How eCommerce Entrepreneurs Can Think Globally From The Outset

In this guest article, Enda Breslin, GM EMEA, ShipBob, outlines why eCommerce entrepreneurs should be thinking about offering their products and services globally from the outset.

There’s never been a better time to launch an eCommerce business. The modern consumer is more comfortable purchasing online than ever and digital channels mean there has never been more shopfronts to sell through. The UK’s eCommerce market is particularly sophisticated and this has led to an explosion in eCommerce entrepreneurs and rapidly scaling consumer goods brands.

While these businesses may often start close to home by engaging family and friends, today it’s almost as easy for Britain’s growing brands to sell in Shanghai as it is in Salford. There’s no reason why even small firms shouldn’t think globally from their earliest days. Retrospective add-ons incur higher costs and slow expansion, whereas putting some simple steps in place from launch offers the opportunity to hit the ground running in new markets – and supports rapid scaling.

Understanding your tariffs

A quick and easy win when selling internationally is to opt for the more detailed Harmonised System (HS) Codes. These codes are used by customs authorities around the world to identify internationally-traded products.

Knowing which version of HS code is best for your brand can make all the difference. Businesses have two options available – a basic version which works in most countries, as well as a more detailed version which is slightly longer. Countries like Australia require more precise specifications, by simply using the more detailed version when importing and exporting your goods, you can save a lot of time and expenditure when dealing with customs. This also allows outbound items and products to flow more smoothly cross-border and prevents unnecessary customs delays which can rapidly become expensive.

HS Codes are also important when it comes to calculating the bottom line. Using a longer, more detailed HS code and allocating the specific tariff will provide customs with a more detailed overview of your product, which can be easily read and authorised by the importer or exporter who has access and understands the method of classification.

English is just another language

Startup brands wisely look to keep costs low wherever possible. Language is a key area businesses should consider when planning for the long-term, providing translations for your website, emails, marketing, product manuals and labels will create a springboard for global expansion.

While investing in multilingual options in the early days may seem like an unnecessary expenditure when your initial focus is domestic sales, consider how much delays will cost you when the time comes to rollout in high-value markets.

Labels are often a problem area we see entrepreneurs and small businesses battling with. When manufacturing stock, it’s better to print multi-language labels in the most spoken languages to avoid the high cost of a second print and waiting for new versions of your labels and stock.

Translator services are incredibly cheap, meaning it’s easy to cater to the 500 million Spanish speakers, 300 million Arabic speakers and billion Mandarin speakers worldwide. Translating these parts of your business into every language from day one isn’t a necessity but covering the most widely spoken will set you up for success.

Similarly, we always recommend providing translations of your customer-facing services like the website or emails to allow a global audience to access your brand and products. Use customer data to assess where your biggest potential markets are and then translate your services into each local language.

Importance of payment gateways

Every country is different and not everyone’s credit card focused. Use a payment gateway with lots of internationally accepted payment methods as different nationalities have strong preferences for alternative payments. Products like PayPal are huge in the UK and the US but the Netherlands, for example, use iDeal.

Offering your customers more ways to pay makes the path to purchase easier and will also stop them from losing interest and buying from a competitor.

Don’t make blind decisions

Today’s online consumer brands have a wealth of knowledge at their fingertips and they need to make it count. Understanding your customers, their purchasing habits and how your web traffic compares to competitors is all vital information that can be harnessed to influence your growth.

As a starting point, we recommend looking at your social and web visitors – whichever countries are biggest outside of your home market, start with those first in terms of localisation. This data is rich with information on your consumers and provides clarity on where you should target.

Early priorities should also include analysing where your highest Customer Lifetime Value and lowest Cost of Customer Acquisition is coming from and assess performance against each of your investments and localisation improvements. Recent supply chain events have also meant small brands need greater visibility on where and how they ship products. Sounding out risk routes to avoid congestion and making sure your stock arrives on time is invaluable and with the right shipping partner, brands will be in a much better position to navigate any issues that arise.

The devil is the detail and with some smart data management, you can lower costs, drive efficiency and ultimately increase your margins – which can make an enormous difference to pace of growth during a brand’s initial days.

The tried and tested eCommerce expansion formula

Finally, utilise the three-step approach to international expansion that has steered eCommerce brands well for years: initial cross border-selling, DDP options at checkout and in-country stock.

Shipping cross-border is about balancing the localisation effort and cost with reward. It’s easy to set up a website and start selling locally but handling this entirely on your own will incur a fairly high cost in terms of shipping and time. Moreover, you’re unlikely to see huge initial sales – after all, you’re a somewhat unknown brand coming into the territory and you’ll likely be shipping from overseas, meaning you won’t be able to compete with the quick delivery speeds of in-country rivals.

We also recommend implementing Delivered-Duty-Paid where taxes are pre-paid at checkout. This is hugely attractive to consumers as they can purchase in the knowledge that hidden costs won’t bite after their delivery clears customs.

Competing with in-country rivals can be difficult but there are two ways to address this issue and both involve harnessing the mature ecosystem of ecommerce partners. A fulfilment partner can help level the playing field by giving your web store the same delivery and returns capabilities of in-country competitors. Alternatively, you have the option to trialling  with a marketplace like Amazon which will reduce risk and give you instant visibility to a large base of international consumers –  but you will surrender some margin on any sales.

As your brand’s popularity grows in the given country and your volumes dictate, we advise moving your products, fulfilment and warehousing locally. This saves you time, money and customs delays – placing products closer to the end user will offer greater control over delivery times and the capability to better manage any supply chain issues that may arise.

Finally, once you start to see traction, improve the offer for better customer experience and loyalty. The post-purchase experience is as important today as the product itself, so ensure you offer customers transparent prices and delivery times.

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