First of all, apologies. It’s been a while since my last post. There are several reasons to that. Family & personal issues, selling one of my Amazon brands (more details in one of my next blog posts) and just a general time out that I gave myself.
But I am fully back to grinding and hustling on Amazon & eCommerce!
In the last few months I’ve seen more and more posts in groups as well as emails from my subscribers about getting suspended on Amazon or even getting products seized at customs because of non-compliance with regulations and certifications.
In this post I wanted to educate you in more details about the recent suspensions or headaches Amazon is giving new and existing sellers. More and more people email me about Amazon suspending their listing or not letting them list a certain product (sometimes super simple items). Most of the times it is too late if they are already suspended. Especially new sellers.
I’ve been warning people since last January 2017 when Amazon cracked down on sellers who don’t comply with legislations & regulations. No matter in the US or Europe, being compliant is getting more and more important to Amazon as governments try to crack down on in-compliant eCommerce companies.
I’ve taken a screenshot from Amazon Seller Central to show you what I mean:
So what does that mean essentially for you as an importer? And how can you comply with these regulations?
I am sure you’ve done your research when looking at a product how you can comply but most of the times its pages and pages of text on government websites that are very difficult to understand.
So I wanted to give you a breakdown and brief overview of how you can can understand regulations. Be warned this is quite the long post but please remember this is a super important topic!
The following is an excerpt from my certificate course. This is such a comprehensive topic that it took me 10 months to finish the course. Here we go:
1) Country specific requirements
This can be a nightmare. Each country has different requirements and regulations. On top of thatthey change all the time or are being updated every few months. Making it also very difficult for suppliers to keep up with it. So it doesn’t always mean that when your supplier hasn’t heard of a new regulation that he is incapable of working with you but because these change all the time. See chapter 10 on capability of suppliers. Even though for example the European Union has general guidelines that are valid for many countries in the EU some countries have even sub-requirements.
There are norms & regulations that count for all countries. As for example D2001/95/EC or General Product Safety Directive (in short GPSD which regulates the CE directive) is valid for most countries within Europe.
Then again take Switzerland for example, since they don’t officially are a member of the European Union they have their own regulations. E.g. a GS certificate is not valid there, you have to have the equivalent on your product (S+ certification).
However in general it is safe to say if your supplier has a high standard of a specific country already (GS certification for example) that you are unlikely to be in trouble.
Make sure to check country specific requirements in your local countries websites and do not assume
that if GS is necessary in Germany the same goes for France for example.
2) What type of certifications are there?
First things first. You need to understand that certifications are based on directives and legislations. So for example the GPSD in Europe (General Product Safety Directive Legislation) or the CPSA (Consumer Products Safety Act) in the US says that a product needs to meet certain standards and need to be safe in general to import or bring to the market.
Simple right? Unfortunately not. The GPSD has tons of directives under its belt such as the CE, RoHS, REACH directive). Which means that for each product or category there are further sub-categories that have directives which tell you exactly what your product needs to meet. Wait a minute, what exactly are you saying? I can’t read all this technical jargon….
There are several types of certification. Before I explain which ones are available please note that most countries have different certification requirements. There are also directives and legislations issued by Government Agencies or councils which can
be met when having the right certification. A Third Party Testing Institute for example issues a certification after having tested the product according to directives and legislations.
Simple please? For example if the RoHS directive (which is under the GPSD legislation) says that a product has to be tested on how many percent of a chemical compound is in the raw material (e.g. Cadmium or Lead) of the final product, the certificate will only be issued once the testing is completed and the percentage of chemical is not above the allowed directive/legislation of RoHS. With that being said, there are:
A) Certifications/Marks required by law
B) Certifications/Marks good to have
C) Certifications/Marks recommended
3) Who and how are certificates issued?
1) Certificates are not issued by factories themselves (except SELF certifications declarations of conformity). If they are
issued by the factory as a declaration of conformity – this is not evidence as such that the product complies.
2)Certificates are issued by Third Party Laboratories (TPL) or Government Agencies (GA). These certificates are actually
evidence of conformity, give you peace of mind as well as support you when someone claims that your product is not
conform to regulation.
Whats the workflow? The supplier or you needs to send in the sample of the product to a TPL or GA. The TPL or GA will then
conduct testing according to requirements issued by the governing country or body. If the requirements are met, the TPL/GA can then issue a certificate that is in some cases valid for a short period or in some cases does not expire. The TPL/GA will then forward the original and copy (PDF) of the certificate to the party who paid for the testing costs
4) What does my product have to meet legally?
In general your product has to meet country specific legislations & directives. Those can be as simple as a document of conformity (DOC) which can be self-declared or a Third Party issued certificate (or Evidence of Conformity) which will cost a
certain amount specified by the Third Party. What your product has to meet legally can be researched on government’s websites such as the CPSC in the US or the European Commission in Europe.
5) Do I really have to have all certificates?
Yes and No
The good news first. No you do not have to have all tests and certificates done by
third party laboratories (both the US and Europe). What would suffice in (almost) all
cases would be a declaration of conformity. Wow really? Yes, and here is the
“however”. If you trust your suppliers blindly that all raw materials are free of
hazardous chemicals, comply with electromagnetic compatibility (electronics for
example) or meet certain other standards then that would be very foolish.
If your supplier can’t provide any certification and claims that he complies with everything
you ask for thats a huge red flag. I also understand that you don’t want to invest in
any certification not knowing if it will sell. And this is the most important part where
you as a entrepreneur and business person need to come to a decision. A) Is my
product potentially dangerous (can it explode??). B) Is my product relatively simple
and can’t harm anyone (e.g. leather wallet)? Once you’ve figured out what you need
for your product you need to evaluate what should be invested. Lets take an
example. For the sake of it lets look at a simple and a complicated product.
Solar powered garden light for 1.2$. Comes with nothing but a few cables, some
plastic and a solar cell. Simple right? Technically I have to meet the following: LVD
(EMC), ROHS, REACH & CE in general for Europe. Now if I were to test all of
these the costs would amount to roughly 2000USD with a very cheap Chinese laboratory.
If it was TUV or SGS the costs would be triple that. Now what if I am
going to order 1,000 pieces and my testing costs would already cost more? That
doesn’t make sense. In this case I suggest to get self declaration of the above
regulations and save yourself these costs. Obviously you’d still want your supplier
to declare that he can fulfil those requirements so look for suppliers who already
deal with customers in the country you want to import to and have a good
reputation or can back up their claim that the item is compliant with raw material
certificates for example (from the raw material supplier).
Small Electric fan heater 5.9$. Comes also with a few cables, some plastic, a plug and a PCB. Simple right?
No. You see, I need to plug this product into the socket (230Volts plus) and the potential dangers are very
high. If the unit tips over or a child puts a cover on top, the entire unit can burn up (and the house with it).
Also here technically I have to meet the following: LVD (EMC), ROHS, REACH & CE in general for Europe.
Ideally I will also want a GS mark for Germany because this is a product consumers want to have with GS.
On top of that I want abnormal testing from TUV for example. Abnormal testing means they would test
what happens if you cover the unit with a blanket or if it tips over that the unit switches off automatically. A
good supplier knows that there needs to be a tip over switch installed and overheating fuse included. This
abnormal test alone costs 4-5,000USD.
A GS mark costs somewhere in the same vicinity (2-4000US$). The other tests (LVD, RoHS, REACH & CE) are
roughly 2,000USD. Now we are looking at 10-12,000USD investment costs. Would I do all these testings before
purchasing? Yes, 1000%. I do not want to risk my business or anyone else’s life because I wanted cheap. You
may say ok but I don’t have that kind of money. Then you need to find a supplier who either has these
certificates already or is willing to invest the money for you. If you can’t find one than its simple – the product is
not for you and your budget. You can still go for it without all the testing and certifications but I think we are on
the same page here that that would be a very foolish decision in case anything happens.
Now I can’t go into hundreds of products or case studies here, that just isn’t possible. But I think you see my point. First I need
to evaluate if the trouble is worth it and if I even want to deal with complicated products.
If the answer is yes then the strategy is pretty clear I think – test and get certificates. If you don’t dare to sell these risky (but profitable) products go the easy way and pick simple products or walk away.
You don’t have to have recommended certification like GS or UL on an electronic product. These
are recommended certifications that improve your chance of selling and create more trust for your
customers. We call these “Quality Seals”. But remember, a self declaration is not evidence of compliance.
It is merely a statement by you or the supplier that all regulations are met.
So if you want to be on the safe side you do testing with a third party laboratory and get actual
evidence certificates). This is for your own protection.
Imagine you are a consumer and you see an advertisement somewhere (online/offline)
and the advertiser has a certain quality seal like GS/UL. Would you rather buy the quality
approved product (even if more expensive) or that of another seller who does not have
these quality seals? I think it’s needless to say you go for the quality seal product. Most
big retailers only purchase a product when it even meets all quality seals. For example
Walmart or Sears will probably not import a baby product that hasn’t got FDA approval
and BPA free certification. They just can’t afford to be in the news when the product gets
tested by a watchdog and the test fails.
6) How does everyone else do it without certificates?
Many importers, especially small ones, eCommerce sellers or importers who send via Air Express (DHL etc.) avoid getting caught by customs and authorities because these carriers (DHL etc.) have special clearance at customs. Why? Because they clear millions of shipments every day around the globe. If every shipment would be inspected by customs,
logistics and delivery times would be a nightmare. So yes basically everyone else is breaking the law.
Importers who go the regular way (regular Air or Sea freight) have to clear each shipment with customs. Since clearance takes a lot longer and there is no “waving trough” of your goods like with DHL they do look at most shipments in detail. If your product does not have necessary certification/documentation your products can get seized and you’ll never get them back (unless you miraculously acquire the certification in a few days).
So yes, you may save a few hundred or thousand $ if you don’t get caught. But if you do get caught, fines or seized goods that can be much more expensive aren’t worth it. So go the correct way from the beginning. Not only do you have an edge over your competitors (you have a quality seal, they don’t) but you also have a safe product that your customers will appreciate (in turn even mention during a review).
7) General costs
As a general guideline here are some costs from a local Chinese testing laboratory (CTS):
1) CE/EMC (800RMB) calculators, clocks etc.
2) CE/LVD (luminaires 2800RMB)
3) RoHS (950RMB)
4) REACH (590RMB)
5) FCC (800RMB up)
7) LFGB (6500RMB)
8) GS (7500RMB)
9) Colorfastness (80RMB)
10) PAHS (390RMB)
11) AZO DYE Test (210RMB)
12) California Prop65 (800RMB)
8) Who pays those certificate costs?
If the product does not have certification and your market requires it the costs lie with you. However if you can convince the supplier to pay for it you may save those costs. Why would the supplier pay for it?
For one, it increases his chance on selling more of his product because he can advertise the certification to other customers and second it helps to improve the quality of the product (if he needs to make adjustments to the product in order to meet the testing requirements). One may argue and say “but I don’t want other customers buy this product, especially not in those countries that I am selling from” – well then it is pretty clear that you have to evaluate if the testing cost is worth it so you can have the
certificate exclusively and in your name. Because if you pay for it the supplier cannot advertise or lend the certificate to other customers.
9) Where can I save money?
In general simple products that have very low requirements such as a knife sharpener, salad bowl, decorative items etc. are ok to have only a Letter of Conformity
- examples of European templates here:http://ec.europa.eu/DocsRoom/documents/5830/attachments/1/translations)
- examples of US templates here: https://www.cpsc.gov/Business–Manufacturing/Testing-Certification/General-Certificate-of-Conformity-GCC
- or a Letter of Guarantee issued by you or the supplier stating that all items are conform with regulations and standards. Best to check with your supplier or a third party test laboratory.
10) Are EU certificates valid in the US & vice versa?
In general NO. Even though some certifications have a stricter testing procedure (such as LFGB in Europe)
they are not acknowledged in other countries. So if your supplier has no FDA certification for the US but
he has LFGB for Europe (the equivalent to FDA) it is a good sign that his products can meet regulations
but it won’t help if you need certification for the US. If you have a good product and feel the investment
is worth it then go for the certification and pay it (or convince your supplier)
11) Getting the supplier to test for you
As mentioned before you can also have the supplier apply and pay for the certification. Especially if you are selling
solely in one marketplace and “allow him” to sell to other countries or markets than you are selling. E.g. Imagine you are based in Germany and for now you only plan on selling on Amazon Germany. You could tell him that he is allowed to sell to any other customer within Germany (online or offline) if he pays for the certification.
German importers or bigger clients are more likely to buy from a factory if they have a certain certification for example. Same goes for the North American market. Walmart for example is more likely to buy from a factory if he has proper certification.
12) Why do some suppliers have no certificates at all?
Sometimes suppliers have no certification at all because either:
- The product is new and they want to see if the market needs this product before paying for any certification. Basically they want to test the waters before investing themselves.
- The supplier only sells to countries where no certification is required at all (imagine regulations in Africa)
- No one has told him yet what is needed and he waits for customers input
- He simply doesn’t care and wants to make a quick buck (stay away)
- He doesn’t have experience in your market but is otherwise capable.
The above is only a brief overview of thousands of regulations and I hope this gave you a bit of an overview. If you want to learn about this topic with in-depth material to make sure you are compliant, check out my Certification Course or post your question in our Facebook group here.
All the best and happy sourcing,