At Infinity Nation & Beyond, we look at the status of your digital landscape and how it affects the growth and profitability of your business. On the show, we will be talking to Business Leads, partners in the e-commerce world, as well as some of our own specialist team to give you actionable insights and find solutions to help you on your growth journey today. We will consider new ideas, stretch our mindsets beyond the status quo and in the process discover how to gain an edge on competition and drive some great results.
Al Keck: Hi, my name is Al Keck and thank you for joining me. In a post-Brexit UK, brands are unanimously looking at solutions to ensure their presence beyond British shores remain seamless. Global E-commerce Experts are a key member of the community providing end-to-end solutions, not only on tax obligations and VAT, but even warehouse and storage. Today, I’ll be talking with Riki Hooker, a general manager at GEE. We are going to look at some of those common pitfalls, what to be aware of when you are looking to expand your reach to new territories, and what are the best tools to arm yourself with before starting out on this new adventure. Welcome, Riki. How are you today?
Riki Hooker: I’m very good. Thank you. Thanks for inviting me.
Al Keck: My pleasure. So I think we have some good discussions today. What types of things do you think businesses should be looking at before they start with their overseas expansion plans from your experience?
Riki Hooker: It’s really important to start with a targeted and structured approach, get advice, plan compliance, and some of this will be depend on whether you are very new to export or whether you are reestablishing EU connections, perhaps post-Brexit. But it’s a big world. There’s 740 million Europeans who are, broadly speaking, tech savvy, online buyers. There’s 580 million people in North America. Your product and your service evaluation will help you to understand where it’s right to go.
Should you just choose English-speaking nations initially because that’ll save quite a lot of cost and pain further down the road? Interestingly, GEE partners with a new online marketplace called OnBuy, and their international rollout is along those lines, English-speaking nations. So that’s an interesting way of going about it. But most of it would depend on product and service. Taking advice, getting compliant with things is the most important place to start. For most, I would suggest just getting started in Europe, beyond the closest sea-locked border from the UK into Europe, which was, of course, formally much easier and is now slightly more challenging. It’s probably the closest port of call for most and it’s probably the right place to begin.
But I think the most importantly, taking time to begin the process and understand all of the different, the components that are going to be involved in terms of getting tax EORI number for a year, for instance, over and above the one that you have in the UK or that registration logistics, whether you need to keep stock abroad. These are all things that you can get down into a strategic plan from the beginning. And that’s a really important place to start.
Al Keck: Did you have a mini checklist or top five tips of what to do?
Riki Hooker: There’s some really good export information provided by the government on the government’s export, the government website for that side of things. That’s a really good place to start your DTI contacts. They’ll give you tailored checklists relating to the type of business that you’re in from an online perspective, then certainly the checklist should include all your tax and your compliance based items like identification numbers, and VAT thresholds and things like that. And then beyond that, if there’s any safety based information that’s required regarding C certification post Brexit, when things have been approved for UK use things like that. But the government export website is the best place to go for a checklist like that.
Al Keck: Okay, cool. And with the sort of current challenges we are seeing in terms of, as you say, going into mainland Europe right now, where if you were in one of your client’s shoes, would you push through that pain or would you just divert to America in this short term?
Riki Hooker: No, the United it comes with, North America comes with its own unique and far from insurmountable, but far from insurmountable challenges. There’s huge cultural and corporate trading differences, despite common language. So typically we would suggest that the first place to start would be geographically closest, but some of that will depend on the product and service that you’re selling.
Al Keck: Okay. And so what’s the most common shortcut you see businesses doing that causes them sort of more pain in the longer term?
Riki Hooker: Very commonly we see businesses exporting by default, so responding to an existing or a new lead or opportunity that might have been presented to them and under their own entrepreneurial hunger to service that leader opportunity, they go ahead and begin exporting by making the sale. And then they work their way backwards to plug her hurdles and the challenges that come in doing that. We see that very commonly and find that that’s the way to cause more pain in the long term, because very often you are providing short term solutions to moving stock into a country, or you have to retrospectively sort out compliance. So from a service and a quality perspective, that’s the most usual thing that we would see as the wrong way of going about an unplanned expansion, if you like.
Al Keck: Yeah. And do you do, from the experience that you have at GEE, are you seeing many people doing sort of some semi sensible analysis of what I would call the 80/20 rule where they look at 20% of their product ranges driving 80% of the revenue per se in the UK. And do they then, and sort of analyze to see if there’s the same type of demand for that product within Europe, be it France, Germany?
Riki Hooker: Very much so. I think if, and for some businesses where there’s been a slowdown of immediate home grown trade, not for all, of course, some businesses far from having that situation, but for some that’s given perhaps a bit of bandwidth to be able to go ahead and put together a feasibility study of some description, however, formal or otherwise of looking into the opportunities within e-commerce, in different markets. Straight from the outset, the e-commerce market in Germany is of equal proportion to that of if not slightly bigger to that in the United Kingdom. So immediately you have the opportunity to double your market with very, very tech, savvy e-commerce, ready buyers. So from whatever product and service that you are selling in, it’s very easy to be drawn into the scale of the opportunity beyond with just from the German market.
The United Kingdom makes up really in round non-statistical terms about a third of the European e-commerce market for online trading platforms. Germany is the other third. And the rest of Europe is the remaining third. So it’s quite, if you tally that up against your own online statistics of traffic date, you’ll be able to quickly get a picture of where to begin this process and where your customers might be. So I think that, yeah, absolutely. European market is a good place to start with, once that phase of eligibility studies being done.
So I think companies are working to put that legwork in first to kind of do that strategic plan. And some of that’s going to be logistical. Some of that’s going to be about how you physically get the goods into Europe. Do you need to split your stock. If you’re selling tangible goods, do you need to store some goods in the UK and do you need to store some goods in Europe? So as a third party supplier, a third party logistic supplier, we have a building in both the Netherlands and in the UK. And that allows the splitting of stock between two places. So some of the feasibility is going to be about how you’re physically going to trade, not just about whether you want to or not.
Al Keck: Yeah. And I think you’re right in terms of with the current challenges with Brexit, and actually interestingly, we invest in the Netherlands are offering such competitive advantages for, or, and backing for you to open warehouses in the Netherlands. When the ship turns up the English channel, whether it turns left or right, doesn’t really bother.
Riki Hooker: Yeah. I think that the…Netherlands has given opportunities, which somewhat unforeseen. Post Brexit, the Netherlands has been open, armed to overseas business, as well as the UK. There’s some real benefits to predominantly English speaking. You’re not really going to find too many trading Dutch businesses that aren’t going to speak English. And from an American perspective, for instance, from Americans who are wanting to expand into the EU who were formally coming to the UK, now those businesses are finding that the Netherlands is just as easy to trade with as the UK. Take a then aside a fantastic logistics network across Northern Europe and also VAT deferment of your imported goods, which will means that your working capital is not being impacted by paying the VAT on the point of entry. Again, if you’re selling tangible goods.
That makes some really, makes a really big impact on the amount of stock, your capital tied up in stock, if you’re having to split stock between two particular places. So that’s a really interesting from Netherlands perspective. And then of course you’re only a couple of hours dry, borderless into Germany to that second third of the e-commerce trade. And that’s before you start thinking about Benny Lux, the French market, the Scandinavian market, depending on what your sales are. So you’ve got a really, that’s a really interesting proposition. And certainly what GEE is advising to overseas traders that want to access Europe.
Al Keck: I know we are definitely considering that for some of our clients moving to the, having our warehouse solution in the Netherlands for exactly the same reason. We did consider Belfast. But I think with the political grenade that was thrown not so long ago, it may be a bit risky, but I think the Netherlands looks really interesting. In your opinion, and where are businesses going wrong? And why is deciding to sort of selling beyond the UK? Why is it such a minefield?
Riki Hooker: I think an underestimation of cultural and trading differences are probably the fastest route to it going wrong. Underestimating the extent of nativization that’s necessary from your website and from your e-commerce, for all your e-commerce solutions. I think it’s not just a case of translating descriptions, for instance, got to make sure that your meta tags and your indexing is all translated as well, or else you’re not going to rank properly in those countries in particular. And that’s especially the case. If you’re selling on online platforms like Amazon, for instance. Say if you’re selling directly off your own site, so for a typical Shopify seller that wants to expand into Europe, then I think not naturalizing your website. Shopify does a great job, using that example. Shopify does a great job of giving the functionality to be able to help you with that, but offering things in native currency, offering things in native language.
I think those are probably the biggest mistake of trying to use British or UK based infrastructure. And that’s not to say you need a new website. You because the world’s not smaller than that nowadays, but you do need to take advantage of the functionality that’s being offered to make sure that your descriptions and indexes are translated and that’s after your products are come client and a properly done in the country, you’ve got your tax affairs in order and those kinds of things. But I don’t think it’s a, I don’t think it’s right to call it a minefield. I think this is just different challenges that are all surmountable. Your listeners have managed to and had the wherewith all course to have a successful and growing business within the UK or indeed abroad from wherever they are. Your existing trading it’s just a different set of challenges that need to be surmounted.
I think there’s an investment that’s required and that needs to be structured. And I think that that under cooking the requirement of what the investment that’s required. At GEE we talk to a lot of American businesses and British businesses who want to expand. And maybe that expansion in total might cost them 15,000 pounds say arbitrarily, that’s getting access to hundreds of millions of new potential buyers who are a few mouse clicks away from closing contents of their cart and getting hold of the goods. That investment is for end to end in terms of how you think about setting up your business in those countries or in Europe, or internationally all of the compliance, all of your tax affairs and keeping those things in stock. So having splitting a stock into other nations, so depending on the size and the scale of your business, that’s quite the opportunity for that kind of sum.
Al Keck: I think it goes back to that adage, isn’t it? The difference between good and great is that little bit extra. And I think it’s just doing that extra level of insight and interrogation of what is relevant for the native country. So, for example, in Germany, I know it’s really important that you are happy to do cash on delivery. No one. You wouldn’t do that in the UK. It’s like you pay for it now and we’ll deliver it. But the Germans are happy or prefer doing it will pay you when you deliver us the product that’s their way of doing it.
So you say, it’s just utilizing the right technology that exists out there in terms of a payment gateway that will allow the Germans to pay that way. And you mentioned meta descriptions and page titles. Here again, it’s not just translating what we do as the relevant term in English into German, because it maybe a different native way of talking about it. An easy example is we call them a duvet in America, they call them a comforter. You’ve got to go back to your data science piece to say, what is the pertinent term that is relevant to the product that I’m selling? And that’s why do I want to optimize the page that way in that language.
Riki Hooker: Yeah, I think that’s that degree of nativization of things when they’re translated. I mean the best example of nativization is when you stumble across an online seller on a market platforms coming from for instance, China, where something’s been presented in a Google translated or an online engine created translation and we’ve all seen and done that of how much that turns you off to the buying experience of that particular product, irrespective of whether it is good quality of good value or what have you. So I think or if you’re presented something in the wrong currency or instantly you’re putting barriers in the way of your customers that you need and do in this day and age.
Al Keck: Agree. Yeah, absolutely agree. Lastly, Riki, can you tell me, or give us your top three tips for how you would nourish your digital landscape? We’ve lost your sound, Riki.
Riki Hooker: This is not one of the tips, be bold. The international market is a ready for your products, is ready for you. At the point where you want to grow your business beyond your own borders, the international e-commerce world is ready for you. So I think be bold. Very importantly. That’s not one of my tips to nourish. My first tip to nourish is translating and nativizing currency and pricing and spending the time to do that. My second tip is making sure you can properly manage your CTAs. We see lots and lots of instances whereby online sellers who are, for instance, based in the UK, they might have great CTAs all the way across their site. They’ll have online chats, they’ll have contact numbers and stuff, but if you’re selling to a Californian or you are selling to someone in a different time zone, your staff have gone home by the time that call to action comes and lands in your box.
So make sure you can properly manage the degree of trade that’s to be generated in the time zones and the way that you do this. And thirdly touched on this very slightly, but using third party logistics providers, that’s what makes your product seamless to get to market. That’s what handles your returns. That’s what gives you next day delivery and the service and quality expectation that those customers abroad are going to be expecting. So in essence, treating those buyers with the same degree for giving them the same degree of quality and services you would do at home.
Al Keck: And I think your second tip there is one of my biggest bug bears or one of the things I often talk to our customers about who will say to us we’ve put live chat on them. It’s like great. When is the website busy? Typically 7:00 PM till 11:00 PM at night. Great. So when is live chat, and they’ll say office hours nine to five. So as you say, it’s all having that support and there’s call to actions there, but there needs to be a follow through. So I think you say really, if you’re an online retailer, now you’re a 24 hour operation, how can your customers talk with you over that 24 hour window? And we’ve seen many a solution where we’ve at our point when the course and the staff might go home, or the customer service staff go home, you then just revert it to a third party out of hours, call handling solution that can just act like first base support, if you’re IT.
They might not be able to definitively answer the question there, and then, but at least your customer can speak to someone and say, “Okay, let us come back to you. I can’t answer that right now, but I can come back to you.” So I agree with you. I think it’s a real consideration in terms of doesn’t stop you going to the market, doesn’t stop you marketing, but it’s a conversion rate impact in terms of whether that customer will buy or not buy, which when you start investing thousands in launching into a new market, the conversion rate is key.
Riki Hooker: Yeah. And you’ve got to trust your data there in terms of those conversions and where your traffic’s coming from. And that type of, you’ve already got to trust what you are being delivered in terms of information, to be able to make those informed judgements and decisions or certainly the process of which one’s the most important.
Al Keck: Brilliant. Riki, where can we find and learn more about GEE?
Riki Hooker: Global E-commerce Experts website. You can find that top of Google, if you search for Global E-commerce Experts, globale-commerceexperts.com. We have a whole expansion pathway for overseas businesses that want to grow internationally, right from the compliance through to the warehouse and account management. So yeah, you can look us up online and where there’s a whole suite of webinars, podcasts alongside the ones that you guys are doing here to help with your journey.
Al Keck: Brilliant. It’s been great to chat Riki and look forward to discussing more e-com tips with you soon.
Riki Hooker: Thanks for having me. Really appreciate it.
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