When luxury handbag retailer Fashionphile.com got so much web site traffic from Brazil that its site crashed, it began to re-think its decision not to sell there.
The web-only retailer, which did $50 million in annual sales in 2013, had tested shipping to Brazil but stopped because its pricy handbags that average $1,200 often never made it to the customer.
“We just lost too many packages,” says Sarah Davis, founder of Fashionphile. She says via tracking, her company would see that a package had made it to Brazil customs and then oftentimes it would simply not get delivered.
But when a Brazilian blogger had a Fashionphile handbag shipped to a New York hotel where she was staying and shared her experience on the popular Brazil fashion blog Garotasestupidas (or Stupid Girls), word about the retailer, which sells often hard-to-find, used handbags, spread throughout the country.
“We were totally slammed from this Brazilian blog once word spread,” Davis says. “We didn’t even ship there, and the country crashed our site.” That was when Davis decided to take another look at Brazil.
At the suggestion of another Brazilian consumer who wanted to order from Fashionphile, Davis began looking into MyUS, a global shipping provider that enables Fashionphile to ship its tony handbags to a warehouse in Florida where MyUS consolidates packages into large shipments and delivers them to shoppers in 220 countries, taking care of customs and duties and final delivery. MyUS charges a fee per order, which the consumer pays, Davis says.
Despite the added fee for MyUS and the notoriously high Brazil customs and duties fees, she says Brazilian shoppers still order regularly order from Fashionphile.com. “They are ordering the really expensive stuff, too, like the $5,000 Chanel handbag,” Davis says. Davis says her case proves that many times it’s worth exploring selling globally. Even into countries often deemed risky or complex there are now services available to help, she says.
Davis, who began selling on eBay in 2006 and launched Fashionphile.com in 2008, says international orders now account for about $10 million, or 20%, of her sales. She accepts PayPal and wire transfer for international orders. Her top countries outside the U.S. in terms of sales are Australia, England, Canada and Singapore. In addition to using MyUS for orders to Brazil, she also relies on tools like the recently launched PayPal site Paypal-Passport.com for tips and tools on selling globally. PayPal launched the site in June to encourage PayPal-accepting merchants to sell more internationally. Cross-border transactions now account for 25% of PayPal transaction volume.
“We wanted to put information a small business person would need to sell cross border in one spot, says Anuj Nayar senior director of global initiatives for PayPal. “When you tell a small business owner they can sell outside the U.S., they are often already putting in 90-hour work weeks. They want to know what you can tell them in 10 minutes.”
The site, which took about a year to create, provides information on selling to 14 countries, including Japan, Brazil and China. It offers names and links to vendors such as local carriers like Correios in Brazil or Chronopost in France, as well as cultural information. In Brazil, for example, most students head back to school in February, and a small merchant selling backpacks in the country might want to offer a promotion at that time. In China, Singles Day, on Nov. 11, is akin to Black Friday in the U.S. in terms of retail sales.
A Transactions/Trade Corridors tool also highlights date-specific, country-level buying patterns around the world. On the transactions map, users can toggle between an import and export view to see the top buying/selling countries; on the trade corridors map, top trade routes are represented by import/export data. A team of local experts and global analysts update the site every few days, Nayar says. The site is also available in Chinese and Portuguese.
The site is backed by the U.S. Department of Commerce, which collaborated with PayPal on a webinar to explain the tool, and the Small Business Administration, a United States government agency that provides support to entrepreneurs and small businesses.
The idea for the site, which get about 10,000 unique visitors a week, came from a report on cross-border selling PayPal released in conjunction with market research firm Nielsen Co. “We got a lot of great feedback, and people were saying ‘This is great. Where can we get more of this?’” Nayar says.
Vendors like MyUS and resources like PayPal PassPort are helping retailers like Fashionphile navigate international sales. But Davis still runs into occasional issues. For example, Davis says Australia recently began holding many of the retailers’ bags in custom because officials thought Fashionphile was undervaluing them. Because the retailer sells used handbags, the value of the item is less than what a retailer might charge for a new version and Australia wanted to levy more taxes, Davis says. Still, she says, big headaches today are rare and are worth the additional $10 million in annual sales.
“It is very easy to sell into many countries once you set it up,” she says. “If you want to branch out and develop your brand and grow internationally, there are tools to help you do it,” Davis says. When she encounters, and she often does, fellow small merchants who say they would never sell abroad, she suggests they test the waters by starting with one country.
“I always suggest to people to just try it,” she says. “Today we ship $20,000 purses to Holland. Nowadays the world is a global online marketplace.”
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