ross border e-commerce is a topic that has been on the lips of the entire industry for some time now; and de facto no one is surprised - the decision to go to overseas markets is a huge opportunity to gain new customers and report further successes.
On the other hand, cross border sales also present challenges: those related to the need to do in-depth research on the market in question and the competition present, to invest in a professional translation of the website and product descriptions, to research the legal and VAT meanders, to learn about the payment methods preferred by local consumers or, finally... taking good care of the logistics.
In today's post, I suggest how to plan an expansion into your chosen market with (logistical) success and avoid costly mistakes, both in terms of time and money. I invite you to read on!
Online shopping in a cross-border e-commerce model
Before getting into specifics, let us take a moment to look at the reality of domestic sellers conquering foreign markets. According to data collected by the IAB in its report 'E-commerce in Poland 2022', Polish e-customers are more likely to buy from local e-commerce owners (almost 80% of respondents); only about 30% of consumers choose to shop cross-border.
However, this does not stop Polish sellers from betting on cross-border trade. The portal Cinkciarz.pl examined their most popular sales destinations in a material entitled '2023 the year of cross-border e-commerce: challenges and prospects for trade without borders'; from the data collected, it is clear that European markets (France, Sweden, Belgium, Germany, and Spain), as well as the United States and Canada, are the most popular.
Cross-border logistics: warehousing and the last mile versus foreign markets
If a survey was conducted on what most people associate logistics with, I dare say that the majority of respondents would focus solely on the subject of deliveries.
Meanwhile, it is a much bigger and more complex 'project': the logistics business is preparing stock, sorting, packing, and labelling goods, delivering them to the end customer, and even... handling returns.
Given the multitude of elements that need to be taken care of in this process, it’s worth considering using external fulfillment experts. This is ideal for cross-border e-commerce – it allows you to focus on developing other aspects present in your online shop: improving UX, combating abandoned carts, or elements such as payment integration or improving product quality.
It is also worth using their services for other reasons – contrary to what you may think, investing in fulfilment also means certain savings, both in terms of time and finances. When deciding on such cooperation, you do not have to look for warehouses and couriers on your own and negotiate with them the rates for servicing particular stages of the supply chain. The fulfillment provider already has these negotiated – and by definition they are preferential, because it operates from a position of economies of scale and, with many e-commerce shops in its portfolio, is able to obtain better rates for handling overseas than a single seller.
Furthermore, special attention should also be paid to the integrations offered by fulfilment staff. When selling abroad, it is worth looking at the marketplaces that are popular in the respective market and the delivery methods preferred by customers. In practice, it is not always the case that people buying goods online want to have them delivered directly to their doorstep. Customers may prefer delivery to a pick-up point or to post office boxes (a method that is extremely popular in Poland). They may also have different preferences in terms of payment method and, although at first glance this is not strictly a logistical problem, in the case of cash on delivery (which is triumphant in Romania, for example) it nevertheless concerns last-mile delivery. Logistics experts are familiar with the markets they look after - so they will also be happy to help with consultations regarding the logistical needs of the end customer
E-commerce sellers thinking of going cross-border should also bear in mind that one new market does not have to mean the end of the adventure of trading abroad. Fulfillment offers great opportunities in this respect - once you have established a relationship with one platform, you can decide in just a few clicks to expand to other markets and be sure that your logistics will also be fully taken care of there.
And finally, there is one more extremely important point about dealing with returns and complaints. When selling abroad, you will not avoid this problem - the customer may want to return the product through no fault of your own, being satisfied with the whole sales process. However, it may turn out that, for example - he chose the wrong size of shoes or imagined the colour of the sofa differently. Bringing such an item back to your head office would be highly costly and completely unprofitable - so when entrusting your business in the hands of logistics experts, ask them how they handle returns and complaints.
And while returns are generally not a problem - handling complaints is still a challenge in the logistics market. And, let's face it, it is extremely important in the sales process. As data collected by the Baymard Institute shows, the majority of customers who have a positive experience in this area say they would potentially buy again from the same e-commerce shop. So what is worth asking specifically?
It is good warehouse practice to have a system that allows you to record the packing process, capturing the moment from the start of the process right through to the application of the label. If you happen to have a situation where a customer complains about receiving an incomplete or wrong order, you will be able to control the situation in just a few clicks.
Cross-border sales: summary
As many retailers - as many needs of online shops. Online commerce is not an easy industry - competition is fierce and continuous investment in e-commerce development can put a significant strain on a company's budget. The situation gets even more complicated when you dream of conquering a new market and going cross-border.
However, this does not mean that you have to abandon your plans - after all, the world of e-commerce belongs to the brave. But before you start selling abroad, do your research thoroughly and look for committed and experienced business partners.
So I wish you the best of luck - and keep my fingers crossed for growing demand for your products and a significant increase in sales in whatever market you choose!
The article is authored by Linker Cloud.