Expertise

E-commerce selling in the EU

Success factors and stumbling blocks in digital international business

Selling via E-commerce may seem boundless at first glance. Sooner or later, however, many SMEs find out that even e-commerce has its challenges. Even if sales take place at a distance, the company still needs to grapple intensively with local circumstances.

Mit E-Commerce in die EU verkaufen

Switzerland Global Enterprise presents five key success factors that can quickly become stumbling blocks in international e-commerce business.

What’s on offer

When you open your web shop to foreign customers, it’s worth taking a look at your range. Each item needs additional master data for dispatch purposes (e.g. customs tariff number), while prices must also be orientated toward the country and channel. Local price levels need to be considered, as do additional dispatch costs. Focusing on the most frequently sold products reduces complexity significantly at the start.

Logistics

Both orders and returns need to be processed quickly and cost-effectively. One important question is whether products are to be stored in Switzerland, in the EU or in both. Order volumes and the breadth of the range influence this decision considerably. Even if you employ professional providers who take on the task of stock management and dispatch within the EU, it is still challenging at the start. For this reason, many companies start with a warehouse in Switzerland despite higher costs in some cases.

Laws

The European Union is not a uniform market. Registration requirements, consumption taxes and value added tax are not standardized. With respect to value added tax, it is important to clarify whether the seller or the customer is responsible for import formalities. While the former is much more customer-friendly, it does involve administrative work. The handling of value added tax should not be underestimated. As a Swiss company, there is the very customer-friendly option of carrying out so-called “EU customs clearance,” which provides equivalent status to that of an EU provider. It is worth seeking advice early with regard to the different models.

Sales channels

Sales can be handled online via your own web shop or through marketplaces such as Amazon. In your own web shop you enjoy full developmental scope, which helps with brand building in particular. However, you also have to take account of all rules and regulations yourself. Marketplaces offer a broader reach, but your product will appear directly alongside possible competing products. It is often worth pursuing both channels, but with different objectives.

Customer acquisition

Essentially, customer acquisition has to be handled differently in the export market than in your domestic market. Cultural factors influence the purchasing process, as does a lack of brand awareness, along with local competitors. Search engine marketing (SEM) adapted to the target country is always to be recommended. To identify particular characteristics, it is worth taking a closer look at local competitors or marketplaces.

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