E-commerce in Latin America

An overview for UK exporters

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Latin America is in the minds of global businesses that aim to expand abroad. Thinking about this potential market with population of over 600 million, Gabriela Castro Fontoura, the director of Sunny Sky Solutions, published early this year, an infosheet on e-commerce in Latin America.

Some topics to be highlighted:

  • From 2009 to 2011 the sector doubled and in 2011, £26.3 million was spent by consumers online;

Who’s buying online?
In 2011, the number of iInternetusers in Latin America were estimated in 212.4 million (36.7% of the region’s population).

  • Brazil is the biggest bommer in the Latin America e-commerce In 2013. Brazilian online businesses experienced a collective increase in sales of 19.9% Which also means 29% of Brazilian income was spent online;
  • Mexico is also a very strong e-commerce marketplace with 21% of Mexican disposable income spent online in 2012. Argentineans also spent 21% of income online;
  • Better softwares, payment gateways, online security and better logistics help to support the rise of this market.

Some considerable barriers:

1- Restricted choice: when it comes to software and payment service providers. In fact, many Latin American companies selling online are still processing orders manually.

2-Tariffs & Tax structures: Different regions have different rules and rates which complicates the payments and costs to be calculated. it means a lot of bureaucracy.

3- Logistical support: Delivering and transporting online goods across Latin America can be a complicated task. Cross-boarder logistical support is required.

4- Fraud & Consumer Trust: By far, the biggest barrier to online services in Latin America is the online fraud. It has a huge impact at consumer’s trust. the percentage of Latin American e-commerce orders which is rejected because suspicious of fraud is far higher than the US average 21.7%.

However, it can also present an opportunity for businesses to offer smarter, safer and more varied online payment options.

Where to start: 

* Researching is essential ( find your target market);

*Plan how to overcome barriers between your business and e-commerce success in Latin America;

* Build credibility to gain consumers’s trust;

* Build up contacts and get knowledge about your target market; 

* Find support from expert and local contacts.

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Posted by

I'm a Brazilian journalist based in West Midlands. In Brazil, I have worked with International Trade and Logistics publications. Now in the UK, I keep writing and I dedicate myself to a new project : Midlands Trade - a blog focused on business in Europe and Brazil. It's also supporting small businesses throughout the #MeetTheBusiness.

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