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The remarkable thing about the Web is not just that you can sell
direct to consumers so inexpensively, but that you can sell to
consumers worldwide. Some Yahoo! stores get as many as half their
orders from overseas.
International orders are a double-edged sword. Most fraud orders
are from overseas. And the percentage of fraud orders from
some countries, particularly Romania, Russia, Belarus, is so
high that we advise merchants
not to ship orders from these
countries.
Fraud is less of a problem with orders from North America, Western
Europe, and the far east. Over the long term, these countries may
become a big source of online sales.
Already the volume of legitimate international orders can
sometimes take new merchants by surprise.
One Yahoo! Store merchant is
a small manufacturer who had never been able to afford to sell
direct to consumers. Instead they sold their products to catalog
companies, who resold them to consumers. The low cost of selling
online encouraged them to try and sell to consumers themselves.
They found they had access to a wider audience than they expected.
The day after they opened their site, they got their first order,
and it was from Malta. The island of Malta, in the Mediterranean.
How did one ship a package to Malta? They figured that out. The
last I heard, the customer in Malta had inquired about being a
local distributor.
You may, like them, go from being taken by surprise by the
international aspect of the Internet, to taking advantage of it.
If you have great products at the best prices, consumers in Finland
and Malaysia and Peru will find you. Make it easy for them. You
don't need to translate your site into many different languages,
but you should show that you welcome orders from all over the world,
and explain clearly what your shipping rates are to each country.
With international customers, it is especially important that your
site look legit. Even in the US, consumers who buy on the Web need
to be reassured. Imagine what it is like for a Japanese consumer.
Would you order from a Japanese site? Just
possibly, if the site looked really professional.
Japanese consumers are going to be equally
cautious about ordering from your site. But if your site is flawlessly
professional looking, and your prices are good, they will take the
plunge.
Ultimately, international orders are going to be a big source of
revenue for American companies. Americans who go to Japan are often
disappointed to find that Japanese products cost more in Japan than
they do in the US. Why is that? Because rents are high in Japan,
and the distribution network is inefficient. Retail prices are
lower in the US than in most other countries in the world, for
similar reasons. Americans would be amazed at the price of a pair
of Levis in Italy.
Merchants look at these inequalities and see opportunity. Trade
is all about price differences. For centuries European merchants
made fortunes by buying spices in the far east, where they were
cheap, and selling them in Europe, where they were expensive. The
Web opens up a similar opportunity, for a lot less than the cost
of outfitting a ship.
Now that the Web offers consumers in other countries a way to do
an end run around their local middlemen, US companies are going to
be the main beneficiaries. I know one Web merchant who is already
selling men's shirts by the dozen to customers in
Europe, where men's shirts are much more expensive.
Of course the opportunity depends on the product. It may never
apply to products that are hard to ship
overseas. But retail price differences are so pervasive around
the world that there is probably some way to take advantage of
them, no matter what business you're in.
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