UK’s FigLeaves.com shares tips on setting up in a foreign market
With its global sales projected to double this year to $40 million, London-based intimate apparel retailer FigLeaves.com has learned several lessons while expanding beyond its U.K. market, says senior vice president Ed Bussey, who will lead a discussion on international markets at the eTail 2005 Conference next week.
Bussey, who heads up FigLeaves’ New York-based U.S. operation, which is growing at a faster pace than FigLeaves’ U.K. market, says one of the first lessons in entering a new foreign market is to staff a local office with the right mixture of employees.
In FigLeaves’ case, that meant hiring U.S. personnel familiar with domestic market demands and logistics, but also including corporate staff from the home office in the U.K. accustomed to corporate policy. The mixed staff helps to assure that the foreign office is handling differences in market and product definitions while serving both the local market demand and home-office policies, he says.
Bussey, who is also a member of the FigLeaves board, will address international market issues during the Industry Think Tanks period, at table 6, at 5:30 p.m., Feb. 16.
“One of the biggest issues is about communication and language,” Bussey says. “We found it enough of a challenge moving into the U.S. market, where we had the same language but a lot of different product descriptions. We’re lucky we didn’t choose Japan first.”
FigLeaves is now looking to set up operations in Germany and Japan, he adds.
Other key areas to closely watch are foreign tax policies, fraud levels and local logistics options, Bussey says.
Retailers heading overseas need to understand the local tax policies and exemptions, he says. “There are exemptions in place some markets for different sorts of products or duties based on the fabric included in a product,” Bussey says. “It’s worth spending money for expert advice on that.”
E-commerce payment fraud can be more of problem outside of the U.S., where fraud control tends to be less vigorous and chargeback levels higher, Bussey says.
He advises retailers also to do their homework in investigating the most advantageous shipping options in a new market, checking the multiple routing and rate options for deliveries as well as returns.
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