Report: Cross-Border E-Commerce an Untapped Opportunity for US Merchants

With U.S. e-commerce sales forecast to grow to $561 billion in 2019, according to Statista, the competition for those dollars has intensified. As a result of the market pressures being placed upon U.S. retailers to support challenged brick-and-mortar stores with e-commerce sales, many
are looking beyond domestic borders for growth opportunities.

However, many are doing so without a complete understanding of the complexities of selling and fulfilling cross-border orders. Furthermore, in many cases they lack a fully developed plan for effectively engaging and shepherding international customers throughout the purchase journey, from discovery to order delivery, and all the steps in between.

This was a key finding of a recent survey of retail executives on their cross-border e-commerce activity. The respondents to the survey, which was conducted by NAPCO Research in conjunction with Avalara, a provider of automated tax compliance software, identified themselves as the person currently or soon to be responsible for managing cross-border activities at their company.

So what's at stake? According to a report from consulting firm Accenture and AliResearch, Alibaba Group’s research division, cross-border e-commerce sales are forecast to reach $1 trillion by 2020. However, those retailers that don't have a seamless purchase experience for cross-border transactions, from calculating and collecting the correct duties and taxes at the point of sale to ensuring shipments adhere to customs regulations for delivery, to name just a few, will struggle to capture that demand.

Selling cross-border doesn't mean simply replicating your current e-commerce experience in a new market. There are nuances that need to be taken into account. For example, customs duties and local taxes, and ensuring shipments adhere to customs regulations aren’t necessary considerations when selling domestically. Therefore, understanding the differences in selling cross-border and having systems and processes in place to account for them is pivotal in successfully establishing and sustaining a cross-border e-commerce business.

The old adage “you never get a second chance to make a first impression” rings true for retailers that hastily rush into cross-border selling without a fully baked plan. At stake is not only the opportunity to capture additional sales and acquire new customers, but your brand reputation as well. It’s inevitable that there will be obstacles that you need to overcome as your company begins selling cross-border, but by having the right systems and processes in place from the start, those challenges will be mere speed bumps on the road to success.

To learn more about the current landscape for cross-border e-commerce, including identifying key challenges as well as potential solutions to address them, download the full report, An Analysis of the Cross-Border E-Commerce Opportunity (and Challenges) for U.S. Merchants. This report will provide retailers and brands with the data they need to formulate a plan for cross-border e-commerce expansion.