International shipping -- is it as outrageous as it looks?
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Greetings Jill, Melody, John, and everyone else dealing with this issue.International shipping can certainly be a beast and I feel you on that.  There are a few ways to dance around it.#1) If you are pre-production, plan a size and shape and weight that ships cheaper.  Once you get past certain dimensions the shipping rates jump tremendously.  If it's a board game, ensure it fits in a medium flat rate box (there are 2 shapes), or small flat rate if that size.  And don't underestimate the value of a flat rate bubble mailer.  They fit way more than a small flat rate does and ships the same price.  -  First class, not flat-rate, is often your best bet.#2) (Best option) You can freight ship a fair stack of your product (book, or game, or else) directly into a foreign region, then ship from there.ie: Freight 3 cases of books directly from your printer (or self) to Germany.  This will cost you a couple hundred dollars ($100-500 depending on size and total weight), but once you divide price by the # of books in the cases it's only a couple bucks each, then you pay only the local in-region shipping per book, and charge the total to the backer.  - Imagine a foreign seller shipping a pallet here, then paying USPS rates... ah, that would only total about $9 per person that way.  -   This only works in bulk.  It won't work very well in small quantities, but UPS's shipping calculator will help you price it out.  Try it.#3) Understand this: Nothing is "free".  Subsidize the shipping price in your pledge amount.Got free shipping on Amazon or KS?  Somebody paid for that.  It's subsidized into the price.  It might feel free to the buyer, but somebody paid a cut to the shipper-man.  If you're paying $50 for something sizable on KS with "free shipping", they subsidized at least $X of shipping into that $50.  Can you do the same?  Increase the price of the book $5 and then charge only $15 shipping?#4) Eat it.  Charge less than the full amount and eat that percentage (ONLY if still profitable to do so).  Does +$5 make your pledge value seem wrong somehow?  Then #4 might be for you.  But know this: You budget this into the net project before you start, and then it's just part of the net goal.  This is basically #3, but a harsher-way of looking at it, when increasing Tier Price is to be avoided.(For #2 & #3 - the more you make and will sell will greatly affect your ability to do this.  The more you make, the lower you cost per unit is, so you can pass that savings on, and the more you make the more likely it will become for you to shippThese are the main ways.  Shipping is real, and it's never free.  You can A) Make it cheaper with great planning early, B) Freight ship directly into the region and ship from within it (a great service to provide for your EU customers who worry about VAT), and/or C) Hide the price of shipping by putting in the pledge amount, and calling shipping free, or D) Eat it (ideally budgeting this plan in in advance.Finally, yes, if you're doing shipping yourself to reduce costs to backers, use Stamps.comI have a ton of advice on Freight Shipping (aka Logistics) and Fulfillment (aka shipping stuff) on my blog, and as much on budgeting, and even a how-to for Stamps.com.  Take a look for detailed step-by-step advice for each.As always, heart this post if it was helpful to you.Best on your projects!John Wrot!-Community Adviser
John Wrot!


How do you handle customs declarations for international shipping?
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A great question!Here's the facts: Your backer rewards are absolutely Merchandise.  They are not gifts, and no government in the world will see them as such.  Period.  : OCan you mark it "gift" and get away with it?  Probably, but it is international tax evasion.  If you get caught... you're gonna find yourself in a lot of trouble.  : /  Simply not worth it.-Anecdote: We sent out rewards all over the world.  We sent all items to the EU with properly declared customs forms as merchandise and the actual values of the products.  Many of them came back to us anyway because the customs agent (as every one is different) couldn't find a packing slip with item-by-item value declaration on it, and he wanted to be 100% certain to milk the person of every penny ..err euro.  -  And that was on properly declared items.So yes: Merchandise.  And yes, you should mark it the full value (of the pledge level).  If you included shipping in the pledge value you can reduce the declared value of the package by the amount of included shipping.  When they are charged VAT it will be on the value of the package + the cost of shipping.  This new total will roughly reflect the actual pledge amount, and thus they will charged the correct amount of VAT without being charged on shipping twice.-Suggestion: Use E-declarations by using an online service like USPS.com, Stamps.com, or paypal.com/shipnow. - Filling out paper forms by hand is murder; the e-declaration is really really easy as it imports data from previously filled out fields, then asks simple questions like: Merchandise or Gift? ; )Always open to private or specific help as well,John Wrot!
John Wrot!


What do you do when your project is WAY more popular than expected?
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I was expecting a couple hundred backers, but got vaulted to 3,400 backers very quickly. "Would be nice to get $5,000" turned into $105,000 over a couple weeks. https://www.kickstarter.com/projects/fringefocus/the-acme-corporation In fact, the majority of my backers were in the final week of my project. On top of that, my project ended on December 24th, with only one week left in the year.That means I needed an accountant, really fast. What started as a personal project became a thing that pushed me several income tax brackets higher, with only one week to get the numbers straight (to avoid paying self employment tax on 100 grand of unexpected income). Here are some important notes regarding the actual money:1. Hire a professional accountant (or accountant + bookkeeper), and explain to them the mountain of cash that is approaching your account.2. If you didn't already set yourself up as a business, do so immediately (ideally before your project even closes). An accountant can usually help you choose between an LLC, or S-Corp. I prefer an S-Corp (more paperwork, but no self employment tax!). Your mileage may vary by state.3. Make sure you have a business checking account (easy to set up anywhere) completely separate from your personal accounts. This is not only easier to manage mentally, it will help immensely if the IRS ever comes knocking for an audit. Keep your business finances separate from your own, and save yourself a headache 5 years from now.4. Catalog every expense, to insane detail. Every piece of tape, every sheet of paper, postage, materials, staff costs, etc. You're basically gonna pay tax on profit, but not on expenses. And no matter how large your pile-of-cash is, the majority will be expenses for rewards. Make sure you're profitable by envisioning worst-case-scenario prices for materials, postage, delays etc. (although this is obviously a step you should have tackled before even starting a project.)5. If your item is still available, make sure you notify your backers / future customers / new people that missed the Kickstarter where you work can be bought. I developed https://fringefocus.com into an easy-to-browse art store to capture those post-kickstarter customers (as well as new people).That's the immediate stuff, and is boring. Here's the fun stuff that happens when you get a much larger community than anticipated.1. Your backers are now your fans, your testing grounds, your audience for future projects. Instead of working in a mysterious vacuum, you have hundreds / thousands of people excited to see your new work! More than all the project revenue, the #1 resource I gained from Kickstarter is the 3,400 cool people willing to check out, share, and enjoy my future work. My Fringe Focus Newsletter http://fringefocus.us5.list-manage1.com/subscribe?u=31d2b1187f4779a02d1a464eb&id=1cf81bdf22 is more popular than any social network, advertising, etc. combined. And it's been steadily growing long after the Kickstarter project ended 2 years ago. Super fun.2. A bigger project means buying materials in bulk. That expensive paper that isn't affordable when buy 100, is super cheap when you buy 4,000. Same for shipping materials, storage, etc. Volume discounts and economies of scale are hugely beneficial, so seek out any volume discounts you can from your suppliers, partners, etc.3. INVEST IN YOUR BUSINESS. You had a project explode, don't let that be your one success. Whatever equipment you've been dying to acquire. Whatever location you want to move into, whatever resources were not possible prior to project, now are. Don't spend a single cent of project money on anything wasteful (okay, maybe a little). Use your savings on resources that will allow you to continue your creativity. My ACME Poster project allowed me to pay for my first entire year of rent on a new workshop. I bought a bunch of woodworking tools, poster storage, even a laser cutter that I now use to produce fun wood projects in my store: https://fringefocus.com/store/housewares/4. Respect. Whether you feel you have earned it or not, a hugely successful projects screams to the world "Hey, I am capable of kind of cool things that people generally kinda like." or even "This person is good at some stuff!". This means you can reach out the media, new bloggers, potential employers (if that's your thing) with some recognition that you can tackle tough problems / big projects. A lot of the attention I get on current projects probably stems from people knowing I successfully completed a big project on a public stage (Kickstarter). You aren't a stranger anymore. :)5. Straight up happiness. People would email me from all over the world just saying how psyched they were by my project, or how much they loved my work. It was (and continues to be) unreal. That kind of positive feedback makes all this hard work worth it, and makes every day a little more fun (knowing a large number of people are happy with what you've made). It's just fun.I could write a lot more, so ask away! I should add that hiring help (ideally in-house with you) for fulfillment is a very good move. As is researching the hell out of postage, postage weights, and best practices. Please feel free to reach out to me at https://fringefocus.com or on Twitter http://twitter.com/fringefocus anytime if you have specific questions about what to do. Thanks! - Rob Loukotka | Fringe Focus Inc. | Chicago
Rob Loukotka
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