GUANGZHOU, China, November 13, 2014 /PRNewswire/ — Following the success of internet giants like Alibaba Group, other Chinese companies are now looking to replicate their luck and expand business to the booming Latin America online industry. Online retail is headed by Brazil, Mexico and Colombia with a combined online population of over 190 million users, and Chinese online retailers are looking for a piece of that cake. Great business opportunities and a non-saturated market like in North America and Western Europe are top reasons to enter the market for the Chinese. However there are big challenges ahead.
According to Jorge Chong, manager of Comprame.com (first Chinese online retailer to focus only on Latin American countries, operated by Latin Internet Technology Co., Ltd.), some of the main barriers that affect the growth of online retailers from China in the region are:
- Language barriers.
- Mistrust of online deals.
- Long delivery times.
- Lack of credit card usage.
Countries like Argentina and Venezuela face more complicated issues like free currency exchange and import restrictions.
Other problems are cultural, for example the tradition to do business using cash and to mistrust online deals. Some are more technical like the lack of highly qualified programmers or the low quality of local online payment processors that accept multi-currency.
According to the latest statistics, the online penetration in Latin America will reach 600 million in 2014 and analysts predict that the region will become the fastest growing online buyer in the next 2 years thanks to the increasing broadband penetration following the trend of Asia.
China’s online business fever is reaching its highest period with thousands of online retailers offering consumer goods with below average prices as the final buyer can receive his or her purchase without passing through middle men or local importers and wholesalers.
“International e-commerce will replace traditional commerce by 2024 as language barriers are broken and consumers and manufacturers communicate directly and do business online thanks to high technology tools like online translators and a mature shipping system,” said Jorge Chong.
Comprame.com is one of the first Chinese retailers to focus their sales only to Spanish speaking countries. They offer a fully customized website for Latin American visitors. They employ non-Chinese customer service representatives that work from China and also employ local employees in key markets like Colombia and Venezuela.