Australia and New Zealand are attractive markets for ecommerce businesses. With mobile phone penetration levels high and a local willingness to buy from foreign brands, the potential for sales and growing customer base is high.
Add to that the large numbers of UK expats in both New Zealand and Australia and there are some very good reasons to explore this part of the world. But what about the logistics – if you’re exporting parcels to Australia and New Zealand what difficulties might you be likely to face?
The time difference between the UK and the East coast of Australia is roughly nine hours. Between Wellington, New Zealand and the UK it’s 12 hours. That can be a tough gap to overcome when it comes to customer service and order efficiency if you’re not prepared for it.
Travel times between the UK and Australia and New Zealand can be up to 24 hours for passenger flights. That generally means that postal times start around five days minimum. So, it’s necessary to factor into exporting parcels to customers in this part of the world the fact that you can’t offer super fast shipping at a reasonable price.
Both Australia and New Zealand are ripe markets for foreign ecommerce businesses looking to explore new customer opportunities. Australia, for example, has the world’s 14th largest economy but is located right on the edge of the Asia-Pacific region, one of the fastest growing in the world. That will make it a key location for future growth – and a market that many other exporters will also want to establish a foothold in, making it very competitive.
Tax and duties
Both Australia and New Zealand impose taxes and duties on products coming into the country and these are usually payable by the recipient. In New Zealand, if the amount due to customs is $60 or less, the entire fee is usually waived. Australia, however, has just removed its Low Value Threshold, which used to mean goods under $1,000 purchased from a foreign retailer were tax-free. Now, a 10% GST is applied.
There are many ways in which local customs in Australia and New Zealand might impact on those exporting parcels there. As island nations with fragile eco systems both have more stringent restrictions on what can be imported – any food or natural products face particular obstacles. It’s also important to factor in the potential delays caused by customs. Every package entering the country has to be inspected by customs and some can be held by up to two weeks.