E-commerce Merchant International Expansion Issues

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E-commerce Merchant International Expansion Best Practices

The best practices to address issues and challenges that affect e-commerce merchants looking to expand internationally include choosing the best third-party logistics (3PL) provider, having multi-currency solutions for foreign exchange issues and payment options, and learning how to combat online fraud.


  • An e-commerce merchant who can successfully extend its offerings outside its local market (also called cross-border e-commerce) is more likely to boost sales by 10-15%.
  • Of the overall retail payment volumes, e-commerce transactions account for 9.1% and is projected to grow up to 12.4% by 2020.
  • Consumers who shop outside their home country can help generate $630 billion, equivalent to 20% of the global e-commerce sales in 2020.
Below are the best practices to address issues that affect e-commerce merchants looking to expand internationally.


  • Online shoppers consider fast delivery time and item availability important when ordering. If an item is unavailable or would take longer to be delivered, 70% of shoppers would search for an item elsewhere, rather than wait for the stock to become available.
  • In the Asia Pacific region, 41% of customers cite delivery time as an important factor on their shopping journey.
  • About 24% of shoppers would cancel an order because of slow shipping.
  • Additionally, 73% expects fast and affordable delivery. Therefore, choosing the right 3PL is vital for an e-commerce merchant to meet its customer expectations.

  • An efficient logistics process should be in place depending on product type, packaging, and other considerations. But for merchants who expands internationally, a 3PL is an option.
  • If an online merchant's shipping is growing, the 3PL should be able to support it and scale operations.
  • Select a 3PL company that has a well-developed software and uses a technology platform that can efficiently track and manage inventory.
  • Choose a 3PL that has warehouse management capabilities, customization options, customer support, advance technology, and with greater geographic footprint.
  • Check for the 3PL's fulfillment centers/warehouses and shipping zones. When shipment travels to fewer shipping zones because the 3PL has many fulfillment centers, it means lesser cost for the merchant as well as the customer.
  • Learn to check freight costs, fulfillment pricing, shipment rates, and hidden logistics costs.
  • In cross-border shipping, understand varying shipping regulations and customs in different countries and make sure that the logistics partner has a transparent legal consideration.
  • For international expansions, having additional 3PLs can help instead of switching to a global company. If there is a dedicated 3PL per region (e.g. one in the US, one in Europe, etc.), it is cost-effective and shortens delivery time.


  • For international sales opportunities, currency exchange is one of the challenges merchants face upon processing international credit cards.
  • E-commerce experts estimated that about 93% of international shoppers opt to pay transactions using their own currency.
  • If an e-commerce merchant does not have the ability to transact in foreign currencies, it results to higher rate of "shopping cart abandonment", higher customer friction, and fewer repeat purchase.

  • Cross-border e-commerce requires an efficient currency management on the side of the merchant.
  • A credible international presence can be maintained if prices are displayed in the customer's local currency.
  • A clear information about the merchant's currency conversion gains trust from the customer.
  • Merchants should also have the ability to compare the advertised pricing after it was converted, against the price they set, and ensure that the correct currency was sent to the customer.
  • Make the shopper's check-out transparent by offering multi-currency payment options.
  • Always consider that when shoppers check-out, dealing with multiple currencies does not only depend on the shopper's location, but also on their billing preferences.
  • Choose a payment service provider that has the ability to eliminate extra foreign transaction fees. These additional fees can sometimes become the reason for shopping cart abandonment when shoppers arrive at the check-out page.
  • When working with a payment service provider, make sure to also consider how their multi-currency payment method corresponds with the limits and regulations of each country.
  • Other e-commerce business operates in multiple websites dedicated per region (e.g: .ca, .com, .uk, etc) which simplifies multi-currency management.


  • The growing e-commerce transactions give e-commerce merchants some challenges in managing fraud.
  • Since it is not easy to verify identification online, international e-commerce merchants are considered the "soft target" for online fraud.
  • The common types of e-commerce fraud that merchants can encounter include phishing, friendly fraud, man-in-the-middle attacks, and identity theft.
  • The overall credibility judgment to a website is important to 75% of online shoppers. Among Americans, 62% worry about data theft, while 69% worry about their credit cards being hacked.
  • For an e-commerce merchant facing fraud problems, it can cause financial losses and product loss, as well as damage to their reputation and loss of customer trust.
  • On average, e-commerce merchants lose $2.40 to fraud for every transaction.

  • To combat fraud, e-commerce merchants can protect themselves and their local and cross-border consumers by adopting card-verification technologies. This can prevent the fraudsters to impersonate the account holder.
  • Gateway fraud filters can also be turned on as it can flag or block fraudulent transactions.
  • Make sure to encrypt and secure all confidential and sensitive data from the customer, as well as the merchant's data.
  • Another effective way to stop fraudsters is by using two-factor authentication technology as it gives an additional barrier. In some cases, it also simplifies checkout for shoppers.
  • Use tools for delivery and signature confirmation. Especially for high-value transactions, fraudsters wouldn't want to be linked to a specific address and be identified, therefore, these tools help in fraud prevention.
  • To prevent chargeback due to fraudulent transactions, make sure the customer knows the exact merchant name that will appear on their billing statements.
  • Merchants can also remind their customers to be careful not to divulge personal information to suspicious entities to prevent phishing.

Research Strategy:

To effectively identify the best practices, we initially searched for different challenges and issues that are currently affecting e-commerce merchants, especially related to international expansion. This way, we were able to identify the common barriers and challenges, thus, giving us a broader view of how they should be addressed. After this approach, we looked for solutions for these challenges and consolidated our findings. While other best practices include solutions for better user experience, payment gateway options, better user interface, and maintaining customer's trust and loyalty among others, we focused our list of best practices to solutions for issues related to foreign exchange, logistics and global shipping operations, and fraud. These best practices were selected as they were consistently mentioned in multiple sources and based the inclusion on their impact when it comes to addressing the issues.

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E-commerce Merchant International Team Statistics

There is an incredibly diverse range among e-commerce companies in how they organize their international teams. Shopify, for example, has a very small international team which it plans to nearly double in the short term to enable the company to gain a greater share of the international market. On the other hand, their close competitor BigCommerce has built its platform around enabling international e-commerce and, with just 734 employees serving 120 countries, appears to have virtually their entire staff as their international team.


  • Shopify reports having over 4,000 employees as of the close of 2018 and LinkedIn currently lists just over 5,000 today. This gives us high confidence that LinkedIn's profiles are reasonably complete and current for this company.
  • LinkedIn currently lists 28 Shopify employees involved in Shopify's international operations. (Note that the search returned 42 results; we manually double-checked those results, resulting in 16 being eliminated.)
  • The international team has 8 women, or approximately 28.6% of the team (8 / 28).
  • Based on Shopify's own figure of 4,000 employees, the international team comprises no more than 0.7% of the company (27 / 4,000, rounded up).
  • Of this team, 22 are based in Canada, 2 in India, and 1 each in Germany, Spain, Lithuania, and China.
  • Shopify's long-term growth strategy depends "in part" on their ability to expand international operations; though this is listed in their annual report under "Risk Factors" due to the possibility that this expansion will be hampered by factors outside of Shopify's control, it may signal a future expansion of the international team.
  • Shopify is currently seeking business development managers for Japan and China, an integrated marketing manager and product manager for Japan, partner managers for China and Germany, a senior marketing director for Singapore, 13 customer success representatives fluent in other languages, and a senior developer and UX researcher for their International Growth team, for 22 new positions. This would bring the total number of members in their international team to 50 (28 + 22), or 37 if we don't count the CSRs.


  • BigCommerce is estimated by Craft.co to have 734 employees as of July 2019. This is almost the same number as the 731 results found on LinkedIn, suggesting that nearly all BigCommerce employees have a profile.
  • However, a survey of those profiles finds that none refer to being on the "international team" or similarly-titled division.
  • The company's leadership profiles show Mark Adams as the VP and GM of Europe and Shannon Ingrey as the same for the Asia Pacific region, but no one in charge of international operations as such.
  • The move into Europe is recent, with Adams only having been hired in March 2019.
  • However, attempting to narrow down international teams by region reveals only secondary figures, e.g., Deepak Anand as the Director of Business Development for Europe.
  • BigCommerce facilitates e-commerce for 60,000 businesses in 120 countries. Given the low employee-to-country ratio (734 / 120 = just over 6 employees per country), the entirety of the company's staff would likely be considered their "international team."
  • Adams confirmed in an interview that BigCommerce generally organizes its teams by service line rather than by country or region.
  • While exact figures on the gender mix at BigCommerce is unavailable, a quick survey of 50 employee profiles on LinkedIn suggests that 15 out of 50 (30%) of BigCommerce's employees are women.
  • Employees are mostly based in the US, with Austin, TX (the company's headquarters) and the Bay Area being the most common metro areas.

The company's breakdown of employees by division is as follows:


In our initial strategy, we considered looking at the two largest e-commerce platforms on the planet, namely Amazon and Alibaba. Our thought was that these would likely have the most data in the public domain via their financial filings, interviews, and op-ed pieces. However, this proved not to be the case. In many ways, these companies are too large, with too many divisions which have an international aspect, to get useful information.

Finding eCommerce retailers with an international presence was the obvious next step. We pulled case studies of eCommerce platforms which had entered the international market to find reputable businesses, reasoning that a consulting firm would be far less likely to use a disreputable company's success to market itself. Armed with those names, we then researched each to determine what information about their teams is in the public domain. We soon found that all eCommerce merchants so identified were partnered with existing e-commerce platforms like Shopify or BigCommerce, tapping into the expertise of these companies' teams.

While in a strict sense, the project criteria specify e-commerce "merchants," keeping to the strictest interpretation fail to locate suitable examples. Consequently, we have interpreted "merchant" in this case to include platforms which, regardless of whether they sell directly (like Amazon), partner with and provide international teams to their client merchants.

The two largest players in this domain apart from Amazon and Alibaba appear to be Shopify and BigCommerce. Shopify's public status and clearly-marked international team made it an obvious choice. BigCommerce, as a private company, proved more challenging to investigate. For reasons explained in our findings above, we believe that the company does not have a clearly defined international team--or rather, given the number of countries it operates in versus the number of employees, the entire staff is dedicated in one way or another to international e-commerce operations. The contrast between the two companies was so striking that despite the difficulties in pinning down BigCommerce's staff divisions, we felt the project was best served by showing how far apart the strategies of two e-commerce companies on the international stage can be.

From Part 01
  • "Over 70 percent of online shoppers would search for an item elsewhere if it was unavailable, rather than wait any length of time for it to come back in stock."
  • "69 percent of Americans worry about their credit cards being hacked."
  • "62 percent worry about the theft of data from their computers"
  • "The overall aesthetics of website’s credibility judgments is 75 percent."
  • "Ecommerce transactions made up 9.1% of the retail payment volume and it is expected to reach 12.4% by 2020. However, this evolution introduces challenges for merchants’ ability to manage fraud. Meanwhile fraudsters are adapting their techniques and bringing their attention to online merchants. This is resulting in rising costs for all merchants such as product loss, financial loss and damage to trust and reputation."
  • "E-commerce merchants are a “soft target” for identity fraud, as it's much more difficult to verify a buyer’s identity online compared to in person."
  • "Merchants lose on average of $2.40 to fraud per transaction."
  • "73% of shoppers expect affordable, fast deliveries."
  • "24% of customers cancel an order due to slow shipping."
  • "...it’s vital to your success as an ecommerce merchant that you partner with 3PL that can help you meet rising customer expectations."
  • "....consumers shopping beyond their home country will help generate sales of US$630 bn, which would represent a neat 20% of global eCommerce sales by 2020."
  • "In fact, eCommerce experts at the Summit estimated that 93% of international shoppers prefer to pay in their own currency."
  • "Merchants that are not selling in foreign currencies, leading to higher customer friction, shopping cart abandonment and fewer repeat purchases."
  • "Ecommerce companies that are not using currency accounts to collect funds in local currencies, leading to higher PSP conversion fees and unfavourable FX rates."
  • "41% of APAC customers cite delivery time and associated costs as a deterrent to shopping online. Combine that with the fact that APAC customs procedures take on average 66% longer than those tracked by the Organisation for Economic Co-Operation and Development (OECD)....."
  • "Have an advanced and efficient logistics process in place based on the product and type of packaging. Employ well-trained people or hire a professional and reputed third-party logistics agency to do the work for you. Have a well-developed software and technology platform to track and manage the inventory."