What makes cross-border e-commerce full of opportunities and challenges?

The proportion of global manufacturers and retailers selling online overseas in 2023. Data source: Statista.com

A world of opportunity

Every day, more and more companies start selling across borders. And it’s not without reason – through international sales, online merchants can build their brands worldwide, diversify their markets, sell in distant regions, and increase their revenues. In times of macroeconomic crisis, cross-border e-commerce still provides the opportunity to ship products to nearly 200 regions and billions of consumers around the world, and even purchase supplies from other countries. Most importantly, the success of a cross-border e-commerce business depends on its ability to reach international online shoppers and convert them into customers.

By the end of 2022, Chinese e-commerce companies are the first choice for overseas purchases, accounting for three-tenths of cross-border online orders in 39 surveyed countries around the world. Among major economies such as the United States, the United Kingdom and Japan, China is the main market for recent cross-border purchases.

The latest leading market share of cross-border online shopping in selected countries around the world in 2023. Data source: Statista.com

What is preventing borderless trade?

Reaching online consumers abroad is easier said than done. More than 55% of supply chain professionals recently surveyed said cross-border e-commerce is difficult. Language barriers often prevent international audiences from accessing certain websites. Businesses should also consider that product features tailored for the domestic market may not work everywhere. In addition, online merchants must accept payment methods that foreign shoppers can use while also providing reliable shipping. International shopping has risks inherent to any online transaction, such as fraud; expensive, lengthy or unpredictable deliveries; and regulations such as customs fees and taxes that further increase the final price of goods.

Still, the key reason why consumers around the world adopt cross-border e-shopping is because these products are more affordable than other existing products. And the main factor that makes them loyal customers is satisfaction with the goods they receive.

Leading challenges facing supply chain professionals in cross-border e-commerce in 2023. Data source: Statista.com