Cross-Border Ecommerce Booms in China

According to a new report from eMarketer, cross-border ecommerce—internet purchases from merchants in other countries—is growing in popularity in China. By 2020, a quarter of the Chinese population, amounting to more than half of all the nation’s digital buyers, will be shopping either directly on foreign-based sites or through third parties such as Alibaba’s Tmall Global and’s JD Worldwide.

“This represents a tremendous opportunity for global entrepreneurs,” said Cleveland Brown, CEO of Payscout, Inc., a leading global payment processing provider. “We encourage small to medium-sized businesses in particular to prepare themselves for taking advantage of the growing Chinese appetite for goods from abroad.”

Brown noted that cross-border digital shopping in China, according to eMarketer’s figures, grew by more than 70% in 2015 alone. This is due, in part, to a higher standard of living in China, along with a greater exposure to—and knowledge of—foreign products.

The cross-border ecommerce boom in China is only one part—albeit a very large and important part—of a growing global trend. The global business-to-consumer ecommerce market, which amounted to $230 billion in 2014, will balloon in size to $1 trillion in 2020, according to a report from global consulting firm Accenture and AliResearch, Alibaba Group’s research arm. In the report, researchers forecasted cross-border ecommerce will see compound annual growth of 27.4% over the next five years, double the rate of worldwide B2C shopping as a whole.

By 2020, more than 900 million people around the world will be international online shoppers, with their purchases accounting for nearly 30% of global B2C transactions. By then, according to the Accenture-AliResearch report, China will become the largest cross-border B2C market.Over 200 million Chinese consumers are expected to be cross-border shopping within five years, with a transaction volume of imported goods purchased online reaching $245 billion.

One reason China is expected to drive so much of the growth in cross-border ecommerce is because its large and growing middle class is hungry for authentic, high-quality foreign products. China’s middle class today, according to McKinsey & Co., is equal in size to the entire U.S. population, and is expected to reach 630 million by 2022.

According to Brown, the explosion of cross-border ecommerce in China—and indeed, worldwide—is a classic win-win situation. It creates a greater breadth of shopping experiences for what in some ways have been underserved markets, and it creates opportunity for thousands and thousands of global entrepreneurs eager to serve these markets.

To make the most of this growth opportunity, Brown believes cross-border ecommerce entrepreneurs will need a robust, secure, and flexible payment infrastructure—which Payscout has been helping to build since its inception. It will also require entrepreneurs to be able to move quickly.

“If you’re trying to enter a global market on your own, the process can be long, frustrating, and expensive,” said Brown. “We understand global markets, we have extensive experience in China, and we have developed a turnkey process—safe, secure, and used by thousands of merchants around the world—that allows a vendor to enter a new market quickly and without friction. Our advice to entrepreneurs is to focus on sales and production, and let an expert focus on payments.”

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