Recently the Global Seller Index published a report on the global state of the e-commerce market under the influence of COVID-19. It showed exactly what are the effects of coronavirus on the international community of sellers in the e-commerce sector, and made it possible to predict what the industry expects in the future.
The study used data and reviews from 200 thousand online sellers from China, the USA, Great Britain, Vietnam, Korea, Japan, Spain and India. Together with NV, NIX Solutions proposes to stop at several local e-commerce markets, which should be interesting to sellers.
Let’s start with the largest market, the Chinese one. The isolation of local suppliers has had an extremely negative impact on the global e-commerce industry.
China
Today, China is a supplier of a huge amount of products and a location for so many branches of international companies that the pandemic outbreak has touched the entire global supply chain.
Although it should be noted that China nevertheless managed to demonstrate a certain stability of its logistics industry. And many local online sellers who managed to buy goods before the celebration of the Chinese New Year were able to avoid sharp losses in sales.
Overcoming difficulties. It is worth highlighting some of the most painful points in the Chinese logistics industry. Firstly, supply problems have led to lower orders from customers. Secondly, costs of the goods transportation increased significantly.
To overcome difficulties in the supply chain, many companies began to use the services of commercial charter flights, despite their high cost. Some online sellers note that the number of air traffic in this sector increased by more than 45% in this regard.
Forecasts. The results of the Global Seller Index report suggest that signs of e-commerce recovery in China appeared during the approach of Q2. And despite the fact that the local government supports the market strongly, the positive dynamics should continue.
Not surprisingly, most Chinese online sellers are optimistic and believe that e-commerce is the future. At the same time, insiders say that: a) pooling all the sellers resources, b) improving the quality of goods and c) initiating the work of all stages of supply at full capacity will help to complete the restoration in this industry effectively.
Europe
The pandemic strongly influenced offline sellers from Italy and Spain: their sales volumes fell by 2 times. European shoppers, who traditionally prefer convenience stores, are now increasingly choosing online shopping. So e-commerce today is “on horseback” despite the crisis.
Overcoming. Of course, Europe was also affected by the pandemic supply chain problems. However, European online sellers have demonstrated their sustainability thanks to the developed ecosystem of e-commerce.
According to the Payoneer study, the number of online sellers in Spain compared with the previous year increased by 30%, in France – by 13%, in Italy – by 85%. Even during the difficult first quarter, online sellers in France managed to increase international sales by 12% year on year.
Forecast. The results of the study and the answers of the respondents allow us to see signs of not only the restoration of the European e-commerce industry, but also its further growth.
Moreover, the number of consumers buying at least half of their online purchases has risen sharply since the start of the pandemic. At the same time, 60% of them say they plan to continue buying online at the same level after COVID-19.
USA and UK
Online sellers from the US and the UK noted a 53% increase in annual sales over the first quarter of 2020. A significant increase in sales is reported after the outbreak of the COVID-19 pandemic, especially for goods deemed necessary or that customers could use in quarantine at home.
Overcoming. Vendor isolation is the scourge of online sellers during the pandemic despite the overall positive e-commerce status in these markets. The viability of e-commerce here is due to the fact that, like in China, many sales during the pandemic were made thanks to stocks accumulated before COVID-19.
Forecasts. Since online sellers from the UK and the USA were actively buying goods in the Chinese market, in the II quarter they continued to strenuously monitor China, which is starting to increase production and delivery of goods. It must be said that the supply chain from China is relatively quickly returning to normal operation. According to experts, the demand for online purchases remains high, they see huge opportunities here in the future e-commerce.
Global findings
The force majeure problems with logistics and supplies around the world caused by the pandemic were inevitable. Online retailers need to draw the right conclusions in order to secure their supply chains in the future. They should begin to monitor their transparency and sustainability intensely, apply risk management with options for interchangeable suppliers abroad and in their country.
But the most important conclusion that business in the e-commerce sector needs to make is that self-isolation of millions of people has shown that the demand for online purchases remains high and will continue to be so. Some people who have not previously purchased goods through the Internet will make online purchases in the future.
Therefore, forecasts for the e-commerce market are quite optimistic. Experts are sure that the situation with the coronavirus spread in the future will allow success for those online sellers who focused on selling popular products.
In addition, the expansion of online sales channels will definitely lead to the need for the active use of high-tech online payment solutions as an important part of doing business in e-commerce.