Management & Finance

10 Tips for Successful Cross-border Ecommerce

Cross-border ecommerce is booming.  Among the challenges of successfully entering a new country or region is understanding the shopping habits of local consumers, and overcoming shipping and logistics obstacles.

Cross-border ecommerce is booming.  Among the challenges of successfully entering a new country or region is understanding the shopping habits of local consumers, and overcoming shipping and logistics obstacles.

Most of my recommendations in “10 Low-Budget Ways to Sell Internationally,” a 2012 article, apply today, in 2019. However, cross-border ecommerce sales have greatly increased since 2012. The industry is collectively learning dos and don’ts for penetrating international markets.

In this post, I’ll offer 10 tips to expand your ecommerce business into new countries and regions.

10 Tips for Cross-border Ecommerce

Market research. It’s important for merchants to research which markets are the best fit for their products. This includes understanding how people shop in different countries. A country with a small percentage of the population using ecommerce is not a choice, for example.

Local competition. Once a promising market is identified, research local competition. This will help understand how to differentiate your products. It might also result in meeting potential merchant partners for service and returns.

Pricing. The last step of market research is to investigate local prices of similar products. Sometimes, based on pricing, it doesn’t make sense to expand into a market as competitive prices could be lower than costs.

Order delivery. Certain countries do not allow an international order to be delivered directly to the customer’s address. Instead, orders are sent to a local customs office for pick up. Thus, merchants should investigate delivery options in a country to ensure pricing and speed is adequate.

Local couriers. Often international shipping requires transferring the package to a local courier for the “last-mile delivery.” A challenge with this process, in my experience, is that local couriers sometimes do not track deliveries, leaving customers in the dark about their order status. Moreover, once the order is delivered, customers do not necessarily receive a proof of delivery. Thus merchants should research local courier partners to confirm their tracking and proof-of-delivery capabilities.

Shipment lead times. With the complexity and the uncertainty surrounding international deliveries, merchants should share estimated delivery dates with customers. It does not need to be exact. A range of days will suffice.

Packaging. Shipping a product internationally might require different packaging as the product will be in transit for longer. This is especially important if the product is perishable, fragile, or high value. Ensuring products arrive undamaged will lessen returns and service queries.

Insurance. Local shipping may not require insurance. But it’s more important with international shipping as there’s a greater risk of products being damaged or lost. By providing insurance, merchants can lessen concerns of international buyers.

Taxation. Tax laws vary among countries. There are many automated tax vendors — Avalara, TaxJar, many others — that keep track of these laws and collect and remit the required taxes. Merchants should not try to manage the international taxation themselves.

Returns. International selling makes returns challenging. The preferred option is for customers to be able to return products locally. If customers are required to return the products to the merchant, establish rules for whom will pay the international shipping. Lastly, since it can take two weeks or more to deliver products to international customers, the return policy should provide time for delivery and for customers to evaluate their products.

Gagan Mehra

Gagan Mehra

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