When it comes to expanding your eCommerce business overseas, we don’t need to tell you how valuable it can be to utilise and lean on third-party service providers who claim to be experts in certain and specific areas of your business.
From the immense value of third-party logistics suppliers like GEE, who offer 3PL storage, fulfilment, and delivery support, to the Responsible Person’s and compliance that enables your business to establish a legal and reputable presence in your target country or destination, there’s a lot to be gained by exploring the different options available to you as a seller.
One of those is the Merchant of Records, also known as the MoR, who takes on a somewhat middleman role in your business – buying suppliers and products direct from the seller before selling them on to the end customer.
In this blog, we’re looking at the value of MoR service providers, how to integrate the MoR role within your business operational structure, and how MoR can create new opportunities for your business.
The Role of Merchant of Records
The MoR role is there to take some of the pressure of completing a sale away from the seller. With so much to think about, from marketing to logistics, fulfilment, delivery, and customer service, collecting payment can fast become a challenge which takes up more time than it is worth.
The Merchant of Records is there to act as your payment collector and can be integrated as a system within your own business structure, or as a separate entity that takes responsibility for payment and all that comes with it – including collecting sales tax, ensuring payment compliance, and honouring any necessary refunds or repayments.
To consider the role of Merchant of Records within the business model, we need to look at both the customer journey and the payment process from a business perspective.
Crucially, no matter how you approach the MoR role, the customer experience is unchanged. They still visit your website, and process payments via your business. The key difference lies in what’s happening behind the scenes – with a third-party MoR system essentially setting up two transactions, one through which they collect the payment, and one through which they pass that payment onto your business.
The Benefits of a third party MoR
The main benefit of a Merchant of Records is that the MoR payment takes away all the admin from you as the seller. By integrating a system which handles the complexities of payment admin, sales tax, and more, an effective and efficient MoR presents a very clear opportunity for sellers to focus on the areas of the business which excite them, and which help them to entice and attract more customers – safe in the knowledge that the fundamental aspects of payment are being handled.
For sellers who are looking to expand overseas, this becomes particularly critical as it enables you to seamlessly sell your products to an international audience without having to worry too much about the finer details and legal requirements of selling in that market. The fact is that selling overseas comes with a lot of admin – both financial and legal – and so having a third-party system to rely on will give you a chance to revel in the positives of a global market without being weighed down by paperwork and complex admin.
Other benefits which are presented and handled by an effective MoR solution include:
- Currency conversion is managed on your behalf by the MoR
- Payment data protection is ensured
- Payment processor fees are managed
- Any payment disputes or refunds are all centrally handled
- Sales tax is calculated and automatically added
All of the above allows you to present a professional and efficient service to customers, all while making your own job as a business owner and seller much easier.
How to get set up with a Merchant of Records
Before we dive into the details of getting set up with a Merchant of Records, it’s important to note that the MoR is not the same as a PSP (Payment Service Provider) like Stripe. While a PSP does take on the process of completing transactions for you, its role ends there, and it does not offer the same administrative support and end-to-end responsibility – meaning that you remain responsible for handling areas like sales tax and compliance.
If you are looking for the support of a third-party Merchant of Records, the team at GEE can help. From integrating systems into your own business model to finding a reputable partner who can take away the stress of financial and legal admin and leave you to manage the creative and customer-facing side of your business, GEE has the expertise and the experience to build and support businesses of all sizes and across all industries.
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