Documents indicate Fulfillment By Amazon is key to controlling the flow of packages from factories in Asia to customers’ doorsteps around the world.
The Germany-based retailer of custom printed T-shirts and other items has purchased Brazil-based Vitrinepix, an online retailer of similar items.
Spreadshirt, No. 218 in the Internet Retailer Europe 500, today announced it has bought Vitrinepix, an online retailer of customer-printed products based in Rio de Janerio, Brazil. The purchase price was not released.
Entering the Brazilian online retail market isn’t easy. The country has logistical issues with much of the region lacking modern roads and consumers often preferring local payment options. For instance, many Brazilian online shoppers use Boleto Bancário, a service that invoices a consumer at checkout and enables a shopper to make a payment at her local bank, post office, ATM or lottery outlet. What’s more, the many customs documents and steep import fees can create headaches for outside retailers shipping items into the country.
Still, the country offers massive online sales potential for online retailers.
E-commerce grew 21.0% in Brazil to $15.0 billion in 2013 from $12.4 billion in 2012, according to Forrester Research Inc. That is compared to 16.9% for the U.S. in 2013, to reach $262.5 billion, according to the U.S. Department of Commerce. The 299 online retailers from Brazil in the 2014 Latin America 500 grew their sales 23.4% in 2013 to reach $11.7 billion compared with $9.5 billion a year earlier.
Vitrinepix sells products from 35 national and international brands as well more than 250,000 designs from independent designers. The company, founded in 2010 in Rio de Janeiro, will operate as a Spreadshirt subsidiary. Vitrinepix founder Viviane Mendes will lead the Brazil subsidiary.
“[Mendes] is extremely familiar with the Brazilian e-commerce market after 18 years and a true expert in marketing and business development,” says Spreadshirt CEO Philip Rooke. “Expansion is not always straightforward. Countries like Brazil can look like a tough market to start a new business in and finding the right partner can be a long process. Because of the size of the e-commerce market in Brazil, it represents a great opportunity for Spreadshirt and Vitrinepix is a pioneer in this sector. It is one of the few companies already offering customizable merchandise. For European companies looking to expand into Brazil a local partner is vital, but it’s important to find a good fit.”
Vitrinepix will expand its assortment with the acquisition but orders from Brazil will still be manufactured in Brazil, eliminating the need for shoppers to have to pay the hefty duties and taxes Brazil levies on imports. Spreadshirt says it will provide Vitrinepix with new state-of-the-art engineering and marketing features for shoppers and global designers and brands selling customized products on its site. Initially, Vitrinepix will continue to sell under its current name and e-commerce site at Vitrinepix.com.br, but Spreadshirt says it will eventually sell under the Spreadshirt name.
Entering new regions and beefing up international sales is a top priority this year for Spreadshirt, Rooke says. In addition to acquiring local players , Spreadshirt expects to launch country specific e-commerce sites in Canada and Australia during the third quarter. Founded in 2002, Spreadshirt is active in 17 markets and operates four global production sites: one in Germany, one in Poland and two in the United States. In 2013, Spreadshirt hit global revenue of approximately $95 million, printed more than 3.3 million customized products, and shipped to more than 40 countries.
“Sometimes partnering is quicker and more effective than organic growth when it comes to international expansion,” Rooke says. “2014 is a year of global growth for Spreadshirt and we’re looking at options in other regions too, but it quickly became clear to us that partnering with Vitrinepix would be an efficient way to move into the Brazilian market.”