- E-commerce platforms are expanding, offering businesses new opportunities to sell directly to consumers online
- The popularity of these platforms increased due to the pandemic and changes in consumer buying behaviors
- A study by PYMNTS indicates that 73.2% of consumers plan to continue shopping online
- Manufacturers are adopting an omnichannel approach to include direct-to-consumer (DTC) sales
- Setting up an e-commerce shopfront allows manufacturers more brand control and access to customer behavior data
- This data helps in improving pricing strategies and customizing shopping experiences to increase customer lifetime value
- Direct selling globally is more accessible, offering manufacturers significant growth opportunities
- The European e-commerce market is expected to reach USD 659 billion this year and USD 756 billion by 2027
- Selling DTC cross-border introduces complex tax challenges including logistics, VAT, customs duties, and e-invoicing compliance
- Countries are taxing e-commerce transactions based on the consumer’s location to level the playing field between local and foreign sellers
- In the EU, low-value goods are now taxed at the domestic VAT rate at the point of sale since 2021
- Adding DTC sales requires businesses to handle VAT calculations directly, differing from indirect sales where third parties usually manage VAT
- E-commerce in manufacturing also involves foreign exchange obligations due to different invoicing and reporting requirements across jurisdictions
Source: vertexinc.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
