Kiwi food & beverage retailers are set to benefit from the launch of the country’s first GST free export marketplace.
The new export model is designed to remove the barriers and costs faced by New Zealand SMEs wanting to export their products by using the same fulfilment process as their domestic customers.
Kiwi retailers wanting to join the new multi-store marketplace can upload their product ranges to the Jetkrate platform. When an overseas customer makes a purchase, the retailer sends the product by courier to a local warehouse which can also consolidate the customer’s other purchases from New Zealand businesses together in one shipment.
The international shipping costs and any customs duty are paid by the customer and Jetkrate manages all export paperwork. The marketplace is entirely free to join and there are no additional time, resources or costs required for the retailer to ship offshore than for supplying a domestic customer.
Varun Khetrapal, Jetkrate co-founder, said New Zealand’s distance from other countries has meant the cost of selling to customers offshore has been significantly higher than those in the domestic market.
He said many retailers have tried exporting but found it was uneconomical when factoring in the overhead costs of completing customs forms for each sale or managing the risk of credit card fraud.
“New Zealand SMEs face a common set of barriers when they want to move into exporting.
“Typically, the sort of issues encountered are around completing customs paperwork for individual orders, the risk of credit card fraud, and the cost of shipping and marketing globally - which reduces their ability to compete.
“The new model has an integrated international package forwarding service built-in which gives us a significant advantage as we remove all the ‘pain points’ of shipping offshore - including managing the returns process.
“Businesses on the new platform can effectively spread the cost of shipping for the overseas customer across multiple purchases from the NZ market, which makes the goods more price-competitive internationally,” he said.
Khetrapal said as the products on the marketplace are destined for export markets, their pricing does not include GST.
He said an example basket of goods (found on New Zealand and Australia price comparison sites) which included Sony headphones, an Oppo smartphone and a Garmin watch would give an Australian consumer a saving of $281 if they used the new process for their purchase.
“Our ultimate goal is to reduce the inherent inefficiencies and overheads associated with sending parcels offshore and bring parity to the international market for our retailer base,” he said.
“The platform is effectively a duty-free retail marketplace - with the ability to ship goods anywhere in the world but without the need for customers to be travelling internationally.
“We know that this model works particularly well when several purchases can be grouped together. When you factor in the GST saved by the customer and lower the cost of consolidated shipping, it can tilt the balance in favour of New Zealand retailers on many types of products,” he said.
Khetrapal said they have around 7,000 overseas visitors on their site each month - complementing the company’s own marketing efforts.
Companies can export their product lines from e-commerce platforms like Shopify and WooCommerce and be trading the same day on the new marketplace.
“We could see this working well for local businesses which have been hard hit by the pandemic and looking for ways to grow their sales without investment,” he said.
According to Khetrapal despite global supply chain delays, their freight partners which include DHL and FedEx have sufficient capacity through their own transport network, which means goods can be shipped anywhere in the world within as little as two days.