7 ways to increase profitability from international sales
The main and quite expected reason that motivates online sellers to enter the arena of cross border trading is the fact that it is profitable. In other words, selling internationally typically causes a rise in an e-tailer’s revenue. In fact there are several ways to increase the profitability from selling items into foreign markets even more! In this article, we have identified seven ways of increasing your revenue from international sales.
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#1 Follow the Seasonal Trends
International seling is ruled by the seasons. WebInterpret has conducted a cross-border trade analysis and identified the seasons that bring the highest demand – which can turn a seller’s business into an extremely profitable one. Here is the list:
- Wedding Season – from April until August
- Springtime – from March until May
- Home and Garden Season – from March until August
- Automotive Season – from March until June
- Summertime – from may until August
- Mother’s Day and Father’s Day – from April until July
- Back to School – from July until September
- Christmas Holiday Season – from October until December
- Halloween – from September until November
- Black Friday and Cyber Monday – November
#2 Lower Your Prices by 20%
One of the reasons why European sellers are listing internationally in the USA and Australia is because European retailers who are registered for the VAT don’t have to pay the VAT when selling into these countries. They effectively lower the prices of their products by up to 20% when listing on the US and Australian markets, hence they become more competitive in terms of price. Data analyzed on 300 professional sellers showed that sellers who removed their VAT in Australia and the USA have increased their sales by 100% in those countries!
#3 Consider Market Demand
We have checked the top ten product categories and it reveals that e-tailers who sell from the Clothes, Shoes and Accessories category are particularly successful. Their customers come not only from the USA and Australia, but from Germany, France and Italy, as well. In fact, Clothes, Shoes and Accessories are taking around 28% of the top ten market share. So you need not worry if you are not a fashion goods seller; there are other hot item categories, as we discussed in a previous article.
#4 Do it Everywhere!
The data shows the the potential of cross border trade is already very big and constantly growing. By examining these growth trends, we note the tremendous value of in cross border trading. The statistics below illustrate the point that distributing your products on every market place will only increase the number of your customers and the amount of zeros in your company bank account.
- Germany is the EU’s second largest e-commerce market after the UK, worth €39 billion in sales;
- Forecasts say that the number of digital buyers in Germany will reach 45.2 million in 2015;
- eBay in Australia and the US combined have about the same number of unique visitors as eBay in the biggest European E-commerce marketplaces, i.e. United Kingdom, Germany, Italy, France and Spain;
- In 2016, 30.4 million people in France are expected to buy goods online, up from 28.1 million in 2013;
- In 2013, 66.5 percent of internet users in France purchased products online. In 2017, this figure is expected to grow to 68.3 percent;
- In 2014, retail e-commerce sales amounted to 8.6 billion US dollars and are projected to grow to 10.53 billion US dollars in 2016.
- In 2016, 17.4 million people in Italy are expected to buy goods online, up from 15.1 million in 2014.
#5 Learn Every Language in the World…
… or own the software that will communicate with your foreign customers for you. Or you could hire translators who will do the work for you. In the past, the language barrier was a serious problem for sellers who wanted to sell internationally. But now, however, it is not a problem thanks to international selling solutions like Webinterpret! Although we don’t want to promote ourselves by explaining what we do we do for international sellers, bear in mind that translating sales listings and into every language in the world is one of the solutions that Webinterpret offers! (Note: You can try us for free for 30 days!)
#6 Lower Costs of Currency Exchange
The foreign currency exchange markets are unpredictable. They are complex, volatile and massively impacted by global political and economic events – both current and anticipated. Most e-commerce businesses don’t have time to watch the markets for them to take advantage of favourable movements in foreign exchange rates. You also don’t have access to the specialist resources that large multinationals have available in-house. But you still need to find a way of making the markets work for you – without spending every spare minute in front of a computer screen. Here are three currency tools that can help you take better control over your international sales proceeds: eE-tailer Collection Account, ‘Rate-watch’, forward contracts.
#7 Consult Your International Business with Practice
There are certain ways of optimising international listings and international sales. Aside from the general sales trends and consumer behaviour facts, there are various things about selling internationally that you will only learn after some time of doing it yourself. However there are many people in the industry (some of whom now work for Webinterpret) who already know the do’s and don’t’s when selling internationally. It’s a good idea to periodically review your business plans and objectives, especially at the beginning of the journey, on the international market.
Want to read more about Cross Border Trade? Check 7 factors that can make or break your international sales deal.