Deciding to sell your products outside of the U.S. market is a lot like playing golf.  There are so many factors that will ultimately contribute to your success or failure.  Get everything right except one thing, and your ball ends up in the lake.  Without a doubt, getting paid is the most important. You can do everything else right, but if at the end of the sale, money does not end up in your bank, you have failed.

There is a big difference between payment methods depending on if you are shipping B2C or B2B.  B2C orders tend to be smaller amounts of money, which means you may be able to tolerate an occasional loss.  B2B tends to be larger quantities and larger amounts.  A loss in this instance could be very damaging.   There are some crossover payment methods for each vertical.  Before you decide on a market, you need to be fully aware of that country’s payment systems.  You may find what looks like a fertile field with lots of potential, but trouble finding a secure payment method could be the fatal flaw.

Explore the Best Options in Each Country

Ideally, you want to get paid before the shipment even leaves your possession.  Shipping internationally without payment in advance is a bad idea.  There are several issues you will need to be aware of before entering a market.

1. What is the cultural preponderance of paying electronically?

Many cultures still don’t trust the idea of putting their payment information on-line.  Many markets still work on Cash-On-Delivery (COD).

2. What is the penetration of credit cards?

Credit card payment is always one method that should be offered.  It is a relatively safe method, and there are systems in place to help mitigate (notice I didn’t say eliminate) fraud.  The penetration of credit cards depends on how developed the country is.  Countries with high education rates and developed economies tend to have higher credit card ownership.

3. What is the penetration of bank accounts in that country?

This seems like a very basic thing everybody has, but it is not.  You may find that your product would do very well in an emerging market.  But if there is a lot of poverty in that country, bank account ownership may not be common.  

4. Are there systems in place for alternative electronic systems, such as PayPal, ewallet?

5. For larger B2B sales, or a high-ticket sale, can you work with the bank of your client directly, and set up an electronic fund transfer?  This probably is not a good method for consumer sales, as it is a lot of work for one small sale.

6. Are your customers able to use a mobile payment (SMS or Short Messaging Service)?  It is a very popular payment system, operated by mobile phone companies.  

As you can see, there are many options available.  Choosing the one that is preferred in that market will help ensure that your customer’s payments are received by you.  Getting paid is always the most important goal. 

Perry Goldstein
Perry Goldstein

Perry Goldstein has spent over 40 years in the electronics industry, in both the Consumer and Pro A/V sides of the industry. He is a pioneer of the ecommerce industry, working with ecommerce platforms since the advent of the channel in the mid-1990s. He has extensive experience working with Amazon since their entry into the electronics industry, as well as many of the biggest online retailers.