eBay and the Flattening of the World: Page 2

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Foreign vs. Local Currency

In reviewing pricing, buyers can see both the foreign currency and the approximate local currency with the exchange rate factored in. By doing so, the total cost of the product including the item’s price, shipping, insurance (and so on) can be factored in and thus domestic and international sellers compared equally.

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Then, if Paypal is used, the financial transaction is incredibly easy, with all of the currency conversions handled and the seller immediately receiving the funds. A very handy element of eBay and their Paypal service is the audit trail it generates. Emails are sent to the parties and the respective systems also retain the transaction data. It’s very clear what was purchased, the date, and how much was paid.

In some cases vendors lower their unit price but increase their shipping charges so buyers need to look at total cost – not just unit price. Additionally, delivery lead times for foreign items are typically two to three weeks. It wasn’t too long ago that these timeframes would have been considered acceptable for domestic purchasing. Now, in the US we expect delivery in a week or overnight, depending on the carrier and service level selected. For purchases that can be planned in advance, the two to three week delay can be perfectly acceptable given a sufficient cost savings. Some sellers offer expedited shipping but the price is often quite high.

Many small orders are shipped via some form of international mail/parcel post with the appropriate customs declarations. The buyer is responsible for ensuring that restricted materials are not being purchased, and any duties owed are collected before the shipment is released to the buyer. In small lots of low-cost goods, there frequently isn’t a duty due. If duties are expected then they need to be factored into the total cost of the material so appropriate comparisons can be made.

Without a doubt the world is more accessible than ever before and the markets reflect this. eBay has opened the doors of global sourcing to small businesses in a way never before possible. For buyers new to eBay, the idea is to always understand and trade off total cost and the associated risks. With a little work, it is very possible to extend your vendor network to include global sellers and reap the benefits.

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