As ecommerce entrepreneurs we are used to doing things on our own, with many of us even starting out as solopreneurs. This isolation, and the ability to control our time as a result, has been very attractive for us for a long time. But more recently this very same disconnectedness can lead to our own ruin.

One of the issues that rattle us to the bones is online sales tax. States have been salivating on the billions of dollars they could get from online sales as ecommerce steadily grew. They went after the online platforms we sell our products on, especially Amazon, but Amazon has proven to be a big gorilla to fight especially with their ability to create thousands of jobs as leverage against states. And so some states turned their attention to the ones they can easily intimidate: us individual sellers.

Amazon claims ownership of most of everything–customers, listings, even prices–but unsurprisingly sales tax is not one of them. It’s up to us to handle sales tax, and everything is so complicated that many of us are not sure what exactly is the right thing to do. Many states even disagree among themselves about sales tax nexus. But still, some sellers have begun receiving letters about this in some states, and it’s definitely not a good position to be in.

This is one of the reasons Online Merchants Guild was born. This nonprofit was created by ecommerce sellers for ecommerce sellers, with the goal to have as many members as possible so that we can collectively fight against issues that are too big for any one of us to fight.

In this episode I talk to Bernie Thompson, an 8-figure seller and member of Online Merchants guild, and Paul Rafelson, a lawyer and law professor working with the likes of GE, Microsoft and Walmart. Below is an overview of what we discussed:

  • How Online Merchants Guild was founded
  • Sales tax nexus and how complicated it is
  • The Wayfair case
  • Constitutional principles violated by states with regards to sales tax
  • Goal for everyone who joins the organization
  • Other goals and member benefits like business insurance, discounted shipping rates, etc

Fighting this issue all by ourselves, like what we are used to doing, is costly and ineffective. We need to stand united and we need more support. We can’t do this by ourselves. There is strength in numbers.

If you want more information about the organization, just head on to its website (it’s still a brand-new site that needs fixing here and there) or send us an email at [email protected] We’d love to discuss it with you.

Resources mentioned:

EcomCrew webinar
Online Merchants Guild
Amicus Brief

Thanks for listening! Until next week, happy selling.

Michael started his first business when he was 18 and is a serial entrepreneur. He got his start in the online world way back in 2004 as an affiliate marketer. From there he grew as an SEO expert and has transitioned into ecommerce, running several sites that bring in a total of 7-figures of revenue each year.