Cross-border trading: opportunities vs. challenges

Cross Border Trade (CBT) is one of the trends driving the borderless world of ecommerce. CBT presents online sellers with opportunities to increase their revenue immensely, but also poses challenges. These can be related to foreign consumer types and logistics on international ecommerce markets.

The ability to make your product visible internationally is a true blessing in the world of ecommerce. But beware … marketplaces, processes and online buyers are not uniform around the globe.

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Selling online abroad: opportunities

Ecommerce is said to be growing 250% faster than traditional retail. More and more people have access to the Internet and mobile devices in non-English speaking countries. The popularity of marketplaces and online shopping is also on the increase there.

There are many emerging markets with a lot of ecommerce potential for sellers located on established markets.

Established markets may not have so many gaps to exploit or may have a high level of competition.

Emerging markets, on the other hand, are improving their logistics and infrastructure and their purchasing power is increasing. One example is China. One strategy for online sellers is to determine those products that may be averagely popular on their domestic market but in high demand on emerging markets.

Another example is to offer products or services at competitive prices. For instance, European VAT-registered sellers can VAT free their listings in the USA and Australia. Since they are exempt from paying VAT in those countries, European sellers have an advantage over local merchants.

In other words, since European retailers selling in the USA and Australia don’t have to pay VAT there, they’re able to offer their items at much more competitive prices than local US and AUS sellers.

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Selling online abroad: challenges

According to research carried out by Oban Digital, 67% of business leaders claim that internationalization is a key part of their company growth strategy, but only 20% said that their current online communication was adapted to foreign local cultures or languages.

The three biggest barriers to CBT seem to be :

  • costs
  • additional overheads related to communication processes
  • businesses focusing on priorities other than international sales growth.

The biggest challenge may seem to be the language barrier between you and your foreign customers. However, the language barrier can be easily overcome. Today there are Cross Border Trade specialized translation and localization services that will help you translate, optimize and localize your offer. They’ll also provide your customers with multilingual customer service.

Studying the behavior of foreign consumers is also important, e.g. the frequency of online purchases and buying habits. For example, buyers from the UK are comfortable using the Internet to buy products.

However, shoppers from other nations such as China may prefer offline retail in numerous cases. This knowledge is very useful in planning successful strategies and determining your most relevant target markets.

You can sell and ship almost everything and almost everywhere.

Yet give some thought to what your business can afford and what items are easier to ship. For example, to avoid shipping issues and the risk of bigger or fragile products breaking, you may want to offer smaller and more robust items. Plan your strategy, but always keep details in mind.

Cultural differences, local business practices, laws, local logistics, payment methods and consumer practices are crucial for overcoming barriers to cross border trading.

Promotion and marketing are also important factors that must be considered and locally adapted. Do some market research and observe trends to get an idea about which markets will bring you the best value for any effort you may make.

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You can sell and ship almost everything and almost everywhere. Learn how international ecommerce can benefit your online store.

International ecommerce sales opportunities outweigh the challenges

Few business growth strategies could potentially double or triple the size of your online store. What’s one of the biggest growth opportunities for online sellers today? International ecommerce.

There are 1.79 bn digital shoppers worldwide (2018) and 2.14 bn is the number projected for 2021. By opening up to the international market with a well thought-out localization strategy, you present your products to, literally, hundreds of millions of new potential buyers.

So why aren’t more online sellers doing this?

Because there’s a misconception that it’s too complicated. It’s wrong to believe, though, that all localization components have to be sorted out from day one, or manually by online store merchants.

With today’s technology, it can take just a few clicks to localize your store. You don’t need to be a developer to master that. The right ecommerce solution can you help you minimize your shipping costs and maximize your international sales potential.

Localization is about overcoming barriers for the buyer so that purchasing is a straightforward process. It’s very simple. To check out how it works in practice, see our ecommerce localization infographic.

In a nutshell…

The possibility of global expansion can benefit many online businesses. However, they need to optimize their digital presence on foreign local markets to resonate with target audiences and to reach expansion and financial goals.

Hence, before you start operating on international markets, you must remember to prepare your online business for global expansion.

And then … just start selling more!


Interested in checking out our ecommerce localization solution to grow your sales immediately?


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