Consumers in Latin America want to buy goods from U.S. brands. In fact, when he was growing up in Guatamala, iguama.com CEO Diego Fernandez’s family was able to take an annual shopping trip to Miami.
But as Fernandez explained during a break at NRF Big Show 2016, not all Latin Americans are fortunate enough to make such a trip. And those Latin Americans who want to buy online usually will not. That’s because international shipping prices can price most consumers out of buying from U.S. merchants.
“Our average ticket price is $75, and if it costs you $35 to ship, you’re adding [another] 30%,” Fernandez said. “Plus there are duties and taxes on top of that, so it more than doubles the price.”
That’s why Fernandez said a solution like Borderfree has not worked in Latin America. Fernandez said Borderfree’s product offering is great in the sense of experience, but the price doesn’t work.
Fernandez said the iguama.com marketplace uses second-tier consolidated shipping services provided by DHL, FedEx and UPS, which helps save on shipping costs and make it more efficient for the individual packages coming in.