Why Retailers Must Think Global

Australian retailers should plan for global growth in every e-commerce decision they make, even if their current activities only cover local markets. They need to ensure their e-commerce platforms, supply chains, and even customer service channels can be mobilised quickly into multiple markets without exponential growth in complexity or costs. If they adopt a ‘global-first’ mindset in their e-commerce strategy, Australian retailers will not only gain a greater portion of the world’s fast-growing volumes in cross-border B2C e-commerce, but also protect local market-share against overseas competitors.

Avoiding ‘local lock-in’

Retailers typically make their entrance into e-commerce by launching stores and fulfilment services for local customers, or one or two overseas markets at most. And small-scale pilots make good business sense — they allow retailers to gauge demand, test the effectiveness of their customer service and logistics channels, and change their sales and marketing focus as required. However, this ‘local-first’ attitude should not apply to the infrastructure and technologies that the retailer chooses to adopt — instead, these should be chosen with global reach and scalability in mind.

Investing in infrastructure and technology without thinking ahead to global expansion puts Australian retailers at risk of ‘local lock-in’. Most retailers will know from experience just how hard it is to retro-fit or transform an existing legacy system — think POS terminals or warehouse networks, for example — to accommodate larger transaction volumes or enhanced business needs. An e-commerce solution that works effectively in local markets is likely to create huge challenges if it cannot deliver the same experience globally.

To avoid local lock-in, Australian retailers must ask themselves how their e-commerce decisions will perform at a global scale. The three main criteria that will impact this consideration are speed, efficiency, and simplicity. Gaining a foothold in the world of cross-border e-commerce requires retailers to move quickly and decisively when new opportunities reveal themselves, without being slowed down by an unresponsive infrastructure or complex processes. This is not to say that Australian retailers should do away with small-scale pilots; however, they must ensure that local success can be easily translated to markets all over the world.

Scaling with speed

Importantly, Australian retailers must tackle the tyranny of distance in order to expand their e-commerce offerings at sufficient speed. Supply chains must operate with high levels of agility if products are to reach customers in Asia, Europe, or the US as quickly as they do from other, nearer parts in the region. And when opportunities unexpectedly arise in new markets as a result of marketing or brand exposure, retailers must be able to quickly set up a local presence or run the risk of missing a window of opportunity.

Logistics management and ERP software plays a major role in the speed at which retailers grow and operate their e-commerce offerings. Cloud-based ERP platforms are an obvious choice for Australian e-tailers, allowing for near-instantaneous deployment in new markets at relatively low costs. But the success of cross-border e-commerce also requires these ERP systems to provide retailers with a global, real-time overview of inventory and order levels, as well as helping to optimise the flow of orders through the supply chain. When establishing the supply chain backbone of their e-commerce offerings, Australian retailers may start with local-only logistics providers — but they should invest in ERP systems with a proven track record in handling the demands of global operations from the very start.

Maintaining efficiency

E-commerce allows Australian retailers to tap into the world’s fastest-growing consumer markets, but it offers no guarantee that doing so will be profitable. For that to happen, Australian retailers must ensure they can maintain high levels of operational efficiency even when running multiple stores, in multiple languages, for customers with a dizzying range of unique preferences. Local-market restrictions or nuances compound the difficulty of doing so.

To do this, retailers should pursue a centralised approach to e-commerce. Web stores should operate on a single platform that can provide multi-language and multi-currency support to operators, as well as seamlessly sharing information with supply chain, customer service, and other core business systems. Even in the early stages of their e-commerce journey, Australian retailers should have a clear idea of which platforms can manage worldwide channels without causing a decline in efficiency or customer service.

Keeping things simple

Global expansion creates complexity, whether in e-commerce or any other domain. Cross-border transactions, in particular, bring with them a range of legal and compliance requirements that even major retailers may struggle to manage. For smaller e-tailers, manually handling compliance burdens across numerous jurisdictions will prove unviable, stymieing attempts to grow from the outset.

Australian retailers should opt for an automated response to these areas of complexity. ERP systems can, and ought to, provide them with automation for financial reporting, revenue recognition, and other areas of financial compliance — and not just according to Australian requirements. Automation of critical yet non-core tasks allows retailers to keep the focus where it should be — on selling, marketing, and growing their e-commerce offerings.

E-commerce’s value proposition lies in its promise to make going global faster, simpler, and more efficient for retailers than ever before. Australian retailers must apply that same global-minded ethos to every aspect of their operations if they want to make good on that promise.


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