April 23, 2018

Cross-Border E-Commerce Good for African Businesses

By Abdi Ali
Published March 30, 2018

Saying that the growth of cross-border business is twice the pace of domestic e-commerce, Steve Burd, Vice President of Sales for DHL Express in Sub-Saharan Africa, says that this highlights a boundless opportunity for African businesses looking to take a piece of the cross border e-commerce pie.Cross-border retail volumes are predicted to grow from from US$300 Billion to US$900 Billion between 2015 and 2020.

DHL, an international logistics company, says that this increase at an annual average rate of 25% provides significant growth opportunities for retailers and manufacturers with an international online product offering.

Saying that this growth is twice the pace of domestic e-commerce, Steve Burd, Vice President of Sales for DHL Express in sub-Saharan Africa, says that this highlights a boundless opportunity for African businesses looking to take a piece of the cross border e-commerce pie.

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Burd points to five common areas which domestic e-commerce customers consider to be a challenge when deciding where to trade internationally:

  • The cost of express shipping
    There is no risk at offering your customers an express delivery option. Customers want choice, not only in their product selection, but also when and how they receive it. Customers are willing to pay a fair price for a faster, more efficient service.
  • Returns rates
    Return rates are actually much lower on international shipping. Businesses could always do it on a trial basis and measure the benefits over losses and adjust their strategies accordingly.
  • Basket values
    Basket values often increase with the introduction of express shipping. Customers tend to buy more to justify the premium shipping costs.

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Customers are willing to pay a fair price for a faster, more efficient service.

  • The customer’s business is doing well locally
    Evidence shows that international customers will spend significantly more than local ones. So even if international traffic to your website is small, it can be worth a lot for limited effort. There are free online tools available which will give you an indication of your international traffic on your website – this will provide an idea of which countries to focus your efforts on. There is no risk in opening doors to the international market – only the risk of getting left behind.
  • Unfamiliarity with customs procedures and processes
    If your paperwork has been done correctly, there shouldn’t be any customs delays or worries. Collaborating with an experienced partner that has extensive knowledge and know-how of customs procedures on the African continent will assist the business’ e-commerce offering to evolve.

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