3 Things You Need to Know Before You Expand Your eCommerce Brand Internationally
Thinking about taking your eCommerce business beyond borders? With the global eCommerce industry booming and sales expected to reach over $6 trillion by 2023, more and more brands are jumping on the opportunity for global expansion.
However, preparing your brand for international expansion requires careful planning, a vast amount of research and of course, a solid strategy. If you’re considering taking the leap to global expansion, there are many things to consider, such as the cultural perspective, branding, fulfillment costs and much more.
In order to help get you started, we turned to three industry experts who are leaders in eCommerce logistics, branding and additional areas to learn more about what online sellers need to consider when expanding their brand internationally.
Here’s what they shared…
1. Keep in Mind Cultural Barriers, Logistics & Regulatory Aspects
It’s crucial you know and really understand the marketplace nuances. Some, from the outset, will be quite obvious from both a cultural and language perspective. How you communicate to this potentially new audience is crucial for your brand positioning and how well you are received as a new entrant into that market.
It’s also common to struggle with the formalities and it’s crucial to complete proper due diligence, thinking not only about market entry but what are the lasting implications and requirements of maintaining a footprint.
Troy Johnston
Co-Founder, Seller.tools
The three most important factors are regulatory differences between your home market and the market you plan to expand to, fulfillment costs and language differences.
Regulatory costs like getting approvals, tariffs and taxes can affect your gross income. For example, Mexico takes income tax out of your eCommerce sales if you are not a resident or business in the country.
Fulfillment costs can also vary greatly between markets. Federal carriers like USPS in the USA may not be reliable or even exist in certain markets – which means you may need to rely on companies like FEDEX, UPS or DHL, which may cost more depending on your product.
Language differences can make direct translations difficult, and even dialect differences can have a big impact on what your listing content is saying.
Mike Begg
Co-Founder, AMZ Advisers
Time is a precious resource, and there are seemingly infinite options of what you can do next. I recommend going to the marketplace that has the best potential for results based on the amount of time invested in getting setup.
When deciding on your next (or first) stop internationally, ask yourself what is your comfort level with the tax compliance, inventory logistics, and potential language translations that will be required?
My recommendation is generally start with Canada, then UK, Germany, the rest of mainland Europe, and then potentially Australia.
Kevin Sanderson
Chief Maximize, Maximizing Ecommerce LLC.
2. Do Your Research on Markets & Don’t Wait to Expand Globally
The biggest challenges are usually defining the viability of a new international marketplace as well as logistical support – especially when assuming scale. It’s important to incorporate as much predictability in a new market rollout and almost treat it like a new brand launch.
If you have the good fortune of having ‘spill over’ success that drives you to a new market, that’s ideal. Where a warmer, potentially more receptive market/audience will take hold of your brand and product mix and help you drive the needed factors to positively impact the Amazon algorithm.
Troy Johnston
Co-Founder, Seller.tools
The largest barrier to entry is just lack of knowledge of the local market. Having a partner in the market that can help you navigate the challenges posed by governments, banking, languages, customer expectations, taxes, etc. can help make your transition into an international market much smoother.
Mike Begg
Co-Founder, AMZ Advisers
The barriers for expanding internationally are more mental than technical. I have seen too often that sellers get excited about a marketplace and do all the work to get the proper registrations and setup their accounts…then never send in inventory.
Sometimes a country’s border can cause a mental border that scares people away from selling in that country.
The reality is that Amazon only sets up shop in business-friendly countries, and there is a saying that I think applies: “Where goods cross borders, armies do not.” What that means is we are contributing to a mutually beneficial relationship with that country, and the citizens and residents of that country are likely already buying similar products to what someone is selling on Amazon in the U.S.. So, Amazon, that country’s government, and the people who live there, all want you to offer your products.
In addition, many sellers wish they had started sooner with their international expansion.
Kevin Sanderson
Chief Maximize, Maximizing Ecommerce LLC.
3. Australia, Mexico and Canada Offer Great Opportunities for Global Sellers
I’m very interested in seeing the impact and potential of the Australian market. It’s been a unique standout from what I’ve seen both the viability of sellers and brand owners and the general customer response. Still quite rural, Amazon infrastructure in Australia is being built out and that investment speaks to a willingness to invest in viable markets. It never hurts to grow and expand your footprint as Amazon does in a given marketplace. There’s strong potential for both synergy and scale.
Troy Johnston
Co-Founder, Seller.tools
We see the largest opportunities in Mexico, India and Australia. All those marketplaces still have very low advertising costs and are starting to see sales volume pick up. In India specifically, we are seeing some clients achieving very large sales increases year over year.
Mike Begg
Co-Founder, AMZ Advisers
Canada is often the most overlooked market because people tend to think “overseas”. Many sellers who do go to Canada tend to find a mature market with great sales (especially compared to other growth options), good margins, and a friendly base of Prime customers with their credit cards on file who love to buy on Amazon. There also tends to be less competition than a lot of markets….
Kevin Sanderson
Chief Maximize, Maximizing Ecommerce LLC.
Don’t Wait to Make the Leap, Start Selling Globally Today
If you want your eCommerce business to continue to thrive and succeed, you’ll definitely need to expand into the global market. But to do this successfully, we recommend you consider what these industry experts shared. With some serious planning, research and determination, you’ll be able to take your business to new heights.
Finally, if you’ve always wanted to expand your eCommerce business into new markets, Payoneer’s cross-border and flexible payments solution can help online sellers like you get paid from leading global marketplaces easily and securely. We take the hassle out of international payments so that you can focus on growing your business globally.