Entrepreneur: What is cross-border trade?
Kunihiro: It's when a sale occurs between a buyer and a seller who are located in different countries.
Entrepreneur: What cross-border trade issues should eBay sellers know about?
Kunihiro: The most important ones are understanding the rates for shipping internationally and understanding the customs process. There are some taxes or duties that might apply to certain items. Many sellers make sure the buyers are aware that it's their responsibility to find out if a tax or duty applies.
Entrepreneur: Is the timing right for those going international?
Kunihiro: Right now is a great time to consider going international because of two factors: One is the large number of buyers on eBay who are located outside the United States. There are eBay sites in 33 countries, and PayPal has localized sites in 13 markets, which makes it easy for buyers and sellers from different parts of the world to transact internationally. The second is the value of the U.S. dollar right now. It is at a historical low vs. other currencies, so there are buyers from other countries who are aggressively looking for U.S. products.
Entrepreneur: What keeps sellers from embracing cross-border trade?
Kunihiro: People don't become active in cross-border trade for two reasons. One is that they aren't familiar with the processes involved in cross-border trade, so they don't take action because they don't know how to do it. The other is a fear of foreign buyers. The interesting thing is that those sellers who are active in cross-border trade say that foreign buyers are some of the best buyers they have.
But for new sellers, there is a lack of trust. I would say to them: "Be as open and communicative as possible. Provide as much information as you can, and use common sense if it doesn't feel right." For someone who's new, I would recommend that they open up at least to Canada and the United Kingdom. On eBay, over half of Canadian buyers [purchase] their items from U.S. sellers, so Canada is a big market that you can have access to, and it isn't as foreign as shipping overseas.
Entrepreneur: What about making payments internationally? Is that a barrier to cross-border selling?
Kunihiro: In the past, payments have been a big friction point in cross-border selling. PayPal has helped eliminate this hurdle because it is available in 56 countries and territories and accepts payments in six currencies--U.S. dollars, Canadian dollars, euros, pounds sterling, Japanese yen and Australian dollars. When compared to paper-based payment methods, which are currently the most widely used international payment method, PayPal provides a far safer and exceptionally more convenient experience. It can take an average of 10 days to send an international money order, and you need to include your bank account information. With PayPal, you can safely send and receive money internationally almost instantly.
Entrepreneur: Where can people get advice on starting cross-border trade?
Kunihiro: We just launched a new page that is a resource for that: www.ebay.com/globaltrade. There are general tools and links to our international community, where you can ask questions. There's also an international trading discussion board on eBay.
Entrepreneur: Will cross-border trade become critical to successfully doing business on eBay?
Kunihiro: For any business that wants to grow, cross-border trade is going to be a core element. I hear sellers say that once they discovered cross-border trade, their overall sales picked up due to the added international purchases. I also hear sellers say that they received a lot of bidding activity from users outside the U.S., but still ended up with a domestic transaction at a higher price.