According to Statista, global retail eCommerce sales were in excess of 5.2 trillion U.S. dollars in 2021. There are projections that this figure might hit 8.1 trillion dollars within the next 5 years. It is evident from these stats that we are experiencing a global eCommerce explosion. This explosion has been precipitated by the rising use of mobile devices around the world, better internet connectivity, and the need for contactless transactions occasioned by the COVID-19 pandemic. If you ever dreamed of owning a thriving online business, your time is now!
Where Should You Register Your eCommerce Business?
The short answer: You should register your online business in a country with reasonably good internet coverage & penetration, high mobile internet speed, and a high number of the internet or social media users. This is because the average online purchases in such countries are always higher than in countries with poor internet connectivity.
The long answer: Besides fast and secure internet, there’s a handful of other considerations to make when choosing where to register your eCommerce business:
– Is it a wealthy country? What’s the country’s GNI (Gross National Income) per Capita? What’s the purchasing power of its citizens? Can they afford the products/services you intend to sell?
– How easy is it to register an online business in the country? How much paperwork must you fill out? Which legal requirements must you fulfill? How long does it take to obtain permits and licenses?
– What’s the cost of getting your paperwork verified and your business registered?
– How favorable is the country’s tax regime? How favorable are the country’s corporate or sales taxes, for example?
– Availability of qualified workers that your business can afford to hire and retain. You don’t want a market whose labor and employment laws impede your profitability.
– If you need to hire foreign employees, how easy is it for them to get work permits?
– How many citizens have working bank accounts in recognized financial institutions or mobile money merchants?
– Time zones- you don’t want to register a business that you’ll struggle to manage due to time zone challenges.
– Are international money vendors such as Stripe and PayPal available? You need to be sure that the citizens have reliable avenues for making payments.
– Political and economic stability in the country. Be particularly keen on countries that are in good geopolitical terms and have healthy economic ties with your home country.
– Quality of trade and transport-related infrastructure.
– Ability to track and trace deliveries and consignments.
Which Countries Are Best For Registering Your Online Business?
Just to give you an idea of the countries you ought to consider, here are 5 eCommerce markets that are worth looking into:
1. China
China is home to more than 1.4 billion people, the majority of which are in the upper-middle and upper classes. The country is also the largest digital market in the world, with more than 780 million online shoppers in 2021. China’s digital economy contributes up to 38 percent of the country’s entire GDP and approximately 52.1 percent of the global digital economy in 2021. What’s more, China’s major cities such as Beijing and Shanghai have an internet penetration rate of 80 percent or higher. This explains the explosive growth of Alibaba, the China-based eCommerce giant.
2. Singapore
Singapore ranks second in 2022 in terms of average fixed broadband internet speeds. Statista projects a steady growth in the country’s internet connectivity from 88.5% in 2020 to 94% by 2026. Apart from the impressive internet connectivity, the country is also a well-developed and peaceful country. There’s a sizable percentage of citizens who are affluent and willing to pay for high-end online products. Another conspicuous benefit of Singapore as an online business hub is its low corporate tax rates, currently at 17%. The low costs of operating your online business in Singapore leave you with impressively high-profit margins.
Singapore company registration procedures for online businesses are simple and straightforward. The government even assists small businesses with marketing and expansion funding. To cap everything off, the country is the gateway to the larger Southeast Asian region. Its close proximity to other major Asian markets gives you the perfect hatching ground for future expansion in the region. The Southeast Asian market is prime for dropshipping businesses, online clothing stores, home-based food businesses, and digital marketing services.
3. Norway
Norway tops the 2022 list of countries with the fastest average mobile internet speeds. That aside, the country is expected to hit a smartphone penetration rate of 92.82 percent before 2025. And, with an eCommerce revenue of US$10.9 billion in 2021, Norway is one of the global leaders in eCommerce adoption. These stats depict a country that is ready for a digital market takeoff. The country is also among the richest in the world with a GDP of USD 62,645 in 2020. The market is up for your taking!
Because of its proximity to other wealthy nations such as Sweden, Finland, and Russia, Norway is the perfect gateway to the vast Scandinavian market. It is easy to spread your wings in the Scandinavian region upon learning the ropes of the Norwegian digital marketplace. You will also be happy to know that Amazon doesn’t exist in Norway, so you don’t have to worry about undue competition from the eCommerce giant. You almost have a clear run to entrepreneurial excellence.
4. Japan
Japan is known for high urbanization, economic stability, excellent infrastructure, and high-internet connectivity. It is also among the fastest-growing eCommerce markets globally. Japanese people are highly educated considering that the country has over 600 universities. That gives you a ready workforce for your online business. The country is also quite wealthy and politically stable, and the people are very hospitable.
5. United States
The US is a global superpower both politically and economically. It is home to eCommerce giants such as Amazon, Etsy, eBay, and Walmart. That already tells you how lucrative the country’s digital market is. But just to paint a mental picture for you, more than 90 percent of Americans have access to the internet, and the super majority prefers online shopping. Taxation varies from state to state but, in most states, online businesses are exempted from taxes such as sales and corporate tax. What’s more, online payment platforms such as PayPal and Stripe are fully operational here.
Final word
Increased internet and smartphone adoption worldwide has precipitated many exciting opportunities for ambitious entrepreneurs. Now more than ever, venturing into eCommerce and other online business ventures is an increasingly viable option. Don’t miss out on this worthwhile realm to expand your entrepreneurial portfolio.
