With a stable economy which continues to meet new levels with the help of the main industries, Russia is open to investments and sustains the potential growth of the e-commerce industry in the country, as statistics revealed the fact that the Russians prefer the online purchase of varied products. There are numerous firms which generate profits sustained by the sales on the internet. Companies nowadays can present their portfolios of goods and services on their websites, and even more, they can extend the business internationally by setting up Amazon stores and sell worldwide. If you are an entrepreneur who wants to sell on Amazon, it is recommended to first of all register a limited liability company, which is the most common form of business in Russia. In compliance with the applicable legislation, our specialists in company formation in Russia can offer support and assistance when registering a business in order to additionally set up an Amazon store in Russia.
A few details about Amazon
Amazon is an online retail shop where everyone can sell or buy products and services. It is considered the largest online mall which addresses to both consumers and entrepreneurs, as they can buy or sell varied products. With a fast development that surpassed the expectations in the e-commerce field, Amazon is available in numerous countries worldwide, including Russia where business persons can easily open an online store on this platform linked to their activities. At the moment there are about 300 million account owners who can display their services on Amazon. According to registered numbers and statistics, Amazon declared profits of about $316 billion for 2016, the representatives mentioning that the revenues will meet new levels for this year.
Conditions to open an Amazon store in Russia
As mentioned above, an entrepreneur can set up an Amazon store only if he/she already registered a firm in Russia. Limited liability company, double liability company, joint stocks or general partnership can be chosen as business entities in Russia. The preferred kind of firm is the limited liability company which can be registered by at least one person who must provide the minimum share capital of RUB 10,000 (approximately $170). The company incorporation in Russia is a simple process which can be supervised by our Russian team of agents in company formation who can also explain how to register for tax purposes with the authorities in charge. Once your company is established you may proceed in opening an Amazon store in Russia and legally issue invoices for future clients. Please consider that for opening an Amazon shop you must prepare a storage place and settle the logistics.
Why you should open an Amazon shop in Russia
The giant Amazon established the offices in Russia in 2013 after the official numbers revealed the status of the business internet in the country. There are about 70 million internet users in Russia and an e-commerce market worth about $40 billion. Besides this important reason, an entrepreneur can choose to set up an Amazon store in Russia considering the favorable taxation system. For example, the VAT rate is set at 18% for must products and services in the country, but there are also exemptions or reduced rates. Food, clothes, and medicine, for instance, are subject to a 10% VAT rate. As for the banking services, the exports, the international transportation or particular categories of medications, these are exempt from VAT in Russia.
When thinking of expanding the business on an international plan with the help of Amazon, one should focus on the skilled workforce in Russia. The labor market in Russia offers attractive options for foreign companies interested in starting their activities in varied fields. Entrepreneurs can rely on the experienced workforce in Russia which has knowledge of English, French, and Spanish languages.
Payment methods for your Amazon store in Russia
When opening an Amazon store in Russia, one must consider the payment methods offered to future customers. At the moment, there are two main payment methods which can be easily implemented in your store: PayPal and the merchant account. PayPal is an online payment method through which a customer can pay for the goods and services chosen on Amazon. Both clients and online stores must have PayPal accounts in order to send and receive money through a linked bank account. As for the merchant account, this kind of payment method allows clients to pay for their products with the help of a debit or a credit card. We mention that for a merchant account, the seller must sign a contract with a financial institution in Russia which will offer a bank account for future online transactions.
For extra information about how you can set up an Amazon store in Russia, foreign investors are suggested to contact our Russian company incorporation advisors.