Exports may save domestic online stores from expanding in China

Domestic online stores sold fewer products in 2023 than a year earlier, and the first quarter of this year also saw a further decline in the dynamics of Hungarian e-commerce after strong growth during the pandemic, Világgazdaság reports.

Domestic online stores sold 7.9% in 2023. fewer products than a year earlier. Reasons include a steady decline in purchasing power over the past two years and the rise of Chinese online sellers. In such a market environment, it is increasingly difficult for domestic enterprises to compete for customers shopping online, as indicated by a recent market report prepared by the research company GKID.

In volume terms, in the first quarter of 2024, the sector grew by only 6.1%. However, the data shows that this moderate increase was not due to Hungarian online stores, whose turnover actually decreased, but rather to Chinese retailers offering low-cost deals. and advertising pressure.

As the number of domestic retailers selling abroad remains low, exporting may represent an untapped opportunity and solution for Hungarian businesses,

– said the logistics company Packeta Világgazdaság.

Major Chinese traders are rethinking logistics after EU customs rules change in 2021 and building faster, duty-free routes for European buyers. This makes Hungarian (and European) buyers more open to cheaper offers as purchasing power declines. Asian traders translated their websites into local languages ​​- with varying degrees of success – and launched an intensive online advertising campaign.

The world’s largest players, mainly Chinese retailers, had over 1 million Hungarian customers in the first quarter of 2024.

According to GKID, this is a challenge not only for online sellers, but also for traditional ones. As the research firm points out, the Hungarian online retailer has two possible futures in the era of global e-commerce: remain a marginal player in its home market or become a regional player. Czech and Polish players have been following the expansion path for years and this is a successful solution for them, the report concludes.

Via Világgazdaság, main photo: Pexels