An online trading company is a trading company that primarily operates via the internet and its electronic commerce tools. Much like any regular trading company, online trading businesses specialise in buying goods from manufacturers and selling them on to consumers or other retailers. However, the online nature of this business makes it different, presenting specific benefits and limitations. Selling goods online offers huge opportunities and advantages, allowing you to trade on a global scale and save on organisational and administrative costs such as wages, office rent and others.
The main difference is that a 100% online trading company (without any physical shops whatsoever, just headquarters and storage facilities) needs a virtual rather than a physical infrastructure. An offline trading company needs offices, shops, storage units and a logistics network linking suppliers, offices and outlets; an online trading company requires offices, storage units, powerful servers and websites, as well as a flexible logistics system that allows it to serve customers scattered across many locations.
As you can see, online trading companies require less physical infrastructure, but they must also be a lot more flexible in serving their customers. Moreover, while for a regular trading company a website is a beneficial addition, for an online trading company it is an essential tool, without which the enterprise cannot function — hence the high requirements for the capabilities of the website and the host server.
laptop and credit card for online purchases Functions of an online trading company The main function of an online trading company is to purchase goods from a manufacturer and sell them on to retailers and consumers. A secondary, but nonetheless essential, task is to deliver the goods to customers, as usually online trading companies lack physical infrastructure, such as shops, outlets and other points of sale.
To buy and sell goods, an online trading company must set up a hub for transferring products from manufacturers to customers. In this case, that hub is a website. Just as a physical shop requires designers and marketing specialists to arrange and present products in the most advantageous way, a digital shop also requires specialists to guide customers through the possible buying options.
As for delivering goods, an online trading company can choose to either establish the delivery network itself, or outsource this task by entering into a contract with a logistics company. The online trading company then hands over its goods to the logistics company, which takes care of delivering the goods using its own network.
Key aspects of trading online Although the goods or services sold by online trading companies will vary, there are some common elements due to the specific ways in which these companies market and sell their final products. Here are some of the main issues that you will encounter, regardless of what you are selling online.
Distance selling A special category of online trading business is EU distance selling. E-commerce has made huge gains in Europe, and the online market is growing year-on-year. However, every retailer must understand the implications of e-commerce in the EU in terms of VAT. VAT rules are quite different for online sellers; for example, there are different thresholds for VAT registration (e.g. GBP 70,000 for the UK, EUR 35,000 for Poland or Italy, EUR 100,000 for Germany). There is no minimum threshold for providers of digital, electronic and broadcast services, who must apply VAT at the rate set by the country where the consumer is located.
Naturally, a website is an absolute must for any online business. Designed as an online store (describing the range of products available, their prices and features), the website must also include the following important sections:
Delivery and returns policy Contact page, with a phone number, address, email address and other contact information for consumers to use Online payment options Online payment solutions A way to accept online payments is by far the most important consideration for an online business. Your consumer must have a way to pay for your products and services instantly and securely. There are two basic ways to accept payments on your online store:
By using an online payment system, for example PayPal By using a merchant account to accept direct credit card payments A merchant account is a special bank account opened for online business purposes, in order to facilitate secure transactions between merchant and customer. Merchant accounts are set up by agreement between the bank and the merchant and they allow you to accept payments in many ways, usually by credit or debit card. Banks are actually not the only entities that can set up merchant accounts; this can also be done by other financial service companies that process credit card payments. Click here to read more about setting up a merchant account.
Online trading company registration As an online trading company is no different from a regular trading company in the legal sense, the registration process is almost identical.
First, you need to register a company. As a trading company is mainly distinguished by the nature of its business, not by its legal structure, registering a company is the first step here, as with any business. This includes all the necessary incorporation procedures such as registering for tax, registering for social security, etc.
Next, a newly registered company must check the import/export policy of the jurisdiction, especially if it is planning to import and/or export products from/to foreign markets. In some jurisdictions, this is a simple procedure — e.g. in the EU, all goods imported from other EU member states are considered to be free circulation goods, and are not subject to customs procedures or extensive documentation requirements. In other countries it may be more difficult, e.g. a trading company in India must register for an Importer Exporter Code with the relevant authorities.
Furthermore, a trading company must acquire the relevant trade licenses if the jurisdiction in question has placed limits on the distribution of the goods it intends to sell. For example, in most countries there are certain restrictions on the sale of alcohol and tobacco products. It is especially important to check for restrictions on foreign-owned companies, as they may require a separate set of licenses to trade in a certain jurisdiction or their activities may be limited in other ways.
To find out about the requirements in the jurisdiction of your choice, please contact Confidus Solutions.
Additionally, an online trading company will need to set up a website, as this is the basis for any kind of online trading. This includes registering a domain name, hosting the site on a server and the actual site development work.
Popular jurisdictions for online trading companies In this article, we have emphasised the need to understand the VAT liabilities of online trading companies. If you would like your clients to pay for goods and services through your website with EU-issued Visa and Mastercards, it is essential that the merchant account is located in an EU bank, and your company must also be registered in the EU. The following jurisdictions are popular choices for incorporating online trading companies:
Gibraltar: Gibraltar is located in the EU, but has not signed up to the EU VAT Directive and is therefore outside the scope of VAT. Companies registered in Gibraltar can set up online stores and connect to merchant accounts at EU banks. The United Kingdom: UK companies (Scottish LP, UK LLP and UK Limited) are commonly used for online trading. These structures are easy to operate and VAT thresholds are quite high. Malta: A Maltese company with a VAT number is a great solution for a solid online business, allowing you to comply with the strict requirements of the VAT system at a lower cost, as the VAT rate (19%) is lower than in many EU countries and the corporate tax system allows non-resident company owners to claim back 6/7 of the tax paid, making the effective rate only 5%. Selling online opens up vast business opportunities, but nowadays every business must consider the tough AML requirements imposed by processing companies and banks, taxation matters (especially in terms of VAT), the time-consuming set-up process for online payment solutions and many other complex issues. Contact us to discuss online trading options for your business.
Top three famous online trading companies As of 2016, the world’s top three holding companies by trade revenue are:
Amazon.com ASOS.com Wal-Mart Stores, Inc. Amazon.com is a renowned international online trading company (revenue of 107 billion USD) and a classic example of this kind of enterprise. The company both purchases goods for resale and allows third-party sellers to use the platform to sell their own products. Amazon.com hosts a number of websites and storage facilities throughout the world, providing localised services for each country or general region.
ASOS.com is a fashion and beauty online trading company based in the UK. As well as offering more than 850 brands, ASOS sells its own products, catering to customers all over the world from its main warehouse in Barnsley. The company has additional warehouses in China, Europe and the USA, which are used to ship goods to over 140 countries.
Wal-Mart Stores, Inc. is a retail corporation selling a wide variety of goods, from groceries to electronics. Walmart (its trade name) is a hybrid business in the sense that it combines both online and offline trading. Besides owning almost 11 500 stores worldwide, the company also offers the possibility of buying goods through their online store and manages delivery. By being active in both offline and online trading, Walmart is able to compensate for the disadvantages and capitalise on the advantages of both models.
With the right paperwork and initial outlay, it is possible for a foreign citizen to open a bank account in Sweden. This opportunity for international accounts and investments offers several advantages based on economic regulations and tax structures. Interest rates, tax laws, and fees vary depending on the specific country in which you are investing; careful research and strategic financial moves could result in significant portfolio growth.
When considering opening a bank account in Sweden, one must enlist the help of international experts to guide them through the process.
Legal structures in Sweden Every international jurisdiction abides by a different set of legal structures for taxation and banking. Confidus Solutions helps you to understand the nuances of each country's legal structures. To do business in Sweden, it will be critical for you to have a firm grasp on the financial and legal implications.
Initial investments The vast majority of bank accounts in Sweden will require an initial financial outlay to secure account opening. This value differs from bank to bank and also depends on variable rates of currency exchange. An international finance expert will help to navigate these conversions as well as the assorted fees and minimums involved in sustaining a bank account. Be sure to understand interest and growth rates associated with any potential international bank account so that you are able to maximize your earnings while minimizing risk.
Tax structures in Sweden For best results and to avoid bureaucratic and legal pitfalls, enlist the support of an expert in international finance and economics. This initial investment in proper processes and research will help to avoid a litany of long-term costs and fees associated with unforeseen errors and legal miscues. Language expertise, financial knowhow, and bureaucratic experience will ensure that your account opening is handled smoothly and without unintended consequences.
The monthly minimum wage in Puerto Rico varies by industry. In relation to consumer prices, the inflation rate in Puerto Rico is 0.9%. The currency of Puerto Rico is the US dollar. The US dollar is one of the most important currencies in the world and is used in several territories in addition to the United States, including Puerto Rico, Guam and the US Virgin Islands. The US Dollar is a stable currency to rely on for investment opportunities. The plural form of the word US dollar is dollars. The symbol used for this currency is $ and is abbreviated as USD. The US dollar is divided into cents; There are 100 in a dollar. Every year, consumers spend around US$5,847 million. The ratio of consumer spending to GDP in Puerto Rico is 0.01% and the ratio of consumer spending to world consumer market is 1.69%. The corporate income tax in Puerto Rico is 20%. Personal income tax ranges from 16% to 33.34% depending on your specific situation and income level. Sales tax in Puerto Rico is 11.5% and is known as Sales & Use Tax.
Gross domestic product The total Gross Domestic Product (GDP) calculated as Purchasing Power Parity (PPP) in Puerto Rico is US$127 billion. The gross domestic product (GDP) calculated as purchasing power parity (PPP) per capita in Puerto Rico was last at 34,709 US dollars. PPP in Puerto Rico is considered very good compared to other countries. A very good PPP indicates that citizens of this country find it easy to buy local goods. Local goods can include food, shelter, clothing, healthcare, personal hygiene, essential furnishings, transportation and communications, laundry, and various types of insurance. Countries with very good purchasing power parities are safe locations for investments. The total gross domestic product (GDP) in Puerto Rico is 105.149 billion. Based on this statistic, Puerto Rico is classified as a medium economy country. Middle economy countries support an average number of industries and investment opportunities. It shouldn't be too difficult to find worthwhile investment opportunities in mid-sized economies. The gross domestic product (GDP) per capita in Puerto Rico was last at 28,737,032 US dollars. The average citizen in Puerto Rico has very high net worth. Countries with very high per capita wealth have a longer life expectancy and a very high standard of living. There are highly skilled workers in many industries and labor is very expensive in these countries. Very wealthy countries offer safe investment opportunities as they are often backed by a diverse and thriving financial sector. The annual GDP growth rate in Puerto Rico averaged -5.8% in 2014. According to this percentage, Puerto Rico is currently experiencing a significant decline. Countries that experience significant declines could see dramatic declines in personal consumption, employment rates, and personal income. A significant drop in GDP should alert investors that this location is high risk and should not be considered a safe place to invest.
Adult literacy rate in Zimbabwe is 86.5%. Male literacy is 88.5%. Female literacy is 84.6%. Therefore, male literacy and female literacy differ by 3.9%. Government expenditure on education is 4.6% of GDP. The education index of Zimbabwe is 0.5 - formal education levels in the country are average, but most of the population has a secondary school education at least; higher education is possible and not uncommon. People in Zimbabwe speak the Shona, English, and Ndebele languages.
English language In Zimbabwe, around 0% of the population or 5,550,000 people speak English. 250,000 of Zimbabwe's population call English their first language. 5,300,000 of Zimbabwe's population use English as either foreign or second language.
The development of telecommunications and economic globalization have made it possible for interested investors to set up companies all over the world. With proper research, financial investment and legal backing, business ventures can be safely incorporated in almost any country in the world. Building an international business used to be a complicated entrepreneurial venture, but today it is commonplace with the help of experienced legal and business advisors.
The advantages of founding a company abroad are as numerous as they are obvious. Many countries offer specific locational advantages, ranging from natural resources and well-established infrastructure to beneficial laws and regulations that encourage growth in a particular industry. Likewise, it can be difficult to start a business or an acquisition in your own country due to adverse situations: political or regulatory environment, lack of resources and more. In this situation, it makes sense to consider an overseas option that offers greater opportunities for growth, development, and success.
Company registration in Argentina When starting a business in Argentina, an interested investor must conduct due diligence regarding legal procedures, international regulations, and sufficient investments for success. It is crucial to understand cultural, social and political factors that influence starting and growing one's business. Failure to do so may result in unintended consequences. Poorly researched and toneless international launches often end in disaster as time, money and energy is wasted due to poor planning.
Legal Documents Every country in the world presents its own intricate challenges when it comes to starting, developing and maintaining a business. Owners, financiers and investors must make these commitments with the support of a knowledgeable and experienced legal team. Only someone with in-depth knowledge of local and international corporate law will be able to set up an overseas business while avoiding the pitfalls that plague many new businesses.
Additionally, smart business people can consider ways to invest in foreign companies without actually starting their own businesses. In these situations, it is still beneficial for the investor to partner with a knowledgeable global economics and litigation advisor. International investments create a truly diverse portfolio that offers growth opportunities that were unthinkable decades ago.
Potential investors, venture capitalists and entrepreneurs should consider the existing infrastructure in Argentina when planning to start a new business. While extensive infrastructure and systems can help make the process of starting a business a smooth one, it could also represent market saturation and reduced growth potential. On the other hand, a lack of infrastructure is often a major obstacle to growth; However, the lack of infrastructure points to a clear market opening for a creative and efficient new business.
With the right documentation and initial expenses, it is possible for a foreign citizen to open a bank account in Iceland. This international account and investment opportunity offers several advantages based on economic regulations and tax structures. Interest rates, tax laws and fees vary depending on the country in which you invest; Careful research and strategic financial actions could result in significant portfolio growth.
If one is considering opening a bank account in Iceland, one must enlist the help of international experts to guide them through the process.
Legal structures in Iceland Each international jurisdiction adheres to different legal structures for taxation and banking. Confidus Solutions helps you understand the nuances of each country's legal structure. In order to do business in Iceland, it is crucial that you have a thorough understanding of the financial and legal ramifications.
Initial investments The vast majority of bank accounts in Iceland require an initial financial outlay to secure the account opening. This value differs from bank to bank and also depends on variable exchange rates. An international financial expert will help navigate these conversions, as well as the various fees and minimums associated with maintaining a bank account. Make sure you understand the interest and growth rates associated with each prospective international bank account so you can maximize your returns while minimizing risk.
Tax structures in Iceland To get the best results and avoid bureaucratic and legal pitfalls, enlist the support of an expert in international finance and economics. This initial investment in proper processes and research will help avoid a litany of long-term costs and fees related to unforeseen errors and legal errors. Language skills, financial know-how and bureaucratic experience ensure that your account opening is processed smoothly and without unintended consequences.
Buy, register or acquire a new or finished company with the help of Confidus Solutions. We provide full business and legal support when starting a new business or purchasing a finished business. Our areas of expertise include commercial law, mergers and acquisitions, contract law, tort law, intellectual property law, tax law, accounting and other business-related services. For more than 10 years, Confidus Solutions has brought together business and legal experts dealing with acquisitions and company registration in more than 150 countries.
The development of telecommunications and economic globalization have made it possible for interested investors to set up companies all over the world. With proper research, financial investment and legal backing, business ventures can be safely incorporated in almost any country in the world. Building an international business used to be a complicated entrepreneurial venture, but today it is commonplace with the help of experienced legal and business advisors.
The advantages of founding a company abroad are as numerous as they are obvious. Many countries offer specific locational advantages, ranging from natural resources and well-established infrastructure to beneficial laws and regulations that encourage growth in a particular industry. Likewise, it can be difficult to start a business or an acquisition in your own country due to adverse situations: political or regulatory environment, lack of resources and more. In this situation, it makes sense to consider an overseas option that offers greater opportunities for growth, development, and success.
Company registration in Laos When starting a business in Laos, an interested investor must conduct due diligence regarding legal procedures, international regulations and sufficient investment for success. It is crucial to understand cultural, social and political factors that influence starting and growing one's business. Failure to do so may result in unintended consequences. Poorly researched and toneless international launches often end in disaster as time, money and energy is wasted due to poor planning.
Contact us for more information on incorporating a company within the jurisdiction of Laos.
Legal Documents Every country in the world presents its own intricate challenges when it comes to starting, developing and maintaining a business. Owners, financiers and investors must make these commitments with the support of a knowledgeable and experienced legal team. Only someone with in-depth knowledge of local and international corporate law will be able to set up an overseas business while avoiding the pitfalls that plague many new businesses.
Additionally, smart business people can consider ways to invest in foreign companies without actually starting their own businesses. In these situations, it is still beneficial for the investor to partner with a knowledgeable global economics and litigation advisor. International investments create a truly diverse portfolio that offers growth opportunities that were unthinkable decades ago.
Potential investors, venture capitalists and entrepreneurs should consider the existing infrastructure in Laos when planning to start a new business. While extensive infrastructure and systems can help make the process of starting a business a smooth one, it could also represent market saturation and reduced growth potential. On the other hand, a lack of infrastructure is often a major obstacle to growth; However, the lack of infrastructure points to a clear market opening for a creative and efficient new business.
Bank account opening in Laos In connection with the establishment of a company, it is necessary to open one or more bank accounts in Laos. Confidus Solutions offers the ability to open a bank account in over twenty jurisdictions, making it easy for you to avoid challenging language barriers or bureaucratic hassles.
Virtual Office in Laos Since a registered address is a necessity for international business, Confidus Solutions enables foreign investors to set up a virtual office in Laos. This address allows international entrepreneurs to accept mail, arrange for shipping and set up a registered bank account in their country of business.
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