have to charge G.S.T. The reason why, according to the Canada Customs and Revenue Agency, is that it COULD be used inside Canada, even if it isn`t.
Say you sold a membership for accessing digitized content (from various sources) on your Canadian website to a customer in the United States. Since there are no restrictions as to where the intangible personal property may be used, and the property is not considered intellectual property (nor the provision of a service), the American customer is subject to G.S.T., even if he never comes to Canada.
Strangely, the same logic doesn`t apply when an American buys a regular book (or a car) which he COULD bring into Canada with him and use here. It is true that it is easier for Canada to assess such items at the border than in cyberspace, but I know of no cases of Americans being taxed on the books or cars they bring with them when they come to live in Canada for about half the year.
As a Canadian registrant, one way you might legally avoid this silly March Hare is to explicitly state on your website and invoice that use of such intangible personal property in Canada is prohibited (or requires an additional fee and the payment of G.S.T.).
3. When Imports Aren`t Imports
Goods shipped to Canada are subject to G.S.T. on importation. Such tax is often assessed at the border. But what if you are a Canadian registered for G.S.T., selling to a Canadian customer but your supplier is in a foreign country?
Pretend that your Canadian customer has bought a book from you from your Canadian website. Your drop ship supplier is located in the United States and is registered for G.S.T. You fax your order to the American company, and they, in turn, ship the book for you (complete with Customs Declaration and their G.S.T. Business Number).
Since they paid the G.S.T., you wouldn`t think you would have to charge it again, would you? "Wrong!", smiles the Cheshire cat. Since you are a registrant located in Canada, you are required to charge and remit the G.S.T.
But you are entitled to input tax credits, aren`t you? In many cases, the answer is "No".
It may be very difficult for you to satisfy the documentary and other technical requirements. As an example, it is not uncommon for American suppliers to absolutely refuse to give an invoice breaking down the G.S.T. or to allow you to be the Importer of Record. This complicates their life unnecessarily and they just don`t need the aggravation.
There are relieving tax provisions covering drop shipping, sales agencies, and other situations. In many cases, unfortunately, the most practical solution is to allow the tax to be paid twice.
4. When You`re Subject to Tax Where You`re Not Subject to Tax
It makes sense that countries impose a tax on sales and income made in their own jurisdiction. But does it make sense for Germany to tax sales made in the United States?
In effect, starting July 1, 2003, the European Union has done just that by imposing an online sales tax.
This means that if someone from England buys an e-book from someone in the United States, the American should submit this tax. Of course, If the sale was to someone in Germany, the tax rate would be different.
The rationale behind this follows: Since countries can`t collect sales tax on Internet transactions at their borders, the only way they can collect it (other than a self-assessment system) is with an online sales tax. Further, it is claimed that businesses in the European Union suffer a major competitive disadvantage because they have to collect Value Added Tax (VAT) but others don`t.
I know what they mean. Welcome to the club!
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