Cross-border online retail sales will grow at twice the rate of domestic e-commerce through 2020, according to a report from German transport and logistics giant DHL.
The international parcel carrier forecast that cross-border retail volumes will increase at an annual average rate of 25 percent between 2015 and 2020, rising from $300 billion to $900 billion in the report "The 21st Century Spice Trade: A Guide to the Cross-Border E-Commerce Opportunity."
While the prediction could benefit DHL itself as a carrier of all those extra packages, the company also found several ways that online retailers could capitalize on the trend. Retailers that extended their offerings to international customers boosted sales by 10 to 15 percent, and retailers that added a faster shipping option to their online stores grew 1.6 times faster on average than other players, DHL said.
The report is based primarily on research and interviews conducted by an unspecified global management consultancy, as well as more than 1,800 responses to a proprietary exporter survey of retailers and manufacturers in six countries.
Despite the potential for big growth, cross-border retail also faces some speed bumps that could derail its expansion. Asked about the challenges of cross-border purchases, consumers cited four main concerns: logistics, trust, price, and customer experience.
In response, retailers can turn to a growing array of technology solutions, such as online payment providers and programs that localize a website's checkout experience for each visitor, helping them transact with customers in foreign markets, DHL found.
Retailers also face challenges in finding the right balance between central and local warehousing and fulfillment operations for their international sales, and in picking the best parcel-delivery service for their needs.