Tuesday 29th Sep 2020 - Logistics & Supply Chain

Time to harmonise cross-border retail regime

Duties and taxes are holding back cross-border online shopping, according to a study commissioned by FedEx.

It found that while shipping cost and delivery time are top of mind with shoppers, 35 per cent of global respondents cited high duties/taxes as a concern for cross-border shopping. The UK, along with China and the US, are the top three exporters of online purchases.

“The results of this study on global trends suggests that streamlining regulations by harmonising duty free limits across the globe could result in a significant uptick in cross-border trade, benefitting consumers and businesses around the world,” said David Cunningham, chief operating officer, International at FedEx Express.

The study, “Seizing The Cross-Border Opportunity”, by Forrester Research questioned more than 9,000 respondents in 17 countries and territories, and conducted interviews with small-and-medium businesses with cross-border operations.

The survey found that SMEs are well positioned to win online business by highlighting their strengths and leveraging the availability of services that bridge the competitive gap with larger companies.

However, it found that SMEs must differentiate by offering unique merchandise while providing world-class service.

“SMEs are in a special position to provide hard-to-find products and personalized service. At the same time, they must offer great logistics and assuage concerns about reputation that their larger competitors address through scale. The good news is that there are third-party logistics providers and global/regional online marketplaces that can help SMEs with these challenges.”

It also found that limited variability in global shopper preferences means SMEs don’t need drastically different regional e-commerce strategies.

“Shoppers around the world generally discover the merchants they do business with through similar methods and seek similar levels of service, negating the need for multiple overarching strategies to reach and serve them. Certain consumers, however, have somewhat varying needs based on factors such as where they live, what they are shopping for, and how much they are willing to pay.”

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