My first store - Some general questions about startup

[Anthony31]

Hi all, 

I realize some of my questions might span a bit into a different parts of the forum, but am hoping they can be answered with this post.

- I'm creating a t-shirt store, and using Printful for fulfillment. Will orders be completely seemless and processed directly with Printful once the customer places them in my store as long as I have the automatic fulfillment selected in Shopify admin?

- Since I'm using Printful for fulfillment, will my address, or Printfull's address be displayed on orders, and how are returns handled? Will customers send returns to me, or Printful? If returns are sent directly to me, can I be reimbursed for the return too, or is that considered a loss?

- When a customer places and order, how is the payment distributed? Will I receive all of the payment, then pay a portion to Printful for their costs, or will Printful be paid their costs and me just paid my profits? 

- If payments are distributed in a way where I recieve everything, then pay Printful for their service, for taxes isn't it going to look like I'm making e.g. $100,000 instead of just $40,000? If this is the case, I'm hoping that $60,000 is a 100% write-off?

- In regards to the sales tax for each product that is charged in the store, this depends on where the customer is, where I am, or where Printful is located? I'm assumign that it's completely separate from taxes on my earnings. Where is that paid to if it depends on where the customer is located, and do I really have to pay money to each state that collects sales tax? How are those states really supposed to be aware of who's making a purchase online? Do I have an option of not collected tax at all similar to how other online stores don't? I'm not a fan of government.

- Since I'm not a fan of government, is registering my business name mandatory? I'd prefer to keep my business and store unregistered, just as I wish my parents never branded me with a SS# and birth certificate to make me property of the state.

[Peter_old]

Hey Anthony,

Trevor the Guru here!

I'd be happy to provide some insight into your questions! I'm going to break down each answer in point form to keep things organized. :)

1. As long as theirs a valid method of payment with funds available, there shouldn't be any issues with keeping your order processing seamless. Since Printful is a print on demand service they will charge your method of payment as soon as an order comes in. They will then process the fulfillment and ship the product to your customer while updating the Shopify admin with the tracking information. 
2. The return address of your store is by default Printful's; however, you can change it to your own address if you'd prefer. They have a document here that outlines this further! They also have a document here that outlines the return policy. 
3. Payments would be deposited directly to you in full to either your bank account or payment provider depending on the payment processors you use within your store. Meaning that you would have to pay Printful separately for each order that comes in. 
4. This question would be better suited for an account, as I'm not a tax expert myself. 
5. As far as Shopify can say, you should be charging taxes for your physical location. Meaning if you're based in California, you would charge customers who purchase from or ship to California. Whether you need to charge taxes for different states, including the one Printful resides in would be a question for a tax consultant. 
6. Shopify doesn't require that you register your business, however, I would also speak with your tax consultant as this could be beneficial in the long run for tax write-offs. 

I hope that provided some clarification on how Printful works. If you do have any questions specific toPrintful, I would suggest reaching out directly to their support support@printful.com! If you have any questions about what I went through above, please don't hesitate to reply back and I'll happily help out!

All the best, 

Trevor M

Shopify Guru

[MarcTaxJar]

Hey Anthony! Congrats on opening your first store.

Printful has locations in California and North Carolina. This means that if you have them ship an item to a customer in CA or NC, they will charge you sales tax unless you have submitted a resale certificate in your Printful account.

Most states, including North Carolina, will accept your home state sales tax license as your resale certificate. However, California only accepts a California sales tax permit as a resale certificate. This means that if you don’t want Printful to charge you sales tax on your orders that are shipped to your buyers, you’d need to register for a California sales tax permit and begin collecting and remitting sales tax in California yourself.

While this is your business decision to make, it pays to look at your numbers. California sales tax is generally 7.5-9%. If you don’t make many sales to California, you may choose to absorb this cost. But if you make many sales to California, you may decide that losing 7-9% on each sale isn’t worth it and choose to register for a California sales tax return and collect sales tax from your California customers.