There are many things you might not be aware of that you MUST know when you're selling online. For example, foreign transaction fees and how to set up your banking to best reduce your banking fees, how to set up legal entities and much much more. This video explains what we're going to cover in this part of the Academy.
While it is IMPORTANT to have the right legal entities set up, the right banking set up and everything organised correctly, there is ONE main thing you must remember when you're first starting out...TRACTION! There is no point avoiding a 3% foreign transaction fee if you can't get sales. This video is an important one.
Here we explain why we want to be running your business in USD as much as possible (even if you're not from the USA). This is EXTREMELY important to understand and Grant even gets out the whiteboard to make it a lot easier to digest.
You can lose a lot of money if you're constantly converting between currencies but there is also another BIG problem that Grant personally faced when being from Australia and selling mainly into the USA. Stripe was declining about 20% of all transactions from a particular reason. The error code in stripe was "Payment Declined by Customer's Bank".
In this video, Grant explains why Stripe was declining these payments and how to overcome it.
Here Grant goes into a Google Sheets and runs through a real-life example inside an Ecommerce store to show you just how much of an impact bank fees can have on your business. If you're paying 3% foreign transaction fees, and you are spending $50,000 a month on expenses, that's $1500 gone in just foreign transaction fees. Imagine when your store is doing 1 million a year!
In an ideal world, we'd all be from the USA and our business would all be running in USD which (if you're from the USA) is going to be the case - damn you!
Here Grant uses a whiteboard to explain how money moves once your customers pay you in USD if you are from the USA.
How you pay your suppliers, facebook ads and your staff, and how your money moves between each.
This is the ideal scenario of cashflow and is exactly what sellers from the USA should be doing.
In the previous video, Grant showed you how money moves between the moving parts in an ecommerce business if you're from the USA and you keep everything in USD. This is the dream.
For the non-USA sellers such as Grant (who is from Australia), we need to do things a little bit differently.
In this video, Grant shows you how he has set up his legal structures, Stripe Accounts, PayPal accounts, and more, to show you how he lets his customers pay him in USD and how he keeps his money in USD as much as possible.
This video in summary shows you how to be from outside the USA but let your customers pay in USD on your website, and then how you can pay your expenses like Cost of Goods (AKA Suppliers), facebook ads, and your team, without losing heaps of money converting from USD to your local currency.
Very valuable lesson right here.
Learn about how much Stripe and PayPal ACTUALLY charge you when you allow them to take payments on your website AND learn about the EXTRA hidden fees they add on if you let them do the currency conversion for you (HINT: Don't let them do this - Grant will show you how to bypass this in an upcoming lesson).
In this video, Grant shows you how to set up Stripe so that you can bypass having Stripe convert your currencies from the USD your customers pay you to your local currency (AUD for Grant being from Australia). This means you pay less fees and earn more profit!
In this video, Grant shows you how to set up PayPal so that you can bypass having PayPal convert your currencies from the USD your customers pay you to your local currency (AUD for Grant being from Australia). This means you pay less fees and earn more profit!
From the previous lessons you know it's GREAT to get a US Virtual Bank account to save on fees and this video shows you the website I use to get all my virtual US Bank Accounts.
See the website Grant uses to get a US LLC and why he recommends it.
Many people know that you want to allow your customers to pay you in USD on your website, for the reasons I have mentioned in previous lessons here in the Business / Banking setup course.
But many people think that because their customers are paying them in USD on their website that they need to pay for their facebook ads in USD also to be able to have accurate reporting and this is simply not the case.
If you are paying for your Facebook ads in USD but using your Australian card, chances are you're likely paying your bank foreign transaction fees to convert your AUD to USD to pay for your ads. You DO NOT want this.
This video shows you how you can allow your customers to pay you using USD but you can also pay for your Facebook Ads in your local currency and not have to pay any foreign transaction fees.
Grant explains how this changes your Facebook Ads reporting and how it affects your reading your ROAS for the day.
This video uses a whiteboard to show you how Grant pays the main expenses for his ecommerce business in a way that reduces fees and make as much profit as possible. This includes things like software, paying your team and more.
There are many ways to pay your suppliers and the best way will usually depend on how many sales you're getting. Some of the ways you can pay for your Cost of Goods (Suppliers) are:
- AliExpress directly
- Bank Transfers using something like Transferwise.com
In this video, Grant explains when you should use each one and the fees involved with using each (aswell ask the RISK).
Learn about the TransferWise Borderless Account and Debit Mastercard and how it could save you fees when paying for expenses.
Grant shows you how his seven figure ecommerce brand is currently set up and how he is accepting USD on his website and paying for his expenses while reducing fees dramatically.
Grant shows you:
- His banking set up
- His legal structure set up
- PayPal and Stripe set up
- How he pays for his Facebook Ads and in what currency
- How he pays his suppliers to reduce fees
Final thoughts on business legal structure set up and banking set up and why none of this matters unless you have TRACTION!