Hello,
I’m looking into the possibility of importing a container of sporting goods (don't want to be too specific) from China to sell here primarily through eBay, possibly through a dedicated website and direct to retailers also.
I just wanted to run through the numbers involved, and see if I’ve got them correct and if my margins etc look appealing.
Cost of Product: €100
Shipping/Insurance/DockFees/Delivery in Dublin: €11.50 (€2000/175 Units)
Delivered Cost into Ireland: €111.50
Duty Payable = Cost Into Ireland * Duty Rate%
TARIC is 14% in case of this Product (€15.61 per Unit)
With Taric Cost: €127.11
VAT Payable = (Cost Into Ireland + Duty Payable) * 21.5%
€127.11 + €27.33 VAT = €154.44
Imported Cost of Product with Duty and VAT Paid= €154.44
Now I’m a bit confused by VAT at this point. If I intend to sell this product on at a higher price do I pay VAT again when I sell it for the higher price? If so do I then get a refund of the lower amount of VAT I originally paid? I assume this is the case, please let me know if it isn't?
I intend to sell each of these for about €275, this is a conservative estimate of how much I can sell them for, I’d imagine €300+ might be possible.
So, working just on the idea of selling them on eBay (so as to keep things simple)
Selling at €275, VAT is €59.13, left with €215.87
Assuming I get the original VAT of €27.33 back
Gross Profit: €215.87 - €127.11 = €88
Cost of Sale = eBay and PayPal Fees, about 10% of sale price = €27.50
Net Profit= €60.50 per Unit Sold
Now firstly I am interested to know whether my calculations are accurate, I have erred on the side of caution with the shipping costs etc, it should be possible to reduce them a bit.
If I were to import and sell these items as a Sole Trader would this change the VAT situation? My intention would be to start with a single container or less of goods and dependant on how they would sell, expand as necessary.
Also, without giving away too much about the goods in question I am not sure whether it is a viable option.
I contacted a UK distributer of a similar product and was told he sells them at ”£129.00 ex VAT with an SRP of £239.00, which is a pretty good margin in this area.”
What I’m trying to work out is whether my product offers a better deal or margin for me than this one.
Now the product that I would be selling at €275 is significantly better than the one for £239, I wouldn’t actually consider selling the widely available one as I’d have no advantage over the major retailers that already sell it in the UK. Also, while the prices from the UK would not involve an import duty I’d still have to pay transport costs from the UK which would make it less appealing.
Anyway, sorry for the rather long post and if I haven’t been very clear. I’m very confident that the product that I am importing will sell well both here and in the UK. The only competitor on eBay sells for €240, my product is far superior to this and so I’d be confident of its ability to sell. I have a few sample units on the way that I will sell to test the waters to make sure of this. Just not sure if I have my numbers right and if it seems an appealing proposition in terms of margins etc.
Finally in terms of retailers, a similar product (slightly worse quality) sells for €400 in shops here, so at what price would they be willing to buy from me to sell at this price themselves?
Any advice would be much appreciated.
Thanks
I’m looking into the possibility of importing a container of sporting goods (don't want to be too specific) from China to sell here primarily through eBay, possibly through a dedicated website and direct to retailers also.
I just wanted to run through the numbers involved, and see if I’ve got them correct and if my margins etc look appealing.
Cost of Product: €100
Shipping/Insurance/DockFees/Delivery in Dublin: €11.50 (€2000/175 Units)
Delivered Cost into Ireland: €111.50
Duty Payable = Cost Into Ireland * Duty Rate%
TARIC is 14% in case of this Product (€15.61 per Unit)
With Taric Cost: €127.11
VAT Payable = (Cost Into Ireland + Duty Payable) * 21.5%
€127.11 + €27.33 VAT = €154.44
Imported Cost of Product with Duty and VAT Paid= €154.44
Now I’m a bit confused by VAT at this point. If I intend to sell this product on at a higher price do I pay VAT again when I sell it for the higher price? If so do I then get a refund of the lower amount of VAT I originally paid? I assume this is the case, please let me know if it isn't?
I intend to sell each of these for about €275, this is a conservative estimate of how much I can sell them for, I’d imagine €300+ might be possible.
So, working just on the idea of selling them on eBay (so as to keep things simple)
Selling at €275, VAT is €59.13, left with €215.87
Assuming I get the original VAT of €27.33 back
Gross Profit: €215.87 - €127.11 = €88
Cost of Sale = eBay and PayPal Fees, about 10% of sale price = €27.50
Net Profit= €60.50 per Unit Sold
Now firstly I am interested to know whether my calculations are accurate, I have erred on the side of caution with the shipping costs etc, it should be possible to reduce them a bit.
If I were to import and sell these items as a Sole Trader would this change the VAT situation? My intention would be to start with a single container or less of goods and dependant on how they would sell, expand as necessary.
Also, without giving away too much about the goods in question I am not sure whether it is a viable option.
I contacted a UK distributer of a similar product and was told he sells them at ”£129.00 ex VAT with an SRP of £239.00, which is a pretty good margin in this area.”
What I’m trying to work out is whether my product offers a better deal or margin for me than this one.
Now the product that I would be selling at €275 is significantly better than the one for £239, I wouldn’t actually consider selling the widely available one as I’d have no advantage over the major retailers that already sell it in the UK. Also, while the prices from the UK would not involve an import duty I’d still have to pay transport costs from the UK which would make it less appealing.
Anyway, sorry for the rather long post and if I haven’t been very clear. I’m very confident that the product that I am importing will sell well both here and in the UK. The only competitor on eBay sells for €240, my product is far superior to this and so I’d be confident of its ability to sell. I have a few sample units on the way that I will sell to test the waters to make sure of this. Just not sure if I have my numbers right and if it seems an appealing proposition in terms of margins etc.
Finally in terms of retailers, a similar product (slightly worse quality) sells for €400 in shops here, so at what price would they be willing to buy from me to sell at this price themselves?
Any advice would be much appreciated.
Thanks