eBay and the U.S. Department of Commerce announced a partnership Wednesday to promote export sales among U.S. small businesses that sell on eBay. Like all such announcements, there was no detail about how this would be done, but I suspect it means a significant improvement in payment security, logistics and marketing for companies and individuals that use eBay for international business.
eBay began facilitating sales across borders several years ago, allowing direct transactions and cross-listings on the different eBay national sites. Members of the District Export Councils immediately recognized the possibilities for helping American small business to conduct international transactions. (District Export Councils (DECs), by the way, are advisory committees to the U.S. Commerce Department composed of experienced exporters or people who provide services to exporters. I’m proud to be one.) DEC members in California contacted eBay about working together to build eBay as a new sales channel for smaller American companies. Using eBay for exporting added eBay’s clout and convenience to arranging transport and receiving payments across borders.
International selling through eBay also meant that eBay and its sellers had to be up to date on each country’s trade restrictions. It wouldn’t do eBay or a seller any good, for instance, for their shipment to be stopped at the border for an export violation – or get stuck in Customs when the buyer discovers that there is some trade restriction that keeps the product out.
On a global basis, eBay facilitated more than $45 billion in cross-border trade and payments in 2013. A recent study by PayPal and Nielsen estimates international on-line retail sales of U.S. products at $23 billion in 2013 – and forecasts such cross-border sales will reach $83 billion by 2018. Small wonder that eBay’s CEO, John Donahoe, was recently added to the President’s Export Council.
eBay finds that 97% of its U.S. commercial sellers (no, we’re not talking about that family “heirloom” you sold last month) export. Even among the smallest 10% of such sellers, 94% of them are exporting. And 95% of eBay’s commercial sellers export to at least two foreign markets. An impressive 81% sell in five or more countries! Clearly, these are not the stereotypical small companies that have incidental sales over the border in Canada or Mexico. These are thousands of small sellers who have discovered an export channel that is cheaper and easier than anything else they have access to.
Watch this space. I am anxious to discover the details of what Commerce and eBay can do together to make foreign sales even easier for small companies.