22/10/2014

By Rynhardt Hanekom, Cross-Border Trade Manager, ChannelAdvisor


In the past, selling internationally was seen as something achievable only for larger companies with international hubs, warehousing abroad, comprehensive back-office support and thousands of employees. However, with the general growth of the global e-commerce landscape and a shift in shopping habits, more and more retailers of all sizes are discovering that going global is not only a possibility, but also a necessity in today’s economy.

ChannelAdvisor’s recent multichannel e-commerce study revealed that almost half (43%) of UK retailers reported that 21-30% of their online sales come from international marketplaces. International expansion poses many opportunities, including a vast number of new customers, the chance to overcome seasonality (it’s summer somewhere, after all) and a potential niche in an underserved market. Retailers from other countries also recognise the opportunity cross-border trade presents, and sell directly into your local market. This means that there is more and more competition you have to deal with locally, and it is another reason why expanding internationally is worth your consideration.

Despite this evolution, online retailers still face a series of challenges when expanding overseas, from getting to grips with different taxation and legislation policies, to language/translation barriers and fulfilment processes. However, it’s important for retailers to embrace the opportunities awaiting their businesses overseas and not shy away from the opportunity.

To help UK online retailers take their first steps into foreign markets, ChannelAdvisor has created a five-step guide to help them expand overseas.

5 steps to begin cross-border trade

Do your research: It’s important to consider each region’s preferred retail channels. Start by researching the most popular marketplaces, comparison shopping sites and search engines in that market. Then take a look at their mobile and social media behaviour. Using your existing geographical and cultural knowledge, think about what in your product portfolio would sell in a new market, then conduct research to back up your theory. And of course, keeping up to date with the latest retail news and trends will give you better insight into changes in consumer behaviour.

Leverage fulfilment programmes: If you already have an eBay or Amazon presence in the UK, you could use Fulfilment by Amazon or eBay’s Global Shipping Programme, which allow you to list products on eBay or Amazon but fulfil international orders by shipping them to a domestic location – they will then forward them on to the final destination.

Be prepared for localisation: Once your products are available to overseas buyers, depending on the region, you may be required to translate product listings, offer customer service in the local language or adapt to different sizing conventions. To avoid keeping the customer waiting, try to have as much of this information already prepared to help speed up the conversion rate.

Take care with taxes and payments: Be aware that value added tax rates and regulations vary by country, along with who is responsible for the payment of taxes. Consult with a tax expert who can address your specific situation and provide guidance. Also be aware of which payment methods and options are expected by buyers (for example bank transfers are a preferred payment method in Germany), and ensure you can support it. Another consideration to make is to ensure you have a solution in place to get the best currency exchange rates.

Get Active: Once you’ve gained a better understanding of your new market and consumer demand, it’s time to increase your engagement there. Instead of listing only on your home country’s marketplaces in a passive state with the option to ship internationally, begin selling in an active state by listing your products directly on other countries’ marketplaces, such as Rakuten Germany, MercadoLivre in Brazil or La Redoute in France. The key here is to expand incrementally test different options as you learn which platforms work best in the markets you’re exploring.