- Insights
Expand Your Ecommerce Business to Poland: Key Opportunities and Benefits in 2024
In a recent update, Amazon reported that its sales reached a record 30 million products in 2023 for its Polish customers, marking an increase of five million compared to 2022, and showing the potential of the ecommerce industry in the coming years.
Why is the Polish market proving so popular, and have you considered whether it’s time for your ecommerce business to expand there too? Let’s take a closer look.
Ecommerce Activity in Poland
Poland’s ecommerce market has experienced tremendous growth in recent years, solidifying its position as one of the fastest-growing digital economies in Europe.
Several factors have driven this surge. The country’s increasing internet penetration rate, particularly among younger generations, coupled with the expanding reach of mobile technologies, has empowered Polish consumers to shop online more frequently.
Moreover, Poland’s ecommerce growth has been fuelled by the rapid rise of Small and Medium Enterprises (SMEs), which have a significant impact on the country’s economy. According to Amazon’s research:
‘Entrepreneurs in Poland play a key role in the economy, generating nearly two-thirds of GDP (67.9%), of which nearly half (45.3%) is contributed by SMEs’
This highlights the importance of SMEs in driving the country’s economic progress, and the growth of the ecommerce sector has opened new opportunities for these businesses to expand beyond local markets and access a global customer base.
By leveraging online platforms, SMEs in Poland are increasingly able to scale their operations and build brand recognition in international markets. In terms of product categories, Amazon.pl reports that the most popular product categories include:
- Home & Kitchen
- Business
- Industry & Science
- Health
- Furniture
These categories demonstrate the broad spectrum of consumer demand, reflecting a blend of household necessities, specialised business and industrial products, health-related items, and furniture.
The diversity of product categories suggests that the Polish market is ripe for businesses offering a wide variety of products which customers are increasing willing to purchase online, making it an attractive destination for ecommerce sellers.
Why Should You Expand Your Ecommerce Business to Poland?
Here are some key reasons why Poland is a top expansion destination for ecommerce businesses:
- Lower Barriers to Entry: One of the most attractive aspects of running an ecommerce business is the relative ease with which you can enter new markets. By utilising established online marketplaces like Amazon, businesses can reach a wide audience quickly without needing to set up physical stores or warehouses. Amazon.pl provides a localised presence in the country which is tailored towards local preferences.
- Leveraging Fulfilled by Amazon (FBA): Expanding into Poland has never been easier, thanks to services like Fulfilled by Amazon (FBA) which is available in Poland. FBA allows businesses to store products in Amazon’s fulfilment centres, where Amazon handles the packing, shipping, and customer service on your behalf. FBA helps reduce logistics and delivery times.
- New Seller Incentives: from the 12thAugust 2024, Amazon began offering special incentives to new sellers on Amazon.pl. New sellers can benefit from a six-month exemption from the standard monthly subscription fee, which provides significant savings in the early stages of expansion. On top of that, sellers who use FBA services will receive an additional 50% discount, making it even more cost-effective to enter the Polish market at this very moment.
What Do I Need to Get Started with an Ecommerce Business?
Entering a new market requires careful planning and adherence to local regulations. TBA Global’s extensive experience in international expansion makes us the ideal partner to guide you through the process.
Here are the essential steps you need to take to get started:
- Register for Value-Added Tax (VAT)
If you plan to store inventory in Poland, you’ll need to register for VAT. This is a crucial step in ensuring compliance with local tax regulations and enabling efficient shipping within the EU.
Registering for VAT in Poland allows you to store products locally and ship them to Polish customers quickly and easily. Additionally, it simplifies shipping to other EU countries, as products stored in Poland can be dispatched across the union and directly to your customers without incurring extra import taxes.
- Register for Extended Producer Responsibility (EPR)
Poland, like many EU countries, has implemented Extended Producer Responsibility (EPR) regulations, which are designed to promote sustainability and environmental accountability. EPR requires businesses to take responsibility for the entire lifecycle of their products, including disposal and recycling.
Before selling products in Poland, ensure that your goods comply with EPR regulations in Poland, especially if they fall into specific categories such as electronics, packaging, or hazardous materials. It’s important to obtain the necessary registrations to avoid any legal penalties.
- Ensure Product Safety Compliance and Appoint a Responsible Person
Product safety is a top priority in the European Union, and Poland is no exception. Many products are subject to strict regulations, and businesses must ensure that their goods comply with local safety standards.
New regulations, such as the General Product Safety Regulation (GPSR), set to take effect soon, will impose additional requirements on product safety across the EU.
In many cases, you will also need to appoint a Responsible Person to oversee ongoing compliance with safety regulations and ensure that your products meet the necessary standards.
Already Based in the EU? Boost Your Business Further!
If you’re already operating within the EU, expanding into Poland is a logical next step. One of the most effective ways to protect and grow your brand in the EU is through the union-wide trademark system.
This system allows you to register a trademark that is enforceable in all EU member states, including Poland. A trademark can help you safeguard your brand identity, build customer loyalty, and protect your business from competitors.
For more information, contact us for a free one-to-one consultation at info@tbaglobal.com.
Each province and territory in Canada has unique tax structures. For example, in provinces like Alberta, only the federal GST applies, while provinces like Quebec apply both GST and their local PST, also known as the QST.
Who Pays Canada Sales Tax?
Sales Tax in Canada is collected from customers purchasing taxable goods and services. The process is as follows:
- Purchase: The customer buys a product or service.
- Tax Collection: The seller collects the applicable Sales Tax at the point of sale.
- Filing: The seller files a tax return to the respective authority (federal or provincial).
- Remittance: The seller remits the collected Sales Tax to the appropriate tax authority.
Certain categories of goods and services are zero-rated, meaning that customers do not need to pay sales tax. Zero-rating may be applied at the federal (national) or provincial level.
Common examples of zero-rated goods at the federal level include basic groceries and prescription medication and drugs.
Do You Need to Register for Canada Sales Tax?
Generally, if you reach the relevant sales threshold in the province/territory, you will need to register for tax.
Separate registrations are required for:
- GST/HST – threshold of CAD$30,000 in four consecutive quarters
- PST – dependent on the relevant provincial or local authority – check with us for more details
Registration usually must be done within 30 days of reaching the threshold.
Unlike European VAT, you are not automatically required to register for tax if you store goods in Canada – you only need to register after reaching the threshold.
If you fail to register after reaching the threshold, you could be liable to pay additional penalties, interest, and backdated GST/HST based on the date that you were required to register.
Marketplace Facilitation Rules
Since the 1st July 2021, marketplace facilitation legislation means that online marketplaces such as Amazon are required to automatically calculate, collect and remit GST/HST (and PST where applicable) for non-resident sellers (i.e. businesses based outside of Canada).
Additionally, if you’re also selling on your own website, you will still need to register for GST/HST separately when you reach the threshold.
Why Register Now?
Expanding into the Canadian market presents a fantastic opportunity for your business. Ensure compliance with Sales Tax regulations to avoid penalties and streamline your operations. Register your interest for a free consultation by contacting us at info@tbaglobal.com.
Take your business to the next level by expanding into Canada today!
