Buying stock from eBay private sellers
Hi guys
Got a quick question in regards to tax/accounting implications when you buy stock from private sellers on eBay who are not registered as business?
And yes, we are not very experienced, yet, when it comes to annual returns and accounting, but constructive criticism is always welcomed.
- If Amazon asks for proof of purchase would PayPal or eBay receipt be enough?
- Can you and how do you put this sort of purchases thru your books?
We are a Limited company, not VAT registered and we are only dealing with private label products, but found this one product by sheer luck and want to try it out - arbitrage.
It’s a branded product with a listing already in place.
Thanks for your time and have a good weekend.
Regards
Marc
39 replies
Seller_fMsCVAHNu4txH
No (not usually)
You record it the same as any other stock purchase.
Chances are that if they’re selling it so cheap that you can buy it in bulk there and resell it here, and still make enough profit, then it’s unlikely to be legitimate products.
Seller_bdSdLjti4IugQ
No Amazon would not accept a PayPal or EBAY receipt as proof of purchase they want an invoice from a supplier such as the manufacture or a company that is clearly running as a wholesaler. The point of them requesting proof of purchase is so they can trace the goods back to a source they know is legit. I would also question why the seller is selling their goods at a price that allows you to buy them resell and still make a profit… also is there any long term business goal with this method? Most sellers work on building up a product line they can buy / make more of to have a steady stream of sales… Yes there are a few sellers who see an item at a crazy clearance price, i.e in a supermarket for example, and clear the shelves and make a decent money but I find you spend more time trying to chase these deals and there’s no guaranteed income here.
With regards to your accounting you should have a solid good understanding of accounts before selling anything. You should speak to an accountant on a regular basis if your unsure of anything or speak to HMRC if your unsure of certain tax policies. It’s very easy to take lots of money in quickly then by the time it comes to doing the end of year accounts your accountant advised you of something you’ve done wrong or you’ve gone over a VAT threshold or haven’t put enough tax away to pay the bill and end up in a mess…
Seller_Rds42gzScDQFa
Amazon would class items purchased on eBay and re sold on Amazon as NOT NEW. My belief is that they would NOT accept a PayPal receipt, they would want to see an invoice from a manufacture or official distributor.
Seller_DROodOAYHftnc
That sounds dodgy to me.
If they have enough stock to purchase in bulk or multiple quantities then THEY should be registered as a business.
Seller_m41AtDwctiAFL
Thanks for continues straight to the point replies.
Dragonmaster, I fully understand everything you’ve said about accounting, thank you.
We are not one of them sellers who search for products to sell from Poundland or clearance sales. We are not long term established here, but already have semi successful private label products here - couple of them are actually designed by us. We are working on two completely new products as we speak as well, but this product I found is just one of them very very rare products which sells on Amazon for stupid money, steadily for over 6 months now. Competition from other brands is minimal, 3 other products which are just well over complicated and sold for even more ridiculous prices.
No other listings for this product, no other sellers.
There is no long term plan, but I’ve never turned away an easy profit opportunity - plus it’s a product associated with my long life hobby outside Amazon.
Over past hour with some detective work I have managed to track down the distributor in EU of that product - eBay pictures did not show the detailed label.
I understand buying from manufacturers or wholesalers is the absolute best way possible, but how about buying from another legitimate business, business which specialises in sales on individual items, not wholesale.
Would an invoice from another business be enough for Amazon?
JillyB1, yes, it does sound dodgy, but this was the best lead I’ve had at the time. Yes they should be registered as business and pay bloody taxes like we all do, I know. What do you do? We can’t just start following their practises, just got to do the right thing and do it properly.
Seller_t4qiTnhVAnRmT
hi, beware a current scam is a Ebay selling going out of “business” and selling stock in bulk cheap, stock which is usually fake or counterfeit.
Quite frankly it is just not worth it, if you cannot trace the chain (product dependent)
Seller_m41AtDwctiAFL
Singularity,
It’s nothing like that, but kit contains fluid. Can’t say much for the obvious reason and I wouldn’t expect anyone on here to actually reveal it.
Neil,
I hear you, but you have to trust me on this one. I am a huge believer of if it sounds to good to be true, it isn’t. It’s a very small niche and this specific product is a unique type/version of that niche, and it’s sold by a seller from EU. So, that’s why it will be an FBA stock, if people are buying it and are happy to wait a week or so for it then having it locally next day has even more chances of increasing the sales…and as mentioned already, other products in this niche are over engineered and way way way to expensive where this product does exactly same job without compromising on quality or durability.
It is a legitimate product, manufactured by legitimate company and retail price is very very low everywhere I looked, so buying it cheap ain’t suspicious. It’s value on Amazon is just much greater, possibly because of other 3 products in this niche being very expensive.
In regards to hazmat, product is manufactured in EU and hasn’t got any hazmat labels, but I will do more digging and order a sample and research the actual content of it to see if it falls into hazmat at all or just a fluid.
Again, thank you for all your input, it is genuinely very much appreciated…and it’s always good to talk to good, genuine and knowledgeable people.
Thank you !
Seller_PUgTge8LPB8FY
If you buy untraceable stock from private sellers on eBay for re-sale as new on Amazon, it’s likely to be just a matter of time before Amazon catch up with you. Your receipts are unlikely to be accepted, so you are risking your entire account by following this course. What Amazon will want to see are invoices from legitimate wholesalers, as opposed to retailers (whether on eBay or anywhere else). You might also consider checking your public liability insurance. Would it be sufficient to cover any claims for damages that might arise out of customers using products that might not be legitimate?
Seller_6sxtIS0RbZ5k7
If you buy from a retailer rather than a wholesaler then it can no longer be sold on Amazon as ‘New’.
