March 7, 2005, 12:00 AM

Canada’s Borderfree expects rapid growth globally, company president says

Borderfree, an e-commerce services company that caters to U.S. retailers selling into Canada, expects markets outside Canada to account for a third of sales within two years, up from 0% today, president Patrick Bartlett says.

Responding to increased demand by both retailers and consumers to engage in global e-commerce, Borderfree, an e-commerce services company that caters mostly to U.S. retailers selling into Canada, expects markets outside Canada to account for 30% of sales through Borderfree within two years, up from nothing today, president Patrick Bartlett tells Internet Retailer.

“We’re talking to several retailers now, and are developing a solution to help them go international beyond Canada,” Bartlett says. Borderfree expects to begin serving markets in Europe later this year.

Borderfree, majority owned by Canada Post Corp., Canada’s national postal system, provides a range of e-commerce services including order management, fulfillment, logistics and processing of cross-border duties and taxes.

Borderfree currently handles e-commerce sales into Canada for about 30 U.S. retailers. Overall e-commerce volumes processed through Borderfree doubled year-over-year in the 2004 holiday shopping season, and sales so far this year are running 400% or more over last year’s pace, Bartlett says.

As growth continues in Canada, Bartlett says more U.S. as well as Canadian retailers are also looking at selling into Europe and other markets. “The U.S. market is reaching an e-commerce plateau, so retailers are looking to expand into rest-of-world markets,” he says. “In addition, international consumers are becoming more comfortable shopping on the web, and there are more payment options for them.”

The inability of many retailers to begin serving foreign e-commerce markets presents an opportunity for Borderfree, which expects to leverage Canada Post’s connections with foreign postal systems in providing logistics and other services.

“A lot of American web sites can’t even take an international address,” Bartlett says. “They only give you the 50 states as options. Or they can’t take foreign market alpha-numeric ZIP codes.”

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