How Australians Can Expand to New Markets with Fulfilment by Amazon

December 4, 2013

Marketplaces Sam Clarke By Sam Clarke

Australian retailers have always had limited options for selling their goods through online marketplaces. Beyond making items available to international buyers through eBay AU, there hasn’t been an easy way to get products in front of a wider audience. As a result, a large majority of businesses here have never built the infrastructure required to sell their products internationally.

Despite these circumstances, it’s still possible to expand your reach into other regions. Keep reading to find out how to boost sales and increase your customer base by growing internationally.

Consider the Global Context

OAustraliaver the last few years, Australia’s online retail market has grown exponentially, and as a result has left retailers beaming with joy as they continue to get their products in front of more and more potential buyers across the country. However, retailers are beginning to reach a saturation point and are looking for new channels and opportunities.

Elsewhere in the world, retailers have more choices. Many of these marketplaces even have options that allow retailers to list and distribute their products throughout the world. In the United States, for instance, retailers have access to two very powerful services:

  • EBay’s Global Shipping Program has allowed U.S. retailers (or rather, retailers with products physically located in the U.S.) to make their products available to buyers on eBay’s list of eligible countries, with very little effort on the part of the retailer. With eBay’s Global Shipping Program, retailers can send a product anywhere in the world. No matter where the buyer is located, the retailer’s only responsibility is to ship the order to eBay’s warehouse.

  • For the media category (books, music, videos, and DVDs) and a growing list of additional categories, Fulfilment by Amazon (FBA) Global Export works in a very similar way, only the retailer has even less to worry about. Utilising Amazon’s existing fulfilment services, retailers are able to ship their products to an FBA location and then  place their products in front of potential customers the world over. Amazon will take care of the entire order and fulfilment process.

While these services aren’t currently available to retailers in Australia, what options do you have for getting in on this massive cross-border trade (CBT) opportunity? The first step in the process of increasing your potential customer base in international markets is to open marketplace seller accounts in your selected locale. Once you’ve opened your seller accounts, how do you go about streamlining the process of fulfilling international orders?

Option 1: Keep Calm and Carry On

The simplest way for most retailers to fulfil international orders is to follow the same process you use domestically: Make your products available and fulfil on a per-order basis. This not only keeps fulfilment in sync with your current practises, but also offers a lot of flexibility for customer service teams as they track orders and update buyers on their shipping progress.

There are downsides, however, and the biggest that comes to mind is the sheer cost involved with handling a large volume of international orders. For many retailers, margins could begin to disappear and the workload alone could become problematic.

Option 2: Fulfil by the Bucket Load

Many retailers getting started with CBT will aggregate orders destined for the same location and handle them as a bulk shipment. This reduces costs associated with fulfilling the order, as well as adds some flexibility for retailers that are new to international delivery, enabling them to focus on their core, local business.

The potential risks here, however, are twofold.  When listing an item on any marketplace it’s generally a requirement to specify the handling and delivery times the buyer should expect. When fulfilling items in bulk, not only are retailers substantially extending handling time, but they’re also risking disappointing buyers who may have expected a speedier delivery. As you look to move to more marketplaces, your reputation should be your top consideration. A buyer’s feedback can make or break a retailer, especially in a new region.

Option 3: Avoid Risk with Amazon

By far the most forward-thinking solution to listing and fulfilling internationally is to remove the risk entirely.

Fulfilment by Amazon: As previously mentioned, FBA is a fantastic tool for retailers. Not only does FBA eliminate the need for retailers to store their products themselves, but it also reduces the hassle of having to ship orders out to the buyers.

Many people don’t realise that FBA is available to retailers in many locations, including Australia. Retailers in Australia can almost immediately begin selling on Amazon internationally by shipping their selected products to one of the many designated FBA warehouses and listing their products on the respective international marketplace. Amazon marketplaces in the US, Canada, UK, France, Germany, Italy, Spain, China and Japan all offer FBA services.

Another big advantage is that having your items in FBA gives you improved access to the Buy Box in the local market. Sellers report they see a lift in sales just by having their items available via FBA versus fulfilling them themselves.

There are some other great advantages to using FBA. With Amazon taking care of dispatch on your behalf, you’re able to reduce how frequently you’re shipping your products overseas. Additionally, you’re able to know, far in advance, what the storage and delivery fees associated with FBA are going to be. Above all else, however, being able to offer multiple delivery services will be your biggest advantage.

Amazon Multi-Channel Fulfilment: In addition to FBA, retailers are also able to take advantage of Amazon’s Multi-Channel Fulfilment. This functionality allows retailers to advertise their products on and take orders from other marketplaces, such as eBay or their own webstore, and push the order back to their FBA account. Then, Amazon will manage the order as it does any other FBA purchase. This feature opens up a whole new world of opportunities for any retailer looking to expand to new territories and new marketplaces.

In a follow-on post, we’ll look in more detail at how best to improve performance on these international markets and where ChannelAdvisor is able to help with the challenges of listing products internationally.

Blog post by Sam Clarke, ChannelAdvisor Sales Engineer, APAC


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