Since its inception in 1994, Amazon has managed to establish itself as the leading company in the eCommerce industry. As a testament to its dominance, Amazon still managed to obtain $75.5 billion sales revenue in the Q1 of 2020 despite the pandemic.
One of the factors that propelled Amazon to greater heights is its access to international marketplaces. The Amazon Global operation provided more audiences and customers for the Seattle-based company.
When Amazon started its international operation, neighboring countries were among its initial inception. Amazon Mexico and Amazon Canada were added as some of Amazon’s cross-border marketplaces along with the expansion of the company.
Similar to other Amazon Global marketplaces, Amazon.ca and Amazon.mx had their own setbacks, especially with order fulfillment. However, with the latest Amazon FBA update, cross-border selling has been made easier.
Cross-Border Selling Made Easy
Prior to this latest Amazon fulfillment update, Amazon sellers based in the United States and enrolled in the FBA program had to replenish inventory in the selected target country, either Amazon Mexico or Canada. After inventory items are sent to separate warehouses for each country, any orders from either of the two marketplaces are retrieved from the respective warehouses and not from the United States.
To simplify cross-border selling, Amazon now lets sellers fulfill orders from Canada or Mexico with US FBA inventory. This means that offers created either on Amazon.com, Amazon.mx or Amazon.ca are automatically retrieved from US inventory unless the item is already in the Canadian or Mexican warehouse.
This makes cross-border transactions easier for both customers and sellers alike.
If you wish to know more about the latest FBA update, you may CLICK HERE.
Why Should You Sell on Amazon Canada & Mexico?
Whether you are new to Amazon or a tenured Amazon seller planning to expand outside the United States, you should consider the sales potential of Amazon Mexico and Amazon Canada.
Apart from the convenience of fulfilling orders from the neighboring countries as mentioned above, Mexico and Canada have relatively huge populations that are also eCommerce enthusiasts.
Cross-border selling is promising for both the Mexican and Canadian marketplaces. This is especially true now that Mexico is considered as the number one top-growing overall eCommerce market, beating the likes of India and China.
eMarketer (2019). Retail eCommerce Sales Growth Worldwide [png]. eMarketer.com
With respect to Canadian eCommerce activity, Amazon sellers will be delighted to know that Great White North also has a thriving eCommerce industry. Just this Q1 of 2020, Canada’s retail eCommerce sales reached $3.9 billion, which is an all-time high.
With these recently reported eCommerce activities and milestones in both Canada and Mexico, for Amazon sellers wanting to test the Amazon Global marketplace, Amazon Mexico and Amazon Canada would be ideal proving grounds.
Cross-Border Expansion Tips to Observe
Entering into the international market would require a re-evaluation of your strategies. Despite having success in the Amazon US market, you should still try to plan and strategize for the Mexican and Canadian markets.
Amazon sellers participating in cross-border selling should be flexible to adjust to the respective market conditions. The same thing goes for the identification of effective channels for marketing, potential product listing, and recognition of local competitors.
Understand the Intention
Another important factor to consider for cross-border selling is the motivation of your target market or audience. While still in the planning and preparation stage, try to learn the business nuances and customs of the region.
Always keep the best cultural and business practices in your marketing strategy and business operation as a whole.
Prepare Technical Solutions
Since you will be entering another marketplace, it would be best to prepare your technology tools and solutions. For referral fees and other Amazon FBA fees, you can always make use of the Amazon FBA calculator.
When it comes to your pricing strategy, employing an automated repricing solution, such as Seller Snap will help in providing a dynamic pricing strategy fitting for each marketplace.
Aim for Smooth Transition
Transitioning from local Amazon transactions to the cross-border international undertaking is never easy. However, with proper planning complemented by reliable technical tools and solutions, seamless execution would be attainable.
One thing to remember when it comes to expansion is the rate of success might not be similar to what you have previously achieved. Since you will be venturing into another unique market, the rate of success may differ. Hence, patience is a virtue.